Disney Grandson Bradford Lund Demands "Hostile" Trustees Not Pay Legal Fees to Their Law Firm From His Trust Funds

Court of Appeal upholds Lund's petition in one sentence - rejecting Trustees and their counsel's opposition to the right to replace a judge as a matter of law

Lund sees "negligence" and "indifference" to the law in filing by Trustees' law firm, Mitchell Silberberg and Knupp

 

News provided by
Lanny Davis

LOS ANGELES, March 5, 2021 /PRNewswire/ -- Walt Disney's grandson, Bradford D. Lund, today sent a letter to his four trustees – L. Andrew Gifford, Robert L. Wilson, Douglas M. Strode, and the First Republic Trust Company (collectively "the Trustees") – demanding that they refrain from using any trust funds for which he is the beneficiary to pay any legal fees to the Trustees' law firm Mitchell Silberberg & Knupp ("MSK").  

Lund won a decisive victory on February 23, 2021 when the California Court of Appeal unanimously rejected the Trustees' and MSK's attempt to block Lund's request for a new judge and issued an alternative writ ordering the lower court judge to vacate his prior order denying the peremptory challenge and issue an order granting the same. Alternatively, the appellate panel issued an Order to Show cause why it should not issue a Writ of Mandate. The appellate panel's decision in favor of Lund was made in a single sentence, rejecting the 33-page filing by MSK at the behest of the "hostile" Trustees, as Lund referred to them in his letter. In its decision, the Court of Appeal cited the clear California precedent virtually ignored by the Trustees' attorneys, MSK, but cited by Lund's lawyers: 

"Opposing counsel on behalf of the [Trustees] were finally forced to admit the indisputable precedent of Truck Insurance Exchange and Grant (of which they were aware when Mr. Lund initially requested Judge Suzuki to correct his original denial) that: A previously denied § 170.6 challenge does not remove that party's one opportunity to duly and timely file another." – Lund's Reply to Trustees' Opposition to Writ.

Lund wrote in his letter to the Trustees: "MSK should not be paid legal fees out of my or my sister's trust," citing the summary dismissal of MSK's opposition to his motion. 

He continued: "You are also on notice that I continue to believe that each of you individually and collectively have again taken actions hostile to my interests in what I feel is clear violation of your fiduciary duties owed to me.  I am still seriously considering taking additional legal action for this and past violations of your duties." 

Lund wrote that the Trustees and MSK "should be embarrassed" by the Court of Appeal's summary dismissal and repeated his demand that the Trustees "not use any trust funds associated with the trust of which I am the beneficiary to pay MSK."

Contact: Alex Lange
alange@tridentdmg.com 
(202) 480-4309

SOURCE Lanny Davis

Full Article & Source:

Disney Grandson Bradford Lund Demands "Hostile" Trustees Not Pay Legal Fees to Their Law Firm From His Trust Funds 

 

See Also:

Brad Lund

Warrants issued for couple guilty in guardian fraud case

SANTA FE, N.M. (AP) - A federal judge issued bench warrants Monday for the former president of a now-defunct nonprofit that provided guardianship services for vulnerable and special needs clients and her husband after they both failed to appear for sentencing for money laundering and other crimes.

Susan Harris, 73, was facing a minimum of 30 years in prison while her husband, William Harris, faced seven years for crimes related to the embezzlement of an estimated $10 million.

As one of New Mexico’s largest guardianship firms, Ayudando Guardians Inc., was shuttered by federal authorities in 2017 after the embezzlement was exposed. Some of the more than 800 victims who lost money were expected to address the court as the hearing continued Monday.

Defense attorneys told U.S. District Judge Martha Vazquez they could not reach the couple by phone Monday when they failed to show up for court.

The couple had been free pending sentencing after surrendering their U.S. passports and putting up their home in an affluent Albuquerque neighborhood as security.

Two other defendants did appear for sentencing. They are former chief financial officer Sharon Moore and Harris’ son Craig Young.

Federal prosecutors say the defendants used client trust, savings and other funds to finance a lavish personal lifestyle that included luxury vacations, and upscale homes and vehicles.

Full Article & Source:
Warrants issued for couple guilty in guardian fraud case

See Also:
Who guards the guardians?: Judge vows to fight for clients who lost trust funds

Guardianship company closed, U.S. Marshals Service says

Lawmaker: Guardian system ‘turned ugly’

Las Vegas lawyer pleads guilty to stealing millions from clients

Longtime estate attorney Robert Graham admitted in District Court Thursday to stealing more than $16 million from clients, many of whom relied financially on trust funds he oversaw.

Graham, 52, who is in custody at the Clark County Detention Center on $5 million bail, pleaded guilty before District Judge Kerry Earley to two felony counts of theft and three counts of exploitation of an older/vulnerable person. He faces a prison term of 16 to 40 years at his Jan. 11 sentencing.

“He’s a despicable predatory thief, plain and simple,” District Attorney Steve Wolfson said after the hearing. “He’s going to serve more time in prison than some murderers. As much justice as we could deliver was delivered today.”

Graham wore black reading glasses as he stood before Earley in jail garb and chains to enter his plea.

“I’m guilty of these charges, your honor,” Graham told the judge.

His lawyer, Deputy Public Defender Bryan Cox, added afterward, “It’s been a very difficult case, especially for the victims and the victims’ families.”

In the courtroom, Chief Deputy District Attorney J. P. Raman, the lead prosecutor in the case, read aloud the names of more than 110 clients who deserve a share of the $16 million in restitution prosecutors will seek against Graham.

The money was stolen between 2011 and 2016, Raman said in court papers Thursday.

The thefts — which ranged from as little as $20 to more than $1 million — occurred in 64 estate cases, 21 trust funds, 10 guardianship cases, and four special needs trusts, the court papers show.

Graham’s guilty plea capped a 10-month legal saga that began when he abruptly shut down his Lawyers West office in Summerlin on Dec. 2 after years of looting client funds.

In interviews with the Las Vegas Review-Journal after his indictment earlier this year, former clients described their frustration with Graham as they fought, sometimes desperately, to get him to turn over their funds in the years and final months before he closed his law practice.

Clients lost everything

The victims who lost everything include a wheelchair-bound woman with cerebral palsy and three young children who survived a crash that killed their parents. Some of the victims are expected to testify at Graham’s sentencing.

Graham secretly funneled an average of $187,000 a month in client funds over the years to a special bank account to run his law practice and pay personal bills, grand jury transcripts show.

He used client funds to pay $244,000 in taxes and $700,000 a year in advertising. He also used the money to make thousands of dollars more in charitable donations to numerous organizations,
including the Church of the Latter Day Saints and Boys Town of Nevada, the testimony shows.
Graham, once a regular fixture on local television promoting his law firm, described his practice as a 20-year business failure in a December interview with the Review-Journal.

“I was responsible for the litigation and felt I had no out,” Graham said. “So bit by bit, I moved the chairs on the deck. Each year, things got worse and worse, and I tried to bail myself out and just couldn’t.”

The State Bar of Nevada moved quickly to take control of Graham’s cases after he abandoned his clients in December and obtained a court order for his temporary suspension.

Assistant Bar Counsel Janeen Isaacsonhas since asked the Nevada Supreme Court to permanently disbar Graham.

“He stole millions of dollars to feed his ego and desires for wealth and power, and he used his law license to do it,” Isaacson said at a recent disciplinary hearing.

Several former clients filed an involuntary bankruptcy petition against Lawyers West in December seeking the firm’s remaining assets.

But lawyers for the clients have admitted there is slim chance of recovering the missing funds. In Bankruptcy Court papers, Lawyers West listed $8.7 million in liabilities and only $438,000 in assets, mostly in unpaid legal fees unlikely to be collected.

Wolfson said Thursday that obtaining restitution from Graham in the criminal case also will be difficult because of his lack of assets.

“The odds of recovering anything significant are probably not very likely,” he said.

Full Article & Source:
Las Vegas lawyer pleads guilty to stealing millions from clients

Who guards the guardians?: Judge vows to fight for clients who lost trust funds

The civil case of Ayudando Guardians Inc. v. Desert State Life Management involves two companies accused of siphoning client accounts for personal gain.

With their owners absent for an initial hearing in the lawsuit Wednesday, a state district judge heard from those who are picking up the pieces after the shocking collapse this summer of the two New Mexico nonprofit companies that for more than a decade specialized in serving developmentally disabled, elderly and otherwise vulnerable clients.

In the audience were lawyers from the U.S. Attorney’s Office, which is prosecuting Ayudando Guardians and its two principals on criminal charges of embezzling at least $4 million in client funds; and Liane Kerr, whose former husband Paul Donisthorpe has been accused by state and federal authorities of embezzling $4 million from his clients’ accounts at Desert State. He hasn’t been criminally charged.

At issue Wednesday was how to proceed with the lawsuit filed by Ayudando Guardians on June 6 seeking damages from Desert State on behalf of seven clients. Those clients entrusted their funds for Desert State to manage, the lawsuit states.

That case was filed a month before Ayudando’s two principals, Susan Harris and Sharon Moore, and the company itself, were indicted July 11 by a federal grand jury for embezzling more than $4 million from their clients. The U.S. Marshals office has been running Ayudando since then, with the prospect of a shutdown of the company imminent. Harris and Moore have pleaded not guilty.

Donisthorpe didn’t attend Wednesday’s hearing. He hasn’t responded to requests for comment and is reportedly brain damaged from a botched suicide attempt.

His wife of 31 years, Kerr, filed for divorce in March after state financial examiners began to look into Desert State’s books. She appeared in court with her attorney Wednesday, but didn’t comment. In court records, Kerr has denied any involvement in the alleged embezzlement scheme or the trust company business.

Both companies are being dismantled by government agencies in light of the fraud and embezzlement allegations.

Judge Alan Malott on Wednesday denied a motion to dismiss Ayudando’s claims against Desert State, vowing to make sure the seven Ayudando clients who may have lost trust funds at Desert State “don’t fall through the cracks” because their guardian is under federal indictment.

“There may be nothing left, but I’m going to try to get as close to the penny as I can get,”said Malott.

Desert State in early August was placed into the receivership of the state Financial Institutions Division.

An estimated 70 people who were clients of Desert State have lost some or all of their trust money, state officials say. Malott, during the hearing, said state district judges are in “crisis management” mode trying to find replacement guardians for Ayudando’s clients.

State FID attorney Kevin Graham told Malott that families and individuals, some with “limited” ability to understand “what’s going on in the case,” have contacted the state to find lawyers to help recover their missing trust funds.

Meanwhile, the state Public Accountancy Board last week revoked Donisthorpe’s CPA license.

Full Article & Source:
Who guards the guardians?: Judge vows to fight for clients who lost trust funds

DA To Review Metro Audit Of Autumn Hills

NASHVILLE, Tenn. - The Davidson County District Attorney has been asked to review a recent Metro audit into the city-owned home for seniors.

The audit found there was no documentation for more than a million dollars in spending at the Bordeaux home and that the former managers had raided the residents' Trust Funds and spent more than $125,000 of their personal money.

Metro councilman Jim Shulman called for the audit a year ago after NewsChannel 5 Investigates exposed financial problems at Autumn Hills last year. The audit found Autumn Hills still owes nearly a quarter of a million dollars to creditors.

Earlier this year, after the problems came to light, the city cuts ties with the management company that it had hired to run Autumn Hills.

A new interim company was brought in to run the place which is now using its former name, the Knowles Home.

Full Article & Source:
DA To Review Metro Audit Of Autumn Hills

Metro Audit Finds Lack Of Oversight Led To Problems At Autumn Hills Assisted Living

NASHVILLE, Tenn. - Metro Government and the city's Hospital Authority dropped the ball, that's according to a just-released audit of the former Autumn Hills Assisted Living Facility.

Last year, NewsChannel 5 Investigates first exposed problems at the city-owned home for the elderly, and a new audit by Metro auditors found a lack of oversight by the city led to plenty of problems.

First, a bit of history. We're talking about the old J.B. Knowles Home in Bordeaux. Three years ago, Metro made a deal with Autumn Hills Assisted Living and Vision Real Estate to run the facility, develop the land around it and save taxpayer money.

But as the audit found, things didn't go as they were supposed to.

Metro auditors said it was impossible to do a full-scale audit of Autumn Hills because the managers failed to keep accurate records of how the money was being spent.  

But what they did find, according to the just-released audit, is the folks running Autumn Hills "mismanaged" the finances, still owe creditors more than three quarters of a million dollars, did not prepare required financial reports or file tax returns.
 
According to the audit, out of $4.5 million withdrawn from Autumn Hills' accounts, more than a million of that had no documentation - including nearly half of which was paid out in cash, plus another $99,000 in ATM withdrawals.

The audit also found managers raided the residents' trust funds. Many residents set aside money each month from their Social Security checks. But auditors found Autumn Hills used the residents' money for operational expenses.

The audit also mentions our reporting late last year and confirmed problems we exposed at the facility, how it failed to pay its bills on time, let required insurance policies lapse, and failed to make capital improvements as required under its contract with Metro.
 
Auditors found no records of any work being done. Managers had claimed to have put in a new chiller and accounting system. But the audit found that was never done. When Metro sent its own team into the facility earlier this year, they found it in "dire need"of major maintenance.

Despite all of the problems, the audit said Autumn Hills still provided food, shelter, and personal and medical care to its residents, though we heard from a lot of them who were not happy with it.

The city did cut ties with Autumn Hills back in January and brought in a new management company on an interim basis. They are still searching for a permanent manager.

Full Article & Source:
Metro Audit Finds Lack Of Oversight Led To Problems At Autumn Hills Assisted Living

United States: Trustees Of Supplemental Needs Trusts: Do Not Take Your Duty Lightly

If Trustees of Supplemental Needs Trusts were not aware of their enhanced duty to the disabled beneficiary of these types of trusts, after Matter of J.P. Morgan Chase, they should be.  A Supplemental Needs Trust is a trust that is funded with the assets of a third party for the benefit of a disabled individual.  A Special Needs Trust, on the other hand, is a trust that is funded with the disabled individual's own assets.  Both types of trusts are carefully drafted such that the distribution powers of the Trustees do not disqualify the disabled individual from means-tested government benefit programs like Medicaid and Supplemental Security Income (SSI).

In Matter of J.P. Morgan Chase, J.P. Morgan Chase and an experienced estate planning attorney, the Trustees of a Supplemental Needs Trust for the benefit of a autistic man, filed an interim account for this $2.7 million trust.  The Trustees claimed combined commissions of over $52,000, yet they didn't visit or inquire about the disabled beneficiary's needs for over 3 years or spend a single dollar for his benefit during such time.  The bank, as somewhat of an excuse, claimed that it lacked the institutional capacity to meet the needs of the disabled beneficiary.  Due to this lack of care, the New York County Surrogate's Court, in denying the Trustees' commission for the period, stated that the Trustees had a fiduciary obligation to be proactive "in keeping abreast of the beneficiary's condition, needs, and quality of life, and to utilize trust assets for his actual benefit."

This case serves a reminder that Trustees of a Supplemental Needs Trust, whether an individual or corporate Trustee, must pay special attention to needs of the disabled beneficiary and, if they are not suited to do so, then they should either hire an agent that can handle the responsibility, or resign.  In other words, "Don't bite off more than you can chew."

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

Full Article & Source: 
United States: Trustees Of Supplemental Needs Trusts: Do Not Take Your Duty Lightly