Pensacola Independent News

LETTERS & OPINIONS | Vol. 8, No. 30, July 26, 2007
(Hope For A New Century?)
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ANNA NICOLE'S COURT LOTTERY My husband and I recently met with an attorney to work on our estate plan. Considering we haven't won the lottery yet, our planning was relatively easy, with a few simple wills, powers of attorney, healthcare directives and little more.

As we went through the process, I was interested in the media's coverage of the ongoing legal dispute between the late Anna Nicole Smith and the estate of her former husband, billionaire J. Howard Marshall.

Just as the trials and tribulations of Hollywood's celebrity blondes may make for good television drama, they make for even better legal lessons.

By now, many are familiar with the tragic tale underlying this case. Anna Nicole met Marshall at a local strip club and they married. He died 14 months later in 1995 and his son, E. Pierce Marshall, inherited everything. Upset by his testamentary desires, Anna Nicole sued, claiming her late husband told her he planned on leaving her half his fortune. But nothing in Marshall's will or trust supported her claim.

Preceding her death in February, Anna Nicole sought legal recourse in multiple courts. First she filed her claim in Texas probate court. Unhappy with the way that case was progressing, she went "forum-shopping" and brought a separate action in federal bankruptcy court in California.

After a lengthy trial with extensive evidentiary presentations by both sides, the Texas court delivered a jury verdict for E. Pierce Marshall. Yet further west, Anna Nicole's search for a more favorable verdict paid off when the federal bankruptcy judge ignored the evidence and awarded her $475 million.

The Ninth Circuit Court of Appeals later reversed the federal bankruptcy court's decision, ruling that the federal courts should have abstained in deference to the Texas state court.

Ultimately, Anna Nicole's greatest legal victory came from the U.S. Supreme Court, which overturned the decision of the Ninth Circuit, thereby expanding federal courts' jurisdiction and increasing their ability to intrude into traditionally state-level affairs.

Beyond our summer tabloid readings, why should we care about this? Several reasons.

First, Anna Nicole's case undermines states' rights. Under the Supreme Court's interpretation of the doctrine of probate exception, distant federal courts, including even highly specialized bankruptcy courts, may increasingly serve as de facto "appellate courts" over state court decisions. This clearly damages America's constitutional balance.

Second, this case is particularly unsettling for the probate process. Previously, estate planners, their clients and beneficiaries, could rely upon the greater consistency and predictability of state courts' interpretation of their own laws, thereby avoiding protracted acrimonious litigation by disgruntled potential heirs.

Now, however, federal courts that are less familiar with individual states' estate-planning laws may distort them and undermine confidence in speedy and efficient estate distribution.

Finally, by gaming our legal system in pursuit of her deceased husband's fortune, Anna Nicole's tragic life leaves a legacy that may include increasing litigation costs and courtroom burdens for businesses, philanthropies and everyday citizens across America. Recent studies estimate that litigation currently costs Americans between $140 billion and $250 billion every single year.

Increasing plaintiffs' ability to forum-shop and duplicate lawsuits, and then handpick the most lucrative verdict, will only multiply this injustice.

Estate-planning lawyers have their work cut out for them.

In the meantime, our only hope of affording the same luxury of forum shopping available to the likes of Anna Nicole may come with a winning lottery ticket.

Renee Giachino-Bookout is a regular viewpoint contributor. She is general counsel for Alexandria, Va.-based Center for Individual Freedom, hosts WEBY radio show, "Your Turn," and hosts "Santa Rosa Insider" on Mediacom's Gulf Coast Network, Channel 27, at 7 p.m. Tuesdays and Fridays.

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