A lawsuit revealing a rupture between two Paul NewmanNewman’s daughters and the late actor’s charitable foundation say its leaders are betraying Newman’s directives to have his family intimately involved in the organization.
They allege that the Newman’s Own Foundation improperly reduced mandatory contributions to entities controlled by the daughters, Susan Kendall Newman and Nell Newman, from $400,000 to $200,000 a year, according to the lawsuit filed in state court on Tuesday. Connecticut. They claim this is the first step towards completely ousting their family from the foundation funded by the profits of their father’s publicity rights.
“The Newman’s Own Foundation has wandered astray and strayed from its mission to preserve and honor the legacy of Paul Newman,” the complaint states. “The years since Mr. Newman’s death consist of a long and consistent pattern of disregard, by those in control, for Mr. Newman’s specific intentions and direction, coupled with mismanagement, scandal and dubious practices.”
The Oscar-winning actor and director established the Newman’s Own Foundation in 2005. The non-profit organization controls and is funded by the food and beverage company Newman’s Own, which uses the name and likeness of the actor to sell salad dressing, pasta sauce and other products. The foundation reported $24.6 million in revenue in 2020, according to tax filings.
Under the agreement, the girls claimed their father conditioned the arrangement on their involvement with the foundation. They are seeking $1.6 million in damages to be paid to charities of their choosing and an order compelling the foundation to follow Newman’s wishes.
The foundation said in a statement that the board’s philanthropic decisions vary each year and that it must make the best use of its limited resources. “Best practices surrounding philanthropic organizations do not permit the establishment of perpetual funding allocations for anyone, including Nell and Susan Newman,” the statement continued. “A baseless lawsuit based on this mistaken wish would only divert money from those who benefit from the generosity of Paul Newman. While we plan to continue to seek recommendations from the Newman family for worthy organizations, our funding decisions are made annually and will continue to reflect Paul Newman’s clear purpose and our responsibility to best practices governing private foundations.
The girls are not board members of the foundation.
When creating the foundation, Newman laid down specific plans on its structure into a living trust. A 2005 document he shared with his advisers and daughters stated that Newman’s Own would pay royalties to its parent company for the use of his name and image rights, according to the complaint. The foundation, in turn, would distribute funds to the girls’ foundations for them to donate to charities of their choice.
But the lawsuit claimed that Robert Forrester, Newman’s former adviser who eventually became CEO of Newman’s Own and chairman of the foundation, and Brian Murphy, Newman’s longtime business manager, manipulated the actor as his ability mental decline to name them to the board of directors in his will. .
“It had been clear for some time that Mr. Newman was unable to act as a trustee of the Living Trust,” states the complaint, which is embedded below. “Rather than informing Mr. Newman’s daughters of their right and of their father’s unequivocal direction that they should appoint a co-trustee to act with Forrester and Murphy, Forrester and Murphy instead unilaterally took control of the Mr. Newman’s affairs, with respect to NOF and with respect to his estate planning decisions.
Newman’s family were “shocked” when his will was read to them because it deviated so much from what they had been told before the actor died, according to the lawsuit. They were threatened with disinheritance if they challenged it.
Although it points to Newman’s living trust, the complaint does not cite the foundation’s governing documents, which would state whether the foundation is mandated to distribute $400,000 to the girls each year.
Paul Roy, an estate planning lawyer at Withers who is not involved in the case, says THR that Newman’s wishes in the living trust on the operation of the foundation are not binding. “It seems to me that the administrators have been directed by Paul to consult with family members when making decisions about distributions, but it’s not necessarily a legal right to decide where distributions go,” he said. he noted. “It makes sense because they’re not directors.”
The board removed Forrester as CEO in 2019 amid allegations of misconduct, including harassment and creating an unhealthy work environment. The girls’ lawsuit also claims the foundation improperly paid for him and his wife to travel first class and stay in expensive hotels.