Succession planning: unpacking the real life Murdoch family trust drama

Court proceedings in the case, known as Doe 1 Trust, PR23-00813, are sealed, so the details of proceedings are ascertained from media reports. In early September, the Nevada judge David Hardy ruled against a petition by media companies to unseal the case, writing: “A family trust like the one at issue in this case, even when it is a stockholder in publicly traded companies, is essentially a private legal arrangement, as the applicable sealing statues recognize.”

He added it may “harm the parties” to allow media access.

The media coalition had argued that the level of privacy shrouding the case “does not pass constitutional muster” and ought to be publicly reported since its outcome could affect thousands of jobs, media audiences, and politics.

For all of his strategising, 93-year-old Rupert Murdoch could not convince the judge to enable his changes to an “irrevocable” family trust, in which he is the settlor.

Why Nevada, South Dakota, and Tennessee are trust fund destinations of choice

Under NV Rev Stat § 164.940 (2024), Non-Judicial Settlement Agreements (NJSAs) allow trustees and “indispensable parties” to modify the terms of the trust as long as those modifications do not violate the trust’s material purpose. Modifications may include altering investment or use of trust assets, changing the location where the trust is administered, or the “granting of any necessary or desirable power to a trustee”.

Steven J. Oshins, Esq., AEP (Distinguished) is a member of the Law Offices of Oshins & Associates, LLC in Las Vegas, Nevada.

He tells LSJ, “Nevada is the leading asset protection trust jurisdiction because it has a short two-year statute of limitations period before its assets are protected from creditors, and it has no exception creditors.  South Dakota is the second-best asset protection trust jurisdiction because it also has a two-year statute of limitations, and it does have exception creditors, such as divorcing spouses, but those creditors are limited to those who had a claim against the trust grantor prior to the transfer to the trust.”

Oshins explains, “South Dakota is the leading dynasty trust jurisdiction because it allows perpetual trusts and has no state income tax and has a very flexible decanting statute.  Nevada is the second-best dynasty trust jurisdiction because it has all of the same material advantages that South Dakota has, but is a close second only because its dynasty trusts are limited to 365 years.”

He adds “Both Nevada and South Dakota are the best, most flexible jurisdictions for decanting trusts (which means distributing into a new trust with different terms) because they don’t require notice to the beneficiaries, they allow a health, education, maintenance and support trust to be decanted into a fully discretionary trust, and they allow remainder beneficiaries to be move up to being present discretionary beneficiaries.”

The probate commissioner in the Judicial District Court in Reno, Nevada, who heard Rupert Murdoch’s application, Edmund J. Gorman Jr. ruled against his attempt to change his family trust to empower son Lachlan Murdoch to be the sole trustee with the ultimate control global media empire, including one of the biggest media companies in the world, Fox News (which reported revenues of just under $US14 billion, and a net profit of $US1.55 billion in 2024). Murdoch also owns News Corporation, The Wall Street Journal and the New York Post.

In his 96-page ruling – a recommendation to the Probate Court, which will leave the eventual judgment in the district court open to appeal – Judge Gorman told Rupert and Lachlan that they had acted in “bad faith” during a “carefully crafted charade” in attempting to alter the trust from its existing provisions that divide Fox News and News Corporation equally – both in terms of financial value and voting shares in the direction of companies – between the four eldest children of Rupert: Prudence, Elisabeth, Lachlan and James.

In early September, the New York Times obtained leaked court documents that referred to the “lack of consensus” between the heirs — and, stated it “would impact the strategic direction of both companies including a potential reorientation of editorial policy and content.”

In early February this year, the New York Times Magazine reporters – with access to the 3000 pages of evidence from the trial – revealed the trust will expire in 2030. The siblings would need to determine the road forward either by then, or before Rupert dies.

Watch this space: an appeal seems imminent

Rupert and Lachlan have already expressed through their lawyers that they plan to appeal, while Prudence, Elisabeth and James released a statement that embraced Gorman’s decision, conveying their desire for an end to family division and court battles. James, particularly, has been candid in interviews about the personal impact that battling his father and brother has had on his health.

In Nevada, a probate commissioner’s recommendations are adopted by the probate judge only if there is not a request for review.

Ironically, it was an episode of “Succession” that instigated Elisabeth’s 2023 message to her siblings regarding planning for Rupert’s death and the future of his businesses. The family has sought privacy with a hit-and-miss success rate. Lachlan was reported by the New York Times to have responded to the message by proposing the plan to change the trust in mid-2023 in alliance with his father’s lawyers and advisers. Rupert and Lachlan labelled this “Project Harmony”.

This “harmony” may have been a reference to James Murdoch, who had severed ties with Fox News following the 2020 US election, in which Fox News anchors encouraging viewers to perceive as “stolen”, a baseless Trump claim. James’ more liberal-leaning views had jarred with the media positioning of his father’s businesses for at least a decade.

The financial stakes of each of the four siblings was not in question, but rather their controlling stake in Rupert’s businesses.

Revocable and irrevocable trusts in Nevada

The Murdoch trust is irrevocable. It was formed as a consequence of Murdoch’s second divorce, during which his former wife Anna negotiated on behalf of her children’s future interest in the family business and wealth. Family trusts can be either revocable or irrevocable. Revocable trusts are relatively easy to change. There are limited provisions to amend an irrevocable family trust, and the Murdoch trust required any amendments to be solely designed to benefit each of the heirs. Ultimately, favouring Lachlan over his siblings was deemed to fall short of the clause enabling changes to be made.

Murdoch had purposefully chosen Nevada since it differs from most US states, which do not allow for any modification of an irrevocable trust once it is submitted into law and declared a legally binding contract. Nevada enables irrevocable trusts to be modified under certain conditions by the trustee, even where the trust has been established outside of the state.

Nevada also provides favourable and uncommon conditions for irrevocable trusts, such as confidentiality of assets, minimisation or complete avoidance of taxed assets, and the option of dynasty trusts (up to 365 years) or self-settled trust.

Very different visions for hugely profitable Fox News a cause of rupture

Since Rupert’s retirement in September 2023 from both News Corp and Fox, instead taking on the role of chairman emeritus in November 2023, Lachlan has been the sole chair of News Corporation and head of Murdoch’s media companies.

While there is a watch-and-wait situation regarding the future of the media companies under either Lachlan’s sole direction, or under a coalition of the four siblings, there are potential scenarios open to speculation.

One possibility, assuming Rupert is unsuccessful in modifying the trust fund provisions, is that Lachlan buys out his siblings. Media has reported this sum to be at least US$3 billion (AU$4.3 billion).

Of the three heirs whose voting stakes are in question, it is James who has caused the most ruckus internally and publicly. Support for the claims by Trump and his supporters that the 2020 election was stolen, a misrepresentation of the January 6 insurrection, fuelling conspiracy theories, and denial of climate change by Fox News caused James Murdoch to speak out privately and publicly in dissent. In July 2020, he resigned from the News Corp board, telling media it was “due to disagreements over certain editorial content published by the Company’s news outlets and certain other strategic decisions.” He has called for his father’s media outlets to take a more balanced approach to news reportage. When Lachlan ran Sky News in Europe, it took a significantly more liberal attitude than his father’s typically confrontational style. In 2021, the Guardian reported that James Murdoch had accused US media of “propagating lies” which have resulted in “insidious and uncontrollable forces” that would be difficult to backtrack.

In 2019, James was interviewed by The New Yorker. It is believed this interview was referred to during the Nevada case, since it revealed the Murdoch heir’s openly contrasting views to his father’s. When asked by the interviewer if he and Rupert spoke regularly, James responded, “There are periods of time when we do not.”

In a February 2025 feature for The Atlantic, the reporter undertook nearly a year of interviews with James. James described Fox News as a “menace” to American democracy. He also provided candid comment on the brutal nature of questioning by his father’s lawyer during the initial March 2024 hearing in a Manhattan office. The lawyer – according to James – referred to the four siblings as “white, privileged, multibillionaire trust-fund babies”. The questions, James realised, were being texted by Rupert to his lawyer during the hearing. James told the Atlantic that over five hours, the lawyer asked questions including:

“Have you ever done anything successful on your own?”

“Why were you too busy to say ‘happy birthday’ to your father when he turned 90?”

“Does it strike you that, in your account, everything that goes wrong is always somebody else’s fault?”

More than any other interviews in the last decade, James and his wife Kathryn’s interview with the Atlantic revealed the level of division within the Murdoch clan. The reporter says Rupert and Lachlan declined to be interviewed for this story, but a spokesperson responded that James’s participation equated to taking answers “from someone who no longer works for the companies but still benefits from them financially” and amounted to a “litany of falsehoods”.

At Thanksgiving 2024, James, Elisabeth and Prudence wrote a letter to their father, beseeching him to: “Put an end to this destructive judicial path so that we can have a chance to heal as a collaborative and loving family,” according to the Atlantic. Allegedly, Rupert replied that they should contact his lawyers if they wanted to talk to him.

It the real-life Murdoch saga more compelling than the fictional series Succession? Yes, and there’s little room for appeal on that, at least.