Family Law Corner: Real Housewife Might Be Out of Touch with QDRO Reality

Brandi Glanville and Eddie Cibrian catapulted to the top of the gossip websites in 2009 when Eddie had an affair with then-married LeAnn Rimes. The ensuing divorce between Eddie and Brandi was seemingly short lived, and the parties were officially divorced in 2010, just one year after Eddie and LeAnn went public with their relationship.  Now they are back in the news, with ugly allegations regarding child support by Brandi and claims by Eddie that Brandi is simply seeking publicity for her newly released book.

Brandi, who capitalized on her newfound fame by joining the Real Housewives of Beverly Hills and subsequently penning two New York Times bestsellers, recently took to Twitter accusing Eddie of asking her for child support.  When Eddie denied this allegation, Brandi Tweeted photographic evidence of her claim in the form of a letter she received. The letter (posted by TMZ) was from an attorney hired in 2010 by Brandi and Eddie to draft a Qualified Domestic Relations Order (QDRO) to divide Eddie’s retirement account, taking into account any overpayment or underpayment of support to Brandi. Eddie is claiming an overpayment of $114,738 in support as of December 2013 and per their Judgment wants that overpayment factored into the division of the retirement plan. Brandi apparently admits there was overpayment, but says she spent the money and she can’t afford to pay Eddie back, apparently despite the existence of the retirement account itself.

The almost four year delay in dealing with these issues is not unusual; sometimes couples unwisely take a considerable amount of time to tie up the loose ends of their divorce, such as finalizing a QDRO. A QDRO is an Order that identifies a spouse as the proper recipient of the other’s retirement plan. (ERISA § 206(d), 29 U.S.C. §1056) QDROs are required for the division of retirement plans such as pensions and 401(k)s.  

In a divorce, parties usually either divide the retirement account in-kind (In re Marriage of Judd (1977) 68 Cal.App.3d 515) or they utilize the cash-out method, where a value is assigned to the retirement account and one party takes another asset/obligation in lieu of taking his or her interest in the retirement plan (In re Marriage of Bergman (1985) 168 Cal.App.3d 742). Here, Brandi and Eddie appear to be using a hybrid approach where they will divide the retirement account, but also use a portion to offset an obligation.  Their legal issue, which appears to be simple, has been blown out of proportion by the media.