A Dead Man, 3 Bar Girls, His Mole And His Money -- Paternity Cases Tie Up $500 Million Estate

DNA FROM A MOLE could determine whether the University of California gets an eccentric's fortune, or whether it goes to three children born to teenage mothers.

SAN FRANCISCO - When he died after his vintage airplane plunged into the Pacific Ocean a year ago, Larry Lee Hillblom, the eccentric founder of the DHL international courier company, left a will that has embroiled California in a bizarre legal battle with three former bar girls over an estate worth at least $500 million.

At stake is a bequest that the University of California system says would be the largest private donation ever given to the institution - one that would provide an immense, long-term infusion of cash into medical research at the university system's five teaching hospitals. The women, however, claim the money belongs to their children, all Hillblom's out-of-wedlock offspring.

Already, the case has attracted dozens of attorneys. It has even prompted a controversial move to change paternity laws on the Pacific island of Saipan and, in the end, may rest on the genetic makeup of a mole taken from Hillblom's face two years before his death.

`Carnegie' was a swinger

The hopes of the university system are pinned on Hillblom's instructions in his 1982 will that virtually all his estate be placed in a charitable trust. It was his wish, Hillblom said, that "substantially all" the trust funds be used "for medical research" with "particular attention" given to programs at the University of California.

"I see Larry Hillblom as a modern-day Carnegie," said Yeoryious Apallas, the deputy attorney general charged with securing as much of the Hillblom estate as possible for the university.

But standing between the university system and the bonanza are the onetime bar girls, who in court affidavits paint a very different picture of Hillblom.

The Larry Lee Hillblom they portray was a well-known denizen of the bar scene in the Far East, hopping from island to island. Hillblom would regularly tip bar managers to procure girls barely into their teens. He would pay the girls to spend days or even weeks with him, the women's attorneys say.

According to the affidavits, Hillblom was partial to virgins and insisted on having unprotected sex.

Three paternity claims

Julie Cuartero, now 16, recalled the night she met Hillblom in a Philippines bar.

In her affidavit, Cuartero swore she was 14 and working as a nude dancer when she encountered DHL's founder. After spending several days with him, she claimed she became pregnant. Hillblom urged her to get an abortion, but she refused. Now, Cuartero is contesting the will on behalf of her 1-year-old daughter, Jellian, born just before Hillblom died.

Two other young women tell similar stories. Kaelani Kinney, now 28, from the Micronesian island of Palau, says her 12-year-old son, Junior Larry Hillbroom, also is the millionaire's child. Kinney says she, too, was introduced to Hillblom in a bar. She was 16. She says he sporadically paid support for her son. Even so, Peter Donnici, Hillblom's longtime lawyer who was left in charge of the trust, says Hillblom always insisted the boy was not his.

Last year, Kinney's attorney rejected a $17 million settlement offer by the Hillblom estate, the only such offer made so far to any of the would-be heirs.

The third young woman, Mercedez Feliciano, 16, says she gave birth to Hillblom's daughter 7 months after his plane went down. Feliciano said she lived with Hillblom in his Saipan estate for a year before his death.

If the three women can prove their claims in court, their attorneys say, their children could walk away with the entire estate, which includes a controlling interest in DHL's international operations and a 23.6 percent share of DHL's domestic operations.

Language missing from will

Hillblom left a legal door open for the children by failing to include in his will the jargon used to disinherit offspring born out of wedlock, attorneys for both sides say.

Hillblom's will makes no mention of children, leaving room for the courts to decide if he knew of them. Existing Saipan law presumes Hillblom would have left his estate to a child he knew existed.

In the late 1970s, Hillblom retired from active management of the company, retreating to Saipan, the main island of the Commonwealth of the Northern Marianas. The Marianas, a U.S. possession acquired after World War II, are a tax haven for millionaires.

In 1993, Hillblom crashed his small Cessna while attempting an emergency landing on the island of Tinian, another of the Marianas.

"He hit a stump that just pushed the plane's engine into his face," said Donnici. "Every bone in his face was fractured. He lost his eye, and punctured a lung. He was a mess."

Hillblom eventually was flown to San Francisco for reconstructive surgery. It was then that physicians removed the mole that may be the key to resolving the case.

Mole is all that's left

Preserved in wax, the mole may be the only sample of Hillblom's genetic makeup. His body was never recovered after he and two friends crashed into the Pacific near the island of Pagan on May 21, 1995.

Attorneys for the would-be heirs have obtained a court order allowing them to test DNA from the mole May 30.

But Apallas, the deputy attorney general, is questioning its authenticity. "There are many questions about this mole, about the chain of custody of the mole," said Apallas, who is seeking a stay of the judge's order.

Even should the test go forward, Apallas says, the case is far from over. Hillblom's will "is not a model of legal draftsmanship," he said, but its intent is clear.

"It sets out what he intended to do. Foremost was the avoidance of taxes through establishing a charitable trust. That he does masterfully."

Had Hillblom believed he had fathered children and had interest in providing for them, Apallas said, he would have done so in the will.

"We believe that he was unconcerned because there were no children, in his view," Apallas said, adding that he believes he can produce evidence that Hillblom was sterile.

In the meantime, Donnici and the California attorney general won a victory last week when Saipan's legislature adopted a bill that would disinherit children not publicly claimed by their fathers.

The bill must be signed by Saipan's governor to become law, and his intentions are unknown.

Lawyers for the children say it was approved only after Donnici made a written promise that Hillblom's trust would give "substantial" funds to Saipan charities.

Donnici says he merely was fulfilling an oft-repeated wish of Hillblom's.