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Ginsberg v. Ginsberg

Superior Court of Massachusetts, Suffolk

December 15, 2017

Faye S. Ginsberg[1] et al.[2]
v.
Bruce C. Ginsberg et al.[3]

          Caption Date: December 14, 2017

          Judge (with first initial, no space for Sullivan, Dorsey, and Walsh): Leibensperger, Edward P., J.

          MEMORANDUM OF DECISION AND ORDER ON DEFENDANTS’ MOTIONS TO DISMISS

          Edward P. Leibensperger Justice

         This case presents a dispute between a sister and brother. The sister disputes (1) the basis of testamentary decisions made by their mother, and (2) the brother’s stewardship as a trustee of trusts established by their parents. The threshold issue is whether the sister’s act in commencing this litigation is a violation of the " no contest" provision in the relevant trust such that this action should be dismissed. The brother, and other defendants affiliated with him, contend that by this action the sister has forfeited her beneficial interests in the trusts. Thus, defendants move to dismiss for lack of standing.

         Plaintiff, Faye S. Ginsberg (Faye), [4] is the sister of defendant, Bruce C. Ginsberg (Bruce). They are the adult children of Manny and Shirley Ginsberg, both of whom are deceased. Faye brings this action on behalf of herself, and as legal guardian of her adult, handicapped son, Andrew Blacker. Faye is joined as a plaintiff by Taylor Blacker, Faye’s adult daughter. In this memorandum, plaintiffs’ claims will be referred to, collectively, as Faye’s claims.

         The Third Amended Complaint (Complaint) names Bruce as a defendant, in his individual capacity as well as in his capacity as trustee of certain trusts. A co-trustee, J. Robert Casey, is also sued. Bruce’s children, Maxwell, Benjamin, Samuel and Zachary, are also named as defendants. In this memorandum, these defendants will be referred to, collectively, as Bruce, unless the circumstances require more specificity. Finally, the list of defendants includes ten corporations allegedly controlled by Bruce.

         BACKGROUND

         The following facts are taken from the Complaint or from documents referenced and relied upon in the complaint.[5]

         Manny was a successful entrepreneur who created an ice cream distribution company which became a multi-million dollar business. Throughout his life, Manny also acquired various real estate holdings in Massachusetts, along with his wife, Shirley. Shirley was an active partner with Manny in his businesses. Manny died in April 2008. Shirley died on September 27, 2015.

         Prior to Manny’s death, the Ginsbergs established four irrevocable trusts for the benefit of their children and grandchildren. These trusts included the Manuel and Shirley Ginsberg 1991 Irrevocable Trust (the 1991 Trust), the 1992 Grandchildren’s Trust (the 1992 Grandchildren’s Trust), the Manuel and Shirley Pleasant Street Annuity Trust, dated February 1992 (the 1992 Annuity Trust), and the Ginsberg Family Trust dated January 1, 2005 (the 2005 Ginsberg Family Trust). Faye and her children are beneficiaries under those trusts. Bruce is a trustee of all of these trusts. Faye was a co-trustee of the 1991 Trust, the 1992 Annuity Trust, and the 2005 Ginsberg Trust, at least initially. By their wills and the revocable trusts, Manny and Shirley allegedly intended that their children would receive equal interests in their assets upon the death of the second to die of Manny and Shirley. Complaint ¶41. Upon Manny’s death, the " bulk of the Ginsberg family wealth was held by Shirley and the trusts established by Shirley and Manny." Complaint ¶43.

         " After Manny died, Shirley increasingly relied on Bruce’s financial experience, and counted on his trustworthiness, to advise her on financial matters affecting her and her family." Complaint ¶44. The Complaint alleges that Bruce caused the trusts to make disproportionate distributions to himself and his family. The Complaint also alleges that Bruce exerted undue influence over Shirley as she declined physically and mentally. Complaint ¶51. In that regard, Bruce persuaded Shirley to make an inter vivos gift to him of a 50% interest in Ginsberg Taunton Properties, LLC (GTP), the owner of real estate in Taunton.

         Despite requests, Bruce has allegedly refused to provide an accounting for any of the trusts. He allegedly concealed trust transactions from Faye and took steps to remove Faye as co-trustee. Complaint ¶55. Faye was removed as a co-trustee of the family trusts in 2012 and 2014. Complaint ¶56. In 2014 and 2015, Bruce allegedly used trust assets to further his private business interests.

         Three months before Shirley died, Bruce allegedly persuaded Shirley to execute new estate planning documents. Shirley executed a will and the Seventh Amendment and Complete Restatement of the Shirley Ginsberg Revocable Trust (the 2015 Shirley Trust) on July 8, 2015. Faye alleges that Bruce persuaded Shirley that she should leave to Bruce and his children real estate assets that Shirley had long promised to Faye. These assets include the family home at 42 Shepard Avenue, Swampscott, and a property called " the Post Office" in Truro. Complaint ¶74. According to Faye, Bruce intentionally misled his mother into making these changes in her plan for disposition of assets. At the same time, Bruce allegedly caused Shirley to change the death beneficiary on her retirement account, as well as other bank accounts, from Faye to Bruce or Bruce’s children.

         When Shirley died on September 27, 2015, Faye was unaware of Shirley’s gifts to Bruce and the new July 2015 estate planning documents. Complaint ¶83. At some date after Shirley’s death, Faye learned of the July 2015 estate plan. In October 2015, Faye, through counsel, requested that Bruce and the co-trustee, Casey, provide information relating to Bruce’s prior administration of the trusts and Shirley’s July 2015 estate plan. The 2015 estate plan documents were produced to Faye on a date not specified in the Complaint, along with a copy of a letter from Shirley, dated July 8, 2015, explaining her testamentary intent. On February 4, 2016, Faye received the Petition for Formal Adjudication of the Will of Shirley Ginsberg, and the approval of Bruce as Shirley’s personal representative. Faye did not file an objection to the probate proceedings or contest the will. Faye’s counsel continued to press for more information regarding the administration of the trusts and the facts surrounding the July 2015 estate plan. According to the Complaint, Bruce refused to provide the information requested. Complaint ¶90. Faye pleads, however, that on May 10, 2016, her counsel received " a limited amount of information regarding the wills and trusts established by Shirley and Manny, which information was both incomplete and unclear." Complaint ¶91.

         The Complaint asserts a plethora of claims, sometimes tied to a particular trust and sometimes not. The Complaint is not a model of clarity. It is divided into thirteen (13) counts:

Count I- Claim for breach of fiduciary duty v. Bruce as trustee of the " Ginsberg Trusts."
Count II- Claim for breach of fiduciary duty v. Bruce as trustee for failure to keep accurate records and to inform beneficiaries.
Count III- Claim for breach of fiduciary duty v. Bruce for failure to act impartially among beneficiaries.
Count IV- Claim that Bruce failed to account to Faye for the sale in 2007 of a property owned by Ginsberg Asset Management, ...

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