Speaker 1: Prince was an icon, one of the best selling artists
Speaker 1: of all time, and many of the songs are part
Speaker 1: of modern culture. But Prince zealously guarded his music. He
Speaker 1: broke with his record label, changed his name to a symbol,
Speaker 1: got back his original master recordings, and pulled his songs
Speaker 1: off streaming music services, all to make sure that only
Speaker 1: he controlled his art. It's a sad irony that Prince
Speaker 1: will have absolutely no say in what happens to his
Speaker 1: music after his death. Though he was quick to hire
Speaker 1: lawyers to protect his music while he was alive, he
Speaker 1: did not hire a lawyer to draw up a will,
Speaker 1: leaving no instructions on how he wanted his music and
Speaker 1: estate handled. My guests are Terence Ross, a partner at
Speaker 1: Captain Euten Rosamond, and Laura's Wicker, a partner at Greenberg Glusker.
Speaker 1: Laura Prince is a state has been said to be
Speaker 1: worth as much as two million dollars, with a catalog
Speaker 1: of about a thousand songs. What's happening now to value
Speaker 1: the estate? Well? Um, his executors will be filing or
Speaker 1: preparing to file with the I R S and a
Speaker 1: state tax return. Um. They'll be working to establish a
Speaker 1: value for his catalog that's in his name and likeness,
Speaker 1: that's reasonable. Um. We've seen in the Michael Jackson estate
Speaker 1: where m his executors valued name and likeness such as
Speaker 1: two thousand dollars, a big blowback from the I R S.
Speaker 1: So I'm sure that Prince's legal advisors or the legal
Speaker 1: advisors for his executors will have their eye on that
Speaker 1: and try to come up with a reasonable but perhaps
Speaker 1: lower number UM for for Prince's name and likeness, his
Speaker 1: music catalog, and the balance of his assets. Terry. Since
Speaker 1: Prince was notoriously protective of his music, is his legacy
Speaker 1: being protected at all? Or is it a dash for cash?
Speaker 1: It really is a dash for cash. From what I've
Speaker 1: read in the popular press. The executors are attempting during
Speaker 1: the period of their administration, are attempting to maximize the
Speaker 1: revenue from both the publishing catalog, the recordings, and his likeness.
Speaker 1: He during his lifetime, Prince did not allow his image
Speaker 1: or likeness or name to be used for commercial purposes,
Speaker 1: and they are now out there trying to do deals
Speaker 1: involving his his likeness, his image, and his name on
Speaker 1: top of licensing UM the catalog of songs, and those
Speaker 1: deals may well be multi year deals that the heirs,
Speaker 1: whoever the air eventually is determined to be, are stuck with. So, Laura,
Speaker 1: since he was protective of is likeness, it doesn't matter
Speaker 1: that everyone knew he was protective of his life likeness.
Speaker 1: Are we still going to see his face on T
Speaker 1: shirts and cups and maybe in ads? Whatever the executors
Speaker 1: determined is in the best interests of the estate, and
Speaker 1: the best interests of the estate are to maximize value.
Speaker 1: So yes. Unfortunately, unless you create an estate plan that
Speaker 1: directs control of your name and likeness as well as
Speaker 1: your other assets UM, your executors are left with a
Speaker 1: fiduciary duty to maximize value for whoever your beneficiaries are.
Speaker 1: And Laura's speaking of beneficiaries, Prince had a sister, a
Speaker 1: half brother, and four step siblings. How will the estate
Speaker 1: be distributed among them? So my understanding of Minnesota law
Speaker 1: is that the step siblings would share as full siblings,
Speaker 1: although I know that there has been UM discover ory
Speaker 1: and is already some dispute about who UM is going
Speaker 1: to take as an heir, And so the probate court
Speaker 1: in Minnesota is going to determine airship in this case,
Speaker 1: because again Prince didn't have a state planning documents that
Speaker 1: set out who he wished to benefit Terry. Can you
Speaker 1: and this is a question that has been asked and
Speaker 1: will never get a real answer, but why someone who
Speaker 1: spent so much money paying lawyers to protect his music
Speaker 1: and his rights wouldn't have a document even indicating what
Speaker 1: he wanted after his death. It's really criminal. And you
Speaker 1: would have thought, because of the good legal representation he
Speaker 1: had in the many UH disputes he had as to
Speaker 1: how his his his music was being used, that one
Speaker 1: of those lawyers would have said, hey, have you done
Speaker 1: any planning with respect here state? UH. And it's not
Speaker 1: like there aren't a lot of examples out there. There
Speaker 1: are a number of bands and artists recording our who
Speaker 1: have paved the way in this area. He could have
Speaker 1: set up a foundation UM, or he could have set
Speaker 1: up a trust and then UM had these assets pour
Speaker 1: into those um upon his death and put in place
Speaker 1: a trustee or somebody in charge of the foundation with
Speaker 1: very explicit instructions as to how to license the works
Speaker 1: and license his likeness. And he didn't do any of that.
Speaker 1: It's just very puzzling. Jim, Laura, have you ever had
Speaker 1: a case you work in a state planning, have you
Speaker 1: ever had a case where someone found it difficult to
Speaker 1: come to an agreement about the state, or you know,
Speaker 1: came to you and then said, well I can't do
Speaker 1: this now. Yeah. Um, I had a client who had
Speaker 1: end stage diabetes and had a very significant estate. UM
Speaker 1: and his wife came in. We created a state planning
Speaker 1: doctor months for them. That would have protected their privacy,
Speaker 1: That would have made um her life after his passing
Speaker 1: really simple. UM. But despite many meetings and many phone
Speaker 1: calls he enjoyed calling to talk, he could not sign
Speaker 1: the documents and so we were left with a very
Speaker 1: significant intestacy. Now, Terry, what happens after whords? It goes
Speaker 1: to the I R s and then Mike. There's still
Speaker 1: funny about Michael Jackson's the state. I believe there are
Speaker 1: I mean, I don't know how many years that's been.
Speaker 1: But part of it is because a state took such
Speaker 1: an aggressive position with respect the valuation of the assets
Speaker 1: that the I R S said, oh, come on, UM,
Speaker 1: We're we're gonna call you on that one and litigated UM.
Speaker 1: Here it sounds like they're doing the exact opposite, that
Speaker 1: they're aggressively maximizing revenue UM and to the extent they
Speaker 1: get these deals done quickly, UM, they'll have a concrete,
Speaker 1: market based valuation of what the assets are worth. But
Speaker 1: at the end of the day, you know, the real
Speaker 1: winner out of all of this is the internal Revenue
Speaker 1: Service Because all of the state planning um that we've
Speaker 1: been talking about did not get done. There are many
Speaker 1: mechanisms where you can avoid big tax bills to the
Speaker 1: i RS. That happened, Laura about thirty seconds left. I
Speaker 1: understand that the taxes are going to be about fifty
Speaker 1: of the estate. Is that about right? Um? About a
Speaker 1: huge chunk. Still, thank you so much for being with us.
Speaker 1: Laura's Wicker. She's a partner at Greenberg Glusker. Terry Ross
Speaker 1: is going to stay with us. As we're talking coming
Speaker 1: up about Paul McCartney suing Sony to gain control of
Speaker 1: the Beatles back catalog of music, and he's using a
Speaker 1: legal tactic that Prince once used. I'm June Grossel. You're
Speaker 1: listening to Bloomberg Law. This is Bloomberg b