BMW heirs say their lives are harder than you think
In our latest billionaires round-up, the siblings who own almost half of the German car-maker say inheritance can be a burden while a Russian investor claims he was overcharged $1bn for famous artworks
Susanne Klatten and Stefan Quandt
Dealing with the responsibility and jealousy from inheriting wealth is a misunderstood burden, according to Susanne Klatten and Stefan Quandt, the billionaire siblings who together own almost half of BMW.
“Many believe that we are permanently sitting around on a yacht in the Mediterranean,” Ms Klatten, 57, told German monthly magazine Manager Magazin in a recent interview with her and her younger brother. “The role as a guardian of wealth also has personal sides that aren’t so nice.”
Ms Klatten — whose father Herbert Quandt helped rescue BMW in the late 1950s — is Germany’s second-richest person with a fortune valued at $18.6bn (Dh68.32), according to the Bloomberg Billionaires Index. She has also built up holdings in chemicals company Altana and carbon producer SGL Carbon.
Mr Quandt, 53, who owns stakes in logistics company Logwin and homoeopathic medicine company Heel, has a net worth of $15.5bn. Both he and his sister have seats on BMW’s supervisory board.
“For both of us, it’s certainly not the money that drives us,” said Mr Quandt. “Above all, it is the responsibility of securing jobs in Germany.”
The two heirs say they’re comfortable with their roles, but initially struggled with taking on high-level positions at young ages. Mr Quandt, who was 30 when he was given his first board seat, said he might have wanted to work a few years as a “simple” product manager somewhere or study architecture.
Ms Klatten, who gained notoriety in 1978 when police foiled a plot to kidnap her and her mother Johanna, said that wealth redistribution does not work and that a fair society allows people to pursue opportunities according to their abilities.
“Our potential stems from the role of being an heir and developing that,” she said. “We work hard on that every day.”
A federal judge in New York rejected Sotheby’s bid to dismiss a $380m lawsuit earlier this week where Russian billionaire Dmitry Rybolovlev accused the auction house of helping his longtime art dealer's scheme to overcharge him on dozens of masterworks.
US District Judge Jesse Furman said Sotheby's failed to establish that the case did not belong in his court because Mr Rybolovlev was already litigating in Switzerland, where much of the key evidence and many witnesses were located.
Sotheby's has called Mr Rybolovlev's claims against it baseless. A lawyer for Mr Rybolovlev had no immediate comment.
The case is part of a multi-year effort by Mr Rybolovlev, 52, to recoup alleged losses he has blamed on the art dealer, Yves Bouvier, who has denied wrongdoing. Litigation has also ensued in France, Monaco and Singapore.
Mr Rybolovlev, through his companies Accent Delight International and Xitrans Finance, accused Mr Bouvier of overcharging him by more than $1bn on 38 artworks, for which he paid in excess of $2bn between 2003 and 2015.
According to the New York complaint, Sotheby's had a hand in 14 of the transactions, and had been "the willing auction house that knowingly and intentionally made the fraud possible" because it knew how much Mr Bouvier was paying the sellers.
The complaint said the artworks included paintings by Amedeo Modigliani, Gustav Klimt and Leonardo da Vinci for which he paid a combined $429.3m from 2011 to 2013.
Mr Rybolovlev sold the da Vinci, "Salvator Mundi," for $450.3m at Christie's in 2017, making it the most expensive painting ever sold.
Mr Rybolovlev's fortune is estimated at $6.8bn, according to Forbes magazine.
Hong Kong billionaire Li Ka-shing’s has offered to support university students, a month after US tycoon Robert F. Smith vowed to pay off loans of undergraduates in an American college.
The Li Ka-shing Foundation said it will pay tuition for all undergraduates in the incoming class of 2019 for four to five years at Shantou University in Guangdong, the southern Chinese province Mr Li came from as a refugee to Hong Kong decades ago. The foundation has committed to an annual grant of 100m yuan (Dh53.41m) to the university, it said in a June 16 statement.
The pledge by the city’s richest man, who turned a plastic flower business into a global empire spanning ports and property to telecoms and retailing, is part of the philanthropic work his foundation has been doing globally. Since 1980, his organisation has donated more than HK$25bn ($3.2bn) to health care, education and religious causes, most of it in the greater China region, according to its website.
Mr Li, whose net worth is about $30bn, retired in May last year and handed the top position at the family-controlled conglomerate to his eldest son Victor Li Tzar Kuoi. Mr Victor Li has stepped in as chairman of the group’s flagship companies CK Hutchison Holdings and CK Asset Holdings, while the father, now 90, remains a senior adviser to his business empire.
The grant comes weeks after Mr Smith, founder of Vista Equity Partners, stunned students at Morehouse College by vowing to pay off the student loans of every member of the class of 2019. The school told the Atlanta Journal-Constitution it will cost an estimated $40m to retire the debt of the graduating class, which totals about 400 students.
The billionaire owners of Purdue Pharma face a New York lawsuit claiming they triggered the US opioid epidemic, a judge ruled, handing an early victory to states and local governments seeking to recoup billions of dollars in social costs from the drugs.
A state judge denied the Sacklers’ request to dismiss the lawsuit, filed by 58 counties and two dozen cities in New York. The ruling is the first by any court denying a motion by the Sacklers to throw out a suit by a state or county and allowing for pretrial fact-finding to proceed against the individual defendants and their trusts, said Paul Napoli, an attorney representing the New York governments.
State and local governments have targeted the Sackler family’s marketing of the OxyContin painkiller, and their wealth, to recover the social costs of opioid addiction, such as payments for opioid prescriptions and Medicaid benefits that wouldn’t have been approved if the risks had been known. Some 2,000 suits against opioid makers have been consolidated in federal court in Ohio, and other cases are pending in state courts. The Sacklers were worth an estimated $13bn as of early March.
The Sacklers were separately sued over the addiction epidemic by New York Attorney General Letitia James in March, two days after Purdue agreed to pay $270m to settle similar claims by Oklahoma. Ms James’s suit added the Sackler family to her complaint against Purdue and its biggest competitors and distributors, including Johnson & Johnson and Cardinal Health.
The suit, filed in New York State Supreme Court, names eight Sacklers: Richard, Jonathan, Mortimer, Kathe, David, Beverly and Theresa Sackler, as well as Ilene Sackler Lefcourt.
New York says the defendants pushed doctors to issue prescriptions, lied about the risk of addiction and ignored red flags from suspicious pharmacies.
“Simply put, they put profit over patients,” Ms James said in March. The Sacklers “profited off the suffering, the death of New Yorkers,” she added.
Purdue Pharma and a representative of the Sacklers didn’t immediately respond to emails seeking comment on the June 21 ruling.
“Expanding this baseless lawsuit to include former directors of Purdue Pharma is a misguided attempt to place blame where it does not belong for a complex public health crisis,” the family said in a statement about Ms James’s suit in March.
Updated: June 29, 2019 02:02 PM