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April 2012

What Does Tupac's Hologram Mean For Other Celebrity Estates?

The music world has been buzzing ever since the surprise appearance of Tupac Shukar — well, that is, a digitally-created 3-D image of Tupac — on stage to rap at the Coachella music festival in California.  Some have described this as creepy, like seeing a ghost.  Is this going to be a new trend for celebrity estates?  Should it be?  Tupac

First, there is the issue of legality.  Was it legal for Dr. Dre and Snoop Dogg to bring Tupac’s image on stage?  Because this was a use of Tupac’s image and likeness for commercial purposes, only the holder of the “right of publicity” for Tupac could authorize it.  That right is owned by Tupac’s estate, under the control of the executor — his mother, Afeni Shakur.

Reportedly, she not only authorized it, but was thrilled with the outcome.  Dr. Dre repaid the estate for this permission with a contribution to the Tupac Amaru Shakur Foundation, which is Tupac’s charity.

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Archie Comics Power Struggle Teaches Lesson On Succession Planning

The New York Times recently featured a fascinating article called The Battle for a Comic-Book Empire That Archie Built.  It detailed the ongoing legal battle over the two dueling CEO’s of Archie Comic Publications.  Archie

On one side is Jonathan Goldwater, the son of John L. Goldwater who was one of three founders of the company and the visionary behind the Archie character, created in 1941.  Goldwater became a co-CEO and controller of one-half interest in the company after his half-brother, Richard Goldwater, died in 2007.

Nancy Silberkleit is the widow of the son of another founder, Louis Silberkleit.  She was a schoolteacher who became co-CEO when her husband, Michael Silberkleit, died in 2008.  By that time, a long-time employee and editor-in-chief, Victor Gorelick, was running the company as a temporary, stop-gap measure.

Goldwater and Silberkleit tried to work together to manage the company, agreeing in 2009 to run Archie Comics by sharing CEO duties.  Silberkleit was to oversee scholastic and theatrical ventures, placing Goldwater in charge of everything else.  They were supposed to consult with each other on major decisions.

So what happened?  Let’s just say that the idyllic Riverdale community, which Archie and his friends call home, wouldn’t approve.  Goldwater claims Silberkleit abuses her power on a scale that would fit in with the movie, Horrible Bosses.  As the Associated Press described it, Goldwater and others accuse her of being “a volatile, abrasive menace who has sexually harassed employees with vulgar remarks, made bad business moves and even paraded a former football player around the office to intimidate people.”

Goldwater even alleges that she of asked male employees to pull down their pants, fired employees she deemed too old, fat or buxom, and let her dog defecate in the office.  Silberkleit denies it all, of course, and says Goldwater is trying to steal the company from her, has defamed her, and that he’s a chauvinist who has tried to lock her out of the company finances.  She even accuses him of puncturing car tires.

They’ve filed lawsuits against each other.  So far, Goldwater appears to be winning.  A New York Judge in one of the cases entered a temporary restraining order against Silberkleit, banning her from the company, preventing her from speaking about the lawsuit and from representing Archie Comics in any way.  Silberkleit then violated the order twice and was ordered to pay nearly $60,000 in fines and legal expenses.  Goldwater, meanwhile, has been allowed to run the company without her during the legal battle.

The parties are now trying to mediate the dispute and find an end to their differences.  Given the nature of the allegations, this seems unlikely.

So where’s the lesson in all of this?  Before the dueling CEO’s predecessors, Richard Goldwater and Michael Silberkleit, died in 2007 and 2008 respectively — both from cancer — they should have done the proper succession planning to have the business taken over by responsible leaders who could cooperate.

Instead, Jonathan Goldwater bought his interest from Richard’s Estate, and Michael’s shares passed to his widow.  A long-time employee was forced to run the company on an emergency basis, and that proved to be only a peaceful interlude to the nasty battle that followed.

Would Richard and Michael — or their fathers, who founded the company for that matter — have wanted the Archie enterprise to descend into such a bitter and ugly court fight?  Of course not.  With thoughtful, advance succession planning for the business, this could have been avoided.

It’s especially important when a closely-held business is run by two equal partners, which can create deadlocks and worse.  Corporate documents like buy-sell and shareholders agreements, and stock restrictions, can ensure that ownership interests don’t pass onto heirs of someone who dies, without the permission of the company or the co-owner.

In other words, just because two business partners get along well — as was the case for decades in Archie Comic Publications — doesn’t mean the next generation will do so too.  When succession planning is done in advance, restrictions — or at the very least, mechanisms to dictate how decisions will be made and what procedures are to be used in case of disagreement – can be used to avoid results like this one.

That’s why it’s important to work with experienced estate planning attorneys, particularly those skilled in business succession planning, when there is a family business.  No one thinks that ugly feuds like this one can happen. But they do, and proper legal planning done in advance is the best source of prevention.

By Danielle and Andy Mayoras, co-authors of Trial & Heirs: Famous Fortune Fights!, husband-and-wife legacy expert attorneys, and hosts of the national television special, Trial & Heirs:  Protect Your Family Fortune! For the latest celebrity and high-profile cases, with tips to protect yourself, your loved ones, and your clients, click here to subscribe to The Trial & Heirs Update.  You can “like” them on Facebook and follow them on Twitter and Google+.

For legal help in Michigan, visit Andy and Danielle's law firm's websites, The Center for Elder Law and The Center for Probate Litigation.

Brooke Astor Estate Settlement: Marshall Gets His Just Desserts

News broke recently about a global settlement involving the estate of Brooke Astor.    The renowned New York society queen and philanthropist, who died at age 105, left behind an estate of nearly $200 million dollars.   Brooke Astor 2

Astor’s assets — along with the $50 million charitable trust of her late husband — have been tied up since she passed in 2007.  The fighting was so extensive that it dragged in a “who’s who” of top New York City institutions, including the Metropolitan Museum of Art, Carnegie Hall, the New York Public Library, Rockefeller University, and even the United Nations, among many others.

Under Astor’s 2002 will, her only son, Anthony Marshall, stood to inherit tens of millions of dollars, with most of it slated to pass to charity after he died.  But Marshall wanted much more.  He and a lawyer,  Francis X. Morrissey, Jr., convinced the elderly Astor — when she was suffering from dementia — to sign a series of codicils to Astor’s 2002 will.  These codicils would have allowed Marshall to leave much of Astor’s fortune to whomever he wanted (specifically, his younger wife, whom Astor reportedly detested) instead of to charity.

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Amy Winehouse Didn't Have A Will After All, But Did Have Millions

Shortly after Amy Winehouse passed away from accidental alcohol poisoning at the age of 27 last July, reports surfaced that she not only had a will, but she had the foresight to update her will after her divorce from ex-husband, Blake Fielder-Civil.  These early reports have recently been proven wrong.   Amy_Winehouse_in_2007

Probate records were recently filed showing that Winehouse died intestate, meaning without a valid will. The estate value is listed as £4,257,580 (worth about $6.7 million U.S.) in total assets, but taxes and other debts reduce the value to £2,944,554, or $4.66 million, U.S.  Many believed her estate would be worth much more, perhaps as high as $15 to $20 million.

But, let’s not jump to conclusions so quickly.  The assets passing through probate court are those left in her individual name when she died.  So anything held jointly with someone else, or that had a beneficiary designation (like a life insurance policy), would pass outside of probate, directly to the other person.  Also, if Winehouse had a trust — which is unlikely, considering she didn’t have a will — anything held in the trust would also avoid probate.  None of these types of assets would be included in her estate value as listed in the probate documents.

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