This article is an instalment in a series, Project Harmony, on Rupert Murdoch’s secret plan threatening to blow up his family.
Stunning revelations in today’s New York Times, that Rupert Murdoch has gone to court in Nevada to try to amend the family trust that controls the powerful Fox and News Corporation media empire, open another chapter in the endless succession drama between his four eldest children. Rupert has called it “Project Harmony” — the reality is anything but. And all just in time for The Australian’s 60th birthday party tonight, set to be hosted by Lachlan in his father’s absence.
The bombshell story was broken by the Times’ crack team of Jim Rutenberg and Jonathan Mahler, who co-authored the landmark “Planet Fox” investigation five years ago and who are well sourced on the Murdoch family.
The Times has obtained a copy of a sealed, 48-page decision by the Nevada probate commissioner, ahead of a hearing in September that will decide whether Murdoch’s attempt will be successful. Although the Murdoch Family Trust is irrevocable, it can be amended if it is in good faith and in the interest of all members.
According to the story, Rupert — who finally retired from the boards of Fox and News last year, formally handing the reins at both Fox and News to his eldest son Lachlan — has petitioned the commissioner to amend the family trust so that the three other children from his first two marriages — Prudence, Elisabeth and James — are unable to challenge their brother’s control of the media empire or moderate the conservative editorial line taken at the Murdoch media businesses including Fox News.
Rupert Murdoch is arguing that any attempt to challenge Lachlan’s control of Fox and News, or to soften its conservative editorial stance, would reduce the value of those businesses, particularly Fox News, the dominant cable news channel in America which is pitched to the MAGA audience fanatically loyal to Donald Trump, and has been crushing its competitors in ratings through an unprecedented, tumultuous election cycle ahead of November’s ballot.
As the eldest son and CEO of Fox Corporation, anointed as successor by Rupert and the board after the sale of the bulk of the former 21st Century Fox to Disney in 2019, Lachlan has stuck dutifully to the centre-right conservative formula devised by his father and the late Roger Ailes, who co-founded Fox News in 1996. That’s led to a deepening division with his younger brother James, who was appalled by the Trump administration. James has had no role at Fox since the Disney sale and quit the board of News in 2020.
It is understood the two brothers have not spoken since, leaving the two sisters Prudence and Elisabeth holding the balance of power on the Murdoch Family Trust, which gives the four siblings an equal say. According to Murdoch biographer Michael Wolff, author of The Fall, Prudence is disinclined to upset any majority that emerges between her three younger siblings, who have all worked extensively for the family business. That leaves Elisabeth, eldest child of Anna Murdoch, as the swing vote in a dispute between Lachlan and James — she has tried to be a peacemaker and has often been described as “Switzerland”.
The key terms of the irrevocable trust were established during Rupert’s 1998/99 divorce from Anna, who could potentially have sued for half the media empire after 31 years of marriage. Anna sought to ensure that her children’s control of the Murdoch media empire could not be challenged by any future children born to Rupert’s third wife, Wendi Deng. Rupert and Wendi had two daughters, Chloe and Grace, and when they were born Rupert did try to amend the trust to ensure his children would be treated equally. That caused huge upset among his older children, who felt that Anna had left billions on the table to protect their inheritance.
A solution of sorts was found in 2006 when it was agreed that the six children would be treated equally financially, but only the four eldest children would have voting shares of the trust. Rupert has four votes while his four older children have one each — which means he and Lachlan have unquestioned control until he dies, at which point his votes effectively expire. That sets up an instability in the structure of the Murdoch empire.
As the relationship between Lachlan and James deteriorated after the Disney sale was agreed, Rutenberg and Mahler reported that Rupert had backed a plan for Lachlan to buy out his siblings’ shares of the trust. Documents were drawn up according to the Times, but Lachlan baulked. As I wrote in my unauthorised biography, The Successor, Lachlan saw no reason to borrow heavily to buy something he already had: control.
When researching the biography, I was guided by sources familiar with the dynamic inside the Murdoch family that indicated Lachlan’s three elder siblings were no longer interested in selling, but were determined to assert control over all of the Murdoch media businesses, and to do it in a way that enhanced democracies around the world rather than undermined them. Those lines caught the attention of the world’s media afficionados, sparking headlines from Vanity Fair to The Guardian, Bloomberg to the Financial Times.
In Lachlan’s camp, such fevered speculation was dismissed as fanciful, but today’s revelations show fears of just such a move by the three elder Murdoch siblings are very real and shared by Rupert himself. To my observation, over years of reporting, Murdoch family time is often six to 12 months ahead of the news cycle, and in retrospect it is clear that the petition to amend the family trust, filed quietly last September, was part of a larger strategy which included Rupert’s very public retirement announcement — both were designed to entrench Lachlan’s succession and ensure Rupert’s conservative political legacy.
Rupert’s attempt to amend the trust once again has alienated Prudence, Elisabeth and James — so much so that they were not present at his fifth wedding, to Elena Zhukova, 67, at his Moraga vineyard last month. Of his older children, only Lachlan was there.
Whatever way the Nevada probate commissioner rules after the week-long trial in September — it is understood that the court hearings will be closed, and a decision may not be known for weeks or months — the action by Rupert underlines that no matter his achievements and missteps as CEO and successor, Lachlan’s position remains vulnerable.
I can’t read Lachlan’s mind but in my opinion his decision, with his wife Sarah, to call Australia “home” despite his heavy managerial responsibilities in the US is one way of telling the boards of Fox and News, shareholders and the rest of the world that he can take or leave the succession — even as behind the scenes he and his father are fighting to protect it.
As he heads off to celebrate the 60th anniversary of The Australian tonight — it is understood everyone from the prime minister down will be attending — the succession question, supposedly resolved, will again be swirling around him, as it has most days for the past 30 years.
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