Prince, iconic singer and performing artist, left behind an estate valued at $200 million (although approximately ½ of this will go to taxes). After his death last year without a will, the battle over his assets began. Sister Tyka Nelson and five half-siblings were officially declared Prince’s heirs by a Minnesota court in May. This is after 45 people can forward to claim a portion of his estate alleging to be everything from his wife to his child. DNA testing ruled out some of the claims.
Some of the squabbling centers around management of the assets. Currently and until the case is resolved, these assets are managed by the executors of the estate. Universal negotiated a $31 million deal with the estate which was later rescinded when they learned that Warner Bros. still owned the US rights to a portion of Prince’s work. The problem arises in that some of the work covered in the contract with Universal would have overlapped with what Warner Bros. already owned. However, without the arrangement with Universal, rights to the rest of Prince’s work will likely go to auction.
Since heirs whose claims were rejected have a year to appeal the finding, the sister and half-siblings will not take over managing the assets of the estate until that point, leaving decisions regarding rights to the work with the executors and the court. The court has clearly state that no assets will be distributed until the appeals are complete so no potential claims are adversely affected. The six heirs claim this is clearly adverse to the efficient administration of the estate due to the rescinded deal with Universal. Currently, the estate has struck deals that allow Prince’s albums to be available to music streaming services and have turned his studio and home into a museum and venue. The heirs are likely to receive their inheritance in a lump sum too. Receiving funds in a lump sum has dangerous implications to the heirs. To learn more about the dangers of lump sum distributions of an inheritance, contact Virtus Law for a free copy of the book “The Ultimate Guide to Estate Planning”. This book explores the benefits of values-based triggers for distributions so as to not fundamentally change the lives of the persons inheriting your wealth.
The court is walking the fine line of balancing the interest of known heirs in gaining control of the assets and being able to make decisions with the possible interests in additional heirs who will want the assets preserved for their benefits. With 45 claims in the mix, it’s hard to know how they will all play out until the probate process is complete. Without a will to guide the court, they turn to the rules of intestate succession, meaning who inherits the assets of someone who dies without a will.
The team here at Virtus Law Firm are fans of Prince’s music and have followed this case with interest. It highlights the value of planning your estate early and regularly updating it. If you have assets or children, making an estate plan helps those you love understand your wishes and act in accordance with them. We can’t promise to prevent family squabbles, but we can create a plan which minimizes the opportunity for complaints. We can certainly streamline the process and protect your wealth. Give our team a call at 612.888.1000 or email us at firstname.lastname@example.org to set up an estate planning consultation. We can help you draft the necessary documents, understand your options, and keep you informed as the law changes.