Oil tycoon’s divorce shows complexity of dividing business assets
Billion-dollar divorce serves as a lesson for other divorce involving businesses
The divorce of a billionaire oil tycoon in Oklahoma recently has likely garnered the interest of many readers in North Carolina. A judge in Oklahoma recently ordered the CEO to pay nearly a billion dollars to his ex-wife as a part of their divorce settlement, according to CNNMoney. Although most people won’t have to deal with such vast sums in their own divorces, the case nonetheless serves as a reminder of how complicated division of marital property can become when a business is involved.
Although a billion dollars certainly sounds like a lot, it should be noted that the CEO was estimated to be worth as much as $20 billion as recently as August. In other words, the wife’s billion-dollar settlement only represents a small fraction of the overall marital estate.
Many analysts expressed surprise that she was not awarded a larger share, saying they expected an amount in the four to eight billion dollar range. She has vowed to appeal the ruling, however, saying that the percentage of the marital estate awarded to her was unfair.
Business plays central role
The husband’s business, a major energy company, played a major role during the divorce proceedings, according to Reuters. The husband largely built up the company into a multi-billion dollar giant over decades as its CEO. However, oddly enough, he had to try to prove to the judge that much of that wealth was a result of passive income, like stocks and rising oil prices, rather than his own hard work.
The reason is that if the wife could show that the husband, and, by extension, the couple, had built up the company themselves then she would have a right to a much larger share of the marital property. At one point, the company was even accused of changing its corporate history on its website to make it appear as though the man had much less of a role in the company’s early success. Given the size of the divorce settlement, it appears as though the judge in this case largely sided with the husband’s arguments, or at least felt that anything over a $1 billion would simply be too much of an amount.
Divorce and business
Many people going through a divorce may have business assets involved in the divorce process, even if most family businesses don’t generate the billions of dollars described in the above case. A family business can become a significant point of contention during a divorce, especially if the issue is not handled properly from the outset.
Business owners involved in a divorce will want the help of a divorce attorney who also has experience in how small businesses are affected by a divorce. Such an attorney can give clients helpful advice to ensure important business interests are not adversely affected by a divorce outcome.