How the Murdoch Family Feud Is Like "Succession" | Pivot

1. KSKara Swisher0:00

   This is an interesting story. Did you see this? Murdoch family and a court battle over who will leave-

2. SGScott Galloway0:03

   Wild.

3. KSKara Swisher0:03

   ... News Corp and Fox.

4. SGScott Galloway0:04

   It's wild.

5. KSKara Swisher0:05

   Or, according to-

6. SGScott Galloway0:05

   What do you think of this?

7. KSKara Swisher0:06

   Oh, I know a lot about it. Th- Let me just go through it for people. Currently, the family trust gives each of Rupert Murdoch's children, four children, equal votes. He has two others, but they have ownership, but not votes. Uh, he wants to change that. He made this when he divorced from his wife Anna, um, to, she, this, she insisted on this. Um, Rupert has filed a petition to amend the trust, it's, it's an irrevocable trust, but that's what he's done to give exclusive control to his oldest son, Lachlan. As reasoning, he cites political differences with his other children that could impact editorial stance of his companies. Uh, three other children have responded with a legal challenge. The trial is expected to begin S- September. It's, it's in Nevada where this is, so it's one person who deals with trusts and estates. Um, you know, there's one tiny little out that he's saying he's doing it for the benefit of these people and he's doing it for political reasons. That's not the benefit of shareholders or anything else that L- Lachlan, who's presided over disaster after disaster at the company, including the lawsuits and behaviors and payoffs and everything else. I mean, Lachlan has been a terrible CEO in that regard. Um, I don't think this helps shareholders. Um, I've, uh, you know, what's interesting, I have a little knowledge of these k- these people. Um, they were not together, James, um, uh, Liz, and I think it's Prudence. They were not aligned at all. Liz moved back and forth like Shiv on Succession. You know, she was, she's very much wanting her dad and her to get along. Um, so this united them, which was, of course, another stupid thing Lachlan does 'cause he's as dumb as a box of hammers. Um, so it's really interesting. Um, uh, you know, this is a family that has huge impact on our society, and he's trying to live beyond the grave. This old, crusty old, uh, Dracula is trying to live beyond the grave. What do you think?

8. SGScott Galloway1:51

   Uh, there are few companies I c- I have difficult time thinking of a for-profit company who-

9. KSKara Swisher1:55

   Mm-hmm.

10. SGScott Galloway1:57

    ... um, has a greater impact relative to its market capitalization. I mean, I think the market cap of... (sighs) I forget what the market cap is, but it's essentially, you know, it- it- y- you have... Oh, it's $33 billion, which is, um, you know, Warner's 20, which is unfair 'cause it has 40 billion in debt, so it's 60 billion in enterprise value. But it's $33 billion, which is, you know, big, but this is arguably... I mean, you could make a no- you could definitely make an argument this is one of the five or 10 most influential companies in the world, and a lot of people think that this company literally picks the Republican nominee, uh, for president and has a huge influence. And Fox's viewership is really strong. I mean, he's, actually, I don't think it's fair to, to say Lachlan's done a terrible job. I, I think the Dominion case was obviously a huge stubbed toe, but I think that's more about the fact that... Well, anyways, uh, y- I think y- I think it's unfair to say he's mone- done a bad job. What I took from this entire story-

11. KSKara Swisher2:51

    Oh, come on. The two cases, there's Smartmatic coming. Bill O'Reilly and other gropers at that company. But go ahead. Go ahead.

12. SGScott Galloway2:57

    Let me say the HR has not (laughs) been very good here, but the company is, the company is as influential as it has ever been, and the Wall Street Journal is amazing. Um, anyways, uh, uh, uh, uh, up for debate whether you think he's done a good job or not. What I took from this had nothing to do with business. Nothing. And that is, I'm, I'm turning 50 and my sole objective right now, all the money I'm spending, almost every... M- like, my biggest thing right now, and my kids are-

13. KSKara Swisher3:28

    Mm-hmm.

14. SGScott Galloway3:28

    ... about to be 14 and 17, I'm buying homes in beautiful places, I'm thinking about where we're gonna live, and making huge investments in my kids, because all I want, m- first and foremost, is I wanna spend a ton of time with my boys when, when they're older. And this is a man who, by any stretch of the imagination, whether you think he's Satan's devil or whatever, has had a remarkably successful career in terms of influence and impact. And when he's getting married, three of his four kids didn't show up.

15. KSKara Swisher3:58

    I know. Wasn't that incredible?

16. SGScott Galloway3:58

    Which in my view, which in my view, means you have failed.

17. KSKara Swisher4:02

    Yeah.

18. SGScott Galloway4:03

    And i- i- uh, I also reverse engineered to another thing. Tax policy. I think we dramatically need to increase tax rates above, say, 10 million a year or on trusts, because I'm telling you, Kara, creating dynasties, it doesn't do anyone any good. Do you think this has been good for their family?

19. KSKara Swisher4:22

    No. And I, I, I, I think it, it's succession. Is, we've got succession here. And he'll, you know, if he dies before this thing gets to trial, it stays the same and then we'll see what happens to this, um, to this company. Because the other three, I wouldn't call them united, but now they are. Now they're like, "Screw you, Dad." Like, it's really, it's, it is pathetic. It's path-

20. SGScott Galloway4:43

    They're against their dad and their dad's fi- this is, this is, uh, like, the, the second thing I've, just behind wanting to spend a lot of time with my boys, you know what I really hope? I really hope that my boys are friends when they're older. And sometimes with the way they go at it, I think there's, that's not a given. (laughs) Can you imagine this? A family where three of the siblings-

21. KSKara Swisher5:04

    It was already-

22. SGScott Galloway5:04

    ... have side... Go ahead.

23. KSKara Swisher5:05

    Yeah. It's t- it was tense between Lachlan and the rest of them. And, but you know, uh-

24. SGScott Galloway5:08

    Because of business.

25. KSKara Swisher5:10

    Liz was between, Prudence is o- out in Australia, does her own thing, but it's just, it's, it's ridiculous. It's a ridiculous thing to do at this moment in time because he's gonna... Let me just tell you, Rupert Murdoch, you're gonna die at like... You know from Moonstruck? No matter what you do, Rupert Murdoch, you're gonna die, and you don't get to decide things after you're dead. That's it. That's it. And he's ruining the rest of his thing just because he has this... You know, some people think that Lachlan is unduly influencing him. He is 90 some years old. That's one of the little things, you know, that Lachlan's engineering this.

26. SGScott Galloway5:40

    Well, uh, w- h- uh, how... You, you can make the same argument on the other three.

27. KSKara Swisher5:44

    No, they didn't start this thing. This was, this has been in place for, for y- decades. Th- they didn't just move to change it. This, this, Rupert did. Yeah.

28. SGScott Galloway5:53

    A little bit of background. Uh, uh, an irrevocable trust is basically-

29. KSKara Swisher5:57

    Mm-hmm.

30. SGScott Galloway5:57

    ... a tax shelter. And this is what I'm getting at. Dynasties, as far as I can tell, don't do anyone any good.

Episode duration: 8:14