Kylie and Kendall's Vicious Week: Today's Celebutantes Need Asset Protection NOW

The Jenner kids have been dodging a lot of legal bullets lately. Between risk and rumor, it’s time to cover the loopholes when you’ve got models in ambulances and dogs biting kids.

As the old pilot joke goes, barely surviving a crash landing isn’t proof of how lucky you are. It’s a red flag that any luck you had is wearing thin enough to show.

That’s where the Jenner side of the rich and famous Kardashian family is now. Sister Kendall has been accused of letting her Doberman bite a little girl in a Los Angeles restaurant. 

Now baby sister Kylie, who wants to be a billionaire, is throwing birthday parties that end with models taking an emergency trip to the hospital.

So far the incidents haven’t added up to more than gossip. They’re lucky. They need to stop relying on their luck and get smart instead.

And if they aren’t willing to make little changes to their lives, I hope someone is advising them who can help them build the structure that will protect them and their money from the consequences of future accidents.

The lines of liability

Kylie is a bigger target because she’s on the Forbes wealth list with a $900 million cosmetics empire in the making. Anyone with a grudge and a little greed who comes into contact with her has an opportunity to try to grab a little of that money in court.

That means eliminating her exposure to nuisance lawsuits. She’s simply got to keep her nose clean. If she’s throwing a party, her advisors need to set up the event to reduce her liability if anything happens to a guest or casual observer.

Her 21st birthday party a few days ago is a great teachable moment there. Kylie and her friends were celebrating in a chic Los Angeles dance club. One of them, a model and mother of two little kids, left in an ambulance.

She’s apparently all right now, but could she have accused Kylie of negligently letting her get hurt? This one is lucky. Holding the event at an outside commercial venue puts the blame on the staff’s shoulders. 

If Kylie had brought the party home, her insurance would need to pick up the hospital bills and she’d probably need to absorb additional legal blowback on her own. 

As social host in California, she would also be on the hook for any damage or injury her guests cause if they get drunk or otherwise overindulge at her home. Better to leave it in the club where employees are trained to defuse dangerous situations — and where liquor liability licenses protect the enterprise.

The good news is that anyone suing Kylie for any personal negligence would have a hard time getting access to the cosmetics company, which is set up as a limited liability corporation. That’s why a lot of corporations get established in the first place: to separate personal and business assets and minimize overall risk.

What’s remarkable is that this is a 21st birthday party where legal adults can order their own drinks and take responsibility for their own behavior. But 18-year-olds are considered adults in their own right, which is how Kylie started that LLC in the first place.

Either way, people in the legal transitional zone need adult supervision or else the parents are vulnerable. Kris Jenner would not appreciate that.

Once again, there’s more silver lining than cloud in this particular incident. The model recovered, the venue would’ve been liable and Kris would never have needed to get involved. It’s a warning for the way the family plans future events.

And the story hasn’t damaged Kylie’s most important asset — her personal brand — at all. Her brand is young and glamourous. Sometimes that means people take an ambulance ride. The company keeps growing behind her.

Shaggy dog story

Kendall, on the other hand, dodged a serious legal bullet when a woman called the police to say the Jenner dog bit her daughter in a restaurant.

Wealth Advisor personnel were actually on the scene. The incident apparently got a little noisy, but restaurant employees smoothed everything out. Whatever happened, there wasn’t any blood.

All the girls are responsible for the behavior of their pets. Hurt someone, you’ve got a lawsuit on your hands. And because the animal doesn’t have assets, you’re the one who has to settle any damages.

The classic solution is always to separate the wealth from your personal ownership through an asset protection trust or other legal structure. Odds are good that the Jenner girls have various amounts of property hidden in trusts here and there — after all, their father was a divorce lawyer who set up their first trust funds and they’ve made a lot of money since.

The trust is largely immune to claims against the person who transferred the assets in the first place. Sue the person and come up with pocket change.

But if your dog attacks someone, it’s often good form to volunteer at least a nominal settlement as a sign of good will. Pay the medical bills. Send a gift. Make sure the lawyers are talking and that there’s a formal understanding that everything’s been smoothed over.

After all, the Jenners are rich for being famous. If their fans start to hate them, they’re in trouble. A dog attack in public isn’t really great PR. 

Smooth it over. Quiet it down. Spend a little money now to protect the family franchise.

So far it’s working. But what’s disturbing here is the way these incidents are clustered. The landings have turned out good so far. The luck may be wearing thin.


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