Rupert Murdoch failed in his attempt to move control of his family’s trust to his eldest son Lachlan after a Nevada commissioner ruled against his bid on Saturday, the New York Times reported.
Commissioner Edmund J. Gorman Jr. ruled that Murdoch and News Corp. had acted in “bad faith” in what is widely seen as an attempt to solidify a right-wing successor to Fox News.
The irrevocable trust currently divides control of Murdoch’s media company between his four eldest children — Lachlan, James, Elisabeth and Prudence — in the event of his death.
Gorman called the attempt to alter the trust a “carefully crafted charade” to place his oldest son in control “regardless of the impacts such control would have over the companies or the beneficiaries” of the family trust.
Adam Streisand, Murdoch’s lawyer, plans to appeal the ruling.
Murdoch initiated an attempt to change the family trust to better position Lachlan back in July. The elder Murdoch worried that the more moderate-leaning views of his three other children would not serve the conservative perspective advanced by Fox Corp. and News Corp.
According to the New York Times then, Murdoch was “arguing in court that only by empowering Lachlan to run the company without interference from his more politically moderate siblings can he preserve its conservative editorial bent, and thus protect its commercial value for all his heirs.”
Murdoch’s other children – James, Elisabeth, and Prudence – pushed into a joint posture against their father thinking he was “trying to disenfranchise them” and that the move “violates the spirit of the initial trust, enshrined in its ‘equal governance provision,’ and that it was not done in good faith,” according to the Time.
The family made attempts to settle the dispute before it went to court back in September, with one potential option being James, Elisabeth and Prudence selling their stakes in the trust back to Rupert and Lachlan.
The Murdochs’ combined economic interest in Fox and News Corp is worth about $6 billion, with the family holding a roughly 40% voting stake in News Corp. and around a 44% stake in Fox Corp.
News Corp. shares have climbed 80% in the past five years, while Fox Corp. shares are up 16% over the same period.
