Marshall v. Marshall

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Marshall v. Marshall
Seal of the United States Supreme Court.svg
Argued February 28, 2006
Decided May 1, 2006
Full case nameVickie Lynn Marshall v. E. Pierce Marshall
Docket no. 04-1544
Citations547 U.S. 293 ( more )
126 S. Ct. 1735; 2006 U.S. LEXIS 3456
Case history
PriorMarshall v. Marshall (In re Marshall) 253 B.R. 550 (Bankr. C.D. Cal. 2001); 257 B.R. 35 (Bankr. C.D. Cal. 2001); affirmed in part, vacated and remanded, 264 B.R. 609 (C.D. Cal. 2000); 271 B.R. 858 (C.D. Cal. 2001); 273 B.R. 822 (Bankr. C.D. Cal 2002); 275 B.R. 5 (C.D. Cal. 2002); vacated and remanded, 392 F.3d 1118 (9th Cir. 2004); cert. granted, 126 S. Ct. 35 (2005)
SubsequentOn remand, 403 B.R. 668 (Bankr. C.D. Cal. 2009); 600 F.3d 1037 (9th Cir. 2010); affirmed, Stern v. Marshall , 564 U.S. 462 (2011).
Holding
Jurisdiction was properly asserted by a Federal District Court over a widow debtor's counterclaim for tortious interference with a gift, because the judicially crafted "probate exception" to Federal court jurisdiction did not apply. Ninth Circuit Court of Appeals reversed and remanded.
Court membership
Chief Justice
John Roberts
Associate Justices
John P. Stevens  · Antonin Scalia
Anthony Kennedy  · David Souter
Clarence Thomas  · Ruth Bader Ginsburg
Stephen Breyer  · Samuel Alito
Case opinions
MajorityGinsburg, joined by Roberts, Scalia, Kennedy, Souter, Thomas, Breyer, Alito
ConcurrenceStevens (in judgment)
Laws applied
28 U.S.C.   § 1331, 28 U.S.C.   § 1334

Marshall v. Marshall, 547 U.S. 293 (2006), is a case in which the United States Supreme Court held that a federal district court had equal or concurrent jurisdiction with state probate (will) courts over tort claims under state common law. The case drew an unusual amount of interest because the petitioner was Playboy Playmate and celebrity Anna Nicole Smith (whose legal name was Vickie Lynn Marshall). Smith won the case, but unsolved issues regarding her inheritance eventually led to another Supreme Court case, Stern v. Marshall . She died before that case was decided.

Contents

Background

Twelve years prior to his marriage to Smith, J. Howard Marshall had set up a trust which owned all of his assets and would pass them to various charities and his son E. Pierce Marshall after his death. Smith had claimed that it was J. Howard's intention after marriage to set up a separate trust for her benefit, which would essentially leave her half the appreciation of the assets of the trust during the period of the marriage, but that his son Pierce had interfered with the formation of this separate trust. J. Howard Marshall neither set up a trust in Smith's favor, nor changed the terms of his will to provide for her after his death. However, he did make his existing trust irrevocable soon after his marriage to Smith. As a result, Smith was excluded from J. Howard's estate. She sued in Texas Probate Court for a share of the estate on several grounds, and her litigation was actively opposed by Marshall's son Pierce. The primary ground for the son's opposition was that his father had an extensive estate plan executed over many decades which expressed his clear wishes. Pierce also believed his father had already been quite generous to Smith during the marriage, providing Smith with both expensive gifts and monetary resources.

After receiving a default judgment against her for sexual harassment, Smith petitioned for bankruptcy in California. Pierce filed a non-dischargeability claim and proof of claim against Smith based on public statements her lawyers made to the media shortly after her husband died, accusing Pierce of frustrating J. Howard's intentions to set up a new trust for Smith and isolating his father. Pierce alleged these statements were libelous, and he successfully sued Smith's attorneys on the same grounds in Texas State Court. Smith opposed the claims and countersued Pierce on the basis her statements were true and on tort claims she was already pursuing in Texas. The Bankruptcy Court dismissed the libel claim on summary judgment and did not allow the claim to proceed to trial. After being released from bankruptcy, Smith pursued her counterclaim against Pierce, alleging he interfered with his father's intention to set up a trust in favor of Smith.

During the Texas Probate proceeding, the Bankruptcy Court awarded Smith $474 million on the basis of a sanction against Pierce, and deemed his interference to have occurred. The Federal District court subsequently vacated the Bankruptcy award and reduced Smith's award to $88 million.

However, after a five-month jury trial in Texas, the Probate Court entered a decision that J. Howard Marshall's will and trust were valid, and that his son was the primary beneficiary—rejecting Smith's claim that the son had exerted undue influence on his father, or interfered with any trust for Smith. When the matter came before the 9th Circuit appellate court, it rendered the District Court's decision invalid on jurisdictional grounds, declaring that only Texas Probate Courts had jurisdiction over probate matters. [1] [2] [3] The case was also important since the Supreme Court last reviewed the probate exception in Markham v. Allen , [4] and its analogue, the domestic relations exception, in Ankenbrandt v. Richards . [5]

The Bush administration, which wanted to limit exceptions to federal jurisdiction in state probate related matters, instructed the United States Solicitor General to submit a brief on the side of the petitioner.

Questions presented

  1. What is the scope of the probate exception to federal jurisdiction?
  2. Did Congress intend the probate exception to apply where a federal court is not asked to probate a will, administer an estate, or otherwise assume control of property in the custody of a state probate court?
  3. Did Congress intend the probate exception to apply to cases arising under the Constitution, laws, or treaties of the United States (28 U.S.C. § 1331), including the Bankruptcy Code (28 U.S.C. § 1334), or is it limited to cases in which jurisdiction is based on diversity of citizenship?
  4. Did Congress intend the probate exception to apply to cases arising out of trusts, or is it limited to cases involving wills?

Opinion of the Court

On February 28, 2006, the case was argued. May 1, 2006, the United States Supreme Court unanimously decided the case in favor of Anna Nicole Smith on the question of federal jurisdiction. [6] The Court held that federal courts have jurisdiction to entertain suits to determine the rights of creditors, legatees, heirs, and other claimants relating to an estate, so long as the federal court does not probate a will, administer an estate, take control of assets being administered by the probate court or interfere with the probate proceedings.

Aftermath

Anna Nicole Smith's dispute returned to the Supreme Court again in Stern v. Marshall (2011). [7]

Related Research Articles

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<span class="mw-page-title-main">Anna Nicole Smith</span> American actress and television personality (1967–2007)

Vickie Lynn Marshall, known professionally as Anna Nicole Smith, was an American model, actress, and television personality. Smith started her career as a Playboy magazine centerfold in May 1992 and won the title of 1993 Playmate of the Year. She later modeled for fashion companies, including Guess, H&M, Lane Bryant, Conair, and Heatherette.

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<span class="mw-page-title-main">Probate</span> Proving of a will

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<span class="mw-page-title-main">Estate planning</span> Process of planning for inheritance of property

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<span class="mw-page-title-main">J. Howard Marshall</span> American business magnate (1905–1995)

James Howard Marshall II was an American businessman, government official, lawyer, and legal scholar. He was involved with and invested in the American petroleum industry via his academic, government and commercial endeavors. He owned 16 percent of Koch Industries and was married to American model Anna Nicole Smith during the last 14 months of his life. His estate became the subject of protracted litigation, which was reviewed by the Supreme Court in Marshall v. Marshall and Stern v. Marshall. The court kept the will and testament intact and substantially all of the assets in Marshall's estate wound up in trusts for the benefit of his daughter-in-law, Elaine Tettemer Marshall, and her family.

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Everett Pierce Marshall was an American petroleum industry executive. He was the beneficial owner of 16% of Koch Industries, which he received as an inheritance from his father, J. Howard Marshall II. He spent the last 12 years of his life as a defendant in lawsuits by his stepmother, Anna Nicole Smith, and his brother, J. Howard Marshall III, who both sought part of his father's fortune after being left out of the will and testament.

Howard Kevin Stern is an American attorney based in California. He was the domestic partner, attorney and agent of the late model Anna Nicole Smith. He became known as a co-star on Smith's 2002–2004 reality television series The Anna Nicole Show. As of 2019 he works with the Los Angeles Public Defender's Office.

The Dannielynn Hope Marshall Birkhead paternity case, a.k.a. Birkhead v. Marshall, was a high-profile legal battle that revolved around the paternity of Anna Nicole Smith's daughter, Dannielynn. Larry Birkhead, Smith's former love interest, filed a lawsuit against Howard K. Stern, Smith's live-in partner who was listed as the father on the birth certificate, seeking to establish his paternity rights. Dannielynn stood to inherit a substantial fortune if Smith's estate succeeded in its ongoing legal battle to claim inheritance from her late husband, an affluent oil tycoon. Given its significant implications and media coverage, the case involved various legal proceedings and garnered substantial public attention. G. Ben Thompson, a former boyfriend of Smith's who worked as a real-estate developer in South Carolina, claimed that pregnant Smith approached him to inform him that he was the father of her unborn child, but he balked telling Smith that was impossible because he had a vasectomy.

James Howard Marshall III is president and owner of MDH Industries, an electronics company based in Monrovia, California. He is the eldest son of J. Howard Marshall II, who owned 16% of Koch Industries.

Kelly Moore is an American author and former attorney.

David Ormon Carter is a United States district judge of the United States District Court for the Central District of California.

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Stern v. Marshall, 564 U.S. 462 (2011), was a United States Supreme Court case in which the Court held that a bankruptcy court, as a non-Article III court lacked constitutional authority under Article III of the United States Constitution to enter a final judgment on a state law counterclaim that is not resolved in the process of ruling on a creditor's proof of claim, even though Congress purported to grant such statutory authority under 28 U.S.C. § 157(b)2(C). The case drew an unusual amount of interest because the petitioner was the estate of former Playboy Playmate and celebrity Anna Nicole Smith. Smith died in 2007, before the Court decided the case, which her estate lost.

Elaine Tettemer Marshall is an American billionaire heiress. Trusts for the benefit of Marshall and her sons own the 16% beneficial interest in Koch Industries; formerly owned by her husband, E. Pierce Marshall, to whom she was married from 1965 until his death in 2006. These shares were previously owned by her father in-law, J. Howard Marshall, who was married to actress Anna Nicole Smith in the last year of his life.

References

  1. In re Marshall, 392F.3d1118 ( 9th Cir. 2004).
  2. Lane, Charles (September 28, 2005). "Supreme Court to Weigh In on Anna Nicole Smith's Inheritance Case". Washington Post. pp. C03.
  3. "A Modern-Day Bleak House". American Spectator. March 5, 2009. Archived from the original on March 6, 2009.
  4. Markham v. Allen, 326 U.S. 490 (1946).
  5. Ankenbrandt v. Richards, 504 U.S. 689 (1992).
  6. Marshall v. Marshall, 547 U.S. 293 (2006).
  7. Stern v. Marshall , 564 U.S. 462 (2011).