What Kim Kardashian, Brad Pitt, And Cheryl Burke Can Teach Us About Dividing Unconventional Assets Throughout A Divorce

Contributing authors: Marilyn Chinitz and Morgan Fraser Mouchette

When it comes time to divvy up assets in divorce, many couples focus on the major markers of their shared wealth like real estate, business interests, savings, and personal property. But plenty of other valuable belongings accumulate during a marriage and have to be accounted for. From our extensive experience advising high-net-worth and celebrity couples in divorce and marital agreements (pre-nuptial and post-nuptial), we can honestly say that all relationships can benefit from carefully cataloging assets in the marital estate, especially those that are held in unconventional ways. Recent publicity around certain celebrity divorces has shed some light on how to approach an equitable (or at least agreed-upon) division of the assets that aren’t necessarily top of mind, offering an instructive roadmap that all couples can benefit from.

Here are some unconventional assets that may need to be accounted for in a divorce.

Diamond Rings and Fancy Things

Over the course of a marriage, couples accumulate many gifts, and particularly when it comes to A-listers, these assets can be worth a significant sum. Planning ahead for gifts like these can save time and heartache later. Take Kim Kardashian and Kanye West, for example. The couple reportedly accounted for the division of all marital gifts in their prenup, which helped stave off additional frustration during their tense public split.

To many, the first marital gift that comes to mind is the sacred engagement ring—valuable not only monetarily but also symbolically, given that many are family heirlooms. NBA star Ben Simmons garnered national attention when he sent a legal notice to ex-fiancé and Love Island host May Jama in January of 2023, demanding she return the $1.4 million engagement ring he bought her. So, who gets the ring? In Mr. Simmons’ case, because the engagement was broken off and no marriage occurred, he was entitled to get the ring back—though if his ex had argued that she interpreted it as a “gift” unrelated to marriage, he could have faced legal complications in doing so. This is why it’s important to make sure your engagement is explicit. Had the couple married, per New York state law, the ring would have belonged to Ms. Jama, as it would have become her separate property.

Couples may also find that they need to consider the division of assets such as artwork, wedding and anniversary presents, and meaningful collections amassed during the marriage. Angelina Jolie and Brad Pitt had a $25 million art collection at the time of their divorce, which became a major pain point in the division of their estate. In 2021, the couple allegedly lifted the standard temporary restraining order placed on their assets at the start of the separation nearly five years prior, which allowed Ms. Jolie to sell a rare Winston Churchill painting she was gifted from Pitt.

In 2022, well known New York real estate developer Harry Macklowe and his former wife Linda Burg were ordered by the New York State Supreme Court in Macklowe v Macklowe 2020 NY Slip Op 01695 to sell and split the profits from 65 pieces of their art collection after each of their appraisers provided significantly different valuations during their contentious divorce. This action was monumental for the art world, resulting in the largest reported art auction sale to date valued at $922.2 million, and ending the years-long, high-profile court proceedings.

IP and Other Intangibles

It’s very common for couples to overlook intangibles that are part of their marital estate—most prominently, intellectual property. This can include film, books, or music, and subsequent royalties, as well as name licensing and many other income-generating endeavors in between.

Rapper MC Lyte wisely dodged this issue when her divorce decree designated her as sole owner of her entire music catalog and other creative property, including royalties. Unfortunately, not every couple has such an amicable settlement. Perhaps most notably, the creator of the board game Trivial Pursuit, Frederick Worth, and his ex-wife Susan set a precedent in In re Marriage of Worth, 195 Cal.App.3d 768, a case which ruled “The principles of community property law do not require joint or qualitatively equal spousal efforts or contributions in acquiring the property.” This means that copyrights established during a marriage, or those previously established that begin earning profit during a marriage, are considered communal property even if the spouse did not contribute to it. (Ms. Worth was ultimately well compensated when the Trivial Pursuit IP was divided according to this precedent.) Reaching a settlement regarding the division of such assets can become even more complex when considering joint intellectual property such as shared song or TV credits.

Cryptocurrencies like Bitcoin and digital assets such as NFTs, among others, also fall into the “intangible” class, and are becoming more and more prevalent in contentious divorce cases. The law currently designates these currencies and assets as shared marital property, even if only one party contributed to the investment. However, cryptocurrencies are one of the most notoriously difficult assets to divide. They are hard to trace and are not legally allowed to be collected by the court, as they are considered to be a “pseudonymous asset.” This opens the door for secrecy and withholding, which is why it is advised to be transparent and aware of all financials in your marriage from the beginning. Forensic experts are often brought in to try and trace the purchase and sale of cryptocurrency at the time of a divorce to ensure that the parties are aware of all assets in existence.

Though not obvious, couples should also consider tax carryovers (including capital losses, net operating losses, passive activity losses, and charitable contributions) as assets in divorce. All of these have inherent value, much like property or cryptocurrencies. They should be discussed in any litigation or negotiation during which assets and liabilities are divided, as they could be worth significant monies.

Even frivolous-seeming intangible assets should be considered in a separation. For example, when Kris and Caitlyn Jenner divorced, they allegedly agreed to split their airline miles and credit card points in accordance with the name under which those assets resided. Those with a hefty flying or shopping habit may not always be amenable to the traditional 50/50 split.

When it comes down to it, divorce can be messy or even downright selfish. Most courts will favor an even split for many of these intangible assets, which is why it is important for any couple to protect themselves via prenuptial or post-nuptial agreements for the best outcome.

Custody Arrangements Aren’t Just For Kids

Our furry companions are more a part of the family than ever, making pet custody a major concern for modern couples. In 2021, the state of New York passed a “best for all concerned” standard that addresses exactly that, essentially treating the custody arrangement of pets similar to the way it would treat that of children, rather than viewing them as property as it had under the previous standard. To this end, the court takes into account the parents’ work and traveling schedules, living arrangements, and other contributing factors to decide how custody of pets should be split. Other states have already passed or are considering similar changes.

Dancing with the Stars’ Cheryl Burke was one of many celebrities, along with Miley Cyrus, who made headlines with a custody battle over their pet. While Ms. Cyrus and former spouse Liam Hemsworth were able to settle their arrangements themselves, Ms. Burke aggressively pursued the issue via court proceedings against her ex, former child star Matthew Lawrence. She ultimately attained full custody and ownership of French bulldog Ysabella in a settlement reached before the matter was to go to trial.

Undeniably, couples are best off settling their pet co-parenting arrangements outside of the courtroom, but for those who cannot come to a joint consensus, we advise looking into the rights under your jurisdiction.

Cheryl Burke, the Kardashians, and others serve as trendsetters once again, proving that open communication and detailed planning are key, not just when you are in the midst of a divorce, but ideally early on, before you even tie the knot.

Marilyn Chinitz is a Partner at Blank Rome with 35 years of experience in every facet of family law. She is known for representing A-List celebrities and influential, high-profile clients in cases that have received national and international attention.

Morgan Fraser Mouchette, Partner in the New York City office of Blank Rome, handles complex matrimonial matters for high-net-worth and high-profile clients. She provides individuals and families with tailored and strategic support to navigate and move on from life’s most difficult outcomes, including divorce.