Investor Group Buys Half of Prince’s Tightly Controlled but Intellectual Property-Attractive Estate

By Bruce Berman
August 2, 2021

A music rights company last week acquired half of Prince’s contested estate from his heirs. Now, a new album recorded in 2010, ‘Welcome 2 America,’ has just been released.

With the value of his music catalogue still subject to an ongoing dispute between the trust managing his estate and the IRS, Prince, who died in 2016, has a new partner.

Primary Wave, whose catalog includes songs by Nirvana, Bob Marley, Ray Charles and Smokey Robinson, has taken a roughly 50% stake in Prince’s estate, buying out the interests of three of the late musician’s siblings. Primary Wave is said to have $1.6 billion in investible assets.

A highly creative and successful writer, producer and performer, Prince was also a savvy IP strategist, who sought to control his work, name and image. He was a fierce defender of his intellectual property rights, and was involved in a series of legal actions against businesses and individuals using his music and other IP without his authorization. He also railed against his record company, which sought to assert ownership rights over his catalogue and name.

Prince’s estate, now half owned by strategic investor, Primary Wave, released on Friday “Welcome 2 America,” an album the artist recorded 11 years ago. The timing is opportune for both the estate and investor, both of which are likely to benefit from the well-timed release. Reviews have been good for the politically themed collection, a tribute to the artist’s timeless output.

“Until an agreement is reached with the Internal Revenue Service on how much is owed in taxes and how they will be paid,” reports the Wall Street Journal, “the estate remains in the hands of Comerica Bank & Trust, which was appointed as fiduciary in 2017. As a result, the regional bank is steward of creative decisions, including Friday’s arrival of ‘Welcome 2 America,’ a previously unreleased album from the vault.”

Monetizing Prince’s once carefully controlled writing, recordings and brand appears to be in the hands of a strategic investor with experience monetizing the estates of artists, dead and alive. Recent sales of Bob Dylan’s catalogue for more than $400 million help to make Prince’s estate attractive, with both unreleased and under-marketed but still timely IP. Other music catalogues that have recently sold include those of Fleetwood Mac, Neil Young, Shakira and John Lennon. It is unclear what other IP rights were included.

https://depositphotos.com/328211670/stock-photo-netherlands-march-2018-single-prince.htmlThe last 12 months have seen an explosion of deals for music, with major publishers, private equity, with hedge fund billionaire William Ackman among those investing in music assets. Prince’s estate—encompassing his music, image, likeness and property—is seen a lucrative, but it has been in flux for five years. The estate has been tied up in probate with a bank, lawyers, advisers and heirs haggling over fees and the reclusive artist’s assets, unreleased music and legacy.

The Internal Revenue Service claims the executors of Prince’s estate have low-balled its value by 50%, or about $80 million, according to the StarTribune, triggering a dispute that could prolong the late musician’s already tortuous and expensive probate proceedings.

The IRS determined that Prince’s estate is worth $163.2 million, well above the $82.3 million valuation submitted by Comerica Bank & Trust, the estate’s administrator. The big gap primarily involves Prince’s music publishing and recording interests. The estate has been valued at $100 million to $300 million.

Fed Up

In 1993, fed up with the creative constraints of his record label, Warner Bros., reports law firm Fish & Richardson, Prince tried to break his contract by changing his name to an unpronounceable symbol. In a press release regarding the name change, Prince famously stated:

The first step I have taken toward the ultimate goal of emancipation from the chains that bind me to Warner Bros. was to change my name from Prince to the Love Symbol. Prince is the name that my mother gave me at birth.

Warner Bros. took the name, trademarked it, and used it as the main marketing tool to promote all of the music that I wrote. The company owns the name Prince and all related music marketed under Prince. I became merely a pawn used to produce more money for Warner Bros.

The symbol would later be copyrighted as “Love Symbol #2” and used as a trademark on clothing, entertainment services, posters, and sound recordings. Although unsuccessful in breaking the contract, Prince’s use of the symbol resulted in him being known as “the Artist Formerly Known as Prince.” However, when his contract with Warner Bros. expired in 2000, Prince resumed using his own name.

Though brewing for some time, Prince’s legal battles heated up in the early 1990s. In 1993, while still signed with Warner Music, he became embroiled in a very public battle with the company, which insisted that they “owned and controlled his name as well as any music released under that name”. While quite normal for the music industry, Prince took great offense, claiming widespread corruption within the industry and fighting to have the rights returned to the artist.

‘Slave’

He had set up his own music label, partly funded by Warner, called “Paisley Park Records” in the mid-80s, but was still contractually bound to Warner to produce several more albums. He was pictured in 1996 with the word ‘Slave’ written on his face, and changed his name to a symbol said to be a combination of the insignia for men and women, allegedly as a sign of rebellion against the company.

Despite hits like Purple Rain, Diamonds and Pearls, and Around the World in a Day come to mind, many of Prince’s songs are extremely difficult to find on the internet. The reason: Prince was meticulous in protecting his work. Specifically, to prevent unauthorized use of his music and individuals from covering his songs. For the most part, he succeeded.

Reclaiming Ownership

Prince was a fierce believer and fighter for artists and took the stand that artists, as the creators and owners of their music, should reclaim their art. In 2007, Prince’s publisher sent YouTube a takedown notice of a video posted of a toddler dancing to Prince’s Let’s Go Crazy.

After his falling out with Warner, Prince entered into a series of contracts with many of the music giant’s most significant competitors, including EMI, Columbia (then a division of Sony), and Universal. He later fell out with Columbia when he agreed to release his album free to the readers of a UK newspaper without informing the record label of his intentions.

Prince then began to take issue with the rising incidence of online sharing of his image and his music. He objected to unauthorized digital distribution, and in 2007 sought to “reclaim his art on the internet”.

He launched legal action against YouTube, eBay and Pirate Bay arguing that, although these companies were able to apply filters to their sites so that no indecent material was posted, they had apparently decided not to apply the same filters to ensure no unauthorized intellectual property of performing artists could be posted.

Prince, born Prince Rogers Nelson, died at 57 of a fentanyl overdose on April 21, 2016. He left no will.

Image Source: Deposit Photos
Author: defotoberg
Image ID: 328211670 

The Author

Bruce Berman

Bruce Berman is CEO of Brody Berman Associates, a management consulting and strategic communications firm he founded in 1988. He has supported 200+ IP-focused businesses, portfolios and executives, as well as law firms and their clients. Bruce is responsible for five books, including From Ideas to Assets (Wiley) and, since 2003, approximately 100 columns for IAM magazine. He also has written on IP for publications such as Nature Biotechnology and Forbes. His weekly observations about trends can be seen on IP CloseUp. In 2016, Bruce founded the the Center for Intellectual Property Understanding, an independent non-profit that raises awareness and provides outreach to improve IP literacy, promote freedom of ideas and deter theft.

Warning & Disclaimer: The pages, articles and comments on IPWatchdog.com do not constitute legal advice, nor do they create any attorney-client relationship. The articles published express the personal opinion and views of the author as of the time of publication and should not be attributed to the author’s employer, clients or the sponsors of IPWatchdog.com. Read more.

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