Wednesday 15 August 2001
Kainz wants record divorce deal
Tech tycoon's wife wants $10M cash, plus $100,000 a month; Documents highlight glamour couple's strifeGlen McGregor
The Ottawa Citizen
In a divorce action that could set a new record for a spousal support in Canada, former journalist Alana Kainz is seeking a lump-sum payment of $10 million and ongoing monthly payments of $100,000 from her estranged husband, Cognos software founder Michael Potter.
The Ottawa Citizen
Alana Kainz and Michael Potter made headlines when they married on his yacht in June 1999 in the posh resort community of Newport, Rhode Island. She now accuses him of breaking a promise of lifelong commitment if she became pregnant.
If granted, Ms. Kainz's claim would top the previous record for a support award: the $75,000 per month and a $1.3 million lump sum won earlier this year by the former wife of a Toronto real-estate developer.
But it is Ms. Kainz's and Mr. Potter's local celebrity -- and the apparent acrimony between them -- that promises to make their divorce the most closely watched in Ottawa since prime minister Pierre Trudeau split with his wife, Margaret.
While many high-profile divorces are settled discreetly by lawyers, behind closed doors, Ms. Kainz appears set on litigating her case on the public record. Court documents filed by her lawyers last month reveal intimate details of a relationship that has fascinated observers since the couple began dating in 1995, after the shooting death of Ms. Kainz's first husband, sportscaster Brian Smith.
In her divorce application, Ms. Kainz, 36, accuses Mr. Potter, 57, of "misrepresentation" in the breakdown of their three-month marriage. She claims he deceived her into having children by promising a lifelong commitment if she became pregnant. But after the birth of their second child, Mr. Potter told her that "she was in the way of him having relationships with other women," she claims in the divorce application.
Ms. Kainz demands $5 million in damages for the alleged misrepresentation, plus another $5 million lump sum for support for herself and their two girls, ages four and two.
Ms. Kainz also alleges that Mr. Potter threatened to throw her out of his home unless she "got a diagnosis with a mental illness."
She estimates Mr. Potter's annual income at $10 million, a figure that afforded the couple and their children a lavish lifestyle when they lived together in his opulent Rockcliffe home.
When they separated in September 1999, Mr. Potter agreed to buy her a $640,000 house on Clemow Avenue in the Glebe. But Ms. Kainz says her lifestyle was "drastically reduced" by the move. She describes the $15,000 a month in interim child support he currently pays as "grossly inadequate" and asks for enough money to move out of the Glebe and buy a new house in Rockcliffe, to make the joint custody of their children easier to arrange.
None of the allegations made in the divorce application have been proved in court. Mr. Potter would not comment, but his lawyer, Gary Steinberg, said his client intends to defend the claim and has no intention of paying the $10 million Ms. Kainz demands.
Mr. Steinberg points to a marriage contract Ms. Kainz signed when she first moved into Mr. Potter's Soper Place home in 1996. It stipulated that if the relationship ended before March 2002, Mr. Potter would pay her a lump-sum settlement of $1 million. If they stayed together longer, until March 2006, the amount would rise to $2 million, and then to $4 million up to 2010 and $6 million beyond that.
But Ms. Kainz argues in court that the marriage contract is "unconscionable" and says she signed only because of "repeated pressure" from Mr. Potter. After signing, she claims, he said his only commitment was to having children, not to a life with her. Ms. Kainz felt "duped and completely devastated," she says in the divorce application. She asks the court to have the agreement set aside.
Financial records submitted by Ms. Kainz show her only other income above the $15,000 support payments is $150 in stock dividends. But she spends more than $27,000 a month, including: $2,500 on babysitting, $3,000 on vacations, $2,000 on charitable donations, $4,200 on household expenses, $1,000 on clothing for herself, $2,000 on children's clothes, $1,000 on meals outside the home, and $400 on hairdressers.
Mr. Potter, who is retired from his position as Cognos CEO, has an estimated net worth of $745 million, a statistic that made him and Ms. Kainz the objects of great media interest. They often appeared on the society pages with other glamour couples such as their neighbours, former Corel CEO Michael Cowpland and his wife, Marlen.
The birth of Ms. Kainz's and Mr. Potter's children and their subsequent marriage aboard a yacht off of Newport, Rhode Island, were lavishly covered in this newspaper, while the demise of their relationship was charted in gossip columns. In a move that seems calculated to capitalize on this public interest, Ms. Kainz's lawyers have injected many personal details into their claim, including a report on the couple's parenting skills, prepared by Ottawa psychologist Arthur Leonoff.
The report contains psychological analyses of Mr. Potter and Ms. Kainz based on interviews and their scores on the Minnesota Multiphasic Personality Inventory, a diagnostic tool used to assess mental health.
Mr. Leonoff notes in his report that the relationship was hampered by a measure of shame because it began so soon after Mr. Smith was gunned down by a paranoid schizophrenic man in the CJOH-TV parking lot. Ms. Kainz sought comfort in Mr. Potter, whom she met in the course of her work reporting on the high-tech industry for the Citizen.
"Although (Mr. Potter) attempted to resist physical intimacy at such short notice, they became involved six weeks after the death of Ms. Kainz's husband," Mr. Leonoff writes. He also catalogues the acrimonious claims and counter-allegations in the relationship: Ms. Kainz describes Mr. Potter as "narcissistic" and "Machiavellian;" he calls her "monstrous" and says she "constructs a reality by the force of her will."
Mr. Leonoff concludes, however, that both are fit parents and recommends that joint custody continue. In her divorce application, Ms. Kainz does not ask the court to overturn the joint custody agreement.
Lawyers for the estranged couple were in court last week after Mr. Potter brought a motion to have Ms. Kainz's lawyer, Leonard Levencrown, removed from the case because of a conflict of interest. Mr. Levencrown is an associate in the firm MacKinnon & Phillips, the same firm as lawyer Hunter Phillips, whom Mr. Potter had consulted about the breakdown of his marriage in 2000. The court last week ordered Mr. Levencrown removed as solicitor of record. Ms. Kainz has found a new lawyer in Toronto.
A mediation conference set for Aug. 23 has been cancelled, and there are no future discussions settled.
Correction note from August 17, 2001: Arthur Leonoff, a psychologist mentioned in Wednesday's story on the divorce action between Alana Kainz and Michael Potter, should have been referred to as Dr. Leonoff. An incorrect honorific was used in the story. (FACT will not add any comment to this.)
Copyright 2001 Ottawa Citizen Group Inc.