Electronically FILED b Superior Court of California, County of Los Angeles 8/13/2019 10:14 PM Sherri R. Carter, Executive Officer/Clerk, By H.

10:14 PM Sherri R. Carter, Executive Officer/Clerk, By H. Suh, Deputy 3|erk

LEON GLADSTONE (SBN 70967)

[email protected]
MICHAEL J. AIKEN (SBN 98786)
[email protected]
ANTHONY DIPIETRA (SBN 235994)
[email protected]
GLADSTONE WEISBERG, ALC
300 Corporate Pointe, Suite 400
Culver City, CA 90230
Tel: (310) 821-9000 - Fax: (310) 943-2764
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Attorneys for Respondents Barry J. Siegel

and ProvidentFM

SUPERIOR COURT OF THE STATE OF CALIFORNIA

FOR THE COUNTY OF LOS ANGELES

ALC LISA MARIE PRESLEY, CASE NO. 18$TPB01759

Petitioner, Judge: Hon. Robert S. Wada
Dept: 99
vs.
BARRY J. SIEGEL’S RESPONSE TO
GLADSTONEWEISBERG,

BARRY J. SIEGEL, an individual and VVVVVVVVVVVVV

THE PETITIONER’S OBJECTIONS
PROVIDENT FINANCIAL TO THE ACCOUNT AND REPORT OF
MANAGEMENT, an unknown legal entity, THE FORMER CO-TRUSTEE OF THE
PROMENADE TRUST
Respondents.
[Index of Evidentiary Exhibits Lodged
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Conditionally Under Seal Concurrently
Herewith]
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Date: August 26, 2019

Time: 8:30 am.
Dept: 99

Action Filed: February 2 1 20 1 8 ,

PUBLIC-REDACTS MATERIALS FROM CONDITIONALLY SEALED RECORD

REDACTED PURSUANT T0 CRC 2.551(B)(4)

60081 1

BARRY J. SIEGEL’S RESPONSE TO THE PETITIONER’S OBJECTIONS TO THE ACCOUNT AND

REPORT OF THE FORMER CO-TRUSTEE OF THE PROMENADE TRUST
 TABLE OF CONTENTS

1 . INTRODUCTION ............................................................................................................... 1

2. FACTUAL BACKGROUND ............................................................................................. 3

A. The Trust Was Heavily Indebted Before The CKX Transaction ............................ 3

Lisa Was Represented By Counsel In Connection With The Transaction,

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B.
And She Issued Written Instructions T0 The Trustees T0 Enter Into It .................. 4
C. Following The CKX Transaction, Lisa’s Outrageous Spending Habits
Continued Even Though And She Was Repeatedly Told To Reign In Her
Spending .................................................................................................................. 5

D. Siegel Repeatedly Told Lisa About Her And The Trust’s Financial
Condition ................................................................................................................. 6

3. THE COURT SHOULD REJECT LISA’S OBJECTIONS THAT THE

ACCOUNTING FAILS TO COMPLY WITH PROBATE CODE §§ 1061, ET
SEQ. ..................................................................................................................................... 8
ALC

A. Provident and Siegel Are Legally Distinct .............................................................. 8

B. Siegel Complied With The Court Order T0 Account For The Trust ...................... 8

4. LISA HAS THE BURDEN OF PROVING THAT SIEGEL ACTED IN BAD

GLADSTONEWEISBERG,

FAITH AND THAT ANY OF THE PROFESSIONAL FEES CHARGED TO

THE TRUST WERE UNREASONABLE ........................................................................ 11

A. Provident’s Accounting Fees Were Disclosed And Reasonable ........................... 11

B. Provident’s Business Management Fees Were Disclosed And Agreed

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Upon ...................................................................................................................... 1 3

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C. Lisa Cannot Show The Amounts Paid T0 Other Professionals Were
Unreasonable Or Unauthorized Under The Trust .................................................. 13

5. CONCLUSION ................................................................................................................. 15

60081 2
BARRY J. SIEGEL’S RESPONSE TO THE PETITIONER’S OBJECTIONS TO THE ACCOUNT AND
REPORT OF THE FORMER CO-TRUSTEE OF THE PROMENADE TRUST
 Respondent, BARRY J. SIEGEL, one of the former co-trustees of the Promenade Trust,

hereby responds t0 Petitioner Lisa Marie Presley’s (“Lisa”) Objections t0 the Account and

Report, respectfully showing the Court as follows:

1. INTRODUCTION
Lisa’s obj ections t0 the accountings are based on an alternate reality. Lisa continues to
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ignore the fact that she received detailed financial reports and advice over the years, as well as

the professional advice received from lawyers involved in the 2005 CKX transaction. Yet, Lisa
does not dispute that Siegel met With her regularly each year over his tenure as the co-trustee of

the Promenade Trust. She does not dispute that Siegel provided her With detailed financial

information about her and the Trust’s financial condition, 0r that Siege] reviewed her tax returns

and those 0f the Trust With her on at least an annual basis. She also does not dispute that she

ALC instructed Siegel and Provident not t0 leave her copies 0f the financial reports and tax returns.

The truth is that Lisa received all of the information that she now claims she never

received, and more. This includes information concerning the accounting fees charged to the

GLADSTONEWEISBERG,
Trust and the business management fees Provident Financial Management charged for the work

it did 0n her behalf. This information is set forth in the financial reports and tax returns that she

received each year and was otherwise discussed. Siege] is not responsible for Lisa’s refusal t0

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take copies of the information he provided.

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The baselessness 0f her allegations is further demonstrated in her feigned ignorance 0f

the 2005 transaction between CKX and the Trust. Claiming she never understood the transaction

or was told of its impact 0n the Trust, Lisa argues that Siegel entered into the transaction for his

own personal motives, and Without full disclosure. She conveniently omits that she spent weeks

going over the transaction with her attorneys. And, she fails to advise this Court that she verified,

under oath, (i) that she understood the transaction after consulting With her attorneys and; (ii) that

the transaction was explained to her satisfaction by Siegel and a former co-trustee, her uncle

Gary Hovey.

In fact, Lisa executed a verification as part 0f the 2005 CKX transaction expressly
confirming that Siege] and Hovey entered into the transaction because she gave them written

60081 1

BARRY J. SIEGEL’S RESPONSE TO THE PETITIONER’S OBJECTIONS TO THE ACCOUNT AND

REPORT OF THE FORMER CO-TRUSTEE OF THE PROMENADE TRUST
 instructions t0 d0 so. Siegel was obligated, under the trust documents, to follow her instructions.

Even if Lisa had not instructed Siegel t0 enter into the transaction, the Trust expressly authorized

him t0 d0 so based 0n the advice 0f the professionals the Trust retained to evaluate the

transaction and the financial condition 0f the Trust. The Trust instrument expressly states that

Siegel is entitled rely on the advice of professionals, Without further investigation and without
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any liability for doing so. Lisa actually amended the Trust t0 state these exculpatory provisions at

the same time as she instructed Siegel t0 enter into the transaction.

Lisa also wrongly accuses Siegel 0f obfuscating his use of Trust assets based on a clear

distinction existing between the Trust’s assets, and Lisa’s own personal bank accounts. This

accusation neglects t0 mention that the accounts held by the Trust were always maintained

separately from those that Lisa held in her own name. The division between the Trust’s and

ALC Lisa’s finances and bank accounts existed before Siegel became a co-trustee in December 2003.

Siegel properly continued this division after agreeing t0 serve as a co-trustee. The accountings,

therefore, comply With the Court’s order.

GLADSTONEWEISBERG,
In short, this case is nothing short 0f revisionist history — one in which Lisa seeks to

absolve herself of any responsibility for her own acts. Siegel conscientiously performed his

duties as the Trustee, and provided Lisa With financial information, as he was required to d0.

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From 2004 through 2010, Siegel did not have a duty to provide a formal accounting under the

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Trust instrument; his only obligation was to provide reports to Lisa, Which he did. Then, from

2010 through 2016, after the Trust was amended, Siegel provided Lisa the financial information

required by Probate Code § 16063 every year.

Thus, Lisa was at all times fully aware of the financial condition 0f the Trust. She knew

(or should have known) of all the charges and fees at issue in her obj ections. Siegel could not

force her to keep copies 0f the reports and other documents he provided to her. Lisa should not

be allowed t0 escape the consequences of her decisions, and be allowed t0 complain more than a

decade after the fact.

Accordingly, Siege] respectfully requests that the Court rej ect the Petitioner’s objections

to the accountings and enter an order approving them. Alternatively, if the Court entertains the

60081 2
BARRY J. SIEGEL’S RESPONSE TO THE PETITIONER’S OBJECTIONS TO THE ACCOUNT AND
REPORT OF THE FORMER CO-TRUSTEE OF THE PROMENADE TRUST
 obj ections, Siegel respectfully requests that the Court set the matter for trial.

2. FACTUAL BACKGROUND
Regurgitating the same tired and false allegations about Siege] entering into the CKX
transaction t0 serve his own personal ends, Lisa ignores the harsh financial reality that her

spendthrift ways caused the Trust both before and after the CKX transaction in 2005. In the years
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leading up to the transaction, the entire Presley estate faced significant financial problems, and

both Lisa and the Promenade Trust were heavily in debt. Yet immediately after the transaction

that pulled the Trust out of millions in debt, Lisa continued her extravagant spending despite all

the advice she received, spending Virtually her entire fortune once again by 2012.

A. The Trust Was Heavily Indebted Before The CKX Transaction

When the Trust was established (long before Siegel agreed to serve as co-trustee), it was

ALC receiving millions of dollars in annual income. However, Lisa’s continuous, excessive spending

and reliance on credit far exceeded What the Trust could pay her from income alone. T0 meet her

demands for cash, the National Bank 0f Commerce, obtained a series 0f loans secured by Elvis

GLADSTONEWEISBERG,

Presley Enterprise’s (“EPE”) assets. This still was not enough, and Lisa’s spending soon put the

Trust into millions of dollars of debt. EX. A, Verified Response and Objection.

By 2003, EPE was approximately $22 million in debt due t0 Lisa’s spending, and the

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Trust itself was underwater by millions of dollars. At this point the bank refused to extend any

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further credit. Lisa’s income was limited her income from EPE, reduced by the payments 0n the

huge debt that was now 0n the books. The Presley estate was 0n the brink of insolvency when

Lisa and EPE asked Siegel t0 evaluate options to address the dire financial situation. Id.

After numerous discussions, the only solution Lisa found appealing was t0 sell EPE

stock, with the understanding that she never wished to part With ownership of the Graceland

property. The Trust retained the Salter Group, an independent consulting firm t0 value a potential

sale and find a buyer. The Salter Group submitted its report in 2005. Among other things, Salter

identified search conditions and parameters, as Lisa requested, reviewed communications with

potential buyers, and presented a detailed analysis of what Salter identified as the best offer. That

60081 3
BARRY J. SIEGEL’S RESPONSE TO THE PETITIONER’S OBJECTIONS TO THE ACCOUNT AND
REPORT OF THE FORMER CO-TRUSTEE OF THE PROMENADE TRUST
 offer came from a group led by Robert Sillerman. Siegel had never previously heard of

Sillerman. Id.

B. Lisa Was Represented By Counsel In Connection With The Transaction,

And She Issued Written Instructions T0 The Trustees T0 Enter Into It

Lisa knew 0f the details 0f the 2005 transaction before it was finalized, and specifically
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instructed Siege] and the other former co-trustee to enter into the transaction. Contrary to her

allegations, Lisa was intimately familiar With the transaction, having taken weeks t0 make sure

she understood it. Lisa’s counsel at Proskauer Rose, as well as independent tax counsel not

affiliated With Provident, analyzed and approved the Sillerman Group’s offer. The transaction

also was reviewed by counsel hired for the Trust and EPE. Lisa only authorized the sale of the

EPE stock after the transaction was evaluated by numerous third-party professionals that had no

ALC relationship to Provident or Siegel. Id.

Then, in December 2004, after the terms 0f the CKX Transaction had been evaluated by
counsel and Salter, Lisa amended the terms of the Trust to include provisions authorizing Siege]

GLADSTONEWEISBERG,
and Hovey t0 enter into the transaction and t0 be absolved ofany possible liabilityfor doing so.

At the same time, Lisa executed written instructions as the beneficiary of the Trust to Siegel and

Hovey. Lisa confirmed, in writing, that Siege] and Hovey were entering into the transaction

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pursuant to her instructions. EX. B, Glanker Letter, LMP Certificate at fl 4. Lisa also
confirmed in writing that she, “had an opportunity t0 discuss the Transaction Documents With
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legal counsel” and that “Further, the material and substantive provisions of the Transaction

Documents have been explained t0 me by my manager/accountant, Barry Siege], in the presence

of Gary Hovey, t0 my satisfaction.” Id. at 1]

1.1

1
Of course, even if Lisa had not instructed Siegel and Hovey 2005 Transaction, Siegel, as
t0 enter into the
co—trustee was authorized under 0n behalf of the Trust 0n advice 0f the
the trust instrument t0 execute the transaction
accountants, attorneys and investment advisers who were retained in connection With the transaction, and Without
any independent investigation on his own part, t0 act upon their advice. EX. B, 2004 Trust at p. 30; Ex. C, 2010
Trust at 1]
2.1.20.2.

60081 4
BARRY J. SIEGEL’S RESPONSE TO THE PETITIONER’S OBJECTIONS TO THE ACCOUNT AND
REPORT OF THE FORMER CO-TRUSTEE OF THE PROMENADE TRUST
 Accordingly, it was not until the transaction had been vetted, evaluated and negotiated by

unrelated third-party professionals that Lisa instructed Siegel t0 enter into the transaction. Siege]

and Hovey did so at her express written direction. Siegel cannot be held liable as a result?

The transaction yielded a fantastic outcome for the Trust, Which received $49 million in

cash (approximately $40 million after taxes), plus preferred CKX stock valued at more than $20
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million, with a guaranteed 8% dividend, as well as $500,000 shares 0f common stock. CKX also
assumed the Trust’s debts, Which by this time were approximately $22 million. The net effect of

the transaction was to infuse the Trust With millions 0f dollars, give Lisa the cash that she

needed, and bring EPE back from insolvency. Between the CKX dividends, the income from

Lisa’s remaining 15% interest in EPE, and management 0f cash assets, Lisa stood to receive

millions in income annually Without having to touch any 0f the Trust’s principal. Unfortunately,

ALC she continued t0 refuse to control her spending and she ignored all the financial advice she

received. EX. A, Verified Response and Objection.

C. Following The CKX Transaction, Lisa’s Outrageous Spending Habits

GLADSTONEWEISBERG,
Continued Even Though And She Was Repeatedly Told T0 Reign In Her

Spending

CKX deal closed in 2005, Lisa immediately resumed her spendthrift ways,
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After the

spending tens of millions of dollars, far more than she was receiving in annual income, in the

first few years alone. Over time, Lisa spent not only her income from the trust, but most of its
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principal, and, t0 the extent she didn’t spend the assets, she encumbered them. Lisa spent most 0f

the money she received from the CKX transaction long before 2012.
The accountings that Siegel has filed show that, every year, the distributions t0 Lisa

exceeded the Trust’s income by the following amounts:

2
[A] trustee 0f a revocable trust is not liable t0 a beneficiary for any act performed 0r omitted pursuant t0
written directions from the person holding the power t0 revoke, including a person t0 Whom the power t0 direct the
trustee is delegated.” Probate Code § 16462.
60081 5
BARRY J. SIEGEL’S RESPONSE TO THE PETITIONER’S OBJECTIONS TO THE ACCOUNT AND
REPORT OF THE FORMER CO-TRUSTEE OF THE PROMENADE TRUST
 amounted

EPE
t0 _,
The accountings also show

far

alone. Lisa spent Virtually all 0f this

that the Trust’s total income between 2005 and 2012

more than she could have ever received in distributions

money by the end of 2012, much of Which went t0 buy

from

real estate that she instructed Siegel t0 purchase.

A schedule 0f Lisa’s extraordinary expenses, above her regular monthly expenses, shows
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she spent_
Approximately

existing
_ by the end of 2012. EX. E, Schedule of Extraordinary Expenses.

of that amount went t0 purchase

home. This figure does not include the expenses

Another_ went to pay her federal and state taxes.

new homes

for the
0r to remodel her

upkeep of the

She also spent_

properties.

in travel

expenses in those years because she refused t0 fly commercial. She spent nearly- 0n
salaries and expenses for her staff, including several nannies, cooks, personal assistants and

ALC bodyguards.

D. Siege] Repeatedly Told Lisa About Her And The Trust’s Financial Condition

Lisa now wants t0 blame Siegel for “allowing” her t0 spend her fortune, after years 0f

GLADSTONEWEISBERG,
ignoring his advice. Lisa was repeatedly told of the problems that her spending was causing. She

knew exactly what she was doing and the effect it had on the remaining Trust principal. She now
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conveniently claims ignorance, but she was warned repeatedly that she had t0 cut her spending,

and was advised endlessly on how she might better manage her finances.

Simply, Lisa tells this Court an outright lie, claiming that Siegel failed t0 advise her 0f

met with Siege] almost twice every year

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the financial problems that she and the Trust faced. Lisa

to g0 over her finances and tax returns. At each of these meetings, Siegel provided her with

detailed financial information about her spending and ever-dwindling assets, and told her that she

needed to reign in her spending. Lisa refused.

For example, in May 2008, Siege] met With Lisa t0 g0 over her and the Trust’s finances.

He provided her detailed documentation explaining that she was exceeding her monthly spending

budget, and that her expenses were far exceeding the income she received from the Trust. EX. G.

Then, in July 2008, Siegel met With Lisa again t0 go over her excessive spending. He

provided her documentation detailing the income and expenses of the Trust for 2007, and reports

60081 6
BARRY J. SIEGEL’S RESPONSE TO THE PETITIONER’S OBJECTIONS TO THE ACCOUNT AND
REPORT OF THE FORMER CO-TRUSTEE OF THE PROMENADE TRUST
 showing she had exceeded her income 2007 b_. EX. H. The financial reports Siegel

approximately _.
provided also showed that, in the first six months 2008, she had already outspent her income by

Undeterred and unwilling to cut-down on her spending, Lisa met With Siegel later that

year, in November 2008. EX. I. The financial reports provided at that time showed exactly what
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her monthly income was from the Trust, and that she still was regularly spending more than her

-
income. Siegel also outlined the details of her extravagance, explaining that she

in extraordinary expenses,

financial reports also detailed the

above and beyond her monthly recurring expenses. The

full extent 0f the Trust’s assets, and showed

spent-

that Lisa was once

again racking up significant loan liabilities (more than _), largely related to her private

airplane and real property purchases.

ALC Lisa met With Siegel the following year in December 2009. The Trust’s assets were

disclosed once again, along with the substantial liabilities Lisa had incurred since the 2005

transaction. EX. J. In an effort t0 get her t0 reduce her monthly expense, Siegel provided various

GLADSTONEWEISBERG,
options t0 reduce her monthly expenses.

March 2010, met With Lisa again 0f the Trust’s deteriorating

_
In Siege] to advise her

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financial condition, providing her with reports showing the total assets 0f the Trust, and the more

than in loans the Trust had incurred since the 2005 transaction on account of her

spending and real property purchases. EX. K.

_
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By the end 0f 201 1, Lisa’s overspending had reached the point that Provident had

difficulty in paying her regular monthly credit card bills. The financial reports provided to her at

the 2011 meeting showed that the Trust by that time had more than in liabilities for

mortgages on real estate that Lisa had instructed Siege] to purchase, and that Lisa had spent

approximately_ more than she had received in income that year. EX. L.
By 2013, the Trust’s financial condition had grown even more tenuous as a result 0f

Lisa’s spending. In February 2013, Siegel met with Lisa to address the situation. He provided her

with financial reports showing that her spending had exceeded her income by more than
-
60081 7
BARRY J. SIEGEL’S RESPONSE T0 THE PETITIONER’S OBJECTIONS T0 THE ACCOUNT AND
REPORT 0F THE FORMER CO-TRUSTEE 0F THE PROMENADE TRUST
 - in 2012. EX.

the first nine

N. Undeterred, she spent

months of 2013. That information was disclosed

approximately- more than her income in
t0 Lisa in November 2013. EX. O.

A dissertation could be written about the financial information disclosed to Lisa, and her
refusal t0 follow advice. However, the uncontroverted evidence is that Lisa met With Siege]

every year t0 address her and the Trust’s finances. The Trust’s assets and liabilities were
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disclosed every year, along With the details of Lisa’s continual overspending. Lisa refused to

modify her spending despite all the advice she received, and squandered her fortune as a result.

3. THE COURT SHOULD REJECT LISA’S OBJECTIONS THAT THE

ACCOUNTING FAILS TO COMPLY WITH PROBATE CODE §§ 1061, ET SEQ.
A. Provident and Siege] Are Legally Distinct

In addressing Lisa’s obj ections, the Court must recognize that Siege] is not Provident and

ALC Provident is not Siegel. Siegel may have a partial ownership interest in Provident and may have
served as a corporate officer, but Provident is a separate legal entity, and must be treated

separately. Lisa has not alleged that Provident is Siegel’s alter ego, and could not prove that

GLADSTONEWEISBERG,
allegation even if she had.

As a separate legal entity, Provident’s work on Lisa’s behalf, as her business/financial

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management firm, should not be confused with Siegel’s role as a co-trustee 0f the Trust.

Provident had a separate contract with Lisa that spelled out its role in handling her personal

financial affairs, Which included the business management tasks associated With her personal

knew 0f that
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financial affairs (including her record label, touring, etc.). Lisa contractual

arrangement, and approved it. She also knew of the fees Provident charged for its services, and

accepted those terms Without obj ection.

B. Siegel Complied With The Court Order To Account For The Trust

The Court ordered Siegel t0 provide an accounting of the Trust. Siegel did exactly What

the Court ordered him to do. The accountings and reports filed with the Court contain detailed

summaries of all the transactions concerning the Trust that are required by the Probate Code.

Lisa now complains that the accounting fails t0 detail the full extent of her extravagant

spending because the accounting details the financial transactions of the Trust, rather than her

60081 8
BARRY J. SIEGEL’S RESPONSE TO THE PETITIONER’S OBJECTIONS TO THE ACCOUNT AND
REPORT OF THE FORMER CO-TRUSTEE OF THE PROMENADE TRUST
 personal bank accounts. She argues that this division between the Trust’s finances and her own

bank accounts is an “accounting trick” designed supposedly (and Without evidence) t0 hide

Siegel’s use of the Trust to profit. Yet, Lisa has known for more than two decades that the

Trust’s accounts have been dealt With separately from her personal accounts.

In fact, this accounting method was in place before Siegel became the trustee. Siegel
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become a co-trustee in December 2003. However, Siegel and his prior business management

firm had provided financial management services t0 Lisa, as an individual, since 1993. The

personal accounts that Lisa held in her name existed long before Siegel became a trustee, and the

trust had always maintained separate accounts. EX. R. Siege] did not create this distinction.

Indeed, in 2009, Lisa demonstrated a clear understanding 0f the difference between the

Trust’s affairs and her personal financial affairs When she briefly terminated Provident’s

ALC services. Growing increasingly frustrated With her financial situation, Lisa briefly replaced

Provident, and hired Kevin Burke 0f Wiseman & Burke to serve as her business manager. As
part of the transition, Lisa instructed Provident t0 transfer all of her personal financial affairs t0

GLADSTONEWEISBERG,
Wiseman & Burke, including control over her personal bank accounts. She instructed Siegel t0

deal With the Trust accounts and its assets going forward. Exs. S & T.
The arrangement did not last long. Lisa fired Wiseman & Burke Within a few months,
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after Wiseman & Burke advised her of the same financial problems that Siegel and Provident
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had been explaining t0 her for years.

Accordingly, it is clear that Lisa has known for decades the distinction between the

accounts maintained for the Trust and those maintained for her personal affairs. Even knowing

this distinction, Lisa never asked the Court t0 order Siegel 0r Provident t0 account for

transactions in her personal accounts.

Nor could she have done so. Nothing in any of the Trust instruments establish a Trust

with respect t0 Lisa’s personal financial affairs, as the Trust beneficiary. The Trust accounts held

specific assets that were placed in the Trust according to the trust instrument. Lisa maintained

her own separate personal accounts, receiving distributions from the Trust as the beneficiary. She

60081 9
BARRY J. SIEGEL’S RESPONSE TO THE PETITIONER’S OBJECTIONS TO THE ACCOUNT AND
REPORT OF THE FORMER CO-TRUSTEE OF THE PROMENADE TRUST
 contracted with Provident (and, at times, other business managers) to handle those aspects 0f her

financial affairs.

Siegel was legally required to separate trust property from those of the beneficiary, and

he properly maintained this division. See, e.g., Prob. Code § 16009. Had Siegel combined Lisa’s

personal finances with those 0f the Trust as Lisa now suggests he should have done, Siegel
KOOOQONUIAUJNH

would have faced potential liability.

Importantly, the fact that all of the distributions from the Trust to Lisa went t0 her

personal bank accounts 0r for her benefit is not actually in dispute. Lisa simply claims (falsely)

that the money was then transferred t0 a bank account that “[Siegel] exclusively controlled in

LMP’s [Lisa’s] name” and that Siegel set up these accounts for n0 apparent purpose other than t0

secretly profit. This claim is yet another example of Lisa denying reality as the bank accounts to

ALC which the Trust distributions went are the same bank accounts that existed before Siegel became

a trustee.

Lisa had full access t0 those accounts, and the ability t0 draw money as she wanted for

GLADSTONEWEISBERG,
her personal spending. These funds were not Trust funds and Lisa was free t0 spend the money

as she Wished. Indeed, in prior years, Lisa and her personal assistants received bills directly and

Lisa paid the bills herself. Lisa later instructed Provident t0 assume these duties, but that does not

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make her personal accounts part of the Trust.3

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Accordingly, the Court should rej ect the assertion that Siegel was required t0 0r should

have to account for Lisa’s personal financial affairs, and for the bank accounts held in her name.

Such an undertaking would be enormous considering the time span involved, and the fact that

her personal finances are intimately wrapped up with various personal endeavors, such as her

music career. Siegel has already spent more than $150,000 preparing the accountings for the

Trust, Which took nearly 9 months. An accounting of Lisa’s personal finances would more than

double that cost and take as much time.

3
Even though Lisa instructed Provident to receive and pay her bills, Provident regularly sent Lisa and her
assistantsmonthly and/or weekly reports 0f the bills that she needed to pay over the years for approval. After Lisa
informed Provident that either she or her eX-husband, Michael Lockwood, needed to approve all bill payments going
forward, Provident began sending those weekly reports to both Lisa and Lockwood for approval.

60081 10
BARRY J. SIEGEL’S RESPONSE TO THE PETITIONER’S OBJECTIONS TO THE ACCOUNT AND
REPORT OF THE FORMER CO-TRUSTEE OF THE PROMENADE TRUST
 Lisa also has not pointed to any reason why an accounting 0f her personal spending is

necessary. Lisa’s only apparent concern With the accounting is that it does not show how much
Provident received over the years for the business management services that it provided Lisa.

That information is easily obtainable in discovery, and, indeed easily ascertainable if Lisa simply

looks at her bank statements (which she has access to), 0r the financial database that Provident
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turned over to her When she terminated Siegel and Provident in 2016. Provident’s fees are readily

ascertained by the financial reports and the database that Lisa already has in her possession.

Indeed, Lisa apparently knows the amounts she claims Provident charged, as she

repeatedly throws out a number, claiming that Provident received $4.9 million since Siegel

became a trustee. The exact number can be determined through basic discovery, without a formal

accounting of her personal bank accounts, Which are not subj ect to the Trust.

ALC 4. LISA HAS THE BURDEN OF PROVING THAT SIEGEL ACTED IN BAD
FAITH AND THAT ANY OF THE PROFESSIONAL FEES CHARGED TO THE
TRUST WERE UNREASONABLE
GLADSTONEWEISBERG,
In addressing Lisa’s objections about the professional fees charged t0 the Trust, the Court

is reminded that those fees are presumptively reasonable. The Trust instruments expressly state

that Siegel’s actions are presumed to be in good faith and in the best interests of the Trust. E.g.,

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Ex. B, 2010 Trust at § 1.8. Lisa bears the burden of showing the fees were both unreasonable,

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and that Siege] paid them in bad faith.

A. Provident’s Accounting Fees Were Disclosed And Reasonable

Conflating Siegel, as the co-trustee of the Trust, and Provident, as the business entity that

contracted with Lisa t0 provide business management services, Lisa claims that Siegel falsely

declared that he did not received fees for his work as the Trustee. However, Siegel’s statements

are unquestionably accurate.

Siegel did not, as claimed in the Petition, receive any money for his work as the Trustee.

However, Provident charged for business management services that Siege] and others performed

on the Trust’s behalf. Those payments were charged at the company’s standard hourly rate. Lisa

acknowledges that Provident, not Siegel received these payments, pointing to the Trust’s

60081 1 1

BARRY J. SIEGEL’S RESPONSE TO THE PETITIONER’S OBJECTIONS TO THE ACCOUNT AND

REPORT OF THE FORMER CO-TRUSTEE OF THE PROMENADE TRUST
 payments t0 Provident as evidence that Siegel secretly profited as the Trustee.

Further, the accountings show that the total amounts paid by the Trust t0 Provident for its

business management services were typically well below $100,000 annually, and typically in the

range of $30,000 t0 $50,000 per year. The trust paid accounting fees in excess 0f $100,000 only

in four years (2005, 2010, 201 1, 2013).4 Because the Trust authorized Siege] to retain
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accountants t0 assist With the Trust administration, payments t0 Provident do not serve as the

basis for a breach of trust claim so long as those fees were reasonable. Lisa bears the burden 0f

proving that the amounts that Provident charged were unreasonable and that Siegel as trustee,

paid those Charges in bad faith.

Even assuming, arguendo, that Siegel and Provident should be treated as the same, and

that payments to Provident for the hourly work it performed should be deemed “trustee fees,” the

ALC fees that were charged t0 the Trust for hourly work were expressly authorized. The 2004 Trust

expressly stated that Siegel was entitled to reasonable fees for his services as the trustee. The

2010 Trust confirmed Siegel’s entitlement t0 fees as a trustee. EX. C, 2010 Trust at 11
1.5. Neither

GLADSTONEWEISBERG,
Trust required prior approval of Siegel’s fees by Lisa 0r anyone else. The question is Whether

those fees were reasonable. Lisa bears the burden of showing that they were not.

For Lisa to claim that Siegel secretly profited because 0f the work that Provident

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performed for Lisa and the Trust is outrageous and falls flat in light of the financial information

she received each year. A11 accounting and other professional fees that the Trust incurred each
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year were clearly shown in the financial reports she received as well as in the tax returns that

Siegel went over with Lisa each year. The Court need only review select samples of these reports

and her tax returns t0 determine that this information was disclosed. See, e.g., Exs. F through O.

Indeed, Lisa accuses Siegel 0f not disclosing a $200,000 payment to Provident in 201 1.

Yet, like he did every year, Siegel met With Lisa in March 2012 t0 g0 over her finances. The

parties expressly discussed the amount 0f legal and accounting fees the Trust incurred in 201 1,

4
Lisa’s recitation in her objections 0f larger amounts allegedly received by Provident is inexplicable,
considering the fees stated in Schedule D do not even closely match the numbers she lists in her objections. Except
for 2005, the accountings do not list any other payments to Provident or Siegel outside Schedule D.

60081 12
BARRY J. SIEGEL’S RESPONSE TO THE PETITIONER’S OBJECTIONS TO THE ACCOUNT AND
REPORT OF THE FORMER CO-TRUSTEE OF THE PROMENADE TRUST
 along with the amount 0f business management fees that Provident charged that year. The same

is true With respect t0 Virtually every annual meeting they held, as shown in the financial reports

and tax returns that Lisa received over the years.

B. Provident’s Business Management Fees Were Disclosed And Agreed Upon

Lisa does not dispute that Provident served as her business management firm for nearly
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two decades — from long before Siegel agreed in December 2003 t0 serve as a co-trustee. Lisa

also does not dispute that Provident did, in fact, provide those services over the years. She

simply claims that she the fees were never disclosed, and were excessive.

The truth is that she expressly agreed t0 the fee arrangement With Provident. In 1993,

When Provident’s predecessor firm began providing services to her, Lisa paid for those services

at an hourly rate. Over the years, Provident switched t0 a flat monthly fee for its services because

ALC Siegel wanted Lisa to save money over what she was paying hourly. A11 such fees were paid

from her personal accounts, not from the Trust, because the work involved her personal finances

and her business affairs — not the administration of the Trust.

GLADSTONEWEISBERG,
Lisa not only knew 0f the flat-fee arrangement, but those fees were regularly disclosed.

Again, Siegel met with Lisa regularly each year t0 g0 over her finances. Lisa has never denied

that these financial meetings took place, or that Siege] followed her express instructions t0 bring

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the documents with him t0 the meetings and to take them away after the meetings because she

did not want copies of the documents in her house.

OOQONUILUJNHOKOOOQONUI-BUJNHO

A review 0f the financial reports, along with her tax returns, makes clear that Lisa
received notice of the fees Provident charged for its services. The financial reports and her tax

returns contain line items relating t0 the expenses she incurred annually for business

management fees, accounting and other professional fees.

C. Lisa Cannot Show The Amounts Paid To Other Professionals Were

Unreasonable Or Unauthorized Under The Trust
Lisa’s desperate attempt t0 avoid all responsibility for wasting the Trust’s assets is

readily apparent as she lashes out about at the amounts paid, not t0 Provident, but t0 all of the

lawyers and other professionals that advised her and the Trust in connection with the 2005

60081 13
BARRY J. SIEGEL’S RESPONSE TO THE PETITIONER’S OBJECTIONS TO THE ACCOUNT AND
REPORT OF THE FORMER CO-TRUSTEE OF THE PROMENADE TRUST
 transaction. There is no evidence that those fees were excessive 0r unauthorized, and Lisa will

never able to prove her claims.

The Trust expressly authorized Siegel to retain professionals, including accountants,

investment advisers, and lawyers, to assist in the administration of the Trust. Lisa specifically

amended the Trust in 2004 in anticipation 0f the approaching 2005 transaction to include
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provisions authorizing Siegel to retain the professionals, and t0 act on their advice, Without

further investigation and Without or liability for doing so. Had he not done so, Lisa would now
be complaining that Siegel had failed to retain legal and other professionals to evaluate and

advise the Trust 0n the transaction.

The Trust further authorized Siegel t0 compensate those professionals for their work.

Again, the Trust did not require Lisa’s or anyone else’s prior approval. The Trust expressly

ALC authorized Siegel to pay their fees. Lisa bears the burden of showing the fees were both

unreasonable and paid in bad faith.

It is perplexing that Lisa now Clams that Siegel paid those professionals “without regard

GLADSTONEWEISBERG,
t0 the value 0f the services performed” and “without attempting to negotiate a better deal for

LMP.” On the one hand, Lisa (falsely) purports t0 have no genuine knowledge about the CKX
transaction 0r the advice she received from the same lawyers whose bills she now attacks. On the

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other hand, Lisa now makes allegations that their fees were excessive based on the value of their

OOQONUILUJNHOKOOOQONUI-BUJNHO
work, i.e. insinuating she knows enough about the work they performed t0 make that claim. Her

positions are nonsensical and contradictory.

Regardless, Siegel did, in fact, raise issues with regard to the bills of the professionals

when he believed the bills were too high, and he negotiated reductions 0f their fees 0n behalf of

the Trust. For instance, one of the items Lisa challenges concerns the $700,000 payment to the

Proskauer firm for its work 0n the transaction. However, Proskauer actually incurred much more

in fees for its work on the transaction. Proskauer explained t0 Siegel in 2005 that the transaction

was much more complicated than originally anticipated. Proskauer estimated that any other firm

of its size would have charged more than $1 million for the work that it performed. EX. U.

60081 14
BARRY J. SIEGEL’S RESPONSE TO THE PETITIONER’S OBJECTIONS TO THE ACCOUNT AND
REPORT OF THE FORMER CO-TRUSTEE OF THE PROMENADE TRUST
 Siegel negotiated Proskauer’s fees down for the benefit of the Trust, persuading the firm

t0 accept $700,000 for its services up to the closing, and reached an agreement that the firm

would perform a substantial amount of post-closing work for no extra charge. Id.

Lisa similarly claims that the payments t0 Sukin Law Group constitutes an example 0f

excessive compensation, and constitutes an unusual transaction for which a further explanation is
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required. Probate Code § 1064 only requires Siegel to identify the amounts he paid to the

attorneys he retained. To the extent that the Court requires a further explanation 0f their work, 0r

the fees incurred, the firm’s invoices for their work are attached. EXS. V & W, Sukin Law
Invoices. The additional $103,999.02 payment that the Sukin Law Group received was based on
its post-closing work for EPE in February and March 2005, which was separate from the pre-

closing work.

ALC In short, Lisa expressly authorized Siegel t0 retain the professionals he hired on behalf of

the Trust, and to pay their fees. Lisa expressly agreed that Siegel’s payment of those fees were

presumptively in good faith, and that it would be her burden to show otherwise. Lisa cannot

GLADSTONEWEISBERG,
produce any evidence showing that the professionals Siegel hired did not perform their duties,

that the fees were unreasonable, or that Siegel should not have paid them for their work.

5. CONCLUSION
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For foregoing reasons, Siegel respectfully requests that the Court reject the Petitioner’s

OOQONUILUJNHOKOOOQONUI-BUJNHO
obj ections t0 the accountings that he filed for the Trust and enter an order approving them. If the

Court is inclined t0 entertain the obj ections, Siegel respectfully requests that the Court set the

matter for trial.

60081 15
BARRY J. SIEGEL’S RESPONSE TO THE PETITIONER’S OBJECTIONS TO THE ACCOUNT AND
REPORT OF THE FORMER CO-TRUSTEE OF THE PROMENADE TRUST
 Dated: August 13, 20 1 9 GLADSTONE WEISBERG, ALC

BY:
C
Ly/ >

Gladstone
Michael J. Aiken
Anthony DiPietra
Attorneys for Respondents Barry J. Siegel and
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ProvidentFM

ALC

GLADSTONEWEISBERG,

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OOQONUl-bUJNb—‘OKDOOQQUIAUJNHO

60081 16
BARRY J. SIEGEL’S RESPONSE TO THE PETITIONER’S OBJECTIONS TO THE ACCOUNT AND
REPORT OF THE FORMER CO-TRUSTEE OF THE PROMENADE TRUST
 AFFIDAVIT AND DECLARATION OF PROOF OF SERVICE
I am over the age of eighteen years and not a party t0 the Within action. I am Of Counsel
t0 the law firm 0f Gladstone Weisberg, ALC, Whose business address is: 300 Corporate Pointe,
Suite 400, Culver City, California 90230 ("the firm").

BARRY J.
On August 13, 2019, I served the Within document(s) described as:
THE ACCOUNT
SIEGEL’S RESPONSE TO THE PETITIONER’S OBJECTIONS TO
AND REPORT OF THE FORMER CO-TRUSTEE OF THE PROMENADE TRUST on
the interested parties in this action:
\OOOQONUIAUJNH

E] filming a the originag true

addressed as follows
copy(ies) thereof enclosed in sealed envelope(s)
addressed as stated 0n the attached mailing list.

SEE ATTACHED MAILING LIST.

E] EMAIL (§ 1013(a), (e); CRC 2. 250)—by transmitting said document(s) by electronic mail
at300 Corporate Pointe, Suite 400, Culver City, CA 90230, to the respective e--mai1
address(s) of the party(ies) as stated above/on the attached mailing list. The document
was served electronically and the transmission was reported as complete and Without
error.

ALC (State) I declare under penalty 0f perjury under the laws of the State of California that the
foregoing is true and correct.

(Federal) I declare that I am employed in the office of a member 0f the bar 0f this Court
at whose direction the service was made.

GLADSTONEWEISBERG,

Executed on August 13, 2019, at Murphy, Texas.

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('7
,/
MONY DIPIETRA
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60081 4
BARRY J. SIEGEL’S RESPONSE TO THE PETITIONER’S OBJECTIONS TO THE ACCOUNT AND
REPORT OF THE FORMER CO-TRUSTEE OF THE PROMENADE TRUST
 MAILING LIST
PRESLEY V. SIEGEL. et al. — CASE NO. 18$TPB01759

Amjad M. Khan Attorneysfor Petitioner

amj [email protected] LISA MARIE PRESLEY
Glennon
Jill
[email protected]
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BROWN NERI SMITH & KHAN LLP

11601 Wilshire Blvd., Suite 2080
Los Angeles, California 90025
Tel: (310) 593-9895
Fax: (3 10) 593-9980

Justin B. Gold Attorneysfor Petitioner

[email protected] LISA MARIE PRESLEY
OLDMAN, COOLEY, SALLUS,
BIRNBERG, COLEMAN & GOLD, LLP
16133 Ventura Blvd., PH
Encino, CA 91436
ALC
Tel: (818) 986-8080
Fax: (818) 789-0947

GLADSTONEWEISBERG,

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60081 5
BARRY J. SIEGEL’S RESPONSE TO THE PETITIONER’S OBJECTIONS TO THE ACCOUNT AND
REPORT OF THE FORMER CO-TRUSTEE OF THE PROMENADE TRUST