Giving Away Purple Rain. How Prince Forgot to Protect His Estate.
Prince died at the young age of 57. He lived a secretive life because he needed to control his image. This manifested professionally, as he is one of the few large artists to also own the rights to his music. He personally owned the rights to Purple Rain, Raspberry Beret, and Little Red Corvette. He never sold the rights to his music, as he stated in an interview with Rolling Stone “If you don’t own your masters, your master owns you.” Various estimates place his personal financial holdings around $300 million; the most important assets include his published and unreleased music.
Prince, died unexpectedly without an estate plan – and now the question is, who is the master of the music? Currently, there are numerous heirs to Prince’s estate and the lack of an estate plan means that his estate will likely be entangled in litigation for years. Who will control the rights to his music? Should the music be sold? Should the unpublished music be released? These will all be vexing questions because there is no guidance to Prince’s intent. And talking about litigation, what are the costs? We are talking about a minimum of six litigants, all of whom will hire a host of attorneys. The immediate financial beneficiaries will be the litigators, not the family.
The estimate of $300 million is a mystical figure as it is only an estimate. All parties will have different estimates, but there is one omnipresent party that has not been discussed, and that is the IRS. The Federal Government and the State of Minnesota will unleash their experts to value the estate. And with a Federal estate tax rate of 40 percent and a Minnesota tax rate of 16 percent, roughly half the estate could go to the government.
Moreover, all of Prince’s attempt in secrecy and living a life of glamorous mystery will now be made public. Without an estate plan, everything is unfurled into the public record. The Fourth Amendment does not extend to the grave. There is no right to privacy, when you do not have an estate plan.
Many athletes and entertainers are young and invincible. We do not think about dying; and often avoid the discussion about estate planning. Death – that is only relevant for the dead. Well, that is what Prince thought too. He was only 57. But like many entertainers and athletes, he wanted to maintain control: over his image, over his assets, over his business. Prince died unexpectedly, and his estate will be torn asunder. The IRS, attorneys and the media will have first pickings. The scraps will be left to the heirs.