Rupert Murdoch‘s eyebrow-raising attempt to restructure the family trust that governs Fox Corp. and News Corp. was rebuked last week in probate court in Las Vegas, thwarting — at least for now — the media mogul’s efforts to change the dictates of how four of his children, including current Fox CEO Lachlan Murdoch might govern the companies after he dies.
The New York Times reported Monday that Murdoch’s bid to ensure Lachlan had control over the companies was rejected by Edmund J. Gorman Jr, a commissioner in probate court in Las Vegas, where Murdoch had filed the case to amend the irrevocable family trust. At present, the trust ensures four of his children — Lachlan, James, Prudence and Elisabeth — will have equal say in governing how Fox Corp. and News Corp. are run Their wishes could have significant effects on the direction of such assets as Fox News Channel, the conservative cable network that has enjoyed an outsize influence on Republicans and right-wing viewers.
Rupert Murdoch intends to appeal the decision, according to a person familiar with the matter. Adam Streisand, an attorney representing Rupert Murdoch in the matter, could not be reached for immediate comment. Representatives of Fox Corp. and News Corp. could also not be reached for immediate comment.
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The Times reported that Rupert Murdoch has in recent years wanted to maintain the conservative leanings of his media empire, particularly at Fox News, which has become the economic linchpin of Fox Corp. But James Murdoch and Elisabeth Murdoch are known to hold different political views than their brother, with James notably contributing to causes that are not in keeping with the opinions espoused on the cable network.
The trouble has come in trying to change the trust.
In order to do so, the elder Murdoch had to prove that the changes he wanted to make would be in the best interests of all parties. Gorman took issue with that concept, noting in a 96-page decision that the plan represented a “carefully crafted charade” to “permanently cement Lachlan Murdoch’s executive roles” despite “the impacts such control would have over the companies or the beneficiaries” of the trust, according to the Times report.
At the heart of the matter, the Times reported, were doubts about James Murdoch’s intentions. James has appeared estranged from his father and brother in recent years, and Lachlan Murdoch and his father sought different methods for disenfranchising the three other children.
“The effort was an attempt to stack the deck in Lachlan Murdoch’s favor after Rupert Murdoch’s passing so that his succession would be immutable,” Gorman wrote in his decision, according to the Times. “The play might have worked; but an evidentiary hearing, like a showdown in a game of poker, is where gamesmanship collides with the facts and at its conclusion, all the bluffs are called and the cards lie face up.”
Despite the ruling, the case can continue. According to the Times, a district judge must ratify Gorman’s decision. And Rupert Murdoch can challenge it.
–Gene Maddaus contributed to this story