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Pritzker Lawsuit Divides Family

The notoriously private owners of Hyatt – The Pritzker family – have decided to part ways, leaving billions in assets up for grabs.

Thursday, December 12, 2002
Kristin Amarante
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Pritzker Lawsuit Divides Family

CHICAGO – Some are calling it the end of a dynasty – the Pritzker family, owners of a $15 billion real estate empire that includes the Hyatt Hotel chain, have ultimately agreed to liquefy and distribute assets to 11 family members over the next decade. Family disagreements over money and business have provoked four generations of Pritzkers to go their separate ways.

“Since Jay's death in 1999, the family has all worked together on a common strategy for generational transition. During this process, we jointly considered the divergent interests and points of view of the various family members. Through this process, we were able to reach common ground and goals for the ongoing conduct of our family's business interests,” said a statement issued by the Pritzkers last Tuesday.

Four years before Jay Pritzker’s death in 1999, he issued a memorandum to 11 members of the Pritzker family, appointing three of them to head the family’s businesses, and clarifying that the Pritzker fortune is to be shared among the rest of the family.

Last year, quarreling between family members prompted the termination of that agreement, and led to a secretly devised new plan that would breakup the Pritzker Empire and disperse funds to each of the 11 members.

However, a young cousin has put a snag in the plan by suing her father, Robert – Jay Pritzker’s brother – and eight other Pritzkers for the return of $1 billion to her trusts and $5 billion in punitive damages.

Liesel Pritzker – an 18-year-old-actress who starred in “Air Force One” with Harrison Ford – contends that her trust funds were emptied to benefit the other members of that generation, who are decades older. The lawsuit maintains that Robert Pritzker moved assets from his children’s trusts to their cousins’ and to the family’s philanthropy, the Pritzker Foundation, the New York Times reported.

In the statement issued by the historically private Pritzker family, they express desire to settle the dispute amicably.

“As a family, we have traditionally shied away from publicity in order to attempt to lead our lives in private. However, now that Liesel Pritzker has taken action in a public forum, we are issuing this joint statement in order to balance the media's interest in understanding more about our generation with our own interest in preserving our ability to live as private individual,” said the statement. “We regret that Liesel, who continues to be a beneficiary of significant wealth and advantage from the family, has chosen to sue her father and other members of her family. While we do not agree with her assertions, Liesel is a member of our family and we therefore remain united in our hope for a fair resolution for all involved.”

As for the Pritzker Empire, which includes more than 60 companies in the $6.4 billion Marmon Group and 2,500 domestic and offshore trusts, the cousins have agreed to liquefy assets during the next 10 years, and to each take about $35 million from the Pritzker Foundation to set up their own charities, in addition to receiving $30 million as part of the agreement, reported the New York Times.

Despite rumors that the family had already commissioned a plan to take Hyatt public, Hyatt Chairman and CEO, Thomas Pritzker denied the rumors saying that the company, which owns 40 hotels and manages 207 more, presently, would remain private.

“Can't foreclose our options in the future, but I can say we have no plans to take Hyatt public in the next several years,” said Thomas Pritzker, Chairman and CEO Hyatt Corp., Regarding Hyatt going public.

US Franchise Systems, which was purchased by the Pritzkers in 2000, also declined to comment.

What do you think about this issue? Will the Pritzker’s be able to keep this unfolding drama behind closed doors? We want to know what you think. Let us know. Drop us a line at feedba ck.

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