Divorces don’t get messier than among the super-rich

Lockdown has not been easy for billionaires, even Bill Gates. News that the fourth richest couple in the world – worth some $125 billion – are heading for a divorce must have been a champagne-popping moment for the US legal community; the more money at stake, the messier the split. The pair have hauled in top brass to manage proceedings: on Melinda’s side are Robert Cohen and Sherri Anderson – who have a host of A-list clients under their respective belts, including Ivana Trump, Uma Thurman and Jeff Bezos. Bill is leaning on Robert Olsen and Ted Billbe – who made MacKenzie Scott the world’s fourth-richest woman after her marriage to Amazon founder, Jeff Bezos, ended two years ago.

The Gateses calling time on their vows after 27 years has kickstarted what is believed to become the most expensive divorce in history. One friend sought to get her own back on her hedgefunder husband by calling every top divorce lawyer in the UK – spending her hedgefunder husband’s money as she went – so there was no one left to represent him. Another kept “lawyering” until the desperate husband caved into her demands, which included ownership of an Italian beach front property she’d always claimed to hate.

A media executive friend who divorced after 30 years of marriage explains: “There are three buckets when it comes to divorce: anger, blame and sadness. Lawyers will do everything they can to keep it in anger and blame.”

The super-rich have an army of lawyers and tax accountants at their disposal; the more the couple fight, the richer they get.

“It’s not level playing fields in this sector,” says Charlotte Ransom, CEO of Netwealth, who advises predominantly high net worth women. “Wealth can be tied up in trusts and offshore companies. The business can be part of a partnership.”

The super-rich didn’t get that way without understanding how money works, even if the bulk of that job was handed over to financial advisers. Bill Gates and Jeff Bezos are married to educated, intelligent women. “[But] I have clients who haven’t worked out that if the husband can afford a £10 million home in central London, he probably has a lot more,” Ransom says.

Emotions, too, can land you a bad deal: “Women often have a particular attachment to the home because of the stability they believe it affords their children.” Clever husbands pretend to be generous by offering it up, meanwhile nabbing the Gstaad ski chalet and New York penthouse.

Of course, it’s not always the women who lose in the battle of divorce. There are plenty of men who come after the wife’s hard-earned assets, but women can be more gullible. One banker acquaintance earned millions a year in bonuses – though only ever told his wife of his base salary (roughly £150,000) and “occasionally” a good investment year. When they were getting divorced, the banker’s boss took it upon himself to call the wife and explain that she was in fact a very rich woman – helpfully providing the documents to prove it.

The reverse can happen, too: a very wealthy (or so she appeared) woman we know never asked a single question about her extravagant banker husband’s financial affairs. Only when they divorced did she find out that he had never actually paid tax on his bonuses and that there was huge debt against all of their combined assets.

The sense of shame and failure – and the idea of the world reading about your dirty laundry – has resulted in many a nervous breakdown. Naturally, the rich have an (expensive) answer for that, too. Jan Gerber, chairman and founder of exclusive rehab clinic Paracelsus in Switzerland, says Covid- 19 had brought about a 500 per cent increase in referrals, many of them because of divorce.

“There seems to be a pattern of divorce emerging that is considerably higher than the rest of the population,” says Gerber. “The super-rich are used to being mobile, jumping on planes, moving from house to house, with charity obligations and social activities. We thought the rich would somehow escape the worst of lockdown, but they didn’t.” Many show up at Paracelsus because there has been an ultimatum. Without work or even a mistress to escape to, a dependence has grown on alcohol, drugs, online gambling, food (and porn). “They come here as a last resort,” he says.

How difficult it was for Melinda and Bill to share their 66,000 square foot home in Medina, Seattle – dubbed Xanadu 2.0 – we have yet to learn. California law says it cannot be claimed by either, as they must split all assets equally, though the Gywneth Paltrow-esque Twitter announcement of their split suggests the separation had been carefully managed.

Cynical as it may sound, the timing may have been executed to maximum effect. The post-Covid drop in corporate profitability and house prices has been a big incentive to start divorce proceedings. “We see this in every recession,” says Emma Gill, director of divorce and family law at Vardags, noting a 60 per cent rise in enquiries since the first lockdown. “If you can buy out your spouse cheaply, great.”

The savviest are those who install a complicated tax structure ahead of time, then wait for the next downturn to file for divorce. “These are handed to court as a fait accompli. Courts are often unwilling to unravel them mostly because they don’t understand them,” she says, adding that “the less financially dominant spouse often just signs on the dotted line without reading the tax letter first”.

The Gates are thought not to have a prenup – but even financial agreements ahead of time are not always bulletproof. A lawyer who worked for British divorce “lionesses” – Lady Helen Ward and Baroness Fiona Shackleton – is said to have advised a hapless young model marrying into a banking dynasty to “cry” in front of the judge. There’s often a Rottweiler publicist on retainer to contend with; one extremely wealthy American friend, whose Hollywood producer husband was caught cheating, saw her prenup thrown into the fire when she threatened to “call my friend Oprah”.

I wonder what, if anything, the Gates will fight over? Where the ultra-wealthy are concerned, it’s anyone’s guess – but the price tag is sure to be eye-watering.

Who have the Gates' lawyers have represented before?

By Alice Hall

Team Melinda: Robert Cohen

• Ivana Trump and Marla Maples: Robert Cohen, one of three lawyers representing Melinda Gates, is a dab hand at navigating messy marital break-downs. The high-profile matrimonial lawyer represented two of Trump’s former wives in their separations from him: Ivana Trump in 1992 and Marla Marple in 1999. It is thought that Ivana's divorce settlement included $14 million, an apartment in the Trump Plaza, a 45-room Connecticut mansion and the use of Mar-a-Lago for one month a year. In comparison, Maples got a measly $2 million settlement, which included a house, plus child support payments for Tiffany.

• Chris Rock: The New York Times called Cohen "the master of the split up", making him the perfect choice to represent comedian Chris Rock in a messy divorce from his wife Malaak in 2016. There was a lot of disagreement between Chris and Malaak over child support, alimony and division of assets. The terms of the settlement remain undisclosed, but it was thought to be expensive.

Team Melinda: Sherri Anderson

• Jeff Bezos: Sherri Anderson is no stranger to helping billionaires sort out their assets. Anderson, who specialises in family law, previously represented Jeff Bezos in his high-profile divorce from Macenzie Scott in 2019, following 25 years of marriage. After the divorce, which became the most expensive in history, Jeff Bezos' net worth still stood at an estimated $121 billion.

Team Bill: Robert Olson

• Mark Zuckerberg: Bill Gates has sought the help of top law firm Munger, Tolles & Olson, founded by the billionaire Charlie Munger who is a close friend of the investor Warren Buffet. Gates and Munger are long term friends, with Gates previously describing him as the 'broadest thinker he has ever met.' Robert Olsen, one of the lawyers from the firm who is representing Gates, has worked with fellow silicon valley mogul Mark Zuckerbug on a number of occasions, including on a case over Facebook’s capital structure.

Team Bill: Ted Billbe

• MacKenzie Scott: Like Melinda, Bill is using lawyers who worked on the Bezos divorce. Washington-based lawyer Ted Billbie represented MaKenzie in her divorce from Jeff, which left her with a partial stake in Amazon worth an estimated $38 billion; at the time, this made her the second wealthiest woman in the world. According to Billbe's website, his firm mostly handles divorces and he "works in high asset cases" and cases with "substantial family wealth." It seems that Bill's expensive divorce is in safe hands.

Read more: The private obsession that has preoccupied Bill Gates for years