Universal Gets To Peek at Warner's Contract With Prince
For months, Universal Music Group has been pushing for a refund on its $31 million purchase of some of Prince’srecorded-music rights amid growing uncertainty over whether its deal conflicts with rights that Warner Music Group already owns.
Now, UMG will be able to decide for itself.
In a court order Friday, a judge granted UMG access to WMG’s 2014 contract with the late pop star, a confidential document that UMG hasn’t previously seen, sources tell Billboard. The document should allow UMG to determine the validity of its own licensing agreement, one of three that it inked with the estate since Prince died last April of an opioid overdose.
UMG had negotiated the final $31 million deal in late January with L. Londell McMillan, Prince’s former attorney, who was serving as an advisor to the estate’s former administrator, Bremer Trust. McMillan had access to the WMG deal, and he told Billboard earlier this month that he’d consulted with a slew of lawyers to interpret it. McMillan stands by the UMG deal, which was approved by Bremer and its lawyers as well as the court. He doesn’t believe it conflicts with the WMG agreement.
Comerica Bank & Trust, the estate’s current administrator, though, hasn’t been able to “rule out” a conflict between the UMG and WMG agreements, according to court documents.
The three Princeheirs that count McMillan as their business advisor -- Prince’s half siblings Norrine Sharon and John Nelson - want to preserve the UMG deal, according to their recent court filing, arguing that voiding it will leave the estate “worse off” by damaging its reputation as a reliable business partner. McMillan, who earned about $1.5 million in commission on the deal, wrote in his own filing that enforcing the deal was “in the best interest of the estate” given UMG’s “sophisticated” copyright protection system its executives who had close business relationships with Prince, including UMG’s executive VP Michele Anthony.
Prince’s half-brother Omarr Baker, on the other hand, said in a recent filing that he saw “ample grounds” for voiding the deal, calling for an investigation into Bremer’s liability in the case of a recision. Bremer has told Billboard that it properly reviewed the court-approved deal and acted in the estate's best interest "at all times."
Last year UMG also bought Prince’s the rights to administer Prince’s publishing catalog and make his merchandise, making the record company a partner that some close to the estate would prefer to appease.
If UMG’s recorded-music deal is canceled, the estate would likely shop the rights to another label or possibly two different labels but would be unlikely to earn as much, sources say.
The deal included licensing rights to the unreleased music in Prince’s “vault,” along with his independent albums and the eventual U.S. rights to some of the albums he released while under contract with WMG.
The date by which UMG would get the U.S. rights to those WMG albums has been the main source of the confusion, sources tell Billboard.