clock menu more-arrow no yes mobile

Filed under:

The Saints and Pelicans ownership battle, explained

The lawsuit for Benson's billions is underway.

Chuck Cook-USA TODAY Sports

Tom Benson, the 87-year-old owner of the NFL's New Orleans Saints and NBA's Pelicans, announced plans on Jan. 21 to transfer ownership of both teams to his wife, Gayle, upon his death. That marked a sudden reversal of Benson's longstanding plans to give control of the franchises to Rita Benson LeBlanc, his granddaughter as well as the Saints' owner and executive vice president ... until last week, when Benson fired her.

Benson didn't just fire his granddaughter. He cut LeBlanc, her brother Ryan and their mother and Benson's adopted daughter Renee out of the will completely. Rita Benson LeBlanc and her family sued.

One major limb on the family tree sawed off over an inheritance. Families sparring over a will is nothing new, but when it involves one of New Orleans' most prominent patriarchs and a national figure thanks in part to his ownership of an NBA and an NFL team, it means the drama and the ugliness usually involved when families fight over money will be played out for the entire country to see.

The lawsuit

Shortly after being fired, Rita Benson LeBlanc, her brother and their mother filed a lawsuit seeking to contest the transfer of ownership for the Saints, Pelicans and other family business assets. The lawsuit, filed in Louisiana, details Benson's failing health to establish the petitioners' contention that he is incompetent and unable to act in the best interest of the family trust. It alleges that Gayle is manipulating Benson, getting his signature for what the suit describes as irrational business decisions and not providing an appropriate level of care for his physical and mental health needs.

As for remedy, LeBlanc and her family members are asking the state to intercede and make his daughter Renee Benson the primary curator of the family trust as well as for Benson himself. Rita LeBlanc would be named the undercurator for Benson and the family trust.

Family business

Renee Benson is the adopted daughter of Benson and his first wife, Shirley, who died in 1980. For decades, she's been part of the family businesses, with ranches and car dealerships included in Benson's holdings. Her daughter Rita has been part of the businesses, the sports teams in particular, from an early age. She interned for the Saints as a high school student, and in college, she interned for the NFL's corporate office as well as NFL Films and NFL Publications. She took a job with the Saints in 2001.

Rita rose to prominence in the aftermath of Hurricane Katrina. The lawsuit glosses over Benson's attempts to move the Saints following the natural disaster. Benson acknowledged his plans to hand over the team to Rita when outside interests approached him at the time to see about purchasing the team and keeping it in Louisiana.

In 2012, the NFL approved a succession plan that would transfer ownership of the team to Renee and her two children upon Benson's death. Rita LeBlanc would be the Saints' owner representative. That plan was reaffirmed by the league last year.

Competition for Benson's attention

Benson was approached by Gayle Marie LaJaunie Bird in 2003 to solicit funds for a charity. The two began dating, according to the lawsuit, months after Benson's second wife, Grace, died of Parkinson's disease in November 2003. They were married in October 2004. Prior to marrying Benson, she signed a prenuptial agreement that limited her claims to Benson's property upon divorce or death.

The relationship between Benson's heirs and his third wife has reportedly been tense for some time. A report by the Times-Picayune says it began to unravel in the wake of Katrina when Rita LeBlanc's role with the team increased.

At the same time, Benson's third wife started to play a more prominent role in his affairs. The Times-Picayune report details a long list of charitable spending, including a $5 million donation to former Saint Steve Gleason's ALS foundation, that sources believe was spurred by his wife. That reportedly began to unnerve Benson's heirs.

The lawsuit also details lavish spending on behalf of Benson's wife. The suit alleges that Benson attempted to purchase a local racetrack and gambling facility, Fairgrounds Race Course and Slots -- something that's prevented by NFL ownership rules. It also points to the purchase of six race horses, for nearly $1 million, for GMB (Gayle Marie Benson) Stables in September 2014.

"Candy, ice cream, soda and red wine"

Benson's health has deteriorated rapidly over the last year, including a publicized fall during the NFL owners meetings in Atlanta last spring. He needs assistance from a walker to get around now, and his cognitive ability is reportedly failing as well. Court documents say that Benson recently said that the current U.S. president was Ronald Reagan and Harry Truman. The suit also points to a recent incident in which Benson was unable to identify his daughter Renee.

The lawsuit also alleges that Gayle Benson is incapable of caring for her husband and unwilling to acknowledge the full extent of his declining health. Benson's family members go so far as to claim his wife has failed to provide him with a proper diet. Under her supervision, the suit claims, Benson is "subsisting on candy, ice cream, soda and red wine."

Cutting Benson's family out

In the lawsuit, Benson's family actually refers to it as a "coup attempt," the process of cutting his daughter and her two children out of the family trust. It allegedly started with smaller things, refusing to get together with the family at Thanksgiving and Christmas and removing pictures of his daughter and grandchildren from the house. From there, it scaled up to the current legal machinations to remove them from the will.

On Dec. 27, Renee, Rita and Ryan received a letter, via email, from Benson that barred them from all of the family businesses, from the sports teams to the car dealerships. In that letter, Benson speaks to the divide between his current wife and the other family members:

"Suddenly after I remarried you all became offensive and did not act in an appropriate manner and even had arguments among yourselves, which created a very unpleasant family situation, which I will not stand for. It made me very unhappy and uncomfortable. This situation can not continue at my age."

Rita LeBlanc was fired from her role with the Saints on Dec. 30, and there were even orders that her car be repossessed.

In January, Benson attempted to remove hundreds of millions of dollars worth of assets from his trusts, including the Saints and Pelicans. That move was blocked by the trustee, setting up the current legal fight.

Transferring assets from the trust

Trusts are a common tool estate planners use whereby property is held by one person for the benefit of another -- in this case Benson's daughter and grandchildren. It allows the assets held by the trust to continue to operate and, ideally, profit. Assets are taxed, but when the property transfers, the beneficiary does not pay inheritance taxes on it, because it's not considered part of the estate. A trustee is appointed to oversee the assets and act in the best interests of both parties until the event triggering the passing of the trust to the beneficiary.

Benson is allowed by law to swap assets in the trust, which he tried to do with his professional sports franchises this year. However, that move was rejected by the trustee because Benson was attempting to swap the assets for unsecured promissory notes, i.e. assets that had nothing but paper backing them.

The attempt to swap those assets would have devalued the two sports franchises from a combined value of roughly $1.76 billion to just over $427 million.

The lawsuit from Renee Benson and her children seeking to declare Tom Benson incompetent halts attempts to swap out the sports teams and other assets from the trust until the issue gets resolved. The two sides could reach an agreement on their own for how to handle the trust and its assets. For now, the matter looks like it's headed for a lengthy court battle that could get ugly, as things tend to do when families squabble over billions of dollars.