A Dying Southern Town Needed a Miracle. Marijuana Came Calling.


In Pennsylvania, distressed rust-belt cities like McKeesport and New Castle, once known for what they made, now find themselves turning to what they can grow.

“We’re talking about bringing in anywhere from 100 to 150 jobs — for us, that’s important,” said Anthony Mastrangelo, the mayor of New Castle, a city of 22,000 near the Ohio border where a company called Holistic Farms has filled a vast warehouse with cannabis seedlings and grow lights. Mr. Mastrangelo hopes the new business will help turn around a city that has been struggling since the Shenango China dinnerware plant closed in the early 1990s.

Mr. Mastrangelo, 80, said he had not heard many complaints from local residents about his city’s new business. But the idea doesn’t go down well everywhere. After Jeremy Faison, a Republican state representative from east Tennessee, sponsored a medical marijuana bill, he ran into significant pushback from his own district. The legislative board in Cocke County passed a resolution opposing his bill on the grounds that marijuana was still deemed illegal by the federal government.











Even so, Mr. Faison said the new industry would be a shot in the arm for rural Cocke County, where more than 24 percent of residents live in poverty and where the illicit cultivation of marijuana has, along with moonshine making, been a historic and notorious fact of economic life.

“Some of the prohibitionists are, like, ‘I can’t believe you’re bringing pot to Tennessee,’ ” Mr. Faison said. “I’m like, ‘Are you serious?’ ”

Last month, the Arkansas Medical Marijuana Commission announced that Bold Team, the company that wants to set up shop in Cotton Plant, was among the companies that would be granted a growing license. On Wednesday, however, the licensing process was declared “null and void” by a Little Rock circuit judge, who noted, among other things, that two commissioners had professional ties to owners of two other companies that had been picked. The Arkansas attorney general has appealed the ruling to the State Supreme Court.

Such challenges are common in state medical marijuana rollouts. The Bold Team owners declined to comment for this article, but Mr. Ryland said he was confident they would eventually be setting up shop. In its application, company officials said their facility would initially have 25 employees, some of them locally hired unskilled labor. The company also pledged to contribute 1 percent of its gross sales to the city budget.

Mr. Ryland, who moved back to Cotton Plant in 2010 after retiring from the United States Department of Agriculture, said that God had called him to fix Cotton Plant. He was elected mayor in 2014 on the slogan “Change Through Restoration.”

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A Dying Southern Town Needed a Miracle. Marijuana Came Calling.


In Pennsylvania, distressed rust-belt cities like McKeesport and New Castle, once known for what they made, now find themselves turning to what they can grow.

“We’re talking about bringing in anywhere from 100 to 150 jobs — for us, that’s important,” said Anthony Mastrangelo, the mayor of New Castle, a city of 22,000 near the Ohio border where a company called Holistic Farms has filled a vast warehouse with cannabis seedlings and grow lights. Mr. Mastrangelo hopes the new business will help turn around a city that has been struggling since the Shenango China dinnerware plant closed in the early 1990s.

Mr. Mastrangelo, 80, said he had not heard many complaints from local residents about his city’s new business. But the idea doesn’t go down well everywhere. After Jeremy Faison, a Republican state representative from east Tennessee, sponsored a medical marijuana bill, he ran into significant pushback from his own district. The legislative board in Cocke County passed a resolution opposing his bill on the grounds that marijuana was still deemed illegal by the federal government.











Even so, Mr. Faison said the new industry would be a shot in the arm for rural Cocke County, where more than 24 percent of residents live in poverty and where the illicit cultivation of marijuana has, along with moonshine making, been a historic and notorious fact of economic life.

“Some of the prohibitionists are, like, ‘I can’t believe you’re bringing pot to Tennessee,’ ” Mr. Faison said. “I’m like, ‘Are you serious?’ ”

Last month, the Arkansas Medical Marijuana Commission announced that Bold Team, the company that wants to set up shop in Cotton Plant, was among the companies that would be granted a growing license. On Wednesday, however, the licensing process was declared “null and void” by a Little Rock circuit judge, who noted, among other things, that two commissioners had professional ties to owners of two other companies that had been picked. The Arkansas attorney general has appealed the ruling to the State Supreme Court.

Such challenges are common in state medical marijuana rollouts. The Bold Team owners declined to comment for this article, but Mr. Ryland said he was confident they would eventually be setting up shop. In its application, company officials said their facility would initially have 25 employees, some of them locally hired unskilled labor. The company also pledged to contribute 1 percent of its gross sales to the city budget.

Mr. Ryland, who moved back to Cotton Plant in 2010 after retiring from the United States Department of Agriculture, said that God had called him to fix Cotton Plant. He was elected mayor in 2014 on the slogan “Change Through Restoration.”

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Are Millions Missing? Some Relatives Want to Know. Others Don’t.


But this well-planned life, built on trust among townspeople and legal trusts to insure financial wishes were carried out, began to come undone in 2002. That was when Ms. Noel, pregnant with her only child, brought Curt Noel, her second husband and a businessman who invested in small, rural companies, home to Jonesboro from Atlanta.

Photo

The older McKee children: Sanders, known as Mac, about age 5, and Virginia, about 3.

[READ MORE: Here’s How to Maintain Peace Among Your Heirs]

The only thing the siblings now seem to agree on is that this was the moment when everything changed. In the 16 years since then, the family has been torn apart by lawsuits, surrounded by lawyers, including the son of the governor, and been deposed multiple times in court over the estate of Dr. McKee and his wife, who was diagnosed with dementia around 2004 and died in 2007.

While the three siblings have shared more than $10 million from their mother’s estate, it remains in dispute, 11 years after her death. The Noels have hired a forensic accountant and fraud expert to look into five years of financial statements, believing that tens of millions of dollars — maybe as much as $100 million — are still unaccounted for.

Ms. Noel’s brothers have said in sworn testimony the matter should have been done and forgotten years ago. No one trusts anyone anymore and getting to a resolution, let alone family harmony, seems challenging.

The tale of the McKee family is in some ways all too familiar. Professionals who work in the field of trust and estate planning have scores of stories about affluent families suing each other after parents die, or of sibling relationships coming unglued over disputes that once might have been managed by a parent.

[READ MORE: Life After Your Death? Here’s Why You Should Have a Trust.]

But at the heart of almost every case is a breakdown in trust among people who grew up together, created memories on family vacations, and shared an entire family history before going out into the world on their own. Sometimes old childhood animosities resurface and guide decisions later in life. Other times spouses point out the flaws in sibling relationships, bringing long-simmering tensions to a head.

The Dispute Begins

With the McKees it was a case of two against two, with the brothers who had remained in Jonesboro on one side and their sister and her husband who had made their life in Atlanta on the other.

“The first visits were incredible,” said Mr. Noel who grew up in affluent Fairfield County, Conn., a world away from a small southern town. “I was stunned at what a close family this was. They all lived next to each other,” he said in an interview.

How the unraveling occurred depends on who is doing the telling. Only Mr. and Ms. Noel were willing to discuss their case. Neither of the brothers, nor their shared attorney, G.S. Brant Perkins, agreed to be interviewed. But voluminous court documents filed in the case clearly lay out both sides.

Not long after Mr. Noel arrived in Jonesboro, he said, he became suspicious that his mother-in-law was being overcharged by her advisers. His initial concern was a homeowners policy, which Mr. Noel said “insured every last knife and fork” and charged accordingly. He said Jack McKee, who had been given power of attorney by his mother in 2004, gave him permission to help Mrs. McKee with her finances. Jack McKee’s depositions make no mention of such an arrangement.

Sanders McKee, the eldest sibling who eventually became a co-trustee of the estate, had a different recollection in his deposition. He said he had been excited to see his sister pregnant and meet her husband. But, he testified, Mr. Noel quickly inserted himself into family matters. On one occasion, according to Sanders McKee, Mr. Noel went into the local branch of Liberty Bank and demanded their mother’s financial information.

Photo

Bobby and Rose McKee, the parents of three children, in a family photograph taken around 1988.

In this telling, Mr. Noel was denied the documents he sought and escorted out.

Mr. Noel called the account ludicrous. He has a master’s degree in business, he said, and is a chartered financial analyst who owns his own company, Eclypse Ventures. He knows no bank would ever give someone off the street those documents, he said in an interview.

Gradually, Mr. Noel said, his concerns moved beyond the insurance policies. He said he was troubled by what he considered to be high fees in custody accounts at the bank, a plethora of mistakes on a multitude of documents related to the estate and assets held in it, and ultimately to who was behind the decisions to move securities into and out of Mrs. McKee’s accounts at the bank over the years.

Mr. Noel said he was also puzzled by differences in account numbers between the bank and its trust department — something the bank contends is not unusual in the industry.

“It’s never good when an in-law becomes a detective,” said Leslie Voth, president and chief executive officer of Pitcairn, which advises wealthy families but is not involved in the McKee case. “You can write the ending. It’s not positive.”

She added that the questions being raised by the son-in-law might be reasonable but do little to re-establish trust in a family. “It’s quite possible that there was already a challenge around the fees or the costs,” Ms. Voth said. And those charges “could have been signed-off on years ago.”

But she added, it’s not often just one error that erodes trust among siblings. “Usually, it’s a whole series of things that adds up to a very messy transition.”

Family Dissolution

The three siblings have said in court documents and interviews that they would be happy to talk to the others. But that hasn’t happened since 2008, and even then, they spoke with their attorneys present, documents show.

What Ms. Noel and her husband are trying to find out — whether their advisers overcharged them and whether other assets are still unaccounted for — would benefit everyone. The trust split the assets evenly. But the brothers say this has gone too far for too long.

“I want this finished, over and done,” Sanders McKee said in his deposition. “I am tired of wasting my life. She needs to stop wasting her own. And I’m tired of this. I’m absolutely exhausted with it.”

But that was in August 2014, and the legal battle continues, costing all sides money and time. The Noels estimated that they have spent $1 million on legal fees in the case, and they’re not resting.

Document

McKee Family Depositions

The siblings in the McKee family have been deposed multiple times in court over the estate of their parents.



OPEN Document


Aside from the cost, the case also demonstrates the strain being a trustee can put on family members.

“When I hear these stories and think how did people get into these situations of not talking to each other, moving out of town, you go back to who did you appoint as the trustee,” said Sharon L. Klein, president of the New York region for Wilmington Trust.

“Individuals often appoint their friends and family members,” she added. “It makes sense, but the people who act, sometimes out of a sense of love or obligations, don’t fully appreciate the obligations of the role of trustee and what can happen if those things are breached. Family members are often unaware of the myriad duties they’re responsible for.”

Often even well-educated professionals may have little knowledge of finance and the details surrounding estates can quickly get arcane.

Complicating the McKee case further are the kinds of family slights that are hard to forget. Sanders McKee said in a deposition that he sent a package of Christmas presents to his sister and his nephew after he moved to Florida in 2007, but it was returned. He called to see whether he had the wrong address but said she told him they didn’t need his presents.

This, he testified, was after she refused to agree to a loan from the estate that would have allowed him to buy a home in Florida unless he gave up his trustee duties. He decided not to step aside, he said in the court documents, and subsequently lost the home and his $50,000 deposit.

Ms. Noel had a different recollection. In an email exchange with The New York Times, she disputed Sanders McKee’s statement that he sent gifts in 2007, saying they were sent in 2006, before their mother died. She shared emails she said she had sent to him and his wife to thank them. She also disputed his statement that he sent gifts in 2007 and said she and her husband had helped her eldest brother with the house.

A looming issue in the dispute is the complicated nature of the father’s estate. It was filled with partnerships — his medical practice, his real estate holdings, farmland, and other entities with friends. In other words, it was not sitting neatly in publicly traded and easily tracked securities, and the Noels wonder if the estate was settled properly and if all assets were accounted for.

Two years into the estate battle, the Noels hired a new attorney, Asa Hutchinson III, who came from a prominent Arkansas family. His father served as United States attorney and in the House of Representatives and is now the governor of the state; his uncle was a United States senator.

Mr. Hutchinson said when he was first retained he thought the issues could be quickly resolved. “I thought it was pretty standard,” he said. “I thought that they hadn’t been using an Arkansas lawyer, and the client, as a nonlawyer, didn’t know what to ask for.”

Photo

Curt and Virginia Noel earlier this month.

Credit
Charles Wesley Frazer for The New York Times

He began deposing scores of people, with the purpose of getting a full accounting of the assets. It was during that process, Mr. Noel said, that he discovered the trust department account with the tax identification number that differed from the number at Liberty Bank.

In 2014, Mr. Noel hired a forensic accountant, Paul Dopp of GlassRatner in Atlanta, to go through certain accounts going back five years. In his report and deposition, Mr. Dopp said there were enough irregularities that the siblings should investigate further.

One that stood out for the Noels was when an extra $3 million was wired into Mrs. McKee’s account and then removed. Robert S. Jones, an attorney at Waddell, Cole and Jones, in Jonesboro, who represented the estate until he resigned amid the legal fight, called it a mistake. “These sorts of things happen from time to time in the process of transfer between financial institutions,” he said in his deposition in 2009.

Mr. Jones’s father, Phil Jones, had been the family’s accountant and adviser on the creation of the family trusts; he has since died. Mr. Jones declined to comment on his or his father’s involvement in the McKee case.

In an interview, Mr. Dopp said he was unconvinced that some of the problems he had seen in the estate transactions were simply mistakes. “Mistakes like this don’t happen in a vacuum,” he said.

“This is a good old boy network,” he added. “And here were some people from Atlanta coming into a small court in town, and they were having trouble finding a level playing field.”

Mr. Noel has become convinced that some sort of parallel estate has control of assets that rightly belong to his wife and her brothers. He has not been able to obtain proof of its existence, however.

Dark Thoughts

The story of an invisible hand controlling assets from a protected distance might seem like an imaginative leap. Battles over estates are often the result of service providers charging a client — especially an elderly one — the most they can or of siblings taking large commissions to manage the financial affairs. Discrepancies can result simply from careless record-keeping.

“This happens all the time,” said William D. Zabel, founding partner at Schulte, Roth and Zabel, and one of the country’s leading trust and estate attorneys. Disputes are especially common in small towns, said Mr. Zabel, who is not involved in the McKee case. “The banks collaborate. They close their eyes. They usually hurt the outside child who’s gone off and relies on the siblings for information. You constantly have cases of siblings versus siblings over the mishandling of family trusts.”

What drives the Noels now is a desire to know who is behind the trust entity with the tax identification number that differs from the bank’s.

Executives at the former Liberty Bank, which was eventually acquired by HomeBancShares, say that account is an old trust account that was never closed in the many mergers the bank has gone through. In a deposition, Lloyd McCracken, who was Liberty’s chief financial officer, referred to it as an administrative account. Executives from HomeBancShares have not been called to testify in the case.

But Mr. Noel said he remains unconvinced.

“When simple questions go unanswered for so long you have to ask yourself why?” Mr. Noel said. “You have to get out of 30,000 feet and ask if there’s a global reason why this is all happening.”

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