Michael Jackson Estate: Value of Right of Publicity
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.
[youtube=http://www.youtube.com/watch?v=vd15YVb2M6M]
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.
