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Cooper: Anna Nicole Smith Baby Unlikely to Inherit Fortune

Despite media reports that Anna Nicole Smith's daughter, Dannielynn, may stand to inherit a portion of the late J. Howard Marshall's estate, Professor Horace Cooper argues that casting aside the Texas probate court's earlier decision that Marshall's son was his legal heir is unlikely.

Smith's fight to win a portion of Marshall's estate made its way to the United States Supreme Court, which ruled late last year that a decision by the 9th Circuit Court of Appeals was overly broad and sent the case back to the 9th Circuit on remand.

The most compelling question for the 9th Circuit will be a determination of which of the courts involved issued a final judgment first, says Cooper.

She's no million dollar baby: After the courts rule, Anna Nicole Smith's daughter probably won't get the big estate, Legal Times, April 9, 2007. By Horace Cooper.

Excerpt:
"When it originally invoked the 'probate exception,' the 9th Circuit panel didn't rule on the merits of either the federal bankruptcy court or the federal district court decisions. With the Supreme Court's narrow opinion explaining that none of the Supreme Court's earlier cases endorsed the notion that federal courts couldn't independently weigh in on probate matters, the9th Circuit now will have to deal with the merits.

"In that context, the most compelling question for the 9th Circuit will be a determination of which court -- the federal bankruptcy or district court or the Texas probate court -- issued a final judgment first. Chronologically the Texas probate case started first, but the federal bankruptcy court issued its verdict first. The 9th Circuit panel reviewing the case will have to determine which decision counts as the first 'final judgment.'

"There are two issues here. First, the federal district court vacated the ruling of the bankruptcy court and reviewed the matter de novo. It did so after the Texas probate trial had concluded. If this decision about vacating the bankruptcy ruling is upheld, it would mean that the bankruptcy ruling has no effect for purposes of res judicata -- that is, neither the bankruptcy decision nor the federal district court's ruling were final judgments for this purpose.

"Second, even if the federal bankruptcy court's ruling was final and determined to have occurred first, there are serious questions, relevant to judicial economy and the principles behind res judicata, about the evidentiary record used by the federal district court.

"A review of the record indicates that whereas the Texas probate trial took nearly six months to sort through all of the legal and evidentiary issues before reaching a conclusion, the federal district court was able to do so in a few days. How? Primarily by reviewing many of the depositions from the concluded Texas probate trial and also by disallowing most of the witnesses that Pierce Marshall sought to call.

"Such an approach has the advantage of expediting matters, but it severely constrains the ability of the court to weigh all evidence necessary. Depositions are useful, but they are not an equal alternative to witnesses testifying subject to cross-examination. As a result, there are serious questions about the sufficiency of the record that the district court relied upon. And such an outcome is contrary to the benefits of res judicata -- which is to allow subsequent courts the ability to rely on the findings of fact of earlier courts.

"Additionally, judicial economy would dictate that the Texas probate court (as a specialty court) should be given greater deference and weight in making these determinations. In this case, the probate court took nearly six months to reach a determination. Casting aside its work will not be done lightly.

"Together, judicial economy and res judicata militate against the 9th Circuit directing a brand new trial to determine the validity of the Marshall will or estate plan. Accordingly, no one should be surprised when, at the end of all the proceedings, it is the original Texas trial verdict that determines the disposition of the Marshall estate. When that occurs (as it almost certainly will), Marshall's money will go to his son -- not to Smith's estate, her child Dannielynn, or Dannielynn's father (whoever that may be)."

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Watch as Professor Cooper discusses the case on ABC's Nightline.