The Prince? estate is gearing up for courtroom fireworks at a hearing next week on a motion to void its $31 million deal with Universal Music Group for the rights to the late pop star’s “vault” of unreleased tunes and other recordings, due to potential conflicts with Warner Music Group’s rights.
In a flurry of court filings this week, Prince’s eldest half sister Sharon Nelson objected to the proposed rescission of the deal on grounds that it would harm the estate’s business reputation. In a separate memo, she and two of Prince’s other half siblings blamed the estate’s new administrator, Comerica Bank & Trust, for failing to defend the the deal, which had been hammered out by Prince’s former attorney Londell McMillan and approved by the estate’s former administrator, Bremer Trust. Those three of Prince’s half-siblings, Sharon, John and Norrine Nelson, now count McMillan as their business advisor and want to preserve the agreement with Universal—even though they opposed it in a court filing when Bremer initially proposed the agreement last year.
“The UMG Vault Agreement is not only objectionable, it is unenforceable, and, if entered, may expose the estate to a lawsuit,” said the memo of opposition filed by lawyers on behalf of all six of Prince’s heirs in September, though lawyers for the heirs eventually approved the deal.
McMillan, meanwhile, who represented Prince for more than a decade and earned roughly $1.5 million in commission on the UMG vault deal, maintained in his own court filing this week that the terms of UMG’s contract are “contractually valid and enforceable.” He accused WMG of “overreaching” and questioning why Comerica never sought a court order to show WMG’s contract with Prince to UMG.
“There are too many people involved in the estate that just don’t understand the entertainment business,” McMillan told Billboard this week.
At issue is an alleged conflict between the licensing rights that the estate sold to Universal at the end of January to some of the music that had been recorded by Prince while he was under contract at WMG’s Warner Bros. Records. While UMG agreed to pay $31 million for a recorded-music package that Bremer and its advisors said included rights to some Warner albums starting as soon as 2018, WMG has indicated to both Bremer and Comerica that its rights to those particular albums don’t expire until several years later, according to court filings. UMG is now seeking its money back as Comerica acknowledged in a document that it couldn’t “rule out” the possibility that the two labels’ rights conflict.
“Comerica apparently just does not know,” wrote lawyers for McMillan’s three business advisees in their filing this week, arguing that the bank should have consulted Bremer and its advisors, McMillan and veteran entertainment executive Charles Koppelman, for help. Comerica retained Spotify executive and veteran artist manager Troy Carter as its own advisor in March.
All six heirs to the Prince estate acknowledged an apparent discrepancy between Warner’s existing rights and the rights that Bremer proposed selling to Universal as early as last fall. In September, attorneys for the six heirs filed a joint memo opposing seven licensing deals that had been negotiated by McMillan and Koppelman and proposed by Bremer Trust. Alleging that Bremer was rushing despite there being “no reason to do the recommended deals now” while objecting to McMillan’s and Koppelman’s combined 10 percent commission — approved by the court on deals completed before their temporary roles expired in February — the filing alleged that the most “egregious example” of the seven was Universal’s deal for the unreleased recorded music.
“The UMG agreement concerns masters that are subject to an existing agreement with Warner Bros. that do not revert to Prince until 2020, not 2018 as stated in the UMG Vault Agreement,” the heirs’ September filing said. “The estate will be torturously interfering with the rights to [Warner Bros.’s] existing agreement, which [Bremer] is seeking to extend, not end,” the heirs’ filing said.
Bremer has said it properly reviewed all contracts and acted in the estate’s best interests. The heirs that McMillan advises have since switched lawyers, while all heirs signed off on the final deal.
In yet another filing this week, Koppelman’s lawyers argued that he and McMillan should not be automatically required to return the combined $3.1 million in commission they earned on the UMG vault agreement, should the judge approve the motion to rescind it. Koppelman’s company asks the court to separate any decision on their commission from the potential rescission of the deal.
Prince’s half-brother Omarr Baker, meanwhile, called in his own filing Tuesday for the judge to investigate who might be responsible for fallout from a yanked deal before discharging Bremer from liability.
Comerica’s motion to void the UMG agreement cites “business reasons” that include avoiding litigation and doesn’t acknowledge any error or legal basis for wanting to scrap the deal, but Baker argues that Comerica’s reluctance to pin blame stems from its court-approved “common interest agreement” with its predecessor, Bremer, which mandates that Bremer and Comerica “cannot, at any time, be adverse to each other in connection with this estate.”
Given that, “it is somewhat unclear who should bring any adverse claims against [Bremer]…and a process for determining whether such liability exists, and any damages that result from that liability, must be established,” Baker’s filing says.
This article originally appeared on Billboard.