Storm swirls around Karmanos family over $105 million dispute involving Carolina Hurricanes loans
Sons are suing the founder of Compuware over money taken from trusts
DETROIT – It's a family squabble of monumental proportion.
The Karmanos family, businessman Peter Karmanos and his three elder sons, are fighting over more than $100 million.
The case is now in Oakland County Circuit Court. The dispute centers on Karmanos's will, which stands to give substantial amounts of money to his sons. The problem? Pete Karmanos borrowed millions of dollars from trusts, made up of Compuware stock, promised to his three sons, Peter the third, Nick and Jason.
The trusts are valued at over $100 million, but over the years, Pete Sr. borrowed against the account to fund his beloved Carolina Hurricanes hockey team. He wrote a loan contract for more than $100 million, agreeing to pay interest using installments until June 29, 2022, or one year after his death.
A lawsuit filed last Thursday says "on or about April 21, Peter the third ... sent his father a notice of default of balance of principal and interest on the June 2013 note."
The sons claim their father "failed to timely cure such defaults and accordingly, on or about May 25, 2016 the entire balance of the June 2013 note ... more than $105 million ... would become immediately due and payable."
Probate litigator Robert Zawideh of Kemp Klein says the case leaves you wondering about the Karmanos fortune's fortunes.
"Well certainly the biggest indicator of money problems is when you're getting sued over nonpayment of money, the lawuit certainly suggests that but there could be other reasons as well," he said.
Normally this kind of case winds up in probate court, but the Karmanos sons isntead filed a civil case in circuit court saying this is a contract dispute.
Local 4 reached out to both parties in the case today. The sons had no comment. Pete Sr. did not return phone calls.
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