Why January is the cruelest month for celebrity sweethearts
With the holidays in the rear-view mirror and New Year’s resolutions still fresh, January has traditionally been the busiest month for divorces.
And this year is no exception.
Among the rush of early year breakups — divorce filings are said to spike by a third this month — are Madison Square Garden Executive Chairman James Dolan and his wife, Kristin, and CNN President Jeff Zucker and his wife, Caryn.
January was also the month in 2005, for example, that Brad Pitt and Jennifer Aniston announced they were getting divorced.
“No one wants to put a summons in his or her spouse’s Christmas stocking,” said divorce lawyer Jacqueline Newman. “But at the same time, everybody wants to start the new year fresh.”
Family therapist Dr. Kathryn Smerling said children play a big role in creating the January rush of separations and divorce filings.
“You don’t want to ruin the kids’ holiday — so you wait until the new year,” Smerling said. “You then give them time to assimilate the idea of separation before announcing it to the world.”
While divorces and separations are certainly jarring for families, when CEOs are involved, shareholders can also be jolted.
In 2013, Best Buy Chief Executive Hubert Joly was forced to sell nearly 500,000 shares of his company stock to pay his divorce settlement.
The company feared the optics of such a sale so much that it issued a statement to address the move — explaining it was all about the divorce.
After studying real-life cases, David F. Larcker of the Stanford Graduate School of Business asserted in a landmark study that divorce can cause CEOs to lose control of their companies, significantly alter their attitude toward risk and diminish productivity across entire firms.
The study, “Separation Anxiety: The Impact of CEO Divorce on Shareholders” focused on Continental Resources CEO Harold Hamm, whose 68 percent stake in the petro exploration and production company was subject to Oklahoma’s equitable distribution laws when his wife of 25 years filed for divorce in 2012.
That was enough, Larcker said, for RBC Capital to warn shareholders that Hamm could be forced into selling a chunk of his stock to pay for the settlement or transferring shares to his ex-wife — options likely to result in a “substantial overhang” and possibly a change of control.
For individuals with lots of money, Beverly Hills divorce lawyer Neal Hersh insists on prenups, knowing that half of first marriages fail, as do two-thirds of second marriages.
Hersh therefore suspects the Dolans — which Page Six reported were separating — have a prenup, considering James’ family wealth and a previous marriage.
A spokeswoman for the couple declined to address this issue, dismissing it as irrelevant, given that the breakup is a separation rather than a divorce.
“They will continue their relationship as business partners,” she said.
The Zuckers, who married when Jeff was 31 and whose wealth-amassing years lay ahead, seem less likely to have a prenup.
Spokespersons for the Zuckers also ducked the prenup or postnup question on the grounds that, unlike the Dolans’ situation, whatever Time Warner shares Jeff might have to sell in a divorce settlement wouldn’t have the volume to affect the stock’s price.
Either way, it’s no surprise to Hersh that the high-profile marriages of high-powered executives are susceptible to breakups.
Many of his clients stay up all night for their jobs and move heaven and earth for their children, he said, but when one spouse complains about a lack of attention, the answer from the other is too often, “Hey, I’m working my ass off. What do you expect?”
“That’s an answer, but it’s not the right answer,” said Hersh, who knows from his own divorce. “It just breeds more trouble.”