The Dolphins Never Played This RoughBy
In November, 1989, two months before his death, Joe Robbie, owner of the Miami Dolphins, moved to keep the National Football League team in the Robbie family "for at least the next generation." He established a trust whose primary asset was two partnerships that together owned an 88% stake in the Dolphins. When Robbie died on Jan. 7, 1990, at the age of 73, his family's control of the club seemed secure.
But now, the family is locked in a feud that pits three of Robbie's nine children against six siblings and their mother, Elizabeth. The dispute could force the sale of a sizable share of the Dolphins, one of the most valuable franchises in sports.
SEEDS OF DISCORD. The structure of the trust and the rest of the estate made conflict all but inevitable, say sources close to the family. Joe Robbie named three of his offspring--Janet Lee, 44, Tim, 36, and Dan, 30--to administer the trust. Robbie also appointed them to the five-person board of Miami Sports Corp., the family-owned company that at the time owned the remaining 12% of the team and 100% of its stadium, named for Joe Robbie. "We were put in a difficult situation by our father," says Dan Robbie, "and we've done the best job we could."
One of the first actions the trio took after their father's death was to sell part of the team and the stadium to Blockbuster Video Chairman H. Wayne Huizenga. Joe Robbie had earlier discussed with him a partial sale to help pay down $90 million in construction debt. But talks had broken off because Huizenga refused to be a minority partner, and Robbie wouldn't sell more than 49%.
Shortly after Robbie's death, Dan, Tim, and Janet reopened talks with Huizenga. In February, they presented the family with a plan in which Huizenga would buy 50% of the stadium and 15% of the Dolphins. The rest of the family argued against acting until they knew more about the stadium's value and alternatives to the sale.
On Mar. 5, Dan, Tim, and Janet overrode the objections and approved a deal in which Huizenga paid $12 million for the Dolphins stake and $5 million for half the stadium. He also agreed to finance stadium renovations and improvements to the surrounding property.
To Elizabeth Robbie and her allies in the family, the deal seemed too hasty. "I don't know what the panic was," says Robbie daughter Deborah R. Olson, 39. "We were given no time to evaluate the market value of the stadium." Olson and another sister, Diane E. Feinholz, 48, say they and other family members don't blame Huizenga. "I do have a problem with my own family running roughshod over my rights," Feinholz says.
More trouble was to come. In July, 1990, Tim, Dan, and Janet dismissed their older brother, J. Michael Robbie, from his post as Dolphins executive vice-president. Elizabeth Robbie publicly deplored the firing, the deal with Huizenga, and the corrosive effect of the trustees' actions. The three trustees won't respond specifically to the criticism, but Janet says: "We've done the best job we could in the interests of our mother, brothers, and sisters."
In March, 1991, Elizabeth Robbie dropped a bombshell. Rather than leave her interests in the control of the three trustees, Elizabeth elected to seek the 30% of her husband's $70 million estate (table) due her under Florida law. In September, the trustees asked for a delay in providing her share. Their main concern: The trust was set up to defer estate taxes until Elizabeth Robbie's death. If her request were granted and she ceased to receive the trust's income, "in excess of $25 million in estate taxes plus interest would be due and payable" by the estate, lawyers for Dan, Tim, and Janet said. And that could mean selling part of the Dolphins.
'NOT GREEDY.' Elizabeth Robbie's attorneys dispute the trustees' reading of tax law. Her lawyer, Dan Paul, says she doesn't want to trigger the sale of the team: "She's not greedy, she lives very simply. It's a question of being able to control some part of her inheritance."
Friends and associates of the Robbies wish all the trouble would just go away. "I hope the family can work this out," says Huizenga, who adds that his relations with both sides are good. A reconciliation isn't impossible, Feinholz says, but it would be difficult. "This is not just about business matters," she says. "It's about the way people have been treated." Clearly, the best-laid estate plans of Joe Robbie have gone horribly awry.
THE SPOILS IN JOE ROBBIE'S ESTATE Asset Value as of Jan. 7, 1990 63% direct interest in the Miami Dolphins $42,545,560 100% of South Florida Sports, owner of 25% of the Dolphins 20,341,079 3.5% of Miami Sports, owner of 12% of the Dolphins and 100% of Joe Robbie Stadium* 509,048 Other assets 7,425,332 TOTAL ASSETS $70,821,019 *In March, 1990, Wayne Huizenga bought 50% of stadium and 15% of team DATA: U.S. ESTATE TAX RETURN
To continue reading this article you must be a Bloomberg Professional Service Subscriber.
If you believe that you may have received this message in error please let us know.