Craig & Wendy McCaw: The $460 Million Divorce That Defined Early Tech Wealth
He built America's cellular phone empire -- she walked away with $460 million and a newspaper
Key Facts
What Happened
Craig McCaw was a pioneer of the American cellular telephone industry. His company, McCaw Cellular Communications, was the largest cellular carrier in the United States before he sold it to AT&T in 1994 for $11.5 billion -- one of the largest corporate acquisitions of the era. Craig and Wendy McCaw divorced in 1997, and the settlement of approximately $460 million made it one of the largest divorce payouts in American history at the time.
The case was tried in Washington State, a community property jurisdiction where all assets acquired during the marriage are presumed to belong to both spouses equally. Craig had built McCaw Cellular during the marriage, making the company's full value a marital asset. Wendy's legal team argued successfully that she was entitled to a substantial share of the AT&T buyout proceeds.
Wendy McCaw used her settlement to pursue her own interests, most notably purchasing the Santa Barbara News-Press newspaper in 2000 for $35 million. Her ownership of the paper became its own saga -- she clashed with editors, fired reporters, and was accused of inserting her personal views into news coverage. The paper eventually ceased print publication in 2023.
The McCaw divorce was one of the first major technology-wealth divorces in American history, predating the Bezos and Gates splits by decades. It established that spouses who support a tech entrepreneur during the company-building years have full community property rights to the resulting fortune -- a principle that would be tested again and again in Silicon Valley.
Legal Breakdown: Telecom-Era Wealth Division
Community Property & Tech Fortunes
Washington's community property law meant that McCaw Cellular -- built entirely during the marriage -- was a marital asset. The $11.5 billion AT&T acquisition price became the baseline for division. In community property states, the supporting spouse shares equally in business success, regardless of who ran the company.
Timing of Asset Sales
The AT&T sale crystallized McCaw Cellular's value before the divorce was filed. When a business is sold for cash before divorce proceedings begin, valuation disputes become much simpler -- the sale price is the value. This worked against Craig, who could not argue the company was worth less than AT&T paid.
Post-Settlement Asset Management
Wendy's purchase of a newspaper with settlement funds illustrates how divorced spouses often reinvest in passion projects. Courts do not control post-settlement spending, but financial advisors recommend diversified investments rather than concentrated bets on a single asset.
What This Means for Your Divorce
- →In community property states, a business built during the marriage belongs to both spouses equally -- even if only one ran it.
- →Selling a business before divorce simplifies valuation but also maximizes the marital estate subject to division.
- →Post-divorce financial decisions matter enormously. A large settlement poorly invested can dwindle quickly.
- →The McCaw case set the template for every subsequent tech-wealth divorce in America.
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This article is based on publicly available court records, news reports, and legal analysis. It is provided for educational purposes only and does not constitute legal advice. No attorney-client relationship is created by reading this content.
Divorce laws vary by jurisdiction. Always consult a licensed attorney in your area before making legal decisions.