The Murdoch family and their media empire have long captivated national attention, with layers of legal and financial complexity shaping the future of one of the world’s most influential media dynasties. At the center of this unfolding story is the Murdoch Family Trust—a key entity tied to the family’s wealth and control of their business interests.
Origins and Purpose of the Murdoch Trust
Rupert Murdoch established the Murdoch Family Trust in 1999 after his divorce from his second wife, Anna Torv. The trust was designed to preserve the family’s media empire and ensure his children would inherit an ownership stake.
Murdoch, whose holdings include Fox News, The Wall Street Journal and the New York Post, structured the trust to allocate eight voting shares: four belonging to him and one each to his four eldest children—Prudence, Elisabeth, Lachlan, and James. Upon Murdoch’s death, his four shares are to be distributed equally among his children, ensuring shared control of the trust. His two youngest daughters, Chloe and Grace, are beneficiaries but do not hold voting rights.
Trusts like this one are commonly used in estate planning to:
- Preserve wealth for future generations by protecting assets from divorcing spouses, creditors, and disputes.
- Provide for beneficiaries, often incorporating provisions for health, education, maintenance, and support (known as a HEMS standard).
- Mitigate tax liabilities by structuring asset ownership to reduce estate taxes and other financial burdens.
The Recent Legal Dispute
The Murdoch trust dispute is a family drama straight out of Succession—though, unlike the show, the power struggles here are playing out in real life.
In late 2023, Rupert Murdoch attempted to modify the trust’s control structure to ensure his eldest son, Lachlan, would have sole authority over the family’s media empire after his death. Murdoch argued that this change was necessary to maintain business stability and Fox News’ editorial direction. However, his other three voting children—Prudence, Elisabeth, and James—challenged this move, arguing that it violated the original intent of equal control and was not in the best interests of all beneficiaries.
The Court’s Ruling
In December 2024, a Nevada probate commissioner ruled against Murdoch’s attempt to alter the trust, finding that he and Lachlan had acted in “bad faith” by trying to shift control solely to Lachlan. The ruling reaffirmed the principle that even the settlor of an irrevocable trust cannot unilaterally change its terms without demonstrating that such modifications benefit all beneficiaries.
As a result, the trust’s governance remains as originally structured, meaning control of the family’s media empire will eventually be divided among Murdoch’s four eldest children.
Lessons for Estate Planning
The legal battle surrounding the Murdoch Trust underscores several critical lessons for trust and estate planning:
- Trustee Duties: Trustees must act with integrity and in the best interests of all beneficiaries, avoiding conflicts of interest.
- Transparency and Record-Keeping: Proper documentation is essential to defend against claims of misconduct or self-dealing.
- Irrevocability: Understanding the implications of creating an irrevocable trust is crucial, as it may limit future modifications, even for the settlor.
- Risk Mitigation: Regular legal reviews and audits can help prevent disputes before they escalate.
Looking Ahead
This case serves as a reminder that not all trusts are created equal. How a trust is structured and administered can have long-term consequences, shaping not only a family’s wealth but also its internal dynamics for generations.
