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Dear Mega Millions Jackpot Winner: Call Me. Sincerely, Lottery Lawyers

Jason M. Kurland of Rivkin Radler in New York. Courtesy photo.

It's the problem everyone wishes they had. Who to turn to after a $1.6 billion lottery win? The record-breaking Mega Millions jackpot, which has birthed a new hashtag, #IfIWonABillionDollars, hasn't seen a winner since July 25, and the odds of winning stand at about one in 303 million.

But here's some legal advice for the winner—you know, just in case.

Lottery lawyer Jason M. Kurland of Rivkin Radler in New York recommends signing the ticket before doing anything else. That’s because it's a bearer instrument, which means, as Kurland notes, that “whoever hands it in to the Lottery Commission with their name on the back of it is the winner.”

Losing an unsigned ticket, means also losing the prize. Mega Millions Florida lottery ticket. Photo: Boofoto/Shutterstock.com.

In other words: Losing an unsigned ticket means also losing the prize.

Kurland stresses the importance of lawyering up, because going it alone is often “too overwhelming” for a lottery winner.

“You’re in a world that you’re not accustomed to being in,” Kurland said. “So if you have an advocate who’s been there before, someone who you know has your back, it’s really invaluable.”

States such as Delaware, Kansas, Maryland, North Dakota, Ohio, South Carolina and Texas allow winners to keep their identities secret, but most don’t. And under most Right-to-Know laws, that information falls under the public records umbrella. The reasoning: It doesn't aid public trust in the lottery process to have all winners remain anonymous.

 

'Let Someone Else Sign the Back of a $1.6 Billion Ticket'

To the lucky winner, "be prepared to be contacted by media—and long lost relatives," said Miami bankruptcy lawyer Monique D. Hayes, who advises securing home and family before going public.

That's easier to do in states such as Pennsylvania, which have allowed winners to have an independent trustee, usually an attorney, sign the lottery ticket and then send the money to a trust account.



 

Photo: Minerva Studio/Shutterstock.com

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In March, New Hampshire Judge Charles S. Temple ruled that the winner of a $560 million Powerball jackpot could remain a Jane Doe after she'd signed the ticket, but did allow the name of her town, Merrimack, to become public.

That said, Kurland "would not blame" the winner for signing the ticket and "just dealing with" the resulting publicity. "It’s very scary to let someone else sign the back of a $1.6 billion ticket,” he said.

Andrew Santana of Fox Rothschild, Pennsylvania. Courtesy photo.

In March, Andrew D. Santana, managing partner of Fox Rothschild in Pennsylvania, signed a winning lottery ticket on behalf of an anonymous client, who sent the funds to an entity called Emerald Legacy Trust.

The $273.9 million cash prize became $199.8 million after taxes.

According to Santana, he had to "threaten" litigation with the Department of Revenue to maintain confidentiality.

"I had a lot of phone calls from a lot of different people who were trying to get them. They'd offer me investment opportunities," Santana said. "There were charitable people and other strange phone calls from people who claimed the ticket was stolen from them."

Santana worked with financial advisory firms and services to help his client manage the money without revealing the winner's identity.

California trust and estates attorney Richard M. Aaron, of Dowling AaronInc., pointed out that his state and many others that prohibit anonymity don't force winners to have pictures taken.

In Aaron's mind, appearing on TV is "a serious error in judgment," as it makes winners and their family "targets to everything from charities, both phony and legitimate, friends, distant relatives, neighbors, complete strangers, financial scammers and maybe worse."

What could go wrong?

In November 2015, Craigory Burch Jr. landed more than $400,000 in the Georgia lotto, before being murdered by seven masked man who broke into his home, demanding money. According to police, Burch was a "preselected" target, and had posed for a photo with a gigantic check two months earlier.

 

'They Are Giddy'

"What people generally don’t realize is that with sudden wealth comes sudden responsibilities and problems," Aaron said.

Having dealt with many clients who have "suddenly become wealthy," including lottery winners, professional athletes and business owners selling their shop, Aaron said he's witnessed clients struggle to grasp "what wealth really means."

"When an ordinary person wins a lot of money, they feel a rush of emotions. They are giddy," he said. "Then they can go from feeling fortunate to feeling guilty, and from being happy to feeling targeted. All of these emotions can leave a lottery winner feeling distressed."

The best way to mitigate the chaos, according to Aaron, is to set up boundaries and procedures—both personal and financial.

"Even a big number is finite," he said.

Photo: Alexander Oganezov/Shutterstock.com.

According to Kurland, many of his clients "tend to act too quickly," and begin incessantly handing out gifts without regard to the tax consequences or lifetime exemptions.

"Winners understand that this was complete luck, that this could have been anybody, and the odds of them winning are so ridiculous that they can’t believe it was them," Kurland said. "They want to do the right thing by their friends and family, but what friends and family don’t realize is that they’re just one friend and one family member. There may be 50 others."

The much-discussed $1.6 billion is Mega Millions' annuity option, a fixed sum paid at regular intervals, while the lump-sum payout would be about $904 million.

After state, federal, corporate and gift taxes on the jackpot, the final figure could be significantly less. Depending on where a winner lives, $1.6 billion might become $600 million, according to USA Mega.

"By giving it away so quickly, you don’t give it a chance to grow," Kurland said. "If you just take a step back, take a deep breath, sit on it for a couple of months, even a year, you’ll realize that instead of giving it away you’ll now have made so much more on your money and now you can give even more away."

Santana and his Pennsylvania client are looking at "charitable endeavors" as they work on estate planning, but "slow and deliberate" is the key.

 

'We Get Paid When They Get Paid'

Monique D. Hayes of Goldstein & McClintock, Miami. Courtesy photo.

Another nouveaux-riche faux pas is the shared lottery ticket—a great idea, until someone changes their mind.

According to bankruptcy lawyer Hayes, oral agreements are no good. Instead, "a simple agreement, clearly identifying who the participants are, what their contributions are and what the agreed split will be" will suffice.

And when it comes to legal fees, there's usually no upfront retainer or fixed fee for lottery winners.

"We get paid when they get paid," Kurland said. "We sit down with the winner and go through all the things we could do for them, and it depends on what they want."

Some winners simply want Kurland's help getting through a press conference, while others want him involved "in every aspect of their lives for years and years."

For Kurland, if he won the $1.6 billion, he said, "One thing I do know for sure is that I would continue to help new lottery winners."

According to trust and estates attorney Aaron, "There is a 'happy zone' of wealth. If you have enough, it can enhance and enrich your life. If you have more than you can handle, it becomes a burden and potentially a source of unhappiness."

The next Mega Millions draw is set for Oct. 23 at 11 p.m. EST.

 

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