Sen. Dianne Feinstein’s family squabble over the extreme wealth left behind by her late husband, Richard Blum, was on full display in a San Francisco courtroom for the first time Monday, before a judge ordered private mediation that will drag the case into next year.
As was already clear from multiple court petitions filed in recent months, the dispute is over millions of dollars in assets and several valuable properties, including a multimillion-dollar beach house north of San Francisco and a mansion in the city worth more than $20 million. Blum died in February 2022.
Katherine Feinstein, the senator’s daughter from a previous marriage who has power of attorney for her 90-year-old mother in legal matters, has argued her mother is owed millions in disbursements from Blum’s estate and needs the money now to cover medical bills. Blum’s trustees have said his estate is incredibly complex and tied up in investments, and they need more time to evaluate his assets, tax liabilities and debts before making substantial disbursements.
The hearing provided no answers as to how those assets will ultimately be disbursed, but made one thing clear: The various parties — California’s senior Democratic senator, her daughter, the trustees overseeing Blum’s estate and Blum’s three daughters from a previous marriage — do not see eye to eye and continue to communicate poorly behind closed doors, even over the most basic issues.
Neither the senator nor the trustees appeared in court. Katherine Feinstein appeared via a video link, as did an attorney for the Blum sisters.
Retired San Luis Obispo County Superior Court Judge Roger Picquet, who was specially assigned to hear the case after San Francisco judges recused themselves in the matter, began the hearing by asking the parties if mediation was agreeable to everyone or if he would be “twisting people’s arms” by ordering it.
Usually when such cases can’t be privately mediated and a judge has to step in, none of the parties leave happy, Picquet said.
Steven P. Braccini, an attorney for Blum’s trustees, said he agreed the case “cries out for private mediation,” but that Katherine Feinstein — a former San Francisco judge — “doesn’t agree.”
John Hartog, an attorney for the Feinsteins, immediately pushed back, saying Braccini was “mistaken,” and that his clients were “more than happy” to proceed with mediation.
But, he said, the Feinsteins also wanted a few other things in the interim.
Hartog asked Picquet to order the trustees to sell the couple’s Stinson Beach house — which the senator and Blum’s estate each own 50% stakes in — and put the proceeds in an escrow account so that interest could be earned while mediation proceeds.
He also asked Picquet to order the trustees to provide a full accounting of their work to process the estate to date, so that the proposed mediation could be more productive.
The requests echoed arguments from Katherine Feinstein on behalf of her mother in the underlying petitions, where she said her mother has been left in the dark in trust matters and wants to sell the Stinson Beach property because she no longer uses it and does not want to continue paying for upkeep.
Hartog said the trustees have a fiduciary duty to make “unproductive property productive,” and that requires selling the Stinson Beach home. Not doing so, Hartog said, has tax implications that are detrimental to the senator.
“It is undisputed that the property costs money to maintain,” Hartog said.
Braccini responded by arguing that Katherine Feinstein had produced no evidence to date for why selling the Stinson Beach home was the appropriate move to make financially, so her arguments fall flat.
He said the trustees were still trying to determine Blum’s estate tax liability and debts. He said assessing the Stinson Beach home had also been made difficult because Katherine Feinstein or someone on her behalf had “locked [the trustees] out” of the home — something Hartog denied.
Braccini said Katherine Feinstein had used the argument that her independently wealthy mother needs disbursements from Blum’s estate to pay for medical bills as a “pretext” for demanding disbursements, and that there “is no evidence of what the senator wants” on the record.
Feinstein’s health has been a major political issue in recent months, with critics suggesting she is too frail to do her job. She was hospitalized earlier this year with shingles and also suffered from encephalitis, a swelling of the brain — which caused her to miss dozens of votes. She continues to need care and has repeatedly appeared confused in public, but is now back in Washington and expected to continue helping Democrats confirm liberal judges put forward by President Biden as a voting member of the powerful Senate Judiciary Committee.
The litigation over her husband’s assets has splashed Feinstein’s private affairs into the open during the final chapter in a long, otherwise polished political career. She has served in the Senate since 1992, and was previously mayor of San Francisco.
Feinstein’s office has declined to make her available to speak on the litigation, calling it a private matter.
Picquet posed several questions during Monday’s hearing, including whether it was reasonable for Feinstein to expect some sort of disbursement — even if it wasn’t from the sale of the Stinson Beach home — given that it has been more than a year since her husband’s death.
To that, Adam Pines, an attorney for the Blum sisters, said the Stinson Beach property is “unique,” and that there were other ways to make disbursements to the senator without selling off the home.
For instance, Pines said, Feinstein currently owns about 83% of her primary residence in San Francisco — a three-story mansion on the Lyon Street Steps, right next to the Presidio, that has been assessed at more than $21 million — while Blum’s estate owns the remaining stake.
The Blum estate’s minority share of the Lyon Street home is worth more than its 50% share in the Stinson Beach house, Pines said, and what is owed in disbursements to the senator could perhaps be paid out as an additional percentage ownership in the Lyon Street home rather than through a selling off of the Stinson Beach home.
Pines’ argument suggested the Blum sisters have an interest in holding on to the Stinson Beach home.
After hearing from all sides, Picquet declined to order the sale of the home but ordered private mediation and ordered the trustees to provide to the Feinsteins at least a partial accounting of the estate and their work to date to settle it.
“Some accounting of some credibility needs to be provided,” Picquet said.
In consultation with the parties, Picquet also set a schedule requiring the mediation be concluded by Dec. 11, unless an extension is requested, and a second court hearing on Jan. 22. That schedule will apply to all three of the separate petitions filed in the matter, he said.
Attorneys for the trustees and the Feinsteins declined to comment after the hearing.