A judge granted a motion by Universal Music Group and Comerica Bank Thursday to nullify a $31 million recorded music deal the label struck with Prince’s estate earlier this year.
In the motion, Universal asked Judge Kevin Eide of the First Judicial District Court in Minnesota to allow the label to go forward with rescinding the deal, which purported to include music Prince released after leaving Warner Bros. in 1996, as well as records he released through Warner prior to that.
However, Universal claims Prince estate entertainment advisers L. Londell McMillan and Charles Koppelman misrepresented the rights included in the deal, many of which remain under contract to Warner Bros.
Eide had previously tried to get the parties to figure out a way to salvage the deal, but ultimately ruled that was not an option. He argued that if the Minnesota court did not void the contract, Universal could pursue litigation in New York or California that would keep Prince’s catalog locked up — and unable to be monetized — for years.
“It has been suggested that UMG is bluffing and they really wouldn’t file suit in the State of California if this Court does not rescind the contract,” he wrote. “In light of UMG’s letter of June 26, 2016, and after their attorneys had an opportunity to view the WBR Agreements, this does not appear to be a bluff. More importantly, this Court must proceed cautiously to preserve the assets of the Estate. If litigation is commenced in New York or California, the exploitation of a substantial portion of the Prince music catalog may be lost for years.
As a result, Eide ruled that nullifying the deal was the best way to keep the assets of the Prince estate secure.
“As previously noted, this Court believes that the Estate must proceed in a cautious manner to preserve the assets of the Estate,” Eide wrote. “While the rescission of the UMG Agreement may certainly be seen as proceeding with a lack of caution, the Court believes that the other option of long and potentially expensive litigation while tying up the music rights owned by the Estate makes the other option more treacherous.”
Universal Music Group and Prince’s estate released a joint statement on the matter early Thursday evening. “Universal Music Group and the Estate of Prince Rogers Nelson welcome the court’s approval of our amicable resolution to this matter. We look forward to continuing to work closely together on Prince’s music publishing and merchandise to ensure that we deliver the very best experiences to Prince’s fans around the world.
Pamela Chelin contributed reporting to this article.