AP (“As Prince heirs stew, bankers and lawyers cash in on estate“)
As the second anniversary of Prince’s death approaches, his heirs have yet to collect a dollar of his estimated $200 million estate. But bankers, lawyers and consultants have earned millions from it.
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Even though it’s been nearly two years since Prince died, the executor of the estate, Comerica Bank and Trust, can’t split the money among Prince’s six surviving siblings until the Internal Revenue Service and executor agree on the estate’s value when Prince died.
It’s not clear when that might happen. The IRS and state of Minnesota are entitled to collect about half, though the estate can stretch out the payments over time.
Court filings several months after Prince’s death suggested that it was worth around $200 million before taxes. The actual value remains one of the biggest secrets in the case, hidden in sealed and redacted documents. The actual valuation could have gone up or down since then.
That’s because the various attorneys, accountants and industry experts at that point had not yet finished appraisals and deals for the use of his music, videos and assets including his Paisley Park studio. Attorneys for the heirs did not return calls for this story or declined to comment.
The six heirs have been bitterly split. Sharon Nelson, Norrine Nelson and John R. Nelson form one faction that has battled Comerica and other heirs on several fronts, including Comerica’s decision to move the contents of Prince’s vault of recordings from Paisley Park to Los Angeles.
But the six showed rare unity last week when Tyka Nelson, Omarr Baker and Alfred Jackson joined the other three in strenuously objecting to an unspecified “entertainment transaction” in the works that they say would be “an embarrassment to Prince’s legacy.” The volume of heavily redacted and sealed court filings and counter-filings suggests it’s big, but the public portions don’t say whether it’s a new music rights deal to replace a failed agreement with Universal Music Group or something else. A hearing is scheduled for Wednesday.
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A small army of lawyers and the taxman. Public filings don’t say how much the estate has already paid the IRS and state of Minnesota, but Comerica and its lawyers have already collected at least $5.9 million in fees and expenses, according to a filing last month.
“There is legitimate concern that at the end of the Estate’s administration there will be little, if anything left to pass on to the Heirs,” attorneys for Sharon, Norrine and John wrote in that filing.
The $5.9 million doesn’t include a pending request for nearly $2.9 million in fees and expenses for Comerica and its lawyers. Nor does it include fees for the heirs’ lawyers and other attorneys, or fees for the estate’s main music adviser, Spotify executive Troy Carter.
The accrual of $8.8 million in legal and other fees seems outrageous on its face but there’s not much to go on here in terms of what that’s for. Presumably, simply negotiating various rights fees (perhaps on a percentage basis) is some large chunk of that. And squabbling among the siblings may be a large cause of the delays in settlement.
The more obvious question, of course, is Why didn’t Prince have a will? Granting that he was relatively young and in good health, you would think his agent would have had a fiduciary duty to ensure that his estate was well-managed. Having basic paperwork in order would seem part of that.
