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It’s Official: Prince’s Estate Manager and Universal Music Group Move to Nullify Recorded-Music Deal

UPDATED: As expected, Universal Music Group and Comerica Bank, the manager of Prince’s estate, are moving ahead with plans to terminate the $31 million recorded-music deal announced earlier this year. On Thursday Comerica Bank, the estate’s manager, filed a motion to approve rescission of the the agreement based on “claims of conflicting rights to sound recordings.” According to an announcement at the time, those recordings comprised most of Prince’s released work after he ended his initial deal with Warner Bros. in 1996 as well as unreleased material, but also rights to certain recordings within that initial Warner deal; Warner is disputing those terms and the motion states that Universal is insistent on a rescission of the agreement announced in February, claiming “Universal was defrauded by the Estate and its former representatives to enter into the License Agreement under false pretenses.”

The motion will be presented before Judge Kevin Eide on May 31.

A significant portion of Comerica’s motion is directed at the conduct during the negotiation of L. Londell McMillan, one of two former advisers to the estate, who negotiated the deal on its behalf. “Warner Bros. Records has claimed that the Special Administrator [McMillan] sold rights to Universal Music Group that Warner Bros. Records already holds based on its previous agreements with the Decedent,” the motion reads. Sources tell Variety that McMillan and the other former adviser, Charles Koppelman, received a 10% commission on the deals they negotiated, which also include music-publishing, merchandise and performing-rights agreements.

McMillan responded to Variety: “This is a contractual interpretation issue and an issue of whether the personal representative desires to defend the assets of the estate — not a fraud issue. I find it inappropriate and absurd for anyone to suggest that L. Londell McMillan committed any kind of fraud over a contractual-interpretation issue that many lawyers reviewed. I look forward to our legal response and the response from the other parties who helped negotiate these agreements. The struggle continues.”

Representatives for Koppelman, Warner, Universal and Comerica either declined or did not immediately respond to Variety‘s requests for comment.

In a separate order made public on Friday, Prince’s six heirs were officially named: Omarr Baker, Alfred Jackson, Sharon Nelson, Norrine Nelson, John R. Nelson and Tyka Nelson. The six had been long considered to be the presumed heirs, and McMillan’s status as advisor to three of them, John, Norrine and Sharon Nelson, was confirmed.

The motion references multiple attempts by Comerica over the past three months to salvage the deal, but Universal insisted on a rescission, claiming that it “was a product of ‘material misrepresentations’ made by the Special Administrator and its representatives” and threatened to “immediately sue the Estate if it did not agree to rescind the agreement.” Sources tell Variety that Universal is opposed to any attempt to salvage because the financial terms of the deal were negotiated so specifically that a complete renegotiation would be necessary.

How these conflicting claims took place is unclear, but a heavily redacted portion of the motion reads: “The Special Administrator and its representatives did not obtain copies of the Decedent’s [earlier] agreements with Warner Bros. Records during the time they negotiated with Universal Music Group and executed the UMG Agreement.”

The motion references multiple agreements between Prince or his estate and Warner Bros. — dated 1977, 1983, 1986, 1991, 2014 and October 2016 — which McMillan ultimately reviewed but was unable to provide to Universal due to confidentiality provisions Warner declined to waive.

Confusion over the deal, which covered much of Prince’s recorded works after the termination of his 19-year-long initial deal with Warner Bros. in 1996, began as soon as it was announced in February. The announcement said that “beginning [in 2018], UMG will obtain U.S. rights to certain renowned Prince albums released from 1979 to 1995” — the years that the artist was signed with Warner Bros. Records and released his most commercially successful recordings by far, including the “1999,” “Purple Rain,” “Parade,” “Batman,” and “Diamonds and Pearls” albums. However, Prince had cut a new deal with Warner in 2014, negotiated in part by Van Jones, that sources say garnered him the rights to the majority of his work released on the label (albeit with certain key exceptions).

McMillan and Koppelman were replaced as advisers in April by Spotify’s head of creative services, Troy Carter.

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