Executors of Michael Jackson’s estate won’t have to pay expenses from their share under judge’s order

LOS ANGELES — The executors of Michael Jackson’s estate no longer will have to pay some legal expenses and other costs out of their own pockets after a judge approved changes Monday to the estate that has earned hundreds of millions of dollars since the pop star’s death.

The changes approved by Superior Court Judge Mitchell Beckloff mean attorney John Branca and music executive John McClain no longer will pay the costs from their share of the estate.

The men had been paying fees for entertainment legal counsel provided by members of Branca’s firm, and McClain had been incurring expenses for the use of a recording studio founded by Marvin Gaye.

Those expenses diminished their 10 percent share of Jackson’s post-death earnings.

Branca and McClain have been collecting closer to
7 percent of the estate earnings since it became a “massive entertainment business enterprise,” court filings said.

Estate attorneys sought the change, saying the executors spend more time than they anticipated on Jackson’s affairs. The men have overseen several Jackson-themed projects, including the licensing of music, video games and a touring Cirque du Soleil show that could become a Las Vegas fixture.

The men agreed in February 2010 to accept 10 percent of the gross entertainment-related earnings of the estate, minus money generated by Jackson’s 50 percent interest in the Sony-ATV music catalog and earnings from “This Is It,” a film compiled from the singer’s final rehearsals.

The exclusions are huge revenue generators for the estate: The Sony-ATV catalog includes publishing rights to music by The Beatles, Elvis Presley, Bob Dylan and other stars. The executors also have been excluded an interest in Jackson’s music, which has sold briskly since his death on June 25, 2009, at age 50.

Since then, the estate has earned more than $310 million.

The percentage covers Branca’s work on the estate and McClain’s producing services.

Under the deal approved Monday, Branca’s firm Ziffren Brittenham LLP will receive 3 percent of entertainment-related income generated by Jackson’s estate in 2011 and future years.

Estate attorney Howard Weitzman said the firm was performing work that would cost more than $2 million a year if it were being handled by another firm, and court filings said that a traditional entertainment estate would include additional managers and attorneys who would receive up to 30 percent of the estate’s overall revenue.

There was no estimate for how much McClain’s billings might be. He bought and restored Gaye’s former Los Angeles studio in 1997, christening it Marvin’s Room, and Jackson and other top singers have recorded music there.

The estate benefits Jackson’s mother, Katherine, and the singer’s three children, Prince, Paris and Blanket, who received an initial $30 million payment earlier this year.

Attorneys for Katherine Jackson and the children had no objection to the changes approved by Beckloff. Meg Lodise, who represents the children’s interest, said, “It is quite clear that what they’re proposing is going to be fair to the estate.”

Weitzman told Beckloff that the estate has resolved creditors’ claims worth at least $11 million and is working to resolve any other valid outstanding debts. Jackson died with an estimated $400 million in debts, but renewed interest in his career have fattened the estate’s accounts, which listed $90 million in cash, according to a September court filing.

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