A new front has emerged in the Benson Family Feud.
As Saints owner Tom Benson tries to resolve a fight with estranged heirs arising from his decision to prevent them from acquiring ownership of his NFL and NBA teams, the NFL will not allow Benson to follow through on a proposal to swap non-voting shares of the Saints with personally-guaranteed promissory notes in trust funds previously created for his daughter and her children.
Via Katherine Sayre of the New Orleans Times-Picayune, recent court filings in a lawsuit sparked by the issue “show that the NFL’s finance rules won’t allow Benson to use his personal wealth . . . to back the proposed promissory notes.” The league’s position derailed a settlement that had previously been reached between Benson and trustees regarding his desire to strip Saints equity from the family members’ trust funds.
The problem comes from the possibility that, if Benson defaults on the 30-year promissory notes, the estranged heirs could attempt to seize his personal assets -- including the controlling shares of the Saints franchise.
Per the report, Benson recently made a revised offer in the aftermath of the NFL’s ruling. The trustees have argued that the proposal, based on a January 2015 valuation of the team, should be based on the value of the team as of September 8, 2016, which would result in an even greater dollar value.
That’s the biggest problem Benson faces as he tries to fix this; as NFL franchise values continue to climb, the 60-percent chunk of the team held in trust continues to climb, too, making it costlier for Benson to replace those shares with comparable assets.
Until these issues are fully and finally resolved, it’s unclear whether the estranged family members will be frozen out completely of an ownership stake in the Saints. Even though they wouldn’t have power over the affairs of the team, they’d own the majority of it -- which would be a very awkward outcome to an already messy situation.