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Battles Coming For Muhammad Ali Estatee

Muhammad Ali was never one to shy away from battles.  From heavyweight champions in the boxing ring, to the United States Government, and to the ravaging effects of Parkinson's disease, Ali continued to fight.  Now there are growing fears that the fight will follow him into the grave, with mounting reports of trouble on the horizon for his estate and his legacy.  Muhammad-Ali

The circumstances are ripe for an estate battle.  Muhammad Ali fathered nine recognized children (including his adopted son from his most recent marriage) over the course of four different marriages.  Estate disputes between the surviving spouse and children from prior marriages are the most common source of trouble in probate courts across our country.  Add in the reality of Ali's long-standing struggles with Parkinson's disease -- which can have not only physical effects, but mental as well -- and there is a strong possibility that unhappy heirs may file challenges in court.

And, of course, there is the reality that so much money is on the line.  Initial reports are that Muhammad Ali's fortune ranged between $50 million and $80 million.  But that could just be the start.  As Entertainment Tonight reported, the value of the champ's fortune could increase dramatically now that he is gone, just as happened with Elvis Presley, Whitney Houston, and Michael Jackson.

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Prince, Tupac, And Snoop Dogg: 5 Top Musical Planning Mistakes

Prince died without a will. So did Tupac Shakur, Bob Marley, and many other legendary musicians. Snoop Dogg doesn't even want a will.  Prince 2

The question is: Why?

It seems like such a basic concept; everyone needs a will. Otherwise the laws of the state you live in determine who receives your assets and controls your legacy after you die. Without a will, you have no say in what happens, and the chances of a family fight increase dramatically.

Even though a will is relatively simple to create, studies consistently show that between 60% and two-thirds of adult Americans don't have a will. All states recognize a "holographic" will, which is one in your own hand-writing. They are perfectly valid as long as a couple basic conditions are met. This is not to say they are perfect by any means, but usually better than nothing. And most lawyers can create a basic will for a few hundred dollars or even less.

Even when an estate is modest is size, dying intestate -- without a will -- is never a good idea. So why don't more adults have wills -- including a surprising number of the extremely-wealthy?

These musical superstars highlight important lessons about why so many people fail to create a will before they die:

1. Prince:  Didn't Trust Professionals

The artist originally known, then formerly known, and then known again as Prince, reportedly developed a deep distrust of professionals, including lawyers.  He felt he had been burned earlier in his career by signing legal documents, so a stream of professionals was unable to convince Prince Rogers Nelson to sign important legal documents like a will.

The result?  His heirs and his legacy are in for trouble with what will likely be an expensive and drawn-out court fight over his vast fortune and musical legacy.

The first battle over the Prince Estate will be to determine who Prince's heirs actually are.  This morning, a man named Carlin Q. Willliams filed the first official paternity claim, based on his mother's affidavit saying she met Prince in July of 1976.  One thing led to another, and nine months later, Carlin was born.  A DNA test will come next, based on blood samples already preserved from Prince's body.

This paternity claim is just the beginning of the long road for the Prince Estate, trying to determine who should receive Prince's money.  If Prince had done a simple will, his instructions would have dictated who received what.  Paternity tests would not have been necessary.

Sadly, Prince's distrust of professionals means that a large chunk of his fortune will be spent paying legions of professionals while his heirs (both actual and potential) try to sort out the mess he left behind.

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The Prince Estate: Trouble Brewing And Still No Will After 1st Court Hearing

Despite the probate process having just begun for Prince's Estate, one thing is clear -- it will be a long and rocky road for everyone involved.  Prince-300x200

While no one can dispute the artistic and creative greatness of the artist whose real name was Prince Rogers Nelson, the famed singer's business smarts were often overlooked. Prince closely maintained and guarded ownership and control over the rights to his music, including the publishing rights, master recordings, performance royalties, and more. He famously stored hundreds of unreleased songs in his “vault”, to be released only when he wanted them to be made public.

The value of this music cannot be known until the contents of the vault are revealed, but estimates of Prince’s net worth based the earnings and future royalty rights to music already released range from $300 million to $500 million.

Those figures may be too low. His music sales have already soared by more than 16,000% in the days following his sudden death. That bump could only be the beginning.

With so much money in play — not to mention Prince’s musical legacy itself — it is shocking that Prince appears to have died without a will.  If that is the case, it is certain that trouble will follow for the Prince Estate.

Prince died with no known children, spouse, or living parents. His closest relatives are his sister, Tyka Nelson, and five half-siblings.  Nelson recently filed a petition in the Minnesota Probate Court claiming that Prince died intestate, meaning he did not have a will.  Since then, media reports suggest that the Prince heirs are already arguing.

The first probate court hearing was held on May 2, 2016.  It was a brief, procedural hearing that lasted only about twelve minutes long.  Despite how short it was, eleven different lawyers attended.

Likely Court Fight Over The Prince Estate Begins

 

The only thing of substance made clear at the first hearing is that the search for a will or trust is ongoing, but so far, has come up empty.  With each passing day, uncovering an estate planning document such as a valid will, grows more and more unlikely.  However, it's still possible one may exist.

When Michael Jackson passed away, his mother Katherine Jackson filed a similar petition as the one that Nelson filed. Katherine asked for a probate estate to be opened for her son believing that he died intestate. To her surprise, however, Michael Jackson actually had both a will and a revocable living trust. Jackson’s estate planning documents did not place any family members in charge of his estate or his trust, which led to years of fighting in court.

Even though Michael Jackson’s family members were initially unhappy with not having control, Jackson’s estate and musical legacy have been well-protected — and actually flourished — since he died. He did not leave his estate to chance by dying without a will.

Hopefully, Prince did some form of estate planning, including a will as well as a revocable living trust. If Prince had a trust, and used it properly, then his financial affairs should remain private and outside of the public eye. This wouldn’t be surprising considering how private Prince was during his lifetime. A trust is the best way to insure that someone’s wishes are followed and the legacy is protected, usually without court intervention.

On the other hand, if Prince truly died with neither a will or trust, then his estate will have to address many complications, including who will inherit.

Prince's sister and half-siblings stand as heirs of his estate, as of now. Under Minnesota law, when someone dies without a will, and with no spouse, children or parents, then the individual’s siblings become the heirs entitled to receive the assets in the estate. Half-siblings are treated as full siblings under the state law, so Prince’s five half-brothers and sisters would be on equal footing with his full sister, Nelson.

This means each would receive an equal share, regardless of how close they were with Prince when he was alive.  Each, of course, would stand to inherit tens of millions of dollars, at least.

But first the question of children will have to be addressed. Without a will or trust, Prince’s estate would potentially pass to anyone who could prove that he or she was a biological child of Prince. This opens the doors to potentially dozens, if not hundreds, of people coming to court asking for paternity tests to try to win a golden ticket to the Prince lottery. In fact, someone would not even have to be a biological child of Prince to share in the inheritance. If someone could prove biological relationship as a brother, sister, or possibly even a niece or nephew of a deceased sibling of Prince, then that person could be an heir as well.

At the initial court hearing, no one came forward claiming to be a long-lost child or other relative.  But it is very early in the probate process, and there is plenty of time for that to happen.  In fact, early media reports demonstrate that heir-hunting companies have been swamped with people contacting them claiming to be a Prince heir.  It's only a matter of time before someone files a claim with the court.

There is also the question of who will control Prince’s legacy. With no will, the court would name an executor of the estate, with authority to conduct business involving all of Prince’s assets. Would Nelson be named the executor? Does she have the ability to handle a multi-million dollar estate? If so, will Prince’s half-siblings fight her in court?

With uncertainty, answering questions like these often result in extended and expensive family fights in probate court. And probate court is open to the public, which could lead to a media circus.  In fact, the initial court hearing was swamped with dozens of media members, despite the fact that nothing of substance was decided by the judge.

In fact, the only real decision made was to confirm that Bremer Trust, a trust company related to a banking institution, has been named as the Special Administrator to manage the assets of the estate.  This is a temporary position only, allowing the company to oversee the Prince estate until an executor is ultimately determined and appointed by the probate judge.

Reportedly, Prince had a relationship with the bank for many years, so it makes sense that the bank’s trust entity would be in the best position to take control of the estate as the probate court process begins. In her petition to start the probate process, Nelson asked for Bremer Trust to be appointed so it could fulfill many important roles, including determining who the heirs are, where they are located, and managing Prince’s ongoing business and financial affairs.

At the May 2nd hearing, all of the heirs agreed with Bremer Trust acting in this capacity and the probate judge confirmed it formally.  So, as of now, Bremer Trust is in charge of the Prince legacy, but how that will be handled will be sorted out well down the line.  First and foremost, Bremer Trust will be searching high and low for any sign of a will, determine if there are any other potential heirs, and of course securing whatever may be in Prince's vault, so that the Prince estate assets can be secured and protected.

Bremer Trust is merely getting things started.  The person or company with ultimate control will not be determined for many months or even years.

There have been many fights in the celebrity world over control of high-profile estates. The executor typically oversees the royalty rights, licensing, and image usage as well as decides on what contracts are signed on behalf of the estate. In Prince’s case, of course, this means having the keys — and controlling the rights — to whatever is stored within the vault. This reported treasure-trove of unreleased music could be used to justify millions in dollars of fees to the executor.  So a fight for control is a near certainty.

And that’s not even the biggest problem that will arise if Prince died with no will or trust. Even more troubling is the reality that Prince would have had absolutely no say in who will control and benefit by his legacy, image and likeness rights, brand, and his musical creations. This is a common problem, repeated time and time again, with musicians who die young or unexpectedly.

The best example was Jimi Hendrix. He passed away at the age of 27 with no will or trust, so everything passed to his father under New York intestate law. When his father died years later, it led to a long and expensive court battle over who would control the Hendrix legacy, brand, and music. Ultimately, the adopted half-sister of Jimi, whom he only met a couple of times before he died, won control. Is this what Jimi would have wanted? His brother that he toured with and shared a close relationship with has no control over, and did not benefit financially from, Jimi’s legacy.

Hopefully unlike Jimi Hendrix, Prince did the proper estate planning so that the people or charities he wants to benefit from, and control, his musical and financial legacy will be able to do so. If not, his estate will be tied up in probate court for years, resulting in many millions of dollars being paid to attorneys, administrators, executors, and others. Even more distressing, Prince’s music, image, and likeness may be used in any number of ways that Prince may not have wanted, no matter how privately he guarded them when he was alive.

That’s the problem of dying without a will or trust. The wishes and intent of the person who died no longer matter. Plus ugly and expensive estate battles are much more common.

With someone as iconic as Prince, that would truly be a shame.

Danielle and Andy Mayoras are co-authors of Trial & Heirs: Famous Fortune Fights! and attorneys with the Michigan law firm, Barron, Rosenberg, Mayoras & Mayoras, P.C. Click here to subscribe to their e-newsletter, The Trial & Heirs Update and learn more about their book. You can reach them at Contact@TrialAndHeirs.com

 


The David Bowie Estate Shows His Genius Extended Beyond Music

Only a very few pop artists enjoyed lasting careers as diverse, colorful, and successful as David Bowie. He remained fascinating and on the cutting-edge, up until the very end, in ways that extended far beyond making music.David Bowie

Bowie, whose real name was David Robert Jones (and who didn't want to be confused with Davy Jones), passed away from liver cancer a mere two days after the release of his latest album, Blackstar, on his 69th birthday.  Knowing that his cancer was terminable, many people believe Bowie intended his last album -- featuring lyrics about mortality -- to be a farewell. In fact, the song Lazurus begins with the line, "Look up here, I'm in heaven," and ends with, "Oh, I'll be free ... Just like that bluebird ... Oh, I'll be free ... Ain't that just like me?"

It's fair to say there was no one else like David Bowie.  He was truly one-of-a-kind, from his iconic music, various personas, and his ever-adapting image, to his finances.  

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Celebrity Legacies: Conflicts Plagued Tupac Shakur Before And After Death

Tupac Shakur was well-known for his "Thug" image, his rap prowess, and his many Tupac Shakur's estateconflicts -- leading up to the tragic shooting that took his life at age 25. So should anyone be surprised at the high number of legal battles involving Tupac Shakur's estate? Or that Shakur could continue to be a pioneer in rap music, even years after his death?  Tupac-Shakur

This is installment #17 of our Estate Planning Lessons From The Stars series, which is based on the Celebrity Legacies TV show for which we provide commentary as the estate legal experts. See other articles in the series here.

Tupac Shakur came to fame in large part due to his battles with police, inspiring lyrics in his first solo release so violent that Dan Quayle publicly denounced them -- building Shakur's "Thug" image in the process. In the same time frame, he was arrested five times for violent crimes, leading to numerous criminal charges and civil lawsuits, culminating in a confrontation during which he was shot multiple times. The very next day, Tupac was sentenced to prison for molestation.

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Bill Cosby Headlines The Top Ten Celebrity Legal Battles Of 2015

What better way to start the new year than by counting down Trial & Heirs Top Ten Celebrity Legal Battles of 2015, complete with lessons?  Bill Cosby

1.    Bill Cosby vs. many woman - Andrea Constad is one of dozens of women who have sued Cosby for defamation, accusing the comedian and actor of lying when he denied sexually abusing them years ago.  In Constad's civil lawsuit, Cosby's deposition was unsealed, revealing that he admitted giving women quaaludes and having intercourse with them.  He says both the drug use and sex were consensual.  Recently, a Pennsylvania district attorney brought charges against Cosby for sexual assault based on the 2004 encounter with Constad.

Lesson:  When victims of assault or other injuries wait too long, they lose the right to sue under the statute of limitations.  The specific length of time varies based on what state the events happened in and what type of claim is brought.  That's why most of the accusers are suing Cosby for defamation, rather than sexual assault.  Even criminal cases have a time limitation on when cases can be brought.  This new criminal case against Cosby was brought not long before the 12-year statute of limitations expired.  Anyone who feels they have a claim to sue, for assault or any other reason, should act promptly and not wait until it is too late.


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Mark Zuckerberg And His Charitable Plan Deserve Praise, Not Scorn

As if founding Facebook  and reaching #16 on Forbes’ ranking of the world’s billionaires wasn’t impressive enough, Mark Zuckerberg – along with his wife, Dr. Priscilla Chan — is out to change the world for generations to come.  But not everyone thinks his motives are pure.   Zuckerberg and Chan

Zuckerberg and Chan announced their decision to transfer 99% of their Facebook stock to a new charitable-based venture called the Chan Zuckerberg Initiative.  This will do this through a new limited liability company, with the stated purpose to “to join people across the world to advance human potential and promote equality for all children in the next generation.”  The stock will be handed over throughout their lifetimes, with no more than one billion dollars in stock gifted or sold annually for the next three years, according to a recent Facebook filing with the SEC.  Zuckerberg and Chan write that the value of the stock, presently, is about $45 billion, but that will likely grow over time considering their youth (Zuckerberg is 31; Chan is 30).

Zuckerberg and Chan believe that they have a “moral responsibility to all children in the next generation.” They point to society’s obligation to help future lives. By explaining their motivations to their newborn daughter, Max, through an open letter for the public to read on Facebook, Zuckerberg and Chan seek to encourage others to follow their charitable lead. Many public figures, like Warren Buffett, Bill and Melinda Gates, and others, quickly applauded the move.

But some questioned Zuckerberg and Chan’s charitable intent or even gone so far as to accuse them of tax evasion.   They claim that the tax benefit of donating appreciated assets, like Facebook stock, in a manner that avoids capital gains taxes on the appreciation harms society rather than benefiting it. They also point to the choice to use a limited liability company rather than a charitable foundation as proof of Mark Zuckerberg’s less-than-noble intent.

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