It’s known to lawyers and legal experts as the case of Marshall vs. Marshall. To the rest of us it’s the long-running legal soap opera of Anna Nicole Smith, the 26-year-old stripper and Playboy model who married 89-year-old Texas oilman J. Howard Marshall. Then, after the billionaire passed away 14 months later, Smith and her lawyer-vultures launched a legal assault to overturn his written will and cash in on his estate.
Anna Nicole herself died from a lethal overdose of prescription drugs in 2007 at the age of 39. But the case of Marshall vs. Marshall continues its 13-year odyssey through the court system. It’s been pushed along by Anna Nicole’s former lawyer and current executor of her own will, Howard K. Stern – who, by the way, was recently hit with criminal charges in connection with her death.
Manipulation and abuse of the bankruptcy system has certainly been the top card in the Smith team’s legal deck. When a probate court was about to rule against her claim to millions of dollars from her late husband’s estate in Texas, Smith’s lawyers went “forum shopping” and filed for bankruptcy in California. There she was awarded $447 million of Marshall’s money – money she never would have seen had she stuck with challenging his will directly in Texas.
The California bankruptcy judgment helped the case take on a life of its own. The award was next trimmed by a federal district court, overturned by the Ninth Circuit Court of Appeals, and then reviewed by the U.S. Supreme Court – which sent the case back to the Appeals Court for reconsideration on narrow grounds. The case remains there today.
Snicker and dismiss the whole sordid mess if you want, but the case of Marshall vs. Marshall is a dark cloud hanging over the Ninth Circuit Court of Appeals and states within its jurisdiction – including Nevada. Should the Smith-Stern forces end up winning this legal circus it would set a dangerous precedent that could expand Nevada’s current unwelcome status as the bankruptcy capital of the nation.
The number of legitimate bankruptcies is high enough already. Compared with the previous year’s fourth quarter, Nevada’s fourth-quarter bankruptcy filings in 2008 were up 38 percent. The extensive Las Vegas real estate and retailing assets of Chicago-based General Growth Properties will be affected by the company’s April 15 Chapter 11 filing. Meanwhile, speculation continues that any number of big casino properties will go that route as well.
Bankruptcy should be a last-ditch option for truly desperate people and firms in financial distress. Instead it’s becoming a great way to not only walk away from one’s obligations, but thanks to the late gold-digger and her lawyers, it’s now being abused as a way to go after the assets of someone else.
The Ninth Circuit Court of Appeals recently scheduled oral arguments on Marshall vs. Marshall for June 26th in Seattle. Let’s hope the court reaches the obvious conclusion that the Marshall estate was never intended for Anna Nicole Smith and her legal team.
