The Charade in the Record.

The case has been told as a succession drama. We read it as something more useful: a public record of how a court actually tests a power to amend an irrevocable trust. Every structure we build contains some flexibility of that kind. There may be a protector who can change the governing law, a trustee who can decant, or an amendment clause for circumstances nobody foresaw. The Murdoch recommendation shows what happens when that flexibility is used for a purpose the trust does not permit. It also shows that the evidence which decided the case was written by the people who ran the plan.

The Murdoch Family Trust was created in 1999, as part of Rupert Murdoch’s divorce from Anna Torv. It is irrevocable. It holds the family’s controlling voting stake in Fox Corporation and News Corp, roughly 40 percent of the voting stock. “Rupert Murdoch Loses His Fight to Change Family Trust,” Bloomberg Law, 9 December 2024 (the trust controls roughly 40 percent of the voting stock of Fox Corp. and News Corp.); D. Chmielewski, “Rupert Murdoch fails in bid to change family trust,” Reuters, 9 December 2024. Its central bargain was simple. After Rupert Murdoch’s death, control would pass in equal shares to his four eldest children: Prudence, Elisabeth, Lachlan, and James. “Succession planning: unpacking the real life Murdoch family trust drama,” Law Society Journal (NSW) (the trust, created on the 1999 divorce, divided control equally among the four eldest children); ABC News, supra (the trust is “irrevocable”).

The trust was not entirely rigid. It contained an amendment clause. As reported from the commissioner’s earlier, June 2024 ruling, the clause allowed changes if they were made in good faith and for the sole benefit of the beneficiaries. J. Rutenberg & J. Mahler, “The Secret Battle for the Future of the Murdoch Empire,” The New York Times, 24 July 2024 (reporting the commissioner’s June 2024 ruling that the trust could be amended if the change was made in good faith and for the sole benefit of the heirs). That standard is familiar to any trust lawyer. It is also what decided the case.

In late 2023 Rupert Murdoch petitioned the probate court in Washoe County, Nevada, to amend the trust. The effect would have been to give Lachlan lasting control and to take away the votes of his three siblings. The stated rationale was that keeping the companies’ editorial direction stable after Rupert’s death would protect the value of the holdings for every heir, including the three being removed from control. Id.; “Murdoch fails to amend family trust in court succession saga: Report,” Al Jazeera, 9 December 2024 (describing Rupert Murdoch’s argument that preserving the companies’ editorial direction would benefit all the heirs). The trial took place over about a week in September 2024, behind closed doors.

Probate Commissioner Edmund J. Gorman Jr. did not reject the idea that the trust could be amended. His June 2024 ruling had confirmed that the power existed. What he rejected was the claim that this particular amendment met the clause’s conditions. According to the recommendation now made public, the plan was designed to secure Lachlan Murdoch’s control of the companies, not to serve all the beneficiaries equally as the trust’s terms require. The commissioner found that Rupert and Lachlan Murdoch had acted in “bad faith” toward the three objecting siblings. Recommendation of Probate Commissioner Gorman, supra.

The reasoning matters more than the result, because it came from the record. The recommendation describes an internal effort called “Project Family Harmony.” It identifies Siobhan McKenna, a close lieutenant of Lachlan Murdoch, as “the driving force behind Project Family Harmony,” who organised the meetings, prepared the agendas, and dealt with the attorneys. Id. It also records what the plan was really about: the “math problem.” The directors who would exercise the objecting children’s votes could outvote Lachlan after his father’s death. Id. An amendment that exists to solve that arithmetic benefits one beneficiary at the expense of three. A clause limited to the sole benefit of the beneficiaries cannot authorise it, however the purpose is described.

The dispute never went through a full appeal. In September 2025 the family settled. It was reported that each of the three siblings received roughly US $1.1 billion for their interests, and that Lachlan Murdoch kept control through a restructured arrangement. A. Weprin, “Succession War Over, Lachlan Murdoch Turns to Next Era of Empire Building,” The Hollywood Reporter, 9 September 2025; M. Savage, “Lachlan finally has control of Murdoch empire but deal is a win for sibling rivals,” The Guardian, 9 September 2025 (settlement figures are as reported and have not been verified against any court filing). The commissioner’s findings therefore stand as a recommendation, not an appellate holding. They are still the most detailed public account available of how a court applies the good-faith and sole-benefit tests to a contested amendment.

It is worth noticing who lost. The settlor was among the most powerful private citizens in the world. He had excellent lawyers and a genuine, reserved power to amend. He still could not bend the trust to a purpose its own terms ruled out.

That is not a flaw in trust law. It is what makes trusts work. The same quality that stopped Rupert Murdoch from redirecting his children’s inheritance is what protects a Lighthouse client’s family from a later creditor. If the settlor cannot rewrite the deal to suit himself, a court cannot order him to rewrite it to suit a claimant. An irrevocable, discretionary trust protects assets because it binds the person who created it. A settlor who wants an escape hatch for himself is also, whether he realises it or not, asking for a handle a creditor can pull.

Modern trusts are rarely frozen in amber, and they should not be. Nevada, like a growing number of American states, lets a trustee decant, meaning the assets of one irrevocable trust are distributed into a new trust on different terms. Nev. Rev. Stat. § 163.556 (trustee’s power to distribute trust property to a second trust). Offshore instruments routinely give protectors the power to change trustees, change governing law, or add and remove beneficiaries. These tools exist because families change, tax law changes, and a trust that lasts for decades has to adapt.

The Murdoch recommendation is a reminder that each of these powers carries its purpose with it. A power to amend “for the sole benefit of the beneficiaries” is not a general power to amend. A power to decant is exercised by a fiduciary and is subject to fiduciary duties. When a change is challenged, the court will not ask only whether the power exists. It will ask why the power was used, for whom, and what the people involved said to each other at the time.

In practice, the drafting of a Lighthouse structure has to match its administration. Change mechanisms should state their purpose plainly. They should sit with people who have no personal stake in how they are used. Where possible they should include a neutral, objective trigger, such as a change in law or a change in a beneficiary’s circumstances, rather than a broad discretion that invites the question the commissioner asked. If a change is ever needed, the reasons should be real ones and should be recorded honestly at the time.

Readers of this series will recognise a familiar pattern. In a fraudulent-transfer case the debtor rarely admits intent, so courts infer it from the “badges of fraud”: insider transfers, retained control, concealment, and suspicious timing. The Murdoch recommendation is not a creditor case, but the method is the same. The court did not need a confession. It had a code-named project, meeting agendas, the involvement of the favoured heir’s own lieutenant, and a stated goal of fixing a voting “math problem.” Together those documents showed the purpose of the plan more clearly than any witness could have.

For a client with a protective structure, the point is uncomfortable but important. Documents do not only record a plan; they become evidence about it. Emails about “protecting” assets from a named adversary, internal memos that describe the goal of a transaction candidly, and planning steps timed to a dispute all end up in a litigator’s exhibit binder. A structure set up years before any claim, for reasons that are true and are written down truthfully, has nothing in its files to fear. A structure improvised when trouble arrives produces its own evidence.

One reason families choose Nevada is its confidentiality. Nevada law lets certain trust proceedings be sealed. For more than two years, the Murdoch case appeared to show that confidentiality working.

Then it stopped working. Six news organisations challenged the sealing. On December 23, 2025, the Supreme Court of Nevada held in New York Times Co. v. District Court that the trust-sealing statutes, NRS 164.041 and NRS 669A.256, do not require blanket sealing of an entire case. The district court must use its discretion document by document, weigh any real privacy interest against the presumption of openness, and consider redaction before sealing. New York Times Co. v. Second Judicial Dist. Ct., 141 Nev. Adv. Op. 71 (Dec. 23, 2025) (construing NRS 164.041 and NRS 669A.256; “the district court erred in interpreting the statutes to mandate sealing throughout the case without the exercise of judicial discretion”). After further proceedings, including an appeal by the transparency group Our Nevada Judges, the commissioner’s full recommendation was released in August 2026. Recommendation of Probate Commissioner Gorman, supra.

The planning lesson is not that Nevada is a bad place to hold a trust. It is that no confidentiality regime is a guarantee, least of all once a dispute reaches court. A structure should be designed so that it would survive being read in full by a judge and then by the public. If its protection depends on nobody ever seeing the file, it is fragile. Our own practice starts from the opposite assumption: full, lawful disclosure whenever it is properly required, and a structure whose purpose can be explained in open court.

The Murdoch dispute was about control, not money. The trust’s economic interest was always shared, and the fight was over who would vote the shares. That makes the case a useful companion to the creditor cases we write about more often, where the question is also control: who can direct the trustee, who can replace the trustee, and who can take the assets back.

In both kinds of case, courts respect a structure in which control has genuinely been separated from the person who benefits. They look through a structure in which control has been kept in the family or quietly retained. The Murdoch trust gave four children equal votes, and a court held the trust to that bargain. The same discipline, with an independent trustee, a protector who is not the settlor, and discretion that is real rather than nominal, is what allows a protective trust to hold up against a creditor.

It is easy to read the Murdoch saga as a story about one family’s quarrel, settled at enormous cost. It is more useful as a lesson in design. The trust worked. It held a powerful settlor to a promise made in 1999. The attempt to get around that promise failed because the power used for it had a purpose, the people using it had a different one, and they wrote the difference down.

A well-built structure should be able to withstand both a determined creditor and a determined family member. That requires the same things in each case: terms that mean what they say, change mechanisms tied to honest purposes, administration independent of the people who benefit, and a record that can be read in full without embarrassment.

This note is general, informational commentary and not legal advice for any particular person or structure. Whether and how a given trust may be amended, decanted, or protected depends on its terms, its governing law, and the facts. The Murdoch findings are a commissioner’s recommendation in a case that settled, not an appellate ruling.