IBJNews

Legal battle over Simon estate plan puts big gifts in limbo

Back to TopCommentsE-mailPrintBookmark and Share

Billionaire mall developer Melvin Simon wanted to leave the Jewish Federation of Greater Indianapolis $10 million, but it could be up to his widow, Bren Simon, whether to fulfill that wish.

The Jewish Federation is one of 10 local or national organizations that together could receive $18.5 million from Melvin Simon’s 2009 estate plan.

Mel Simon Charities factsAmong those in line for a windfall from Simon’s estimated $2 billion fortune are Butler University, Congregation Beth-El Zedeck and The Children’s Museum of Indianapolis.

It’s not clear, however, whether the amounts designated will change, or whether they will be paid at all.

While earlier estate documents said Simon’s trustee “shall” distribute the gifts, the 2009 plan leaves Bren total discretion. According to the trust documents, Bren shall receive assets “with the request, but not the legal obligation” that she fulfill Melvin’s charitable wishes.

The charities appear to have no choice but to stand by for a year or more while a lawsuit seeking to throw out the 2009 plan plays out.

Deborah Simon, one of Melvin’s three children from his first marriage, sued in January, charging he didn’t understand what he was doing when he made the changes in February of last year, seven months before his death at age 82.

Bren, who married Melvin in 1972, contends the new plan reflects his wishes, and that he fully understood what he was doing.

Under the 2009 plan, Bren, 66, would receive half of Simon’s fortune outright, with the other half going into a trust paying her income the rest of her life.

The prior plan would have provided one-third to Bren outright. Another one-third would have gone into a trust paying Bren income during her lifetime, with his children receiving the remainder. The final third would have gone to charitable trusts that were to donate tens of millions of dollars a year to local and national charities.

The changes don’t appear to put into peril high-profile donations for which Melvin and Bren signed formal donor agreements that put the estate on the hook for contributions. Last month, attorneys for Bren at Krieg DeVault notified those recipients—including Indiana University and the Riley Children’s Foundation—that the estate will fulfill those commitments.

In 2006, the couple said they were giving $50 million to create the Melvin and Bren Simon Cancer Center and fund a faculty and research endowment. The next year, Simon family members, including Melvin and Bren, announced $40 million in gifts toward completion of a 10-story inpatient tower at Riley Hospital for Children.

Attorneys for Bren did not respond to requests for comment. Several organizations named in the 2009 estate plan either declined comment, or could not be reached.

Melvin and Bren Simon in 2007 agreed to give the Children’s Museum $1.2 million, but CEO Jeffrey Patchen said via e-mail, “The Children’s Museum considered its options and determined that not getting involved was the best course of action to take.”

The Children’s Museum’s agreement was with the Simons personally and with a charitable foundation that is not part of the estate.

It and other charities whose fates are uncertain are listed in an appendix to a trust that was revised as part of the 2009 estate plan. The appendix is slightly different from the one attached to the prior trust. It listed $18.9 million in contributions for a dozen organizations.

The revision eliminated $150,000 for the Indianapolis Zoological Society and $100,000 for the Association for the Cure of Cancer of the Prostate. It also reduced from $1 million to $500,000 gifts to the International Council of Shopping Centers, Urban Land Institute and United Way of Central Indiana.

Both versions list $1 million for Butler University. Butler officials are aware the university was named in Simon’s estate plan but have not received verbal or written commitmets, spokeswoman Courtney Tuell said.

The Jewish Federation did not return a phone call.

Beth-El Zedeck could receive $2 million for an endowed construction and maintenance fund. Although the congregation has a lawyer monitoring the suit, President Karl Smith said, “We are just not commenting on the matter at this time.”

Rob MacPherson, vice president of development at the Central Indiana Community Foundation, said that even if the charities had written pledge agreements, those are no guarantee of payment from the estate.

“The donor has the decision all the way up until the final [estate] documents are signed,” he said.

The only rock-solid guarantee, MacPherson said, would be if the pledge were to be paid from an irrevocable trust.

IU and its hospitals say in claims filed in Hamilton County court Feb. 12 that their agreements are irrevocable. Riley Children’s Hospital is counting on $12.5 million from Simon’s estate to pay for construction of the patient tower. The donation agreement calls for a charitable trust to make eight payments, starting one year after Simon’s death, Sept. 16.

The Indiana University Foundation said it still is owed $44 million of the $50 million the Simons pledged for the Simon Cancer Center and to set up the Joshua Max Simon Cancer Research Fund.

IU also is expecting $500,000 for Simon Hall, a science building on the Bloomington campus.•

ADVERTISEMENT

  • So...is Debbie really Greedy?
    Or is what she, and her family, are saying with merit?
    I would find it hard to believe that when Mr. Simon was in better health, and he actively made those donations, that he would want them to be held back. What you have here is bad blood between family members, and it should stay there. They need to work it out, but also stay within the law...
    I don't think Debbie and her siblings are the greedy ones here...

Post a comment to this story

COMMENTS POLICY
We reserve the right to remove any post that we feel is obscene, profane, vulgar, racist, sexually explicit, abusive, or hateful.
 
You are legally responsible for what you post and your anonymity is not guaranteed.
 
Posts that insult, defame, threaten, harass or abuse other readers or people mentioned in IBJ editorial content are also subject to removal. Please respect the privacy of individuals and refrain from posting personal information.
 
No solicitations, spamming or advertisements are allowed. Readers may post links to other informational websites that are relevant to the topic at hand, but please do not link to objectionable material.
 
We may remove messages that are unrelated to the topic, encourage illegal activity, use all capital letters or are unreadable.
 

Messages that are flagged by readers as objectionable will be reviewed and may or may not be removed. Please do not flag a post simply because you disagree with it.

Sponsored by
ADVERTISEMENT

facebook - twitter on Facebook & Twitter

Follow on TwitterFollow IBJ on Facebook:
Follow on TwitterFollow IBJ's Tweets on these topics:
 
Subscribe to IBJ
  1. Aaron is my fav!

  2. Let's see... $25M construction cost, they get $7.5M back from federal taxpayers, they're exempt from business property tax and use tax so that's about $2.5M PER YEAR they don't have to pay, permitting fees are cut in half for such projects, IPL will give them $4K under an incentive program, and under IPL's VFIT they'll be selling the power to IPL at 20 cents / kwh, nearly triple what a gas plant gets, about $6M / year for the 150-acre combined farms, and all of which is passed on to IPL customers. No jobs will be created either other than an handful of installers for a few weeks. Now here's the fun part...the panels (from CHINA) only cost about $5M on Alibaba, so where's the rest of the $25M going? Are they marking up the price to drive up the federal rebate? Indy Airport Solar Partners II LLC is owned by local firms Johnson-Melloh Solutions and Telemon Corp. They'll gross $6M / year in triple-rate power revenue, get another $12M next year from taxpayers for this new farm, on top of the $12M they got from taxpayers this year for the first farm, and have only laid out about $10-12M in materials plus installation labor for both farms combined, and $500K / year in annual land lease for both farms (est.). Over 15 years, that's over $70M net profit on a $12M investment, all from our wallets. What a boondoggle. It's time to wise up and give Thorium Energy your serious consideration. See http://energyfromthorium.com to learn more.

  3. Markus, I don't think a $2 Billion dollar surplus qualifies as saying we are out of money. Privatization does work. The government should only do what private industry can't or won't. What is proven is that any time the government tries to do something it costs more, comes in late and usually is lower quality.

  4. Some of the licenses that were added during Daniels' administration, such as requiring waiter/waitresses to be licensed to serve alcohol, are simply a way to generate revenue. At $35/server every 3 years, the state is generating millions of dollars on the backs of people who really need/want to work.

  5. I always giggle when I read comments from people complaining that a market is "too saturated" with one thing or another. What does that even mean? If someone is able to open and sustain a new business, whether you think there is room enough for them or not, more power to them. Personally, I love visiting as many of the new local breweries as possible. You do realize that most of these establishments include a dining component and therefore are pretty similar to restaurants, right? When was the last time I heard someone say "You know, I think we have too many locally owned restaurants"? Um, never...

ADVERTISEMENT