Thomson family tensions exposed by lawsuit

The lawsuit and subsequent court filings describe years of inheritance squabbles and tensions over safeguards on the family’s wealth, offering a rare glimpse of its business, The Wall Street Journal reported.

The lawsuit was filed in the Ontario Superior Court in September 2013 by James Lawson, who is claiming damages for alleged breach of his employment agreements as chief executive of the investment arm of the family of Sherry Brydson. She is a granddaughter of the Thomson empire’s founder Roy Thomson and a cousin of his grandson, David Thomson (photo).

Her family company owns a substantial equity stake in the Thomson family’s main holding company, Woodbridge.

The Journal said that in his suit, which is still pending, Lawson also accuses members of the Thomson family of an elaborate effort to shield the media clan, whose 58 per cent stake in Thomson Reuters is valued at around C$23.2 billion, from billions in tax payments.

It said Lawson says in his court filings that Thomson family members do not pay tax on the Thomson Reuters dividends and other income they get through Woodbridge. In 2011, the documents allege, Woodbridge distributed about $350 million of its cash on a tax-free basis.

None of the Thomson interests specifically addressed the tax allegations in their court filings. The existence of Lawson’s lawsuit and Thomson family members’ response to it have only recently come to light.

The newspaper said that in February, the company that manages Brydson’s family wealth, Westerkirk Capital, which owns a 23.6 per cent stake in Woodbridge, filed a counterclaim against Lawson and response to his original lawsuit. Lawson filed his defence to the countersuit days after that. The Toronto Star newspaper reported some details of the case on Saturday.

Lawson alleges in his suit that he was fired from Westerkirk in part because he pushed for better governance at Woodbridge.

In its court filings, Westerkirk denies Lawson’s allegations, saying he was fired for, among other things, incompetence, conflicts of interest and for accessing “graphic and outrageous” pornography at work.

Lawson denied those claims in court documents and through his lawyer declined to comment.

A spokesman for Brydson said the case is an employment lawsuit and has nothing to do with Woodbridge. “Westerkirk and the Brysdon family will defend themselves, and intend vigorously to pursue their counterclaims against Mr Lawson through the courts,” he said.

A representative of Woodbridge, David Thomson and Thomson Reuters declined to comment, the Journal said.

It said that in more recent years, tensions within the Thomson corporate empire had risen as family members branched out to pursue their own businesses and new generations staked their claims on their inheritance. ■