Five lessons from the Bezos divorce settlement that could apply to your case
Headlines last week detailed the divorce settlement agreement between Jeff and MacKenzie Bezos. It was a huge marital estate estimated at 137 billion dollars; the largest asset was Amazon which Jeff Bezos founded during the marriage with help from his Wife MacKenzie. MacKenzie agreed to accept 25% of the Amazon stock which amounted to about 36 billion in assets. Most of us cannot relate at all, but in reading the details, it occurred to me that there are pertinent lessons to take away from this. In this post, I have highlighted five takeaways that apply even when you are not the founder of Amazon. I will elaborate on some of these subjects in future blog posts, but for now, here is the Cliffs Notes version:
- Enough is as good as a feast
MacKenzie did not get remotely half of the substantial assets. So how is that fair? It is important to understand that there is no presumption of an equal split of assets. Equitable does not mean equal and you cannot apply everyday notions of “fairness” in equitable distribution. The size of the marital estate, needs of the parties and many other factors are considered. It is important not to get hung up on percentages and to work with counsel to understand how the court will see your case from an equitable standpoint.
- Don’t bite the hand that feeds you
By distributing a small a percentage of Amazon stock (amounting to 4%) to MacKenzie with her also relinquishing voting rights, the control of Amazon was left squarely with Jeff Bezos. MacKenzie also relinquished her interests fully in the Washington Post and Blue Origin. She was smart not to sabotage the assets by fighting for more control or making the market nervous about who had control of the companies. That would have hurt her and her stock value. In any divorce, preserving the value of the assets is paramount. Even if you have a small business, the family is often dependent on the retention of the business and the income even after divorce. So it is crucial that the business is valued and distributed in a way that the owner spouse will still be able to remain in a viable business.
- It takes a village
Choose good teams that you trust. In going through a divorce, you rely on a lot of people for both legal and emotional support. But these are different roles. For Jeff and MacKenzie to get a settlement done of this magnitude in the amount of time it was accomplished most likely took a hefty team of professionals– probably including lawyers, financial experts, and business experts. It paid off with a swift and fairly clean result. In any divorce case it is important to hire the right professionals and to listen to their advice. Keep in mind that you are not hiring a lawyer or expert to join you in your anger against your spouse or to tell you what you want to hear. They are there to advise you about your case and to help you get the best results.
The other aspect of having the right “team” in your divorce is related to emotional support. In disclosing the settlement terms, both Jeff and MacKenzie noted in their tweets that they could not have accomplished it without the support of their family and friends. Divorce can be a tough ride. You will need to seek support from where you can. But, just as you cannot rely on your professional team to be your emotional support, you also do not want to rely on legal advice from friends and family. However well meaning, that is not helpful to your case.
- Don’t pick fights unless you have to
Settlements can be a good thing. You can put yourself in the driver’s seat in a way that the court system will not. Jeff and MacKenzie completed their divorce settlement in just over three months. They saved themselves, time, money and a lot of emotional toll. Also they were able to keep a lot of their divorce issues confidential and control the dissemination of information. It is always worthwhile to explore settlement before heading to court—litigation is sometimes necessary, but it should be a last resort.
- This too shall pass
In their tweets, both Jeff and MacKenzie noted that they looked forward to putting the divorce behind them and moving forward as friends and co-parents. Maybe this was just social media propaganda. But it is important to consider life beyond divorce and what that will mean for you and your spouse. Divorce does not actually last forever although I know it can feel that way. After thirty years in family law, I have seen first-hand that it is possible to get through it, move forward and regain your life back. It is important to keep this end in mind– it will help you make the best decisions you can as you navigate the difficult process of divorce.