Divorce at Altitude: A Podcast on Colorado Family Law

Exploring Premarital Agreements in a High-Profile Divorce: The Kevin Costner Case | Episode 168

August 30, 2023 Ryan Kalamaya & Amy Goscha Season 1 Episode 168
Divorce at Altitude: A Podcast on Colorado Family Law
Exploring Premarital Agreements in a High-Profile Divorce: The Kevin Costner Case | Episode 168
Show Notes Transcript

Dare we say it? Kevin Costner's divorce case with its contested premarital agreement, is one for the books - one that might rival any of his Hollywood screenplays. A prenup stating a $1.5 million payout to Christine Baumgartner upon divorce, child support complexities, parenting time issues - can this be contested considering his net worth is considerably more this many years after the agreement was drafted? 

In this episode, Ryan and Amy dissect the known details about his premarital agreement, discuss its enforceability, and delve into the attorneys' strategies as they move forward in this divorce case.  They also discuss the general unenforceability of certain clauses in premarital agreements. They also contrast Colorado's lack of case law on premarital agreements with other states, like California and New York.

What is Divorce at Altitude?

Ryan Kalamaya and Amy Goscha provide tips and recommendations on issues related to divorce, separation, and co-parenting in Colorado. Ryan and Amy are the founding partners of an innovative and ambitious law firm, Kalamaya | Goscha, that pushes the boundaries to discover new frontiers in family law, personal injuries, and criminal defense in Colorado.

To subscribe to Divorce at Altitude, click here and select your favorite podcast player. To subscribe to Kalamaya | Goscha's YouTube channel where many of the episodes will be posted as videos, click here. If you have additional questions or would like to speak to one of our attorneys, give us a call at 970-429-5784 or email us at info@kalamaya.law.



0:00:03 - Ryan Kalamaya
Hey everyone, I'm Ryan Kalamaya and I'm Amy Goscha. Welcome to the divorce at altitude, a podcast on Colorado family law. 

0:00:13 - Amy Goscha
Divorce is not easy. It really sucks. Trust me, I know. Besides being an experienced divorce attorney, I'm also a divorce client. 

0:00:21 - Ryan Kalamaya
Whether you are someone considering divorce or a fellow family law attorney, listen in for weekly tips and insight into topics related to divorce, co-parenting and separation in Colorado. Welcome back to another episode of divorce at altitude. This is Ryan Kalamaya, and I am joined by my esteemed co-host, amy. What's new, amy? What are we going to talk about today? 

0:00:46 - Amy Goscha
It's all over the news. I know everyone is talking about it. We're talking about the costner divorce. It's really interesting because it has some interesting legal issues and we're going to be specifically talking about the premarital agreement and why it's getting contested and maybe some things that you can do to either enforce it or to deal with discovery issues. 

0:01:12 - Ryan Kalamaya
Yeah, and for listeners, kevin Costner, he does have a house in Aspen. It's a beautiful property. I drove past it just a couple of days ago, most people know, and he was kind of photographed in Aspen during the summer when we were recording this. But we're not involved. It's a California divorce. There's some issues in California. But, amy, I see just some headlines. I know my wife, she really likes this kind of news and it has been all over the place. I think it's unfortunate that we're even talking about this issue and that it's all over the news. 

0:01:49 - Amy Goscha
to begin with, yeah, I mean, I think when you look at celebrities involved in divorce, it just brings another complexity to the situation. So I think it's just one of those things where I think, as divorce attorneys and also people who are listening, we can learn from those divorces that are semi pretty much public. We can learn a lot from them as well. 

0:02:17 - Ryan Kalamaya
Yeah, we've had various episodes previously about arbitration, about private judges and keeping things confidential. We'll get into things with the Kevin Costner divorce. But, amy, for those that maybe don't know about what the issue is or just to kind of set the stage if listeners are hearing this and it's been kind of resolved and no longer applicable, just delay the groundwork. What are we talking about? Or whether the issue is involved in the Kevin Costner premarital agreement challenge and divorce in California. 

0:02:50 - Amy Goscha
Yeah. So I'll back up and just, you know you're always looking at from when I'm meeting someone. I want to know the statistics of the marriage. So for those of you that don't know, Kevin Costner has been married for 18 years. He has three children with his now second wife. You know it's obviously a very high profile case. 

There have been some issues related to even, you know, child support, and where it all hinged was the parties meeting Kevin and his soon to be wife, Christine. They signed a premarital agreement in 2004, right before they got married, and essentially what that prenup said, that was that, upon divorce, Christine would get 1.5 million as a payout and so when they chose to part ways, she would not leave the you know, marital residence when she was supposed to. That was one of the provisions within the premarital agreement. Costner believes that the premarital agreement is ironclad and should be, you know, upheld and as enforceable. So that's the main, you know, issue that going on right now is that Christine is contesting the validity and the enforceability of the pre-NEP that they signed in 2004. 

0:04:01 - Ryan Kalamaya
Yeah, and we don't know what the financial disclosures were at the time, but in 2004, kevin Costner was a movie star, he had done Field of Dreams, he had done Dances with Wolves and so, understandably so he wanted to protect himself. He had gone through divorce and so before and there was a premarital agreement and so then, you know, there's this payout We'll talk about. You know that we don't know the ins and outs, but it's been reported that Kevin Costner is now worth $400 million because he there's the Yellowstone and some other various, you know, media and entertainment businesses that he's been involved with. But he's worth a lot more now than he was at the time of the divorce or at the time of the marriage. And so, you know, she, understandably, is saying, well, I want more money, but he's under. Also understandably, if you take his perspective, we signed an agreement of $1.5 million, just so people understand. Amy, you mentioned child support. Why are didn't they deal with child support in the premarital agreement? Or can't you have, you know, an agreement on child support? 

0:05:14 - Amy Goscha
So you cannot have an agreement on child support, so you cannot have an agreement on parenting time. They're also, you know, having a battle over the parenting time for the children, even though the children are a little bit older I think they're 13, 15 and 16. But, yes, it's against public policy to contract around parenting time, decision making and child support in a premarital agreement. 

0:05:37 - Ryan Kalamaya
And I'm nearly certain that is a universal tenant for California, massachusetts, across the country. You know that each state has their differences. We've talked a little bit about that and so, but you know, my understanding is, at least according to the news is that he's been Kevin Costner has been ordered to pay somewhere in excess of $100,000 per month in child support during temporary. So as we record this, they're about to have a hearing on the validity, unless they settle it. So, amy, can you maybe talk about the validity of premarital agreements and then guide our listeners through what is discovery and what are the attorneys and the parties really focused on right now, as we record this, when there's a dispute of a premarital agreement? I think that will be helpful for listeners to understand, because there was you know, there's some news reports when we recorded this about them doing a deposition and maybe put that into context for everyone that may be interested. 

0:06:43 - Amy Goscha
Yeah. So there's definitely discovery issues going on right now, and that hinges around the fact that when you have a premarital agreement, there has to be a fair and full and fair financial disclosure at the time or before you enter the premarital agreement. So, essentially, the wife is arguing that there was not adequate financial disclosures, you know, at the time of entering the premarital agreement in 2004. And so her attorneys are seeking documents from Kevin, such as bank statements for years and years, going back to look at what it was his financial situation actually like at the time of signing the premarital agreement. And, if it was, you know, if he failed to disclose something or it was significantly different, you know that could raise a question as to the validity or the enforceability of the premarital agreement that Kevin and Christina entered. 

0:07:37 - Ryan Kalamaya
Right and so, and then I think there's another argument, so there's the disclosure argument, but then there's also reportedly and this is very common, these arguments, they are fairly universal in challenges to premarital agreements. And, for listeners, what we're going to do is we'll talk about what are the things that Kevin Costner and his attorney, laura Wasser the kind of Hollywood divorce queen what issues are, kind of questions or things that they're going to be concerned about or doing, and then what are the things that Christine Baumgartner, that her attorneys are going to be really focusing on, but Christine also is making this. Kevin Costner's wife is saying that she felt pressured to sign the agreement and that she didn't understand what she was signing. So can you maybe comment a little bit more on that, amy, to put it into context of what we're talking about? 

0:08:31 - Amy Goscha
Yeah, so I mean essentially, you know she was saying that she was there was undue influence and possibly coercion at the time of the signing. You know, however, both parties I presume I haven't seen the premarital agreement were represented by counsel. You know, in Colorado there's case law that says that just because you sign a premarital agreement the day before a wedding, that doesn't mean that you were forced to do that and the reason is because you could choose not to get married. You know. So those arguments are, you know, really hard. But if you're Christine's lawyer, you're going to be interviewing everyone that was at the wedding. You're going to be interviewing everyone that you know, like her family members coming up to the signing to figure out. You know what was the state of mind You're going to be looking for. You know, was there a video of the actual signing? You know so those types of things. If you're Kevin's attorney, you're going to be also probably interviewing those same type of people. You know, but it is kind of it's definitely a harder, you know, argument to me. 

0:09:35 - Ryan Kalamaya
Well, yeah, and one of the things in the law is that there's these things called burdens of proof, and so it's a matter of okay. So you have this written agreement and in the Kevin Costner divorce they there's clearly a signed agreement. But then you get into well, is the starting point that agreement is valid and then the Christine Baumgartner, kevin Costner's wife, has to prove that it's invalid. Or does Kevin Costner have to prove that it's valid? And you know, california, I think, has some burden shifting. It's kind of weird that they, the one has to make prime aphasia case of, you know, kevin Costner says there's an agreement, it was entered involuntarily, and then it shifts. So in Colorado, the person challenging an agreement, a marital or premarital agreement they have the burden to prove, in essence, that there was no financial disclosure or that they were forced into it. And you have to have a voluntary agreement. And you know, really, amy, and my experience is that there's often it's more common for parties to argue what the agreement actually means or says and argue over the terms, as opposed to whether it's valid or invalid. But when you get into these arguments about whether it's valid or invalid, often what will happen is you, the Kevin Costner's attorney will send interrogatories, so questions, and this has been kind of leaked in the news. One can only assume that this is bum gardeners cause, like she's just trying to pressure through public support cause. Kevin Costner is a public figure and so they feel like there's some sort of advantage where Kevin Costner is like I'll pay you off, I'll pay you more than the 1.5 just to make this news so that people like Ryan and Amy aren't talking about it and other people but there's been some leakage about that she's refusing to acknowledge or say exactly whether what her contentions are. There's been these kind of vague induendos. 

But really what we would do is Kevin Costner on his end, he would say you know that he would ask her you know, tell me, when did you first learn about the? The Kevin Costner wanted to have a premarital agreement? Did you guys talk about this when you guys got engaged and really get specific about the terms and the timing and all of that? And you know, did you disclose your financial circumstances and really get into the nuts and bolts and unpack the negotiation? And critical to that is because, christine Baumgartner, she's going to have to waive her attorney-client privilege because she's challenging it. And if she did have an attorney and she didn't understand it. Then Kevin Costner, understandably or rightfully, is going to say well, how often did you talk to your attorney? And there's going to have to be a disclosure of the billing statements and the notes. And so, amy, can you maybe talk about how important or why those attorney files are going to be exchanged and what relevance that would be in the discovery phase of a challenge to a premarital agreement? 

0:12:54 - Amy Goscha
Yeah. So that would be very important in the discovery phase because let's talk about the financial disclosure. So within the attorney's file you're going to be able to see what financial disclosure actually was made on each side. So that's going to help in the determination to see was there a fair disclosure? The other thing that you're going to find is drafts of the premarital agreement and possibly redline versions that hopefully went back and forth between the attorneys. You know, usually if you have more drafts and redlines, that could indicate more of a negotiated fair agreement and also clients were viewing it several times. 

So if someone is saying I've never seen this document, I don't remember it, I don't remember the terms. You're going to be looking for the number of drafts. So those are also the timing when was the first draft given to Christine's attorney? When email correspondence between the attorneys, phone calls on billing records? So you're going to be looking for all of those types of things which you would get through discovery. And, as you mentioned, ryan, they're doing they just did depositions, you know. So the attorneys are also. Another discovery tool that you're going to be doing is you are going to be taking depositions of the parties and you know some various people From your perspective. 

0:14:21 - Ryan Kalamaya
you know what are some other depositions that you could think of that would be useful, you know, in this situation, Well, certainly the attorneys that were involved in the kind of the negotiation paralegals, notaries, anyone you know, if Christine, if she had a therapist or she had some sort of you know her sister or her mom, you know anyone that Christine may have mentioned. You know I feel really forced or you know they were confiding in that person and that is why you would really want to dissect the attorney file, because if her attorney was sending her emails and had that in the file, or if their billing statement showed that there was multiple phone calls and you know. But the attorney file and really I think it's helpful for listeners to understand what we, what the courts, often will do is have a hearing on whether or not the agreement is valid or not. Because after that and we've seen this in news reports by Kevin Costner is that she's asking for all this information on his new business ventures. There's some new you know, series or doc documentary or some movie that he's working on and they're saying we want all the information related to that and Kevin Costner is saying that doesn't even matter because under the premarital agreement that's mine and you don't get any part of that, so the value is really immaterial. So when you have a premarital agreement that has business valuations or the value of property. You're not even getting into what really the value or the importance of that if there's a valid separation or valid premarital agreement, and so you first get into, is the agreement valid or not? And that's where these parties are at, and so there would be, you know, an examination by her. 

Tell us at your deposition, who did you tell that? You felt pressured. You said you didn't understand it. Well, you know, let's look. You know, ms Bumgardner, let's look at the billing statement and these emails from your attorney. What did you not understand? Your attorney is explaining this to you and that's why it really they're so fact, specific. And you know the notary. You know, for people that you know may not understand, like a notary ensures that someone is who they say they are in terms of signing it. But you mentioned videos. Oftentimes these premarital agreements now are videotaped and the point or the reason is that it shows that someone was voluntary. So were they crying when they signed it or were they, you know, laughing about? You know how it will never come to a divorce and you know like that really can matter. 

0:17:14 - Amy Goscha
Yeah, and also video recordings can show you. You know we've had certain cases where there's an allegation that you know financial disclosures were attached to a document. Also can show you and prove you know what actually. You know like what documents were present at the signing. 

0:17:33 - Ryan Kalamaya
Right. And so, amy, the calculus by Bumgardner is that she's had to have some sort of calculation or discussion by her attorneys that she's trying to get more than $1.5 million. I think that's important because if she was to get zero, there's no property that is different than, obviously, $1.5 million. I mean, if he's worth $400 million, well that's obviously a drop in the bucket for him. But when parties have a clear expectation and there's money on the table and there's a negotiation, how they arrived at the $1.5 million? Was that just suggested by Kevin Costner and his attorney at the time in 2004? Or was it originally $1 million but then she asked for $2 million and then they landed at $1.5 million? How they arrived at the $1.5 million really matters. But, amy, reportedly there's a prevailing party attorney's fee provision in the agreement. Now there's no Colorado case law on that sort of provision, but for listeners that may not understand, what potentially does that mean for the end result in this challenge? 

0:18:50 - Amy Goscha
Yeah. So what we're talking about is, in a premarital agreement, parties can contract and there's usually a provision where it says that if you contest the validity or the enforceability of the premarital agreement and if you lose, you have to pay attorney's fees, not just yours but also your soon-to-be ex-spouses. Another provision and there can be a negotiation point that a party files for divorce, that the party, the moneyed spouse, pays for the attorney's fees during the divorce or an initial retainer. But, ryan, what you're talking about is it can be. It's essentially a penalty clause. I guess I would look at it. It deters someone from just filing motions with the court to say that I don't like this agreement anymore. There's a monetary penalty saying if you enter this agreement, there's certain ways that they're invalid and not enforceable. But you better be sure of that, otherwise you're going to be paying your own attorney's fees and your spouse's. 

0:19:59 - Ryan Kalamaya
Yeah, here in Colorado we have the Interim Marriage of Eichler and it stands for the proposition that if there's a waiver of attorney's fees, so the premarital agreement says each party pays their own attorney's fees at the time of the divorce and fast forward. Like Kevin Costner and Bumgardner they're going through a divorce here in Colorado. Well, he has such a disparity in the financial circumstances that the public policy militates in favor of people having legal counsel and they shouldn't be penalized because they don't have as much money in this circumstance. So Kevin Costner would pay for her reasonable attorney's fees under the Eichler case, even if there was a waiver but the prevailing party attorney's fees, the court might say a reasonable amount would have been $10,000 for you to have this divorce and to negotiate child support, for example, or some other aspects, maintenance, and in Colorado maintenance. There's a release on maintenance which we can maybe talk about, but in this context it has yet to be determined whether or not, if her attorney's fees, or rather if Kevin Costner's attorney's fees were, let's say, $200,000, whether that's going to come out of the 1.5 that she would have received. 

I have seen premarital agreements that gives a certain time to the other party to either accept and agree that the agreement is valid, and if they do so, then they get a particular amount and so it's this kind of incentive. 

So she would get $1.5 million, so long as she doesn't contest it. She's got 30 days or 60 days to make that decision. But people can, they can go into these sorts of negotiations and it's a calculated risk. In Colorado, what we oftentimes see, amy, is people will say because of the Eichler case and the Newman case which basically says that maintenance and spousal support even if the premarital agreement says that it's not, that there's no spousal support that is going to be not enforced by the court and so maintenance can be set as if there was no maintenance provision. What we see is Christine Bumgardner that person, that party, would say I'm not challenging the premarital agreement, I'm just going forward on Colorado law and it says that I can get attorney's fees and I can get spousal support. And so it's kind of walking that tight line between, you know, calling into question the agreement while at the same time not challenging the validity and potentially having prevailing party attorney's fees. 

0:23:02 - Amy Goscha
Yeah, I think one other interesting, I guess, discovery issue related to the cost and our divorce and the premarital agreement is confidentiality. So apparently there's a confidentiality agreement and Kevin Costner's attorneys are arguing that you know there are certain documents that are confidential that Christine is you know, that not, you know is not able to you know have because of confidentiality. So, ryan, what is you know your take on? You know if you had a case like that where the parties entered a confidentiality agreement, you know how do you navigate the confidentiality issue. 

0:23:40 - Ryan Kalamaya
Well, the first thing that strikes me is how ironic is, because we've gotten all this information about what is all going on in the Kevin Costner divorce. So for them it seems as if there is no confidentiality, because we seemingly get the blow by blow and find out how much he's making from Yellowstone. I mean we made like 16 or 16.8 million dollars or something like that last year. But you know really, you know the confidentiality provision and the concern with Kevin Costner says listen, I'm working on a project, I can't give you information because it's confidential. Then we have protective orders where you know people will agree that they can't disclose to the news or some other you know provision. But we see this all the time where you know premarital agreements and these high net worth individuals and celebrities. They really value their privacy and they're confidentially confidentiality for you know good reasons. So you know, we have seen, you know those issues in several cases and in many cases actually, that we work on anything else that I may have missed, amy, no, I think that's good. 

0:24:48 - Amy Goscha
One of their interesting provision you know we're talking about celebrities that people ask are is, you know, like a anti cheating provision valid within a premarital agreement, and I'm pretty sure it's universal that those are against public policy. 

0:25:03 - Ryan Kalamaya
Yeah, I think that you know there are these morality clauses and so you can have contractual provisions where I do think are enforceable, where you know, for example, if there are children, that you get the marital house and the idea makes sense right, like if someone's going to give up their career or they're going to, you know, provide something, you know motherhood or fatherhood, you know parenting, that they get something. But, generally speaking, if it says that you know that if there's anti cheating or there's some sort of incentive for divorce, you know those generally are unenforceable. But you know, the reality, amy, is that there's not that much case law here in Colorado compared to other states. We use these other states as kind of examples. In California and New York have, you know, a robust, you know body of case law and you know we're working on, you know a book I am on on these issues because for me I think it's really fascinating how Colorado we just don't really have that much guidance from other states. 

0:26:08 - Amy Goscha
Yeah, so that was just kind of interesting and I think you know wrap everything up essentially, discovery is very important when it comes to contesting or defending a premarital agreement, and so we're hopeful that you know we highlighted some of those interesting issues within. You know the cost near divorce. 

0:26:28 - Ryan Kalamaya
Yeah, and I really hope for both of them, those people, that they're able to kind of move on, because I mean, their lives are just being dissected and I think that's just a little bit of a judgment on. You know that she's asking for this amount and you know it's unfortunate to see it. You know, get some messy, but it does happen. It happens in particular on premarital agreements. They are often challenged in knowing when and how to defend them or attack them is something that really is kind of an art and science, because you know there is some law. There are various arguments that can exist on both ends. 

So, but thanks for joining us on divorce at altitude. Hey everyone, this is Ryan. Again, thank you for joining us on divorce at altitude. If you found our tips, insight or discussion helpful, please tell a friend about this podcast. For show notes, additional resources or links mentioned on today's episode, visit divorceataltitudecom. Follow us on Apple podcasts, spotify or wherever you listen in. Many of our episodes are also posted on YouTube. You can also find Amy and me at kalamaya.law or 970-315-2365. That's K-A-L-A-M-A-Y-Alaw.