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A California appeals court has issued a final ruling that Michael Jackson’s estate can proceed with a $600 million sale of the singer’s catalog to Sony Music, rejecting objections from his mother that aimed to block the deal.
A month after the appeals court issued a tentative ruling against Katherine Jackson, the court finalized that decision on Wednesday – ruling that the estate’s executors (John Branca and John McClain) didn’t violate the terms of Michael’s will when they inked the gargantuan deal with Sony.
“The will gave the executors broad powers of sale, with no exception for the specific assets at issue in this case,” the court wrote. “As such, [a lower judge] did not err in concluding that it was Michael’s intent to allow the executors to sell any estate assets, including those at issue in the proposed transaction.”
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Beyond the merits of the deal, the court also rejected Katherine’s appeal for a simpler reason: that she had “forfeited” her arguments by failing to make them before a lower probate court.
Katherine’s attorneys did not immediately return a request for comment. She can still appeal the ruling to the California Supreme Court, though her odds of overturning the ruling are low.
As reported by Billboard earlier this year, the Jackson estate and Sony Music have reached a deal that will see the music giant buy half of the singer’s publishing and recorded masters catalog for more than $600 million.
But because the Jackson estate is still pending before a Los Angeles probate court more than 15 years after his 2009 death, his executors took the then-confidential deal to Judge Mitchell Beckloff for approval. When they did so, Katherine filed objections — among them that the sale “violated Michael’s wishes” and that the catalog would likely continue to gain value over time if retained.
In April 2023, Beckloff rejected those objections and ruled that the deal could move forward. Katherine then filed an appeal, resulting in Wednesday’s ruling.
In the new decision, the court rejected a number of key arguments from Katherine, including her claim that the sale would violate basic inheritance rules because it would prevent all of Michael’s assets from being transferred to his heirs. In doing so, the court said Michael’s will vested Branca and McClain with “full power and authority” to make such deals while in control of the estate.
“The proposed transaction is not a gift or distribution of estate assets—it is an asset sale, pursuant to which the estate receives a significant monetary payment and interest in a joint venture,” the court wrote. “While the proposed transaction will result in the estate exchanging assets for cash and other valuable rights, it neither diminishes the estate’s value nor impairs the executors’ future ability to transfer the estate’s assets to the trust.”
The wrangling over the Sony deal has exposed rifts among Jackson’s heirs. In March, Jackson’s son Blanket asked the judge to stop his grandmother from using estate money to fund her efforts to block the Sony deal. Though both had initially opposed the sale, Blanket and Jackson’s other children accepted the probate judge’s decision allowing it to move forward.
Later that same week, the estate responded to claims from Katherine’s attorneys that she needed estate money to pay for her legal battle, arguing she had received more than $55 million since the singer’s death. The estate’s executors argued that “virtually no request of Mrs. Jackson for her care or maintenance has been declined,” including more than $33 million in cash.
A rep for the estate’s executors declined to comment on Wednesday’s ruling.
Christoph Behm has been named the new CEO of Sony Music Germany, Switzerland and Austria (GSA), replacing Patrick Mushatsi-Kareba, who is exiting the company at the end of August.
Berlin-based Behm, who began his career at Sony Music in 2011 and has worked in a number of senior roles for the label over the past decade, including head of streaming and director of digital sales, will report to Daniel Lieberberg, president of Sony Music Continental Europe and Africa.
In a statement announcing Behm’s promotion, Lieberberg said the newly appointed CEO’s “deep understanding of our DSP partners and creativity as a leader will serve him well in his new role.”
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“Christoph has played an important role building and expanding our business across this region during the streaming era,” said Lieberberg. “He has worked closely with our artists to bring their music to new fans in innovative ways and has embraced continuous industry change to create opportunity despite rapidly shifting paradigms and business models.”
Sony Music did not provide any details about Mushatsi-Kareba’s departure from the company. The outgoing CEO has headed Sony Music’s operations in the GSA region since 2018 when he joined the label from Universal Music Germany. Prior to that, Mushatsi-Kareba spent eight years at Apple, where he was responsible for overseeing the tech company’s music business in multiple European markets, including Germany, Austria, Italy and Switzerland.
Although Sony Music GSA has enjoyed significant commercial success over the past six years, sources with inside knowledge of their relationship tell Billboard that Mushatsi-Kareba and Lieberberg did not always see eye to eye.
Prior to his promotion to CEO, Behm held the role of senior vp of Sony Music GSA’s commercial division, where he oversaw a large team, including the company’s family entertainment business. In the past two years, Behm’s responsibilities grew to also encompass oversight of catalog, sales and streaming departments in the region.
Top-selling frontline Sony artists in the GSA market include Apache 207, Nina Chuba, Rap Larue and Reezy.
“It fills me with pride to now lead the company that I have served in various roles for so many years,” said Behm, who takes up the CEO post on Sept. 1, in a statement. “We are at another exciting time for our industry, and I look forward with great confidence to this next chapter for Sony Music GSA,” he added.
Germany is the world’s fourth-biggest recorded music market in IFPI’s annual rankings behind the United States, Japan and the United Kingdom.
As the 2024 presidential election heats up ahead of Nov. 5, Sony Music is throwing its hat in the ring with a campaign to increase voter turnout. Called Your Voice, Your Power, Your Vote, the non-partisan initiative is meant to educate artists, songwriters, industry professionals and communities across the country about voter registration. Its website […]
Investment giant Apollo Global Management is backing Sony Music Group to the tune of $700 million to help the company fund music acquisitions, it was announced Friday (July 26). The deal could provide the financial assistance needed for Sony’s planned acquisition of Queen‘s recording and music publishing catalogs. Sources have told Billboard the band is […]
Michael Jackson’s estate has won a tentative court ruling that would allow it to proceed with a $600 million sale of the singer’s catalog to Sony Music, overcoming objections from his mother that aimed to block the deal.
Katherine Jackson had argued that the gargantuan deal violated the terms of Michael’s will, but a California appeals court tentatively ruled Wednesday (July 17) that she had “forfeited” that argument by failing to make it before a lower probate court.
Even if she had properly raised that argument, the appeals court said the estate’s executors had the power to make the deal. The court said Jackson’s will had vested the executors (John Branca and John McClain) with the authority to “sell, invest, or otherwise manage estate property” while they were in charge.
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“The court is tentatively inclined to affirm the probate court’s order granting the executors’ request to proceed with the proposed transaction,” the appeals court wrote in its ruling, obtained by Billboard. “We tentatively conclude that Katherine’s challenge fails on the merits because the probate court’s order does not violate the terms of Michael’s will.”
Such “tentative” rulings must be finalized before they are formally entered, but they strongly indicate the way the court is planning to rule. An attorney for Katherine did not return a request for comment on Thursday. A rep for the Jackson estate declined to comment. News of the tentative ruling was first reported by Rolling Stone.
As reported by Billboard earlier this year, the Jackson estate and Sony Music have reached a deal that will see the music giant buy half of the singer’s publishing and recorded masters catalog for more than $600 million.
But because the Jackson estate is still pending before a Los Angeles probate court more than 15 years after his 2009 death, his executors took the then-confidential deal to Judge Mitchell Beckloff for approval. When they did so, Katherine filed objections — among them that the sale “violated Michael’s wishes” and that the catalog would likely continue to gain value over time if retained.
In April 2023, Beckloff rejected those objections and ruled that the deal could move forward. Katherine then filed an appeal, resulting in Wednesday’s tentative decision.
The wrangling over the Sony deal has exposed rifts among Jackson’s heirs. In March, Jackson’s son Blanket asked the judge to stop his grandmother from using estate money to fund her efforts to block the Sony deal. Though both had initially opposed the sale, Blanket and Jackson’s other children accepted the probate judge’s decision allowing it to move forward.
Later that same week, the estate responded to claims from Katherine’s attorneys that she needed estate money to pay for her legal battle, arguing she had received more than $55 million since the singer’s death. The estate’s executors argued that “virtually no request of Mrs. Jackson for her care or maintenance has been declined,” including more than $33 million in cash.
Colombian hitmaker Nanpa Básico has signed a record deal with 5020 Records, the company tells Billboard. The 31-year-old singer-songwriter from Medellín, Colombia (born Francisco David Rosero Serna) has made a name for himself thanks to his socially conscious, raw lyrics and a signature style that blends hip-hop with reggae and regional influences. His latest album, […]
Sony is the undisclosed suitor that Queen was in an exclusive period with in negotiating the sale of its catalog and other music assets, as reported by Bloomberg today. There have been multiple reports that the catalog was up for sale since Music Business Worldwide first broke the news last May.
So far, Queen is believed to have had initial conversations about the potential deal with Disney, which owns the band’s masters for North America, and Universal Music Group. According to sources, the deal is being shopped by the band’s lawyers.
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In fact, each band member was said to have their own lawyers for the deal; early this year, some sources suggested that John Deacon’s share of the band’s assets might not be included in any potential agreement. Putting a deal like this together is a very complex process and with all the personalities involved, it’s still a question of whether one will ultimately be struck. In fact, that very issue — band members with different agendas — is said to have derailed a deal for the Pink Floyd assets a while back. That deal was expected to go for $500 million before it collapsed sometime in 2022.
Sources previously told Billboard that Queen was seeking $1.2 billion for its music assets, a price tag that limited the number of prospective suitors. In order to swallow the hefty price tag, Sony is reportedly partnering with an undisclosed financial player. Previously, Sony had help in acquiring the Bruce Springsteen master recording catalog from Eldridge Industries, which at one time owned Billboard.
Queen’s lawyers and Sony Music representatives were not immediately available for comment.
The Queen catalog includes iconic hit songs such as “Bohemian Rhapsody,” “Killer Queen,” “Another One Bites the Dust,” “Radio Ga Ga,” “Somebody to Love,” “Crazy Little Thing Called Love,” “You’re My Best Friend, “We Will Rock You” and “We Are the Champions.” Since 1991, the catalog has generated slightly more than 38 million album consumption units in the United States and has nearly 46 billion in global on-demand streams, according to Luminate. Go here for a full breakdown of the band’s catalog and financial performance.
If Sony completes the deal, it could very well be the biggest music asset deal ever made, even if it does not command the highest valuation for an artist’s music assets. Late last year, Sony bought half of the Michael Jackson estate for about $600 million, according to sources, though Sony never confirmed the acquisition.
Led by SZA’s SOS, Travis Scott’s UTOPIA and growth in paid subscription streaming services, Sony Music revenue grew 16.9% to 1.59 trillion yen ($11.05 billion) in its fiscal year ended March 31, its parent company, Sony Corp., reported Tuesday, May 14.
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Sony Music’s revenue topped guidance of 1.56-1.57 trillion yen given in Sony Corp’s previous quarterly earnings in February. Its adjusted operating income before depreciation and amortization (AOIBDA) of 368.7 billion yen ($2.55 billion) also topped guidance of 350-360 billion yen.
The yen-denominated revenue figures were boosted by foreign exchange rates. Of Sony Music’s revenue gain, about 32%, or 76.5 billion yen ($529 million), came from foreign exchange. Both recorded music and music publishing divisions enjoyed higher revenue from streaming services and paid subscriptions — Spotify’s price increase in July 2023, and continued subscriber growth at all platforms, also provided a boost to recent earnings by Universal Music Group and Warner Music Group.
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Recorded music revenue of 1.07 trillion yen ($7.39 billion) was up 20.4% from the prior year. While physical revenue dropped 7.4% to 101.3 billion yen ($701.7 million), streaming jumped 18.5% to 709.5 billion yen ($4.91 billion) and accounted for 66.5% of recorded music revenue, down from 67.7% in fiscal 2022. The “other” category, which includes merchandise, rose 59.8% to 221.4 billion yen ($1.53 billion).
Other top releases for the fiscal year were Bad Bunny’s Un Verano Sin Ti, Harry Styles’ Harry’s House, Miley Cyrus’s Endless Summer Vacation, Luke Combs’ Gettin’ Old, Peso Pluma’s Genesis, Doja Cat’s Scarlet, Rod Wave’s Nostalgia and Beyoncé’s Renaissance.
Music publishing full-year revenue rose 18.1% to 326.7 billion yen ($2.26 billion). Streaming revenue improved 21.1% to 185 billion yen ($1.28 billion) and accounted for 56.6% of publishing revenue, up from 55.2% in fiscal 2022.
Visual media and platform revenue declined 0.4% to 202.1 billion yen ($1.4 billion). Within the segment, gaming revenue fell 9.5% to 98.2 billion yen ($680 million).
Stray Kids’ “Social Path (feat. LiSA)” was the top music release for Sony Music Entertainment Japan for the full fiscal year. Other top releases in Japan were King Gnu’s The Greatest Unknown, SixTONES’ The Vibes and two releases by Nogizaka46: Monopoly and Ohitorisama Tengoku.
For the second straight quarter, Sony Music’s operating income of 301.7 billion yen was the largest of any Sony Corp. business and accounted for about a quarter of the parent company’s total operating income. Although Games & Network Services’ revenue of 4.26 trillion yen ($29.55 billion) was more than 2.5 times Sony Music’s revenue, it had operating income of 290.2 billion yen ($2 billion) – about 4% lower than Sony Music’s operating income.
Even though Sony Corp.’s full-year revenue grew about 13% on a constant currency basis, the company is wary of uncertain business conditions and volatility. As such, Sony Music’s parent company is putting a greater focus on earnings, efficiency and business profitability.
During the earnings call, Sony Corp.’s management discussed the company’s “mid-range plan” that includes a partial spin-off off its financial services division in Oct. 2025 and increasing focus on growth in its three entertainment segments — music, film and games and network services — and its imaging and sensing solutions business. The parent company aims to achieve an annual growth rate of 10% or more in these business segments.
“In the music segment, we continue to aim to grow faster than the market by strengthening our efforts in emerging markets, increasing monetization opportunities for our music catalog, and incorporating adjacent businesses such as merchandising,” said Hiroki Totoki, president, COO and CFO.
Looking ahead to the current fiscal year ending March 31, 2025, Sony Music expects 4% increases in both revenue and operating income.
Sony Music’s fiscal fourth quarter revenue climbed 23.5% to 422.2 billion yen ($2.85 billion). Recorded music revenue in the quarter rose 29.4% to 288 billion yen ($1.94 billion) due to 23.9% growth in streaming revenue and a 91.9% improvement in the “other” category. Music publishing revenue grew 25.5% to 82.9 billion yen ($558.6 billion). Visual media and platform revenue dropped 3.8% to 51.4 billion yen ($346.6 million) due to a 22.2% decline in gaming revenue.
Both SOS and UTOPIA were also Sony Music’s top two albums in the fiscal fourth quarter as well as the full year. Other top albums in the quarter were 21 Savage’s American Dream, Beyoncé’s Cowboy Carter, Bad Bunny’s nadie sabe lo que va a pasar mañana, Peso Pluma’s Genesis, Bad Bunny’s Un Verano Sin Ti, Tate McRae’s Think Later, Justin Timberlake’s Everything I Thought It Was and Harry Styles’ Harry’s House.
Trueno has signed a record deal with Sony Music Latin, Billboard can announce. The Argentine rapper and singer, known for his socially conscious lyrics, is a leading force in the hip-hop scene of Latin America. “Joining Sony Music US Latin is a big step in my career! I am very excited to be able to […]
In January 1999, Universal Music Group laid off hundreds of employees during a wave of consolidation with PolyGram. “The biggest staff cuts were at Geffen and A&M, two Los Angeles-based labels that have been folded into Interscope Records … and at Island Records, which has been merged with Mercury,” Billboard reported at the time, predicting that the cuts would affect label rosters, with “baby bands … expected to suffer the most casualties in the shake-ups.” In an interview with The New York Times, one artist manager described the impact of the merger on his band as if “a car [got] shut off in midgear.”
Roughly 25 years later, UMG is expected to cut hundreds of jobs to create “efficiencies in other areas of the business so we can remain nimble and responsive to the dynamic market,” according to a January statement from the company. Warner Music Group has announced layoffs of more than 800 people in two rounds over the last 12 months; on Monday, WMG label Atlantic Records announced additional cuts of about two dozen employees, primarily in the radio and video departments. (Sony Music is also expected to trim staff, according to sources; a rep for Sony declined to comment.)
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These cuts herald a leaner approach to the major-label business, and some talent and their representatives are worried about how this impacts their future.
Artists “are going to be upset,” says Mike Biggane, who was head of curation for Spotify, then worked at UMG as global executive vp of music strategy and tactics until last year. “The teams that artists signed up for and have been going to battle with will all be gone. That is going to impact the managers and the remaining label staff, who are already spread too thin.”
“If you’re not a multi-platinum artist, good luck,” says Allen Kovac, a longtime manager who had several acts in the UMG system during the 1999 consolidation.
A rep for UMG declined to comment. Speaking to financial analysts on Wednesday, UMG CEO Lucian Grainge said that “when it comes to supporting their rosters, [labels] will have access to our highest performing internal teams and resources to bring the new artists to even higher levels of success.”
And some executives were more sanguine about the impact of the upcoming staff cuts. Chris Anokute manages Taela, who was signed by Michelle Jubelirer before she recently left Capitol Music Group. “I’m very grateful to Michelle for signing her,” Anokute says. “Now there’s new management, and I’m excited to work with the new team to keep on developing her. I’m not worried for one second.”
Major labels have been consolidating internally for more than two decades. In 2004, Atlantic Records and Elektra Records merged as part of a Warner Music Group shake-up that included 1,000 layoffs. “Warner began cutting money-losing and under-performing artists from its merged Atlantic-Elektra label’s roster, and is preparing to let go as many as half of the label’s 170 acts,” The Washington Post reported.
Later the same year, BMG and Sony Music merged. “In each market tough decisions will have to be made about the senior executive lineup, overall staffing and artist rosters,” Billboard wrote.
While layoffs were typically followed by roster trimming in the past, history can serve only as a limited guide when assessing the latest round of cuts. “The environment today seems quite different to that of the late 1970s and early 1980s — the first time the industry experienced serious contraction — or the early 2000s,” says Adam White, a former Billboard editor-in-chief who later served as UMG vp of international communications. “During both of those time periods, industry sales slumped significantly and staff cutbacks were widespread. Isn’t that in contrast to the current environment, with revenue admittedly not growing at previous, double-digit rates — but still growing?”
Nonetheless, with leaner staffs, “you either need to spread your remaining staff more thinly or serve a smaller roster,” says Peter Sinclair, who worked at UMG for five years before founding beatBread, an artist-funding platform, in 2020.
Some major-label executives contend the staffing changes their companies are making will let them offer more resources to artists, not less. WMG CEO Robert Kyncl, for example, told staff that the cost savings from recent cuts would free up money that can be put towards “increasing funding behind artists and songwriters,” while Atlantic Music Group chairman/CEO Julie Greenwald said the company would be “bringing on new and additional skill sets in social media [and] content creation” to “help artists tell their stories.” In a memo to staff on Wednesday (Feb. 28), Grainge wrote that “our long-term growth strategy, including this organizational redesign, represents a new paradigm for artist support.”
However, many acts believe major-label staffs are already stretched perilously thin, and that layoffs will only exacerbate artists’ feelings of being underserved. “Way too many of my clients complain about what the labels aren’t doing for them,” says Todd Rubenstein, an entertainment attorney. “Even if there is a whole plan they come in with, it’s still not getting serviced.”
“I’m not anti-label; I think every single artist we have is on a major label,” adds Crush Management founder Jonathan Daniel. But “the reason I set up my company the way I did” — Crush has its own marketing and radio promotion staff — “is because labels always have too many artists for how many people work there.”
Labels are already more willing to trim their rosters than they were in the past, and A&R executives say this may have intensified independent of the recent layoff announcements, after a period of excessive signing driven by pressure to maintain market share and an abundance of viral hits on social media. “Would [layoffs] speed up the process of trimming the roster?” asks entertainment attorney Michael Sukin. “Sure, but labels don’t need an excuse.”
That said, when employees are laid off or leave to take another job, some artists will lose their internal advocates. Executives believe it’s likely that there are acts in the UMG system who won’t have their options picked up after the layoffs because no one inside the buildings will fight to keep them.
“Any artist that’s more singles-based is more of a risk on your balance sheet,” says one A&R executive-turned-manager. “They want artists that have sticky fan bases that will be there and support them when they don’t have a hit.”
This all sounds nerve wracking for artists, who are, after all, the lifeblood of record companies. In reality, though, an artist who was a label’s 40th most important act may not have been getting a ton of help anyway — as a UMG executive told The New York Times around the time of the Polygram merger, “for the [artists] we let go, they’ve probably already been dragged over the coals by a record label that can’t do the best job for them.” Nick Stern, another longtime artist manager, is fond of saying “there’s nothing better than being a top five priority at a major label, and nothing worse than being 20 to 50.”
And while artists who got dropped by a major label in 1999 didn’t have many ways to get their music heard around the world, that’s not the case in today’s digital industry. Song creation, distribution and marketing are now all far more affordable. “As the majors’ gatekeeping role shrinks, artists have more options, more leverage, more control and more creative freedom,” Sinclair says. “If you’re an artist and you get dropped by the majors, I’d recommend you take it for what it is: an opportunity.”
When Biggane left UMG last year, he started Big Effect, a company developing technology designed for smaller artist teams to release products and manage catalog effectively. He predicts an “exodus of talent on both sides — people working in the industry trying to provide services and artists looking for services.”
“They’re all going to come out in the independent market,” Biggane says, “and try to find each other.”
Additional reporting by Kristin Robinson