In 2009, things took a particularly bad turn for Kinkade. The FBI launched an investigation into his business practices; he was suspected of defrauding his investors. He was already on the hook for almost $4 million in damages to several gallery owners who also accused him of fraud.
]]> The following year, the manufacturing division of his art empire filed for bankruptcy. Rumor had it, too, that he had been arrested on suspicion of drunk driving. At some point in the last few years, he and his wife separated.He was just 54 when he died of accidental acute intoxication from mixing alcohol with Diazepam, an anti-anxiety drug. According to his brother, Kinkade had been dogged by alcoholism for a few years. His brother added that, in addition to his financial and marital troubles, Kinkade was pained by continuing negative reviews of his work by art critics.
For his personal representative, the financial issues and the uncertain status of his marriage could make the probate process complicated. If the FBI's investigation is still underway, probate could be hugely complicated. Kinkade's family will have the formidable task of managing the painter's legacy, of bringing the focus back to the painter's faith and undeniable commercial accomplishments, regardless of what anyone thinks of his work.
Sources:
Huffington Post, "Thomas Kinkade Death Raises Questions," David Gibson, April 9, 2012
Huffington Post, "Thomas Kinkade Cause Of Death: Painter Died Of Drug And Alcohol Overdose, Coroner Rules," Dan Whitcomb (Reuters), May 7, 2012
]]>Kinkade was an unlikely success story. He dropped out of art school; his parents were divorced. But in his early 20s, he became a born-again Christian, and his faith inspired him to paint -- Kinkade often described his works as messengers of God's love -- and to sell those paintings out of the trunk of his car.
]]> He credited his faith, too, with the idea of mass marketing his work. Kinkade built up an empire, boasting factories that daily produced 500 reproductions of his most popular paintings. His exclusive galleries dotted the retail landscape of upscale and mid-level shopping malls across the country. He was wealthy, happy and, yes, hugely successful.Something happened, though. Sales slowed as accusations of inappropriate behavior flew. Women complained about his actions, and the press picked up a story of outrageous and out-of-character public behavior as well. He came clean to his gallery owners in 2006 about some of his behavior: Stress had led to overeating and alcohol abuse.
There was more on the horizon, though. We'll get into that in our next post.
Source: Huffington Post, "Thomas Kinkade Death Raises Questions," David Gibson, April 9, 2012
]]>This is actually about probate litigation involving seven estranged children whose father gave them an ultimatum. One lawsuit after another followed Charles' 2004 death. The suit we've been talking about is a great blend of probate, intellectual property and contract law.
]]> Seven of the children who signed the contracts with their father want to terminate the transfer of copyrights to about 50 of Charles' musical compositions. The problem, according to the complaint, is that the Ray Charles Foundation did not inherit the copyrights; those belong to Charles' music publisher. Instead, the foundation inherited the income from the royalties contract Charles had entered into with his publisher.Again, we don't know the whole story. Nor has our research turned up anything about the earlier lawsuits -- did the children challenge the will, or have the lawsuits focused on transferring the estate's income from the foundation to the children? We do know, though, that the lawsuits have hampered the work of the foundation.
If a testator does not want anyone to challenge his will, he can add a no contest or in terrorem clause. The clause would essentially disinherit an heir if he or she challenged the will in a legal proceeding. In Florida, the law is of two minds when it comes to no contest provisions.
But that is a subject for another post.
Source: The Ray Charles Foundation v. Raenee Robinson et al., Complaint, US District Court, Central District of California, Case No. CV12-02725
]]>A will is both a promise and a contract, but disputes aren't settled by the parties; one of them has passed away. No, it's off to probate court in these cases, and often the outcome depends on what the deceased intended. Without the court or an independent mediator, the argument can go nowhere. It's an endless cycle of "I think he meant this" with a "If he meant that, why didn't he write it down that way?" response.
]]> Ray Charles left behind a promise, a contract and a will. The contract was between him and each of his children (who were over 18 in 2004, at least): They would give up their claims to his estate in exchange for an irrevocable trust. The will left the remainder of the estate -- copyright royalties and all -- to the Ray Charles Foundation.And the promise? There were actually a couple of promises. The first was to people, especially children, with hearing impairments. Charles established the foundation to support programs and research for the hearing impaired.
The other promise was to his children. If they did not sign the contracts, they would not get a dime. We just came across this particular promise in the fine print of the court documents from the most recent lawsuit. At any rate, without knowing the particulars of the parent-child relationships involved, it is impossible to offer any insight into the motivation for the contract and promise and the motivation for the lawsuits that started almost the day Charles died.
We will, we promise and we contract to finish this up in our next post.
Source: The Ray Charles Foundation v. Raenee Robinson et al., Complaint, US District Court, Central District of California, Case No. CV12-02725
]]>Ray Charles must have thought he'd done just that. He and his advisers must have thought that the Ray Charles Foundation could maintain control of the income from the songs and music Charles wrote during his 50-year career when they asked Charles' children to forgo any claim to the royalties in exchange for a sizeable trust.
]]> Of course, it didn't work out that way, as we have pointed out in the last five posts. The copyrights became the subject of multiple lawsuits between the children and the foundation quite soon after Charles passed away. In the most recent dispute, though, the works in question were all works for hire. The music publishing company controls them. Charles contracted with the company for royalty payments.In 1980, Charles renegotiated his contract with his music publisher -- or, rather, the company that had taken over his publisher. As we understand it, the 1980 agreement is where the transfer confusion that we discussed in our last post started.
From the court documents, it looks as if the record label/music company did not register the copyrights to all of the compositions Charles wrote as an employee. The company sometimes took years to register a work, but all of the works at issue here were clearly written and recorded when Charles worked for Atlantic/Progressive/Rightsong Music.
At any rate, the works that were not registered were covered by the 1980 agreement, and Charles was paid a tidy sum for handing them over to the company. The agreement also covered royalty payments.
It is that transfer that the heirs want to terminate.
Source: U.S. Copyright Office, "Works Made for Hire Under the 1976 Copyright Act," Circular 9, April 2010
]]>If everything had gone smoothly, the foundation would have been funded in great part by the income from Charles' copyrighted works. The copyrights to about 50 of those works are at issue in the most recent legal tussle between the foundation and seven of his 12 children. The copyrights, the foundation claims, belong to the music publisher; the transfers filed by the kids are invalid.
]]> According to the U.S. Copyright Office, the employer is both the author and the owner of a work made for hire. The employer and employee can agree by contract that the employee will be the owner. Copyright protection lasts for 95 years from the date of publication (explained in our April 24 post) or 120 years from the date of creation. So, at the end of 95 or 120 years, whichever comes first, the work enters the public domain.The law also allows the author to terminate certain "grants of rights" 35 to 40 years after making the grant or after publication. For the works in question, though, this right to terminate does not apply. The law doesn't recognize Charles as the author; at best, he could be the owner, but in this case he was neither.
We're almost there....
Source: U.S. Copyright Office, "Works Made for Hire Under the 1976 Copyright Act," Circular 9, April 2010
]]>Critics of the defendants in this case, seven of Ray Charles' 12 children, say they decided to go after the copyrights because they blew through the money from their trusts in very short order. The court filings don't touch on that, and it is not our place to speculate. The court filings do, however, claim that the children all agreed to give up their claims to any of their fathers' works in exchange for the $500,000 (in trust). And, the story of the lunch at which Charles proposed the plan has been repeated often.
]]> When we left off, we were talking about the singer's copyrights -- in truth, the copyrighted works composed in whole or in part by the singer. The music company owned the copyrights; Charles negotiated with the company for a cut. As the law changed, he updated his contracts.As we said, the copyright law changed in 1976. The system for determining ownership (registration versus publication) changed, and the calculation of ownership duration changed. For works created after 1976, the system was more favorable for the author. For works created before that?
The Copyright Act of 1976 included a grandfather clause for works written before that date but not yet in the public domain. The extension term -- the renewal period -- was changed from an additional 28 years to an additional 47 years. The total term, then, was 75 years, and it matched the new law.
Another law change, in 1998, extended the term even further. If the author owned a copyright, the term was the author's life plus 70 years. For works for hire and works copyrighted before 1978, the term was increased to 95 years.
What did this mean for Charles? We'll get into that next time.
Source: The Ray Charles Foundation v. Raenee Robinson et al., Complaint, US District Court, Central District of California, Case No. CV12-02725
]]>It looked simple enough in 2002, when Charles promised to establish irrevocable trusts for his children in return for their giving up rights to the rest of his estate. It looked simple enough when they all signed the agreements. The trouble started almost the minute Charles died, though, and the copyrights to his songs and other musical compositions have been the subject of litigation ever since.
]]> This suit was filed when the defendants filed to transfer a number of copyrights to themselves. The copyrights, however, were not theirs to transfer, according to the foundation. They may not be the property of the foundation, either.The matter is complicated by changes made to the copyright laws during Charles' lifetime, as we discussed in our April 17 post, and the status of the works as "work for hire." The law change affected the "life" of the copyright -- that is, how long the protection would last before the work entered the public domain. The work-for-hire provisions dictate who reaps the profits during the life of the copyright.
Remember, copyrights do not generate income when they enter the public domain. The law before 1976 required that works be registered to be protected under the copyright laws, and that registration date started the countdown to the date when the work would enter the public domain. That term was limited to 28 years, at which time the owner could renew for another 28 years.
After 1978, when the Copyright Law of 1976 took effect, copyrights were in effect for 75 years, and the clock started ticking on the date of publication, not registration. According to the U.S. Copyright Office, the date of publication is the date the work is made available to the public (although a performance does not count as publication).
What about works created before 1978, though? The 1976 law and a subsequent law addressed them -- and added a new layer of confusion for probate nerds. We'll try to explain in our next post.
Source: The Ray Charles Foundation v. Raenee Robinson et al., Complaint, US District Court, Central District of California, Case No. CV12-02725
]]>After much speculation, it was confirmed that the challenges to the administration of an heir's will have finally been settled. The man, who is the descendant of railroad magnate James J. Hill and the founder of the Pony Express, had an estate worth upwards of $60 million. Shortly before his death, the man amended his will to include the operator of a local retail store as his sole beneficiary in 2011. The man's trust administrator disputed his most recent will by concluding that he was not mentally fit when he had that document drafted.
]]> According to reports, the estate's trust administrator argued that an earlier version of his will, created in 1997, should be enforced by the court. The 1997 will indicated that money would be distributed between friends, family and several charities. Additionally, the trust administrator disputed late amendments to the first will that granted total control of the trust to the store operator named in the 2011 will.Though it was confirmed that the dispute was finally settled, and that this is the "final chapter" in the estate dispute, the terms of the settlement remained confidential. However, it has been indicated that the final settlement included payment for attorney's fees and that all the beneficiaries received an equitable share.
Even the legal representatives involved in this case indicated that it was one of the most complex probate cases they have ever handled. Fortunately, all the parties involved seem to be content with the outcome, which is not always the end result of estate disputes.
This case provides a lesson to everyone considering the formation of a will and trust. In order to avoid the potential heartache of a lengthy legal dispute, it is wise to take steps make sure your estate plan will not be contested. This is particularly true if your physical and mental condition at the time your will is drafted could be called into question after your passing.
Source: The Maui News, "'Fair' resolution a 'final chapter' in Dorcy estate," Brian Perry, April 19, 2012
]]>The foundation claims that all of Charles' children agreed to accept the proceeds of individual trusts at their father's death and, by doing so, agreed to waive any rights to the rest of his estate. The bulk of the estate went to support the foundation, which in turn supports programs and organizations serving the hearing-impaired -- a particular passion for Charles.
]]> The movie "Ray" has a wonderful scene early on between the 7-year-old Ray and his mother. She explains to him that he is going blind, and there's nothing to be done about it. He'll have to use his ears instead, she says. And she quickly runs through the kinds of things he'll have to differentiate: the step of someone entering the room and someone leaving it, for example -- all of the things in life that the sighted take for granted. Charles gave tirelessly to programs that helped kids, especially, overcome hearing disorders.The foundation depends on the income from Charles' intellectual property and contract rights. Remember that Charles composed throughout his 50-year career. Copyright law changed dramatically in 1976 and again in 1998, and copyright laws have always been different for "original" work and work for hire. Think about a career that produced hundreds of works with and without a contract over a period of time covered by three sets of laws. It's a headache waiting to happen.
In the complaint, the foundation offers an explanation of the copyright status of the specific works in question. There are about 50 of them, and all are works for hire. Charles wrote them when he was under contract with a record company; the company's affiliate, a music publisher, registered the copyrights. Charles wrote the songs, but the music publishing company owned them.
The lawsuit turns on the renegotiation of those rights. We'll cover that topic next week.
Source: The Ray Charles Foundation v. Raenee Robinson et al., Complaint, US District Court, Central District of California, Case No. CV12-02725
]]>He wanted them all to give up any further interests in his estate.
]]> Charles had established a foundation for the hearing impaired, especially hearing-impaired children. An article published at his death quotes him on the subject: "Hearing is the most important thing in the world. If I lost my hearing it would be like being dead as far as I'm concerned." The foundation wasn't a death-bed whim. Charles had spent years working for and donating to programs for the deaf.Court records indicate that all of the children over age 18 agreed, in writing, to their father's terms. They accepted the $500,000 trust as their sole inheritance from Charles; they understood that they would receive no other inheritance from him; and they willingly relinquished and waived any further claims to Charles' estate.
The foundation now claims that seven of the children have breached the agreement and gone back on their promises. Although each accepted his or her trust when Charles died, they have taken steps to acquire the copyrights to more than 50 of their father's compositions. If the transfer went through, the children would start to receive profits on April 1, 2012, and those payments would continue for another seven years.
The facts that they have breached their agreement with their father and acted against their father's express wishes are just part of the foundation's complaint. It turns out that there is a problem with the copyrights. A big enough problem, the foundation argues, that any transfer would be invalid. We'll go into more detail in our next post.
Sources:
Courthouse News Service, "Ray Charles Foundation Sues Seven of His Kids," Dan McCue, April 2, 2012
Complaint, The Ray Charles Foundation v. Raenee Robinson et al., US District Court, Central District of California, Case No. CV12-02725
]]>At least, it looked that way in 2004, when Charles died. He had established a foundation that would fund scientific, educational and charitable programs for the hearing impaired, with a particular focus on hearing-impaired youth. The foundation's income would come from copyrights and royalties from the singer's works, photos and film royalties. (We'll get to the copyrights and royalties later, but, for a quick review of how musicians are paid, go to our series on Bo Diddley.)
]]> The singer/songwriter's personal life was complicated. Married twice, he had 12 children -- with nine different women. The youngest was born in 1987.From news reports and court documents, it's easy to surmise that, first, Charles' passion was the foundation, and, second, his children didn't really get along. But he wanted to make sure they were all taken care of after his death, so in 2002 he got them all together -- except for two that were in jail -- to explain his plan.
Charles said he would set up irrevocable trusts for each of his children. He would put $500,000 in each trust and take care of all of the taxes. When he died, each child would get the money free and clear.
On one condition.
to be continued ...
Sources:
Courthouse News Service, "Ray Charles Foundation Sues Seven of His Kids," Dan McCue, April 2, 2012
www.PBS.org, American Masters: Ray Charles, May 17, 2006 (accessed April 11, 2012)
]]>Narcy Novack spoke at length with detectives following her husband's murder. During those conversations, Narcy complained about her husband's collection of Batman memorabilia. Ben Jr. had six warehouses full of Batman "junk," she said, adding that "that stuff has no value." The Batman collection is one of the first things mentioned in every article about Ben Jr.
]]> As an aside, those lengthy conversations were the subject of a motion to exclude last month, when Narcy claimed the statements were coerced. The court disagreed, and the statements can be used as evidence at her trial -- only, however, if she takes the stand.Apparently, Narcy sold or auctioned off a good deal of both Ben Jr.'s and Bernice's estates before her arrest in July 2010. In the year-and-a-half since then, the remainder, including the Batman collection, hit the auction block.
According to the attorney appointed by the probate court to serve as personal representative for the combined estates, the cost of storing the Batman collection would have been prohibitive. The wiser move was to sell it. The auction was scheduled for November 2011.
There was some concern that the proceeds from the auction would be spent on Narcy's defense. Once again, Florida's slayer statute comes into the picture. The money from the auction will be held in trust until the estate disputes are settled.
At this point, it's hard to know when that will be. Even if Narcy is not convicted (her trial begins later this month), no one can predict whether the other parties, Ben Jr.'s aunt and cousins as well as Narcy's daughter, will fade into the background.
Sources:
CBS Miami, "Murder Trial Looming, Battle Begins Over Novack Family Fortune," Feb. 21, 2012
Forward.com, "Hotel heir's murder sparks Miami feud," Mary Jane Fine, March 19, 2012
]]>Right now, the estate is the subject of several court actions. The most recent was a Petition to Determine Heirs filed in a Florida probate court by members of Ben Novack Jr.'s extended family. Before that, the daughter of Novack's widow-cum-accused-killer has asked a court to make sure her mother doesn't get any piece of Ben Jr.'s estate.
]]> Narcy Novack, frequently referred to as the "Stripper Widow" by the press, is awaiting trial on charges of racketeering, conspiracy, violent crime in aid of racketeering, interstate domestic violence, stalking, witness tampering and obstruction of justice. The prosecution's witness list includes her daughter.The estate is valued at between $6 million and $10 million, and there are reports of much more hidden in offshore accounts. The estate is actually the combined estates of Ben Jr. and his mother, Bernice, another of Narcy's alleged victims.
Just about every story about Ben Jr. mentions his collection of Batman memorabilia. He accumulated the second-largest Batman collection in the world, including a Batmobile cast from the original mold used for the '60s television show. The Batman collection alone was valued at about $2 million.
That is, when it was sold off.
Source: Forward.com, "Hotel heir's murder sparks Miami feud," Mary Jane Fine, March 19, 2012
]]>Only to her son, apparently -- Bernice did not name her son's wife, Narcy, as an heir. The two women apparently had a difficult relationship. At one point Bernice believed Narcy was trying to poison her, according to the older woman's sister. Regardless, when she died -- or was murdered -- she left everything to Narcy's husband and made Narcy an even wealthier woman, at least by proxy.
]]> To a forensic genealogist who was keeping up with the story, the relationship between the two women made the possibility of Narcy inheriting Bernice's estate unpleasant. The idea of any member of Narcy's family inheriting, however, was unspeakable. As we've discussed, if Narcy is not convicted, she stands to inherit from Ben Jr., who inherited from his mother. If Narcy is convicted, her daughter from an earlier relationship, May Abad, is next in line.The genealogist decided to find other members of the Novack family. He thought someone should contest Abad's claim by invoking the slayer statute. The argument would be that Abad and her children could use the money to help Narcy with her appeal or defense costs in a civil trial. Since the slayer statute bars Narcy from benefitting from her victims' estate, Abad should not inherit.
He did, indeed, find relatives. Bernice's sister and Ben Jr.'s four first cousins could be legitimate heirs to both his estate and his mother's. Sure enough, Bernice's sister has hired an attorney who has filed a petition with the court.
All of this to forestall the possibility of Abad's helping her mother with the money inherited from her mother's alleged victims. What is strange, though, is that Abad is testifying against her mother, and she has petitioned the court to keep her mother from seeing a dime from the estate. She also believes her mother and uncle arranged to have her assaulted or killed. There is no love lost between Narcy and her daughter.
The question, of course, is whether there's anything left from the estate. We'll get into that in our next post.
Source: Forward.com, "Hotel heir's murder sparks Miami feud," Mary Jane Fine, March 19, 2012
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