Which is harder to endure: never possessing a vast fortune, or holding one in your hands and then watching it slip away?
Years before Jeff Bezos moved $36 billion in Amazon stock to MacKenzie Scott, and long before Bill Gates and Melinda French Gates divided one of the largest private fortunes in the world, Patricia Kluge became a name synonymous with high-stakes divorce in America.
Her 1990 split from billionaire media tycoon John Kluge left her with Albemarle House, an extraordinary Virginia estate, along with cash and continuing income. The settlement was generally reported to be worth about $100 million, though some estimates pushed the figure closer to $200 million. British tabloids, never shy about spectacle, went even further, branding it a “$1 billion divorce.”
Rather than simply retreat into a life of comfort, Patricia tried to turn that windfall into something lasting. She poured her resources into creating one of the most ambitious wineries in the United States. For a while, the gamble looked like a triumph: her wines collected awards, the vineyard was valued in the tens of millions, and she seemed to have reshaped divorce wealth into a legitimate business empire.
But the 2008 financial crisis changed everything. In the years that followed, the estate, vineyard, winery, jewelry, antiques, and much of what remained of her lavish lifestyle were sold off or lost. By 2011, Patricia Kluge had filed for bankruptcy.
Still, her story did not end with financial ruin. In an unexpected turn, she later went to work for the man who purchased pieces of her former empire out of foreclosure: Donald Trump.
(Patricia Kluge, center, via Getty)
Early Life
Patricia Kluge was born Patricia Maureen Rose in Baghdad in 1948. Her father was British, and her mother had Scottish and Iraqi Chaldean roots. The family lived comfortably, with summers often spent in Lebanon.
As a teenager, Patricia moved to London. She worked as a model and married Russell Gay, the much older publisher of the British men’s magazine “Knave.” She also wrote a sex-advice column for the magazine. Their marriage lasted roughly five years, after which Patricia moved to New York.
Marriage to John Kluge
John Kluge was a German-born entrepreneur who built his fortune through broadcasting. After taking control of Metropolitan Broadcasting Company, he expanded into television, radio, outdoor advertising, entertainment, and other businesses under the name Metromedia.
In 1985, Kluge agreed to sell Metromedia’s major television stations to Rupert Murdoch for approximately $2 billion. Those stations became the foundation of the Fox television network. By 1989, Forbes estimated John’s fortune at $5.2 billion, making him the richest person in America.
Patricia and John married in 1981, when she was 33 and he was 66. They adopted a son, John Jr., and moved to Virginia, where they spent several years creating Albemarle House.
The 26,000-square-foot, 45-room neo-Georgian mansion was surrounded by formal gardens, lakes, an 18-hole golf course, and thousands of acres. It was filled with museum-quality antiques and became a destination for celebrities, politicians, business leaders, and royalty.
The $100 Million Divorce Settlement
Patricia and John divorced in 1990 after nine years of marriage. The financial terms were confidential, which helps explain why estimates vary so widely.
The settlement gave Patricia control of Albemarle House and much of the surrounding property, along with cash and continuing payments. The most credible estimates valued the package at somewhere between $100 million and $200 million. The lower figure became the one most commonly attached to her story.
Even at $100 million, it was an extraordinary fortune. In 1990 dollars, that amount had the spending power of well over $200 million today.
Patricia could have lived comfortably for the rest of her life. Instead, she decided to build something.
The Vineyard Gamble
In 1999, Patricia and her third husband, William Moses, established Kluge Estate Winery and Vineyard on the Albemarle property. Patricia was not interested in producing an inexpensive regional wine. She wanted to create bottles that could compete with the best wines from France and California.
She hired prominent European consultants, installed expensive equipment, planted hundreds of acres, and built a lavish winery and tasting operation. The wines earned strong reviews, and the estate’s sparkling wine became particularly respected. At its peak, the business was reportedly valued at approximately $75 million.
But Kluge expanded aggressively. She and Moses took out a $22.5 million mortgage against Albemarle House and borrowed roughly $39 million from Farm Credit of the Virginias. They also pursued Vineyard Estates, a proposed luxury subdivision of vineyard homes that required millions more in financing.
By the late 2000s, the winery was producing approximately 30,000 cases per year while selling fewer than half that number. The business was burning through cash, and the real estate project had launched at almost the worst possible moment.
The Financial Crisis
When the global financial crisis erupted in 2008, demand for luxury homes and expensive wine collapsed. Loans went into default, the winery reportedly began losing hundreds of thousands of dollars per month, and Patricia scrambled to raise money.
She listed Albemarle House for $100 million in 2009. With no buyer, the price fell first to $48 million and then to $24 million.
In 2010, she auctioned her jewelry, furniture, art, clothing, and antiques through Sotheby’s. The sales raised more than $20 million, but the proceeds were not enough to rescue the winery or satisfy her creditors.
Farm Credit foreclosed on the vineyard and winery. Bank of America took Albemarle House. The Vineyard Estates development was also lost.
In June 2011, Patricia and William filed for Chapter 7 bankruptcy protection. Their filing listed between $10 million and $50 million in liabilities and between $1 million and $10 million in assets.
A woman who had once controlled one of the grandest private estates in America was now watching it all pass into someone else’s hands.
Donald Trump Buys the Empire
Donald Trump, a longtime acquaintance of the Kluges, initially offered approximately $20 million to buy or rescue the winery. When the lenders rejected that approach, he began acquiring pieces of the property through foreclosure auctions and private deals.
In April 2011, the Trump Organization paid $6.2 million for more than 700 acres, the vineyards, winery, trademarks, and winemaking operation. Trump separately acquired roughly 217 acres surrounding Albemarle House for just $150,000. In 2012, he bought the mansion itself from Bank of America for approximately $6.7 million.
A property Patricia had once listed for $100 million had been assembled by Trump, piece by piece, for a small fraction of that amount.
Trump hired Patricia as vice president of operations at the renamed Trump Winery. Her contract lasted about a year. The winery was later transferred to Eric Trump, who continues to oversee it. Albemarle House was restored and converted into a luxury hotel.
Starting Over
Patricia eventually moved back to New York and turned her attention to jewelry. Having spent decades collecting and commissioning elaborate pieces, she began working with jewelry professionally and selling her own designs.
Her most memorable response to the collapse came in an interview with “Town & Country”:
“I enjoyed all of these things hugely. But they did not define me. The person is an entirely different entity. The person is private. The person is introspective. The person puts family before everything. Purpose. Work. Creativity. These are what define me. And not the dressing.”
Patricia Kluge lost a mansion, a vineyard, a winery, an art collection, millions of dollars in jewelry, and one of the largest divorce settlements in American history.
But she never viewed those possessions as the final measure of her life. She took a job inside the business she once owned, moved on when that chapter ended, and created another career from scratch.
That may not be the ending she imagined when she received her divorce settlement. It is, however, a far more interesting one.
