A US appeals court has tentatively ruled in favour of Sony Music’s $600 million deal to acquire half of Michael Jackson’s music catalogue, rebuffing efforts by the late pop star’s mother Katherine Jackson to block the transaction.
The court said that it was “tentatively inclined to affirm a probate court’s order” granting estate executors permission to close the Sony deal. “Katherine’s challenge fails on the merits”, it added, “because the probate court’s order does not violate the terms of Michael’s will”.
The latest development follows the probate court’s earlier approval of the deal which Katherine subsequently appealed. While this ruling still needs to be finalised, it seems likely that this will happen in due course.
According to sources, Sony’s deal with the Jackson estate will give its 50% ownership of Michael’s songs and recordings, and possibly a catalogue of songs written and performed by other artists which are owned by the musician’s Mijac company. Sony had a long-time business partnership with Michael before his death in 2009, including via their music publishing joint venture Sony/ATV. The major previously bought the estate out of that JV in a $750 million deal.
Because the Jackson estate is somehow still pending before an LA probate court more than fifteen years after the musician’s death, the latest Sony deal, negotiated by estate executors John Branca and John McClain, had to be signed off by a judge. That process began late last year, which is when Katherine, initially backed by Bigi Jackson - Michael’s son, better known as Blanket - asked the probate court to block the deal.
Katherine told the court she was protecting her son’s wishes, arguing that he had made it clear that he never wanted his catalogue to be sold. However, Branca and McCain claimed that Katherine has a long track record of opposing deals that would benefit the estate.
Despite this, they said, they had managed to rescue the Jackson business from “the verge of collapse”, the musician having wracked up hundreds of millions of dollars in debt while he was alive. That the business is now profitable, they argued, shows they know what they’re doing. And, in their expert opinion, now is the best time to be doing a big catalogue deal with Sony.
When the probate court sided with Branca and McCain, Blanket dropped his objections to the Sony transaction, but Katherine decided to appeal. Which resulted in a side legal battle, with Blanket objecting to Katherine seeking money from the estate to fund the appeals process.
In their tentative ruling this week, the appeals court concluded that, under powers granted to them by Michael’s will, Branca and McCain have the authority to “sell, invest or otherwise manage estate property” in any way they see fit while they are in charge.
Assuming the tentative ruling is now finalised, Sony will get its ownership of 50% of Jackson's catalogue, closing yet another mega-bucks deal involving a legacy artist’s assets. Sony is also reportedly in the process of closing the very latest of those deals, its billion dollar purchase of Queen’s catalogue and brand.
