Epstein is Dead. Will his Victims be able to Recover against his Estate?

Recently, sex trafficker Jeffrey Epstein was found dead, allegedly by suicide.  A number of people have raised questions what this means for his estate and the victims.  At this time, there are more questions than answers.  This is due to the extreme complexity of Epstein’s estate.  It would be spread out over at least three separate US states and a Caribbean island.  Those states includes New York, Florida, and New Mexico, where he apparently had residences.  

For ease of discussion, I will use California law as an example.  As noted above, this situation is extremely complex given the large value of the estate, multiple states involved, and the impending lawsuits. To determine what will happen next, one needs to start with the following question:

DID JEFFREY EPSTEIN DO ANY ESTATE PLANNING?

The first step is to figure out if he set up a Will or a Trust and who the beneficiaries to the Will or Trust are.   It is highly unlikely that he would put in language in any way benefiting any of his victims (potentially outside of a few of the women who apparently went from victims to assistants).   It is, thus, highly likely that these estate planning documents distribute nothing to any of the victims.

If he set up no estate planning, all states generally assume distribution plans for assets.  In California, the distribution plan is called intestate succession.  The law looks to see surviving family and distributes all assets to those surviving family members.  In other words, the law essentially writes your Will for you. I understand Epstein has one brother, so if he prepared no estate planning paperwork, all of his wealth (estimated at $500 million) may go to his brother.  People may be surprised that a person of his wealth may not have done any estate planning, but we have numerous examples (Prince, Aretha Franklin) of wealthy individuals doing little to no estate planning.  

WHAT DOES A TRUST OR WILL MEAN FOR VICTIMS?

So, whether Epstein did nothing or something, the victims may be in a bad position.  This is important, because the Administrator in charge of the estate *must* follow certain general guidelines.  Important California guidelines that are most likely reflected in other jurisdictions include the following:

1.  California Probate Code 16000 says that a Trustee (ie Administrator) of a Trust *must* follow the terms of the Trust:

16000. On acceptance of the trust, the trustee has a duty to administer the trust according to the trust instrument and, except to the extent the trust instrument provides otherwise, according to this division.

Law surrounding Wills is similar. This means that the victims would potentially get nothing if the trust or will provides nothing for the victims.  

California Probate Code 16002 says that a Trustee of a Trust must act solely in the best interest of the beneficiaries.

16002. (a) The trustee has a duty to administer the trust solely in the interest of the beneficiaries.

So, again, if the beneficiaries are friends or family, then the $500 million would go to them and solely to them.  To try to direct money to another source (Ie victims) could potentially lead to a breach of Trustee duties.  Again, laws surrounding Wills in California are similar.

And even if Jeffrey Epstein did no estate planning whatsoever, the person (or entity) appointed to administer his estate would be subject to these same fiduciary duties.

Either way, the victims potentially have an uphill battle.

WHAT IS THE VICTIMS’ RECOURSE?

What can the victims do?  They can immediately file a lawsuit against the estate. Their lawsuit could include tort (physical damage) claims pursuant to California Civil Code 52.5 (law re: human trafficking) and/or 1708.5 (law re: sexual battery).  Plus, there are a litany of other potential claims they could file under, including regular assault and battery (as opposed to sexual assault/battery).

The main difference with the lawsuits that can be brought against his estate by victims is that they would be Civil claims only, not criminal. In other words, the lawsuits would only seek financial restitution (money) for the victims, as opposed to the criminal prosecution of Epstein. After all, he is no longer around to live out a prison sentence.

WHAT HAPPENS WHEN THE VICTIMS FILE LAWSUITS AGAINST HIS ESTATE?

Under California law, this would force the Administrator of the Estate to defend the lawsuit pursuant to California Probate Code 16011 (and other similar laws in a non-trust context):

16011. The trustee has a duty to take reasonable steps to defend actions that may result in a loss to the trust.

Here’s where it gets tricky. The real issue here is not necessarily money to the victims (although that is an important aspect), but instead discovery.  Discovery is a legal process in which facts are discovered.  Many people think you file a lawsuit, go to Court, and tell the Judge your side of the story.  In reality, you file a lawsuit and then your lawyer sends a lot of paper to the other side’s lawyer demanding facts, documents, and a host of other information.  The standard for “discoverable” facts and documents is exceptionally broad.  In California, it is enshrined in California Code of Civil Procedure 2017.010., which says that the evidence one side is trying to obtain (through the discovery process) merely has to be relevant or something that will lead to relevant evidence.  Almost everything and anything in any way related to Epstein, his victims, his best friends, and his employees would be relevant here, and thus potentially part of the victims’ lawsuits.  

The estate, struggling with the unprecedented disastrous PR of this specific situation, will want to avoid discovery at all costs. Why? Because through the process of discovery, there is a strong possibility that substantially more detrimental and devastating facts will emerge. Those facts could relate to anyone ever involved with Epstein.

This means the estate will be highly motivated to throw a lot of money at the victims.  They may even try to twist it into a “look at how generous we are” situation for a PR boost. By being “generous” right off the bat, the process of discovery can be stopped. If this happens, the victims then have a choice to take the money and accept a silence inducing settlement OR plunge ahead with the lawsuit.  

If the victims forge ahead, then presumably all of the facts will come out in the discovery process.  The legal costs could be astronomical and the process could take years.

To save face, the estate may try to seal everything to keep it from public view.  Note that they just unsealed 2,000 pages worth of discovery from a previous related lawsuit here on Friday August 9, 2019. It is not clear whether any Court will seal the evidence in this particular situation. One key difference here will be that the right to privacy enjoyed by individuals such as Epstein will be decreased, as will the attorney client privilege he held while living.

Attorney Lisa Bloom already announced she is ready to move forward on behalf of victims with lawsuits against Epstein’s estate.

Are Epstein’s Victims likely to Prevail with Lawsuits against his Estate?

This estate may be the most complicated public estate we have ever witnessed.  It will be spread over multiple locations involving an estimated half a billion dollars worth of assets.  Literally every aspect of this situation is toxic and the people in charge of the estate are most likely legally precluded from giving a penny to the victims.  What can change that are lawsuits and PR.  Even if the people in charge of Epstein’s estate do not care about hurting vulnerable women, they will care about the bad PR that stems from hurting vulnerable women.  Epstein may have tried to fight his victims in life, but in death he may have opened the door for them.