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Abstract: 

An Indiana State Court recently held that a trustee was justified in retaining Eli Lilly stock transferred to two charitable remainder annuity trusts, where a specific clause in the trust authorized retention of the stock. While the case rejected a challenge to the trustees’ actions and investment decisions, that result was probably predictable on the facts—since the governing instrument authorized retention of the Eli Lilly stock specifically. It is likely that there are many charitable remainder trusts (CRTs) (and family foundations!) holding investments that are not diversified, and that the trustees do not have such good facts to rely on.

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