On July 19, 2023, Rolling Stone broke the news that Composer Danny Elfman had previously settled a case involving alleged sexual misconduct for $830,000. The settlement and NDA had been signed back in July of 2018, but the news was coming out in 2023 because the accuser, Nomi Abadi, had filed a lawsuit, claiming Elfman had missed two payments of $42,500 each. These two payments, according to Abadi, were not related to her personal payments, but were earmarked for a charity.
We recently wrote about court documents from Abadi's team, which provided us more details about the settlement payments. We learned that part of the settlement agreement was for Elfman to make 4 payments of $42,500 each ($170k total) into a Charitable Gift Fund, that Abadi was then required to donate to a public charity. We also learned that Nomi founded her own charity and obtained the proper IRS designation, seemingly so that it could be the beneficiary of these funds. She claims to have donated the amount paid into this fund so far ($85k according to her) to her charity, which she claims she does not personally benefit from. One thing we still don't know is what happened to the other $660k of the $830k settlement. In Abadi's inital complaint, she states, "The parties agreed to resolve an underlying dispute which included terms that Defendant would make payments in four different categories in various installments over the course of 5 years totaling $830,000.00." We now know that one of those four categories was for 4 payments totaling $170k to go into the Charitable Gift Fund, which Nomi was required to then donate to a qualifying charity. It remains unclear to the general public what the other three categories, representing the remaining $660k, could be.
There is evidence that at least some of that money was personal payments that went to Nomi Abadi. Plaintiff's Opposition to Defendants Motion to Compel Arbitration states: "Plaintiff has received her personal compensation from the settlement." As far as we can tell, no other categories have been identified in court documents. All we know of is the $170k to the Charitable Gift Fund and the personal payments to Abadi. This doesn't necessarily mean that all $660k of the non-Gift Fund money went to Abadi. But it seems that at least some of it did.
"Paragraph 1(b) of the July 31, 2018, Settlement Agreement includes a term that provides for payment by Defendant Elfman to the Bank of America Charitable Gift Fund (Charitable Gift Fund) in four increments of $42,500.00, to be paid on or before the first Monday of each July, ending July 5, 2022. Defendant Elfman paid the first of the four payments to the Charitable Gift Fund on September 17, 2018..."
The payments appear to have started in 2018, and there was a schedule of "various installments over the course of 5 years". It is common, when an award amount is high, to have a "structured settlement" - wherein the amount is payed out in installments, rather than in one big chunk. The primary purpose of this is to decrease the award winner's tax burden. Reporting lower income each year keeps the award winner in a lower tax bracket, and they will pay less in taxes overall.
We were curious if Abadi would be required to report her Settlement Award on her taxes, and as far as we can tell, her Award would not be tax-exempt as it is not related to physical injury. (We are not tax or legal professionals, we just Googled it.)
A quote from Nomi Abadi, on the Roar with KK podcast, released 3/10/2020:
"These settlements were- became an option because of republican white men made these exist. CEOs do not get taxed, victims do get taxed. Settlements are usually paid slowly over an amount of time. The victim usually ends up with very little, but they're also very protective to the victim. Like there's so many misconceptions about like, this greed, and it's like, no no no no, it's like, NDAs can sometimes be a wonderful thing for victims."
This statement from Abadi strengthens our supposition that her personal payments were spread out over the next five years, just like the Charity payments were, and that they were not tax exempt.
While we don't know the amount or the dates of the personal payments to Nomi Abadi, we could reasonably assume (and hope) that she would be financially stable, at least while the payments were ongoing. However, in April 2021, Abadi claimed in a legal document that she was broke and in debt.
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As we covered in a previous blog post, Nomi Abadi accused an ex boyfriend of Domestic Violence in 2020, and sought a restraining order against him. The court found that Abadi did not provide adequate evidence to support her claim. Her ex boyfriend then requested that Abadi be ordered to pay his legal fees, calling the case "frivolous".
In response, on April 22, 2021, Abadi filed an Opposition to Notice of Motion for Attorneys Fees and Costs. A keen-eyed reader of D.E.T. sent us an email, prompting us to take a closer look. In this document, Abadi argues that she should not have to pay her ex's legal fees and costs. One of the reasons she gives for this belief is that she doesn't have the ability to pay.
Included in the Opposition is an Income and Expense Declaration (same link as above) that Abadi provided to the court as evidence of her inability to pay. In this document, Abadi claims to have no income other than unemployment benefit payments and Covid-19 stimulus checks. Under "Assets" she lists only $1,312.64 in cash, checking accounts, savings, etc. and a laptop valued at $2k. She does not list her piano under assets, and under "job related expenses" she has written in $150 for "tuning piano on loan to me". This is odd, as Abadi's complaint against her ex included a claim that he was harassing her to pay him back for a piano that he gifted her. Her ex had countered that the piano was not a gift, but that he had loaned her $3k to purchase it. On 10/13/17, she had paid the outstanding $1,000 via a cashier's check, apparently writing "piano loan" on it. He provided an image of the check as evidence in his Response to Request for DVRO. He also pointed out an email thread between them in a screenshot Abadi provided, with the subject line "Piano Loan", with the most recent response dated 8/19/17.
Whether it was a loan or a gift, Abadi owned the piano outright by this point, but did not list it as an asset. Instead, she included tuning expenses for a piano that was "on loan" to her. Perhaps she somehow lost the first piano between 2017 and 2021 and had to borrow a second one.
----- Under "Installment payments and debts not listed above", she lists over $27k in various credit card and other debt.
One debt line item is listed as: "NPO attorney for NPO filing, balance: $1,757.50, unpaid." This appears to be referencing the nonprofit filing for the Female Composer Safety league. At this point (4/22/21), according to Abadi, Elfman had made two payments totaling $85k by 7/17/20, into the Charitable Gift Fund. One would think that Abadi would have used this money to pay the NPO attorney for the filing. Perhaps she was waiting for the FCSL to receive the tax exempt designation. Maybe it is represented in the FCSL's 2022 form 990, which shows $13,588 in "Professional fees and other payments to independent contractors". If so, that debt should not have been listed as her personal debt on her Income and Expense Declaration, since it was money owed by the FCSL, not by Abadi. Another legal debt listed is a balance of $10,912.50 (no payments made) for a Patent Attorney, regarding a "Patented Instrument". There is a hand-written note about this debt in the left margin, but it is unfortunately illegible, due to the quality of the photocopy.
Nomi Abadi holds a patent for an (honestly, pretty badass) "double keytar" that she calls the NORY. The provisional application for the NORY (U.S. patent US-20190066645-A1) was filed Aug 29, 2017. The "Filed" date is Aug 29, 2018. The Patent Application Publication is dated Feb 28, 2019. The name NORY is a registered trademark, with an application filing date of Aug 29, 2017 and a registration date of November 13, 2018.
[[As a totally unrelated side-note, the police report filed by Nomi Abadi about Elfman's alleged behavior was filed in November 2017. A former friend of Abadi's said in a legal declaration (provided by Elfman to Rolling Stone), that they received calls and messages from Abadi in November 2017, alleging Elfman's abuse, which they did not believe, as it went against everything Abadi had previously shared with them. The police report and disclosure to this friend took place a year after the alleged behavior, but only 3 months after the NORY patent and trademark processes were initiated.]] In her appearance on the Beyond the Chameleon podcast, dated January 25, 2022, Nomi said, "but when you're making a commercial product, it is a really hard process and a very very, very expensive process. I patented it, uh, I own the patent. I paid out the government fees, that was a lot of money. Now I'm raising funds to to pay my electrical engineer and get my new mechanical engineer on board to create three versions of it that we want to see." It's unclear if the almost $11k listed as still owed for "Patent Attorney" in April 22, 2021 included these "government fees", or if that was separate from the large sum that Abadi claims to have paid by Jan 25, 2022.
The patent and trademark are both registered to Abadi as an individual, not to an LLC or corporation. We were unable to find a legal entity for NORY in the state of California. In the "Income from Self Employment" section of the Income and Expense Declaration next to "name of business", Nomi writes "self employed musician and composer" but mentions nothing about NORY. If there truly is no legal entity, then any expenses for the NORY that year should have been listed under "job related expenses". If there is an LLC we haven't found, California LLCs undergo pass-through taxation, which means income and losses flow to the owners, and are reflected on their personal taxes. We would assume they would also have to be reflected on the Income and Expense Declaration. Perhaps there were no profits or losses for NORY that year. Or perhaps there is a different type of entity, or an entity in another state that is handling bookkeeping and taxes related to the NORY.
We looked into whether a patent or registered trademark would be considered assets that Abadi would be required to list on her personal taxes. The answer is that they are intellectual property and therefore considered "intangible assets", and the rest went over our heads and we needed a nap.
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The "debt" section on Abadi's Income and Expense Declaration also includes $2,000 owed to her mother, who helped her out when she lost music students during Covid. She wrote in the margins that her boyfriend pays half the bills and utilities, and pays extra when she is unable to pay.
She also claims to have paid her attorney for this case a flat rate of $500 on a credit card. Abadi initially represented herself in this case, but brought on an attorney after she lost and her ex sought reimbursement of his legal fees. In the text of the Opposition, page 6, Under III. EXHIBITS, it reads, "The fact that she was self-represented during the preparation of, and hearing on her Request of Restraining Order and that she was able to retain counsel undersigned with an initial retainer of $500 which she paid by credit card, with the understanding that she could not pay additional fees, and that counsel undersigned would apply for payment of additional fees from Time's Up Legal Defense Fund." Grammar aside, that sentence fragment says a lot.
Some supporting documents are attached to the Income and Expense Declaration, including Form 1099-G for the year 2020, showing that Abadi received $8,636 in Unemployment Compensation in that year. This means Nomi Abadi collected unemployment benefits two years after, as far as we can tell, she began receiving payments from her $830k settlement award.
While Abadi's tax return is not attached, instructions on the Income and Expense Declaration outline that she should bring it with her to court, in case they want to check it against the Declaration. So we can reasonably assume that her tax return would reflect the same information as the Income and Expense Declaration, which does not mention anything about the Elfman settlement payments.
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These documents present more new questions than they answer:
Where did the $660k of the non-Charitable Gift Fund money go? What were the other three categories? How much of it accounts for Nomi Abadi's personal payments? Was it paid out in increments, like the Charitable Gift Fund money was? Or did she receive it all up front, pay the higher tax rate, and spend it all before 2020? Was the entire sum eaten up by "government fees" for the patent on the NORY double keytar? If it was received in increments, why wasn't it listed on the Income and Expense Declaration? Was it also not listed on her tax return? Why did she need to collect unemployment? Why was she still carrying so much debt?
We are not accusing Nomi Abadi of lying to the court, the IRS, the unemployment office, her mom, her boyfriend or her lawyers about how much money she had. We are simply wondering where $660k of Abadi's 2018 settlement award went, if she claimed not to have of any of it in 2020 or 2021. We'd like to say "thank you" to the reader who dropped us the note to look into this. We are not legal or tax professionals. We can and may get things wrong. We are normal people with no special access to information, beyond what is publicly available online. We do our best to present our findings fairly, supported with evidence, and with little opinion or commentary. It is not our intent to shame, embarrass, defame or disparage anyone. We simply seek to share the facts we can find. If you spot something we got wrong, or have information that could change hearts and minds, please reach out to us by using the Contact Us form, or email us at dannyelfmantruth@gmail.com. Don't forget to sign up for our mailing list, so you know when the next blog drops.
Edits: 1/18/24 for typos
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