Honey Sherman’s family members sue for part of Barry Sherman’s billions

According to the application, Barry set up the “Bernard Sherman 2016 Trust” as a tax-planning strategy sometime in 2016 and named as beneficiaries the 22 children and grandchildren of Barry and Honey’s extended family, including the children and grandchildren of Honey’s sister Mary and Barry’s sister Sandra. 

The trustees of both Barry’s estate and the 2016 trust are Jonathon Sherman, Sherfam money manager Alex Glasenberg, and Brad Krawczyk, who was formerly married to Sherman daughter Alexandra. It is those three men, the Shechtman twins allege, who have failed in their “fiduciary duties” to provide information on the trust to the beneficiaries. The lawyer for the Shechtman twins wants the court to suspend or remove the three trustees and appoint an independent trustee. 

Jonathon’s lawyer, and a lawyer representing Glasenberg and Krawczyk, say they “disagree” with the allegations but declined to speak further as the matter is before the courts.

Barry and Honey Sherman were murdered on Dec. 13, 2017. Their strangled bodies were found two days later posed in a seated position in their basement swimming pool room. Initially investigated as a murder-suicide, police announced it was a double murder following a Toronto Star investigation. To this day, one lone full-time detective is working on the case. A search warrant a year ago was used to obtain thousands of documents related to Barry’s business dealings. No charges have been laid in the case although the police say they have numerous persons of interest. 

This lawsuit is the latest family feud that has erupted in the wake of the murders. Previously, the Star has reported on a falling-out between Sherman son Jonathon and his three sisters. The falling out began with a dispute over who would control the family fortune and intensified with allegations from Sherman daughter Alexandra that her brother Jonathon was somehow involved in the murders. Jonathon has told the Star he had nothing to do with the murders.

Barry’s extensive wealth came initially from his ownership of generic drug giant Apotex, which he founded in the early 1970s. But his wealth also extended to investments in companies like Rexall Drugs, numerous apartment buildings — even a condominium tower at Yonge and Bloor streets. His children and extended family referred to Barry’s generosity as “the Bank of Barry Sherman” or simply, “the Bank of Barry.”

While the financial press estimated his wealth at $4.7 billion when he died, insiders at Sherfam, his private holding company, have told the Star that his entire fortune, including monies held offshore, was closer to $10 billion. Today, following the instructions in his will, the Sherman fortune has been divided equally among Barry and Honey’s four children: Lauren, Jonathon, Alexandra and Kaelen. A Honey Sherman will was never found, though a confidante of Honey’s told the Star that Honey was updating her will in the weeks before her death. The lawsuit does not explain whether the estimated $500 million is still in trust or has been distributed.

A full picture of Barry’s holdings remains shrouded in mystery. Apotex (now sold to an American company) and Sherfam are private business entities with no requirement for public disclosure of assets and cash in the bank. 

The lawsuit filed by the Shechtman twins is the first public indication that Barry created this trust. Sources suggest that this was a tax-planning strategy from the man who, though a proud philanthropist, was stingy when it came to paying taxes to government. He once invested in a fleet of Caribbean yachts which he believed would solve some of his tax issues (in that case, it only made them worse when it was discovered there were no yachts and no business losses to write off). 

In the lawsuit brought by the Shechtman twins, they allege that Barry set up the 2016 trust as part of an “estate freeze.” An estate freeze is a complicated tax-planning strategy that allows a person to lock the value of their holdings at a certain point in time (potentially reducing their future tax liability), and then transfer the future growth of the business and any future tax liability to those who will later control the estate, often family members. This is a common strategy for family-owned businesses. 

The lawsuit states that this new trust holds 1,000 shares in Shermco (a Barry Sherman company) and estimates that the growth in the value of these shares was at least a half-billion dollars between 2016 and his death in late 2017. The Shechtman twins believe they and other beneficiaries are entitled to some of this value.

In pursuing this case, the first problem for the Shechtman twins, and their lawyer John Adair, is that they have very little information about the trust beyond a simple document identifying the beneficiaries. The lawsuit alleges that the trust document identifies the beneficiaries as the four Sherman children (Jonathon, Lauren, Alexandra and Kaelen); the three children of Mary and Allen Shechtman (Matthew, Rebecca and Noah); and the children of Barry’s sister Sandra and her husband Mike. Grandchildren are also identified as beneficiaries.

The lawsuit says attempts have been made by the Shechtman family to get to the bottom of the trust information, with no luck. 

(A previous trustee and executor was Jack Kay, Barry’s close friend and second in command at Apotex. However, Kay resigned as Barry’s executor and a trustee of the 2016 trust after Jonathon fired Kay from Apotex. A financial deal was struck for Kay to be compensated for his more-than three decades of service to Barry.)

This legal action appears to be an attempt to get a judge to order the three trustees to provide all available information on the 2016 trust. The twins’ lawsuit states that they only recently received any information at all. “The Trustees did not provide the beneficiaries with a copy of the trust deed or indeed any information about the trust until such was requested by the Applicants in 2023. The Trustees were apparently content, for nearly six years since the tragic death of Barry (and Honey) Sherman in 2017, to leave the beneficiaries entirely in the dark with respect to essential information such as the trust deed.”

One major complication the Shechtman twins say they face is that Barry set up the trust as a “discretionary trust,” meaning that the three trustees (Jonathon Sherman, Alex Glasenberg and Brad Krawczyk) can determine who among the beneficiaries gets what and how much.

The complication, the lawsuit explains, relates to hostility from the four Sherman children to the Shechtman family. As evidence, the lawsuit states that, “Regrettably, following the murders of Barry and Honey Sherman in December 2017, the relationship between the Sherman Siblings and Mary Shechtman, her husband Allen, and the Applicants broke down.”

As the Star has previously reported, Honey’s sister Mary told the Sherman children soon after their parents were found dead that Honey had promised her $300 million (Mary has told the Star that Honey actually promised her $500 million but she used the lower figure because she thought it would be more palatable). The four Sherman children broke off contact with Mary soon after the funeral. 

“Over the passage of time, it has become clear that the breakdown is irreparable. Although the primary conflict is with Mary Shechtman, it has extended to her children Matthew and Rebecca, who are not on speaking terms with the Sherman Siblings,” the lawsuit states.

The lawsuit says that evidence of “animosity” by the trustees towards the Shechtmans is that (the lawsuit alleges) the Sherman trustees “actively encouraged” Noah Shechtman (the third Shechtman child) to sue Mary for an accounting of a trust she had set up. That case is still before the courts. Noah is not speaking to his mother and has not joined his siblings in the lawsuit against the Bernard Sherman 2016 Trust.

The Shechtman twins, in their pleadings, argue that while the trustees are entitled to use discretion in distributing funds, they cannot do this “on the basis of personal animosity.”

In their pleadings filed in court, the Shechtman twins also allege that there is a major dispute between Jonathon Sherman and the other two trustees. They state that Jonathon “is no longer on speaking terms with (trustee) Alex Glasenberg and actively disagrees with decisions” made by both Glasenberg and the other trustee, Brad Krawczyk. 

Shechtman lawyer Adair has asked the court to do several things. First, order the trustees to provide a full accounting of the trust. The lawyers representing the Sherman side have told the Shechtman family that “there is no relevant accounting” to be made. The Shechtman side wants a court to step in so that they can see the accounting for themselves. 

Second, given the animosity between both sides, the Shechtman side wants the court to either suspend or remove the three trustees and appoint an independent trustee to oversee the trust during this litigation. Adair, the lawyer representing the Shechtman side, said in his pleadings this is necessary because the trustees have “breached their fiduciary duties by refusing to pass their accounts.” Passing accounts refers to a court reviewing and approving the accounts of a trust. 

The Star reached out to the lawyers representing the numerous parties in this case.

Adair, representing the Shechtman twins, said in a statement to the Star: 

“Matthew and Rebecca stand by their allegations and believe that the record will support their request to remove the trustees. They hope, however, that this matter can be resolved without the need for further litigation.”

Chantelle Cseh, lawyer for trustees Krawczyk and Glasenberg, said “the Trustees disagree with the allegations in the (Shechtman) application, but as the matter is before the court it would be inappropriate for the trustees to provide any media statements at this time.”

Tom Curry, a lawyer representing Jonathon Sherman, also said he disagrees with the allegations and could not comment further.

Robert Cohen, who represents Barry’s sister’s children and grandchildren (the Florence family), said his clients have “an interest in the outcome of the litigation” because they are beneficiaries. Cohen said he could not comment further at this time, but expected all sides will file materials in court in the months ahead.