Michael Jackson Estate: Value of Right of Publicity

by Tamera H. Bennett
July 2, 2009

I vacillate between the most valuable asset in Michael Jackson’s estate being his 50% interest in the Sony/ATV Tunes, LLC music publishing catalog and his right of publicity.

Estate Tax attorneys are chomping-at-the-bit about the calculation of the value of Michael Jackson’s name and likeness, i.e., his right of publicity.  It is possible the actual value for estate tax purposes may exceed the liquid assets of his estate.  Under California law, an individual’s right of publicity is descendible and can be transferred by a contract, will or trust.  If there is not a specific bequest in the will, then the interest may pass via a residuary clause (Cal. Civil Code Sec. 3344.1(b)).

If the Will of Michael Joseph Jackson that recently surfaced is valid, and there was no previous transfer of his right of publicity, then the interest transfers to  the Michael Jackson Family Trust executed on March 22, 2002.  If the will is not valid and the right of publicity interest passes intestate, in accordance with California Civil Code Section 3344.1(d)(2), because Michael Jackson died unmarried his interest would pass equally to his three children.

The question looms, what is the value of his right of publicity?  For estate tax purposes, the goal will be to comply with the tax laws, but keep the figure as low as possible.  For dealing with a third party that wants a license to use his name or likeness the goal is to maximize the right.

In the 1980’s the value of Mr. Jackson’s right of publicity had skyrocketed. Who can forget the Pepsi commercials?  Reportedly Mr. Jackson received $1.5 for the Pepsi spots.

Additionally, the song in the Pepsi commercial is a derivative of “Billie Jean.”  I cannot find confirmation regarding who owns the copyright in the music in the commercial.  It is possible that Mr. Jackson was earning public performance songwriter and/or publisher  royalties each time the commercial aired.

There was an LA Gear deal that went south and various posters, stickers and molded dolls with custom outfits.

Reportedly a custom clothing line, not for dolls, was scheduled to launch in the Fall of 2009. Depending on the contract that may still occur.

The Marketing Arm’s June 26, 2009 Press Release stated:

According to data from the Davie Brown Index (DBI), which uses consumer surveys to score 2,500 celebrities across various attributes, at the time of his death, Jackson’s trust among U.S. consumers was significantly lower than other iconic musicians, including Elvis Presley, Elton John, and Bruce Springsteen, whose trust scores were as much as 30 points higher than that of Jackson. Data from the DBI indicates that while Jackson is known by a remarkable 99 percent of U.S. consumers, his scores for attributes such as appeal, aspiration, breakthrough, and endorsement are notably lower.

The press release goes on to say the focus moving forward should be on Mr. Jackson’s career successes rather than any legal or personal issues he faced during his life.

Could the value for either estate tax purposes or for licensing purposes go down because of past allegations?  Recent examples of personal life  issues potentially lowering a celebrity’s right of publicity include American Apparel’s attempt to lower the value of Woody Allen’s name and likeness for calculating damages in a lawsuit.  Additionally, Olympic Gold Medalist Michael Phelp’s perceived value went down after an unfortunate photograph surfaced.

What there is no question about is the right of publicity exists and the family/estate/trust/whoever owns the right should strongly enforce the right and guard the nature and types of licenses issued.  “Fair Use” is a defense in right of publicity cases, but it is often very difficult to prove.  There will be a lot of unauthorized goods floating around out there.

To some it all up, if the Lego company wants to have a Michael Jackson Lego block constructed look-a-like, they are probably okay so long as there is one or a very limited quantity because they would be protected under free speech.  If they plan to mass-produce them in kits….get a license.

Surrogacy Lawyer Speaks: Michael Jackson Estate

by Tamera H. Bennett
Posted July 1, 2009

I asked California surrogacy lawyer Stephanie M. Caballero to provide my readers a basic understanding of the  contractual process involved in surrogacy cases and the rights of the surrogates and/or donors and how this relates to Michael Jackson and his children.

In an email reply Ms. Caballero stated:

Gestational carriers in California do not have any custodial or visitation rights to any surrogate child they give birth to because the intent to parent controls in these cases and the Intended Parents, whether they used their own genetic material or a donor egg or sperm, are the only legal and natural parents of that child.

Even if Michael Jackson used a sperm donor to father his youngest child, that sperm donor is not the parent.   Custody would have been relinquished in this case by a judgment of parentage signed by the judge and certified  by the court, allowing Michael Jackson’s name to be listed as the only parent, since he was not married at the time.

For the law regarding the lack of parental rights of sperm donors, click here to review California Family Code section 7613.

To learn more about the probate process and how that relates to Michael Jackson’s estate click here to listen to an audio interview with California probate attorney Jennifer Sawday.

California Probate Attorney: Michael Jackson Estate Process

by Tamera H. Bennett
posted June 30, 2009

The news varies from hour to hour whether or not Michael Jackson had a will and is it valid.  Only a judge can make the decision if the will is valid and that decision will be months, even years away.

Mr. Jackson resided in Los Angeles County, California and passed away there as well.  The probate of his estate, with or without a will, is proper in the Superior Court of Los Angeles.

The link to my CREATE PROTECT BLAWGCAST here, provides insight from California probate attorney Jennifer Sawday on the process all probate cases take in California with a special emphasis on the Michael Jackson case (click here for link to initial court filing).

Our conversation explores the potential legal issues involved in settling a celebrity estate such as:

• What is the time-line for probate in California?
• Could some assets pass outside the probate proceeding?
• What does probate cost?
• What is the strategy behind Ms. Katherine Jackson filing for Letters of Administration so soon after death?
• What happens if a “will” shows up?
• What are the potential guardianship issues?
• What if allegations arise that Michael Jackson is not the biological father of some or all of his children?

Look forward to your comments and questions on this topic.

Part 2: Brown, Garcia & Hendrix— Estate Nightmares?

by Tamera H. Bennett
with research assistance from Mitch Mitchell

James Brown, Jerry Garcia, and Jimi Hendrix all held very different spots in the world of music and entertainment ….. Part one of this post on James Brown is here.

Jerry Garcia

The latest suit against assets once controlled by Jerry Garcia involves the trust holding the publicity rights of musician Merl Saunders vs Jerry Garcia Estate, LLC.  Click here for a link to the First Amended Complaint filed June 26, 2009 in the Northern District of California.

Merl Saunders performed hundreds of times with Garcia primarily as the “Merl & Jerry Band.”  The complaint alleges there was a partnership between Merl Saunders and Jerry Garcia regarding equal name billing and a 50/50 split of profits and losses as to performances and recordings made as Merl & Jerry.  There were numerous master recordings/sound recordings of the “Merl & Jerry Band” and the complaint alleges those were owned jointly.

In December 2004 a CD set entitled “Pure Jerry: Jerry Garcia & Merl Saunders Band, Keystone Berkley, September 1, 1974 was commercially released.  Released June 28, 2005, was a CD set entitled “The Jerry Garcia Collection, Vol. 1: Legion of Mary” (“LOM Vol. 1”) which contains Jerry and Merl sound recordings.

Saunder’s trust claims the releases were never authorized, there has been no accounting for Saunder’s ownership in the sound recording copyrights or for the use of Saunder’s name and likeness in promoting the releases.

The original complaint, filed December 28, 2008, and the amended complaint,  allege violations of Saunder’s right of publicity as well as unfair competition and a demand for an accounting.

The Saunders Trust may be too late on bringing some of their claims.  The statute of limitations for violation of the California right of publicity statute is four years.  For the release in December 2004, the trust may have missed their time to file by only a few days.  The complaint alleges the plaintiffs were not aware of the release until some time after the actual release date.

The Lanham Act does not set out a specific statute of limitations for a False Endorsement/Unfair Competition claims, but relies upon a theory of laches to determine the applicable statute and such laches time frame is usually taken from the analogous state law.  There is a four year statute of limitations for state law unfair competition claims in California, and a discovery rule/tolling period does not always apply.

As to the accounting between co-owners of a copyright, the claim can be brought at any time, but some courts have limited the recovery to a look back of three years from the time the lawsuit was filed.

An additional defense to the claims of breach of right of publicity and unfair competition is simply that inherent with the rights as co-owner of a copyright, when the copyright, ie, the sound recordings are released, the co-owner may include attribution to the joint owner.  I believe the Plaintiffs could have won on a right of publicity and/or unfair competition claim had Mr. Saunders not been listed, but that they will be unlikely to recover anything more than an accounting between co-owners of a copyright in the case at hand.

Michael Jackson Had A Will In Place… Maybe

by Tamera H. Bennett
posted June 29, 2009

UPDATED 2:45 pm July 1, 2009: Michael Jackson’s last will and testament is circulating on the web and was allegedly filed with the Los Angeles Superior Court today.  Click here for a copy of the Will.  Click here for a nice summary from The Hollywood Reporter Esq. Blog.

UPDATED 12:00 pm, June 30, 2009: Click here to review the Petition for Letters of Special Administration filed on June 29, 2009 by Mrs. Katherine Jackson to serve as Temporary administrator of Michael Jackson’s estate.

The Wall Street Journal reported today that the “2002 Will” may be filed with the Superior Court in Los Angeles as early as Thursday this week.

Attorney John Branca told the Hollywood Reporter today that the “Will” is to be filed in the next 48 hours.

UPDATED 3:15 pm, June 29, 2009: Yahoo and CNN are reporting Mrs. Katherine Jackson, the mother of Michael Jackson, has filed in the Los Angeles Superior Court to serve as the administrator of Jackson’s Estate.  Ms. Jackson also alleges Michael Jackson died without a valid will.

Let the will contests begin…..

PRIOR POST: Billboard reported over the weekend here and here that Michael Jackson did have a written will.  Supposedly the last will and testament was executed in 2002 after the birth of his third child.  There may be codicils (amendments to the will) or a completely new will that was created later than 2002, but all of this is speculation.

As I blogged here last week, there could always be challenges to the estate planning documents such as the will or any trusts that were in place at Michael Jackson’s death.

Michael Jackson’s Estate: What Happens Next?

by Tamera H. Bennett
posted June 26, 2009

Music fans of all ages are mourning the loss of the King of Pop.  Almost everyone I chatted with today had a story about the first time they heard “Thriller” or saw the video.  I was in high school and stayed up to midnight to see “Thriller” on the VHS station late-night video program.  We lived too far out in the sticks to have cable TV — so no MTV.

The question that has been raised repeatedly today is what happens to Michael Jackson’s estate?

I suspect Michael Jackson had a strategic estate, wealth, and asset protection plan that included layers of trusts and business entities.  I would be very surprised if any “major” assets were owned by Michael Jackson personally.

The largest asset is his 50% interest in the Sony/ATV music publishing catalog reportedly valued between $500 Million and $1 Billion dollars.  A check of the Delaware Secretary of State shows the formal business entity for the publishing company is Sony/ATV Tunes, LLC a Delaware Limited Liability Company.  I have not confirmed, but have it on a reliable source that Michael Jackson’s interest in the LLC is held by a trust. [UPDATE:  The New York Times reported on June 27 this asset was held in trust]

Most likely the asset is held in a “spendthrift trust” and shielded from creditors.  In this type of trust, the beneficiary has no control over the distribution of trust income or assets and the corpus (big word for initial money/asset placed in the trust) and income is no longer in the estate of Michael Jackson and could not be attached to pay his  reported $500 million debt.

If the bulk of the assets are in trust, then the public may never know the extent of his estate.  The trust documents, unless there is litigation surrounding those documents, would never become public record.  Documents would only become public record if there is a probate of a will, will contest or other legal challenge regarding distribution of his estate.

There can be a plan in place and litigation still occur.  I blogged here about the ongoing dispute among the heirs of James Brown and the challenges raised to his trust documents.

I was interviewed on this topic today by the leading music trade and hope to have a link up to that article shortly.

This link goes to a post I am continually updating on the topic of a valid will and administration of the estate.  This link goes to my interview of California Probate attorney Jennifer Sawday on the topic.

Click here to review comments from a California surrogacy attorney.  Go to JDSupra to read my additional thoughts on what happens next.

Entertainment Law Update Podcast 2

by Tamera H. Bennett

Had another great time co-hosting the Entertainment Law Update Podcast

with attorney Gordon Firemark.  You can hear, download and subscribe to the podcast here.

Topics (with lots of links) include:

• Congratulations to Maren Christensen, Executive VP and General Counsel at Universal Studios,  who’s been named Beverly Hills Bar Association’s Entertainment Lawyer of the Year for 2009.
• Supreme Court Nominee  Sotomayor’s background and 2nd Circuit ruling in favor of statutory damages as deterrent.
• Backlog at the Copyright Office.
• Does the Register of Copyrights hold office lawfully?  A pending Constitutional Appointments Clause challenge  questions the validity of CRB appointments, but what about the Register’s ministerial Acts?
• Sports Leagues losing control of fantasy-sports leagues as Courts rule that the First Amendment trumps rights of publicity, and player statistics, etc., where there’s a public interest in the information.
• Good discussion of “Access” element of copying analysis in ruling on Summary Judgment for Defendant in song plagiarism suit.
• Warner Music issues DMCA Takedown on Organization that hosted Prof. Lessig talk
• Woody Allen/American Apparel case settles
• SAG settles Force Majeure claims
• Tenenbaum’s fair use argument – Case is set for trial July 20.

A Sequel To Catcher In The Rye?

By Tamera H. Bennett

UPDATE JULY 1, 2009: U.S. District Court judge Deborah Batts issued a preliminary injunction barring the defendant from manufacturing, publishing, distributing, shipping, advertising, promoting, selling or otherwise disseminating “60 Years Later, “  the unauthorized sequel to J.D. Salinger’s novel, “Catcher in the Rye” in the United States

The Judge held Mr. Salinger was likely to succeed on a claim of copyright infringement after weighing, in detail, the factors for a fair use defense.

Read The Wall Street Journal Law blog comments.

UPDATE June 18, 2009: The judge issued a temporary restraining order for 10 days.  Read more at The New York Times.

ORIGINAL POST: Author J.D. Salinger, at 90 years-old, filed a lawsuit this week seeking damages for copyright infringement and an injunction against the writer, publishers and distributor of a sequel to “Catcher In The Rye” …. “60 Years Later: Coming Through the Rye.”

Read more at the Ask Before You Act Blog.

Earliest Known Sound Recordings Uncovered

by Tamera H. Bennett

U.S. News and World Reports published an article this week on sound recordings that were made 20 years prior to Thomas Edison’s invention of the phonograph.

Read the article for a  great piece of music and sound recording history about the phonautogram.

Want to learn more about the history of the phonograph?

(As a side note, one of my favorite scenes in “Oh Brother Where Art Thou?” is when they “cut” the phonograph record.  When you watch that scene you understand why the slang is “cut a record.”)

Copyright Office Improves Processing Time and Service

The message below was distributed by the US Copyright Office today.

See my prior post on the topic here.

Copyright Office Improves Processing Time and Service

A recent Washington Post article focused on the lengthy processing times the Copyright Office is experiencing in wake of its transition from a paper-based to an electronic processing environment. The Copyright Office is working diligently to improve processing times and service to the public in general. To clarify, current processing times by filing method are as follows:

• E-Service with Electronic Deposit:  5 months for 90% to be completed; 33% completed in 2.5 months
• E-Service with Physical Deposit: 6.5 months for 90% to be completed; 33% completed in 3 months
• Paper Claims: 18 months for 90% to be completed; 33% completed in 12 months

You can save money and time and help us improve our services by filing claims online via eCO. Please visit www.copyright.gov for more information.

Texas Music Mini-Conference: History of Texas Music

On Saturday, May 30, Dallas Public Library’s Fine Arts Division will host a one-day conference on the history of Texas music.

Twelve sessions will be offered covering a wide range of performers and styles, including Stamps-Baxter and Southern Gospel music, Texas blues, rock bands from the 60s, two noted women in Texas music, the Texas International Pop Festival, jazz in Texas, the Big D Jamboree, and more. Two film screenings will be included in the day: Teen-a-Go-Go and South Dallas Pop.

Although the conference is free, space is limited, so advance reservations are requested. To register for the event, please visit http://texasmusic.eventbrite.com.

Here is a link to the schedule.

Here is additional information on the topics/presenters with links:

Ruby Allmond and Louise Tobin:  Audra Brock, Jim Conrad, and Deborah Porter (Texas A&M University, Commerce)
http://rubyallmond.com
http://www.tamu-commerce.edu/library

South Dallas Pop Festival (film screening, Q&A):  Roger Boykin, Anne Bothwell
http://www.kera.org/tv/productions/southdallaspop

Texas Blues:  Jay Brakefield, Michael Dyson, Alan Govenar
http://www.docarts.com
http://www.blueshoeproject.org
http://www.theeagle.com

Buddy Holly and Buddy Magazine:  Stoney Burns, Ron McKeown
http://buddymagazine.com
http://www.myspace.com/buddy_magazine
http://www.buddyhollycenter.org

Fort Griffin Fandangle (sampler):  Jim Coker and Fandangle sampler performers
http://www.fortgriffinfandangle.org
http://www.tshaonline.org/handbook/online/articles/FF/kkf2.html
http://en.wikipedia.org/wiki/Fort_Griffin_Fandangle

Big D Jamboree and the Light Crust Doughboys:  David Dennard, John Mark Dempsey, Art Greenhaw
http://www.dragonstreet.com/aboutus.html
http://www.artgreenhaw.com
http://faculty.tamu-commerce.edu/jmdempsey
http://www.tshaonline.org/handbook/online/articles/BB/xfb1.html
http://www.tshaonline.org/handbook/online/articles/LL/xgl1.html
http://bigdjamboree.net/home.html

Texas  Music Overview; Goals for Future Research:  Kevin Mooney
http://www.music.txstate.edu/facultystaff/bios/mooney.html
http://www.tshaonline.org/handbook/online/articles/TT/xbt2.html
http://ecommons.txstate.edu/cgi/viewcontent.cgi?article=1006&context=jtmh

Rock Bands, the 60s, Teen-a-Go-Go (film screening, Q&A):  Mark Nobles, William Williams
http://groups.yahoo.com/group/BigD60s
http://www.myspace.com/teenagogogaragebands
http://www.flickr.com/photos/bigd60s/sets
http://www.teen-a-go-go.com
http://blogs.dallasobserver.com/unfairpark/2008/05/do_not_read_this_unless_you_ha.php
http://vids.myspace.com/index.cfm?fuseaction=vids.individual&videoID=36336572

Texas International Pop Festival: Angus Wynne
http://www.tshaonline.org/handbook/online/articles/TT/xft1.html
http://www.texaspopfestival.com

Bob Wills:  Jeff Storie
http://webtest.dbu.edu/fine_arts/Faculty/MusicFaculty-effreyStorie.asp
http://www.deckerjones.com/storie.htm
http://www.bobwills.com
http://www.turkeytexas.net

Southern Gospel and Stamps-Baxter:  B. F. (Bob) McLemore and Pauline Thompson
http://www.tshaonline.org/handbook/online/articles/SS/ehs3.html
http://www.tsgsm.com
http://www.tshaonline.org/handbook/online/articles/GG/xbg2.html
http://en.wikipedia.org/wiki/Stamps-Baxter

Copyright Office ECO Not Speeding Up Process

by Tamera H. Bennett
Posted May 21, 2009

And I thought it was just me  1) wondering when  my clients’ late 2007 and early 2008 paper filed copyright applications were going to register; 2) struggling to use the new ECO system….

Read More From The Washington Post:

The trouble is twofold. Workers say the electronic system is slow and prone to crashing. Managers say the challenge has been retraining the staff to use the system. Both sides agree the more significant problem is the fact that much of the public is still using paper applications, which must be painstakingly entered by hand into the new electronic database.

About 45 percent of applications are still in paper form. The staff is spending so much time handling the paper claims, it doesn’t have enough time to process electronic applications, which has created delays for online claims now, too. It now takes six months to process electronic claims when it should take one month.

Updated 5/26/09: Read more commentary from the Plagiarism Today blog.

BLAWG REVIEW #212

By Tamera H. Bennett

BLAWG REVIEW #212

“You Don’t Have To Call Me Darlin,’ Darlin’”

When I teach music publishing classes or seminars I always give an example to explain the difference between an idea and the expression of an idea. The expression of the idea fixed into a tangible medium is what is protected by copyright law.

My favorite example is to tell the class they each need to write a song that includes these ideas: trains, rain, momma, jail and pickup trucks.  (Yes, lyrics still count).  In the end they may all come up with something completely different and each original work would be protected by copyright law. Even if those same ideas are found in another song … the perfect Country & Western song.

Songwriter Steve Goodman penned the lyrics that singer David Allan Coe made famous in 1974  and turned the classic country song “You Never Even Call Me By My Name” a/k/a “You Don’t Have To Call Me Darlin,’ Darlin’” click to watch the video into a country cult classic. (Country cult is not an oxymoron, is it?)

Verse One
Well it was all
That I could do to keep from cryin’
Sometimes it seemed so useless to remain
But you don’t have to call me darlin’, darlin’
You never even call me by my name

Sometimes it seemed so useless to remain…  We don’t know for sure if he and “darlin” are married, but in Texas it could have been a common law marriage.  Watch out during those divorce proceedings for taped phone calls and emails showing up in discovery says the New Jersey Law Blog.  The Alabama Family Law Blog makes it clear it takes two to tango but only one spouse to get a divorce.

You never even call me by my name… As a trademark/branding lawyer one of my clients’ biggest concerns is being called by the right name and making sure no competitor is using the same or similar name.   Check with the Los Angeles Trademark Attorney Blog to see if it is the  “The Girl From Ipanema” wearing that IPANEMA tagged swimsuit.  Over at the TTABLOG we can voice our thoughts on Lamb’s vs Lam for rum.  Las Vegas Trademark Attorney Ryan Giles asks will the real Andre Agassi and Stephi Graf stand up now that their cybersquatters are down? Mr. President, please do not be confused by those pending OBAMA trademark applications in the EU as reported by the IPKAT.  And Google, what are you doing now with those crazy adwords?  Read the update from IP lawyer Ron Coleman on the Texas class action against Google.  This week is the Annual International Trademark Association Convention in Seattle so I am giving a special shout out to Seattle Trademark Attorney Michael Atkins comparing the Space Needle to the Rock ‘n Roll Hall of Fame.

Verse Two
You don’t have to call me Waylon Jennings
And you don’t have to call me Charley Pride
And you don’t have to call me Merle Haggard, anymore
Even though you’re on my fightin’ side

CHORUS:
And I’ll hang around as long as you will let me
And I never minded standin’ in the rain
But you don’t have to call me darlin’, darlin’
You never even call me by my name

Just make sure she really wants you hanging around because GPS can now be attached to stalkers.

Verse Three
Well I’ve heard my name
A few times in your phone book (Hello, Hello)
And I’ve seen it on signs where I’ve played
But the only time I know
I’ll hear David Allan Coe
Is when Jesus has his final Judgment Day

REPEAT CHORUS

Watch out for those signs, too.  Like Woody Allen, sometimes your picture might be associated with something you oppose.

RECITATION:
Well, a friend of mine named Steve Goodman wrote that song
And he told me it was the perfect Country & Western song
I wrote him back a letter and I told him it was not the perfect Country & Western song because he hadn’t said anything at all about Mama,
Or trains,
Or trucks,
Or prison,
Or gettin’ drunk.
Well he sat down and wrote another verse to the song
And he sent it to me,
And after reading it,
I realized that my friend had written the perfect
Country & Western song
And I felt obliged to include it on this album
The last verse goes like this here:

Well I was drunk the day my Mom got out of prison
And I went to pick her up in the rain
But before I could get to the station in my pickup truck
She got runned over by a damned old train

This additional verse that makes the song the perfect country and western song, also makes it o-so perfect for Blawg Review….

Did he say drunk and prison in the same line? You better see what my Twitter colleagues have to say at the Criminal Defense Blog, the Simple Justice Blog and the Defending People Blog.

Trains, people and trucks rarely make a good combination.  See what the Chicago Injury Lawyer Blog has to say about a recent train accident. Read here about the man charged with DUI in a car/train accident.  Also, no texting while driving the train.

CHORUS:
And I’ll hang around as long as you will let me
And I never minded standin’ in the rain
No, you don’t have to call me darlin’, darlin’
You never even call me
Well I wonder why you don’t call me
Why don’t you ever call me by my name

Until I re-read this post I thought it was the perfect Blawg Review post.  Then I realized it said nothing about…

Fashion and the law
Cuban Trade Laws and the impact on music
Estate Planning
Copyright Infringement
Negotiations
The Theatre
Social Media in the music business
Branding in the music business
Patents in the music business
or Tattoos — Famous Trademarks as Tattoos, that is

Now I realize I have written the perfect Blawg Review post.

You don’t have to call me Darlin,’ Darlin’ ….
just call me lawyer Tamera H. Bennett.

Blawg Review has information about next week’s host, and instructions on how to get your blawg posts reviewed in upcoming issues.

UPDATED 5/18/09:  American Apparel and Woody Allen settled for $5 Million after this Blawg Review went to press.  Read more here.

McDonald Not So McCurry

by Tamera H. Bennett

An appellate court in Malaysia brought to an end an ongoing legal battle that began in 2001. McDonald’s corporation sued the owners of the McCurry restaurant in Kuala Lumpur claiming likelihood of consumer confusion between the McCurry name and the McDonald’s trademark.

Read more at the Ask Before You Act Blog.

Brown, Garcia & Hendrix— Estate Nightmares?

by James “Mitch” Mitchell
and Tamera H. Bennett

James Brown, Jerry Garcia, and Jimi Hendrix all held very different spots in the world of music and entertainment, though there is some arguable overlap given the extent of each one’s influence. Yet, one thing they most certainly all have in common after their respective deaths concerns problems in handling their considerable assets, including royalty and trademark rights.

This is a three part blog post taking a look at the interesting twist, turns and legal wrangling by these guys’ heirs and other third parties.

James Brown
James Brown, the Godfather of Soul, died Christmas Day 2006 from congestive heart failure resulting from complications of pneumonia.  Problems with Brown’s estate came to the surface when it was clear that his wife at the time of his death, Tomi Rae Hynie, and the child from that relationship, were not included in his will that was executed in 2000.  Also in 2000, Brown created the “I Feel Good Irrevocable Trust” which included the bulk of his musical copyright assets and real estate assets.  The beneficiary of the trust is a charitable organization.

To add to the exciting mix, Brown was separated from Hynie at the time of his death and there are legal questions as to the validity of their actual marriage.  Under South Carolina law, Hynie and the child from that relationship are entitled to an inheritance so long as they were not specifically disinherited in the will.

The family members reached a Settlement Agreement in 2007, which the court rejected.  On April 6, 2009, the judge wrapped up hearings on the matter and a ruling on the division of the estate is anticipated.

More spin on the estate came to light also on April 6, 2009 when a former publicist of James Brown, Jacque Hollander, sued for a stake of the “I Feel Good” trust.   Hollander alleges the trust is illusory and the assets from the illusory trust were instead property of a partnership between her and Brown that was established in 1987 and never dissolved. Hollander v. Estate of James Brown (09 CV 2147).

Be watching for upcoming blog posts on Jimi Hendrix and Jerry Garcia.

Woody Allen v. American Apparel Heats Up

By Tamera H. Bennett
posted May 13, 2009

The lawsuit filed by actor/director Woody Allen over the unauthorized use of his image by American Apparel,  Inc. on the billboard shown below is heating up in preparation for trial scheduled to start next week.  Read the complaint here, answer here, American Apparel’s MSJ Memorandum here.

Image from CurbedLA

American Apparel President Dov Charney admits the image was taken from the movie Annie Hall and there was no request for permission to use Allen’s likeness on the billboard. Charney defends the actions claiming fair use.

The billboards and images from the Annie Hall movie were intended to be a parody/social statement and comedic satire to provoke discussion and public discourse about the baseless claims that had been made against American Apparel and myself, society’s reaction to lawsuits that delve into an individual’s  private sexual life and the media’s sensationalism of such matters.

Allen does not see it exactly the same. Allen does not endorse any products in the US and believes this use of his image not only violates his right of publicity, a state law claim, but also creates a false association or endorsement, which is a claim brought under the Federal Lanham/trademark Act.

From a legal wrangling standpoint, discovery has been a mess.  American Apparel is attempting to drag in unrelated personal information via the discovery process.  There are various motions flying back and forth to compel Allen to answer discovery questions and Allen is responding the requests are over-broad and will not lead to relevant information.  American Apparel argues that Allen’s personal information is important in determining the value of his image in calculating damages.

From American Apparel’s standpoint what do they have to lose?  I think from a legal standpoint the judge will deny American Apparels pending motion for summary judgment because there are factual issues regarding whether or not this use was a fair use.  But, that said, if American Apparel settles or goes to trial, it may still be a cost effective marketing campaign.  History seems to reflect that controversial press is the goal of this company.

Read more from The Hollywood Reporter Esq. blog.

UPDATED 5/18/09:  Case settled paying Allen a reported $5 Million.  Read more here.

Vassar, Wiseman Overcome Copyright Infringement Suit

by Tamera H. Bennett
May 5, 2009

I first blogged here about the 2007 lawsuit for copyright infringement against extremely successful country songwriters Phil Vassar, Craig Wiseman, their individual music publishers and Proctor & Gamble.

On April 29, 2009 the judge granted the defendants’ Motion for Summary Judgment and dismissed the lawsuit.  The Memorandum can be found here.

To survive summary judgment, the court stated, the plaintiffs would have to sufficiently show that Vassar had “access” to their song and that Defendants’ song is “substantially similar” to Plaintiffs’ song.

ACCESS
The defendants submitted evidence of their “pitch” log to show they had pitched the song to an A&R employee of Vassar’s record label and that a copy of the song on CD had been left for Vassar’s manager. The defendants assert the A&R record label employee agreed she would get the song to Vassar. The A&R record label employee had no recollection of ever hearing the song and stated she could not pitch directly to artists on the label’s roster.

The court stated:

Again, the plaintiffs’ burden is not to show that Vassar absolutely heard the song or even that he absolutely had the opportunity to hear the song; rather, the plaintiffs’ burden, at this stage, is to show, with all factual inferences drawn in their favor, that there is a genuine issue of material fact as to whether Vassar had a “reasonable opportunity” to hear the song. Blige, 558 F.3d at 491. The plaintiffs have met this relatively low burden by showing that the plaintiffs’ song was in the possession of Vassar’s manager’s office and Vassar’s record label, and by showing that there was some indication that the record label was prepared to forward the song to Vassar.  This evidence creates at least a fact issue as to access.

SUBSTANTIAL SIMILARITY
The court moved to the next step, but found no “substantial similarity” between the two songs.

On the technical musical structure, there appears to be general agreement that the two songs are not particularly similar. While there are certain, basic musicological similarities between the two songs (for instance, similar or identical time, tempo, and length), the experts in this case essentially agree that these similarities are the result of common usage in the industry, and that they are not indicative of copying. (See Docket No. 79 Ex. 1 at 3.)

UPDATE: This blog post was cited at www.billboard.biz here.

Music Publishing Settlement MGMT -w- Sarkozy’s party

By Tamera H. Bennett

Read my original post here regarding the use by French President Nicolas Sarkozy’s party of the song Kids by New York songwriters/recording artists MGMT.

The settlement for uses outside of the scope of the license granted by SACEM was reported by one source at $47,860 US and another at $39,000 US.

Music Publishing A Good Investment

by Tamera H. Bennett

Two hundred million dollars is just a drop in the bucket to purchaser classic song copyrights such as “The Sound of Music” and the “King and I.”  I guess that  is what Imagem Music Group, a Dutch pension fund, thought when they purchased the music publishing catalog containing  the hits and Broadway classics penned byRichard Rodgers and Oscar Hammerstein II.

ASCAP lists the music publisher for Rodgers and Hammerstein II as Williamson Music, Co.  In addition to the hits of Rodgers and Hammerstein II, Imagem Music Group acquired songs by Irving Berlin and Lorenz Hart that were included in the Williamson Music, Co. catalog.

How did the number $200 Million come about if the purchase price was not disclosed?  At some point, estimated annual song catalog earnings have probably been discussed among industry professionals.  Typically in music publishing/song copyright acquisitions, the buyer will examine the net publisher’s share of earnings and then multiply that by a factor to reach a purchase price.  That factor can vary on the low end of two to three times net publisher’s share to as high as 10 to 15 time net publisher’s share.   It is estimated the Rodgers and Hammerstin catalog was valued at seven to 14 times net publisher’s share. In the end, the copyright owner typically knows what they are willing to sell for and the buyer has to figure out how many years it will take to recoup the investment.

So what is net publisher’s share of earnings?   Assuming there is only one music publisher that owns the copyright in the song, the income that will go into net publisher’s share will be 50% of public performance income which is paid direct to the publisher (in this case from ASCAP) and 50% of all other income sources.  All income, other than public performance, will be paid 100% to the music publisher and counted as publisher’s gross revenue.  The publisher then remits 50% of that income from mechanical royalties, synchronization royalties, print royalties and other income streams to the songwriter(s).  What remains is the net publisher’s share of earnings.

In addition to past revenue streams, a buyer and seller should be looking at future revenue streams.  With CD sales dropping and legal/paid digital downloads not yet catching up to the decline in physical product sales, other revenue streams are key in determining future earnings and valuing a song catalog.  Factors include whether or not the existing publisher was on top of administering the catalog and collecting revenue or if there would be an immediate need to audit licensors, did the existing publisher work to exploit the catalog, does the catalog include songs that will be viable for sync uses in film/tv/commercials, has the catalog been exploited for greeting cards/toys/non-traditional uses, are there hits/classics that will continue to be re-recorded by new artists, and are there branding opportunities available.

If you want to read more about the recent buying and selling of music publishing catalogs read this article at Reuters.  It gives a nice overview when HUGE publishing catalogs are the subject.  Keep in mind, most independent catalogs will not be valued anywhere close to $200 million.

Entertainment Law Update Podcast Episode 1

by Tamera H. Bennett

Glad to be joining Entertainment attorney Gordon Firemark on the Entertainment Law Update Podcast.

Episode One gives the listeners some insight into the following topics:

• SAG & AMPTP have arrived at a deal…
• The competing “Octomom” trademark registrations
• Is giving a (loaded) iPod as a gift an act of copyright infringement? (First Sale and Fair Use) (President’s gift to Queen ElizabethII)
• Copyright and Defamation issues in new social media… Twitter, Facebook, etc. Courtney Love being sued.. a cautionary tale for anybody who uses the Web? 1st Circuit won’t review defamation ruling in Noonan vs. Staples.
• Copyright holders taking action against content “scraping” websites. (Hot News doctrine)
• Fair Use, YouTube, DMCA takedowns, etc. -YouTube says 37% of DMCA takedown notices are not valid copyright claims, etc.
• Wish Upon a star” – Fox’s “Family Guy” “parody”/”satire”
  Litigation: “Push” lawsuits – When is a deal a deal?
• Featured Topic: Ownership of partners’ and principals’ intellectual property contributions to a business in the absence of employment agreements.

Check with your state cle reporting.   If you are a Texas attorney, listening to the Entertainment Law Update can count toward your self-study credits.  MCLE credit with a reporting number/certificate are pending for Texas and California.