The Bezos Divorce: Let’s Talk Business

by | May 29, 2019 | Business, Divorce | 0 comments

The Bezos Divorce: Let’s Talk Business

By now, we all know of the infamous Bezos divorce. After official statements made by both Jeff and MacKenzie Bezos highlighting their amicable divorce circulated the internet, the world got to learn about their previous trials, separations, and now seemingly happy conclusion to their 25-year marriage. In fact, Jeff, 55, went as far as to say if he could go back and know their marriage would end, he would “do it all again” and looked forward to their “shared lives as friends.”

Amazon CEO Jeff Bezos and MacKenzie Bezos at the Vanity Fair Oscar Party in 2018.

In an equally friendly statement made by MacKenzie Bezos, 49, it was revealed she was “happy” to give her ex-husband 75% of their Amazon stock after finalizing their divorce. Seems cordial, right? However, many feel their bright announcement is actually due to darker implications; and when you look at the future of Amazon, that may be the case. Let’s examine.

The Incentive

There are many factors—business factors, that is—that suggest the divorced couple emphasized a cheerful split for reasons specifically related to Amazon. For Jeff and MacKenzie Bezos, a messy divorce could be bad for business. Contrary to what many might think, MacKenzie was vital to the founding and early development of Amazon. In fact, she was the one who negotiated their first freight contracts and even drove the two to Seattle before starting Amazon.

“I was there when he wrote the business plan, and I worked with him and many others […] in the converted garage, the basement warehouse closet, the barbecue-scented offices, the Christmas-rush distribution centers, and the door-desk filled conference rooms in the early years of Amazon’s history,” MacKenzie Bezos wrote in a review of the book The Everything Store: Jeff Bezos and the Age of Amazon.

According to Washington State law, this makes MacKenzie Bezos qualified to acquire half of Jeff Bezos’s assets. If they had indeed divided the assets between the two, Jeff Bezos would have been forced to sell some of his stock in Amazon. In this scenario, he would not only lose significant control of the company, but because he’s the famous face of Amazon, his company’s public image would change drastically.

Additionally, Amazon was already facing major heat in the press. Worker strikes, accusations for opening a new headquarters in New York City (in fact, Amazon decided not to continue with this), and poor working conditions and low employee wages. If that wasn’t bad enough, it was made worse when the National Enquirer exposed racy text messages between Jeff Bezos and Lauren Sanchez, 49, reportedly months before their divorce, inflicting an even larger stain on Amazon’s image.

Related: Tips to Minimize the Negative Effects of Divorce on Children

For Business’s Sake

So, what exactly did Jeff Bezos mean when announcing that he looked forward to “wonderful futures ahead […] as partners in ventures and projects” with MacKenzie Bezos? Well, it points to several possibilities: first, they’ve decided to keep the interests they have in Amazon. By doing so, they not only avoid months and months of exhausting forensic accounting, but save themselves from having to sell any assets.

Second, Washington State is known as a community property jursidiction state. As we mentioned above, this refers to simply dividing any assets within the marriage among the two parties. Without a prenup or agreement, a Washington State court may have to decide who gets what. Because Jeff and MacKenzie Bezos do not have a prenup (as they were rare in the early 90s), if they went along with this, they would’ve either had to sell their assets or let the court decide for them.

Related: What to Do With a Business During Divorce

A Reasonable Decision?

Because of the sheer power and wealth Amazon has, divorce matters such as alimony or prenuptial agreements are hardly an issue for Jeff and MacKenzie Bezos. Not only due to her heavy involvement in the company—entitling her to half the shares—but because even if she received only $1 billion, the interest alone would cover any imaginable lifestyle or family expenses. It’s not hard to see the most rational decision for the now-divorced couple—especially when dealing with such a massive fortune—was to retain their assets and continue moving forward, as business partners, for Amazon.

Amazon CEO Jeff Bezos and MacKenzie Bezos attending John McCain’s funeral in 2018.

Philanthropy

Soon after their divorce was finalized, MacKenzie Bezos pledged to donate half her fortune to charity. She joins billionaires Warren Buffett and Bill Gates in this philanthropic plight, properly titled the Giving Pledge. After acquiring 4% of Amazon in the divorce settlement, she is worth $37 billion and making big steps towards philanthropic action.

“In addition to whatever assets life has nurtured in me, I have a disproportionate amount of money to share. My approach to philanthropy wil continue to be thoughtful. It will take time and effort and care,” MacKenzie Bezos said in a now-famous statement.

Jeff Bezos has not joined this pledge.

Davis, Ermis & Roberts

We are experienced attorneys working in family law, divorce, business, and much more. We serve all civil and criminal courts in Dallas, Tarrant, Rockwall, Collin, and Ellis County. If you’re going through divorce or family separation, regardless if business assets are involved, we can help you.

Schedule your free consultation or fill out our online form. We are always available and ready to fight for your legal issues, even after-hours. Let Davis, Ermis & Roberts represent you today.