On June 30, 2016 there was a hearing about the anti-SLAPP motion. (Lawsuits brought to scare, harass and intimidate defendants or restraint of business is called SLAPP. The motions filed by the defendants against such cases are called anti-SLAPP.) In order to succeed in their anti-SLAPP motion defendants will need to prove that the statements they made (and mentioned in the complaint) are protected under the right of free speech in connection with an issue of public interest.
Unexpectedly the newly assigned judge to the case refused to issue a formal ruling on the anti-SLAPP motions. As a first step parties have agreed to determine whether the statements in question (Sony Statement, Weitzman statement, album back cover, album video statement, Cascio’s at Oprah) were commercial speech or not. Judge refused to do such determination. Judge also mentioned that even she considered the anti-SLAPP motion, she would be inclined to deny it as the statements could be potentially misleading for reasonable consumers.
At this time, this is a huge win for the plaintiff MJ Fan. The judge told the parties to move on and start the class certification. This means the case survived the first dismissal attempt and the case will move forward with class discovery.
However most probably defendants (Sony, MJ Estate, Cascio, Porte) aren’t happy with judge’s refusal to issue a formal ruling on the anti-SLAPP motions. Zia Modabber said during the hearing “Whether or not these are Michael Jackson’s vocals is irrelevant. If it is noncommercial speech, we win, it’s over.” If statements in question are noncommercial speech, they would be protected by constitutional right under freedom of speech. Defendants also mentioned that a class discovery and certification before determining if the statements are commercial or not would be wasteful.
So what’s next? It would depend on the actions of the defendants. Will they do what the judge said and continue to the next step in a class action lawsuit? Or given they didn’t get a formal ruling in their anti-SLAPP motions would they pursue to get a ruling on that matter? Given a favorable ruling can end this case for the defendants, it’s quite likely that they may appeal this decision. In a few months’ time we will have a better idea about how this case will proceed.
The news of Sony purchasing Michael’s 50% share in Sony/ATV has resulted in anger, emotional outbursts and heated discussions among the MJ fans. Recently The MJCast had a Sony/ATV purchase roundtable at their 27th podcast. The podcast started with a quite balanced discussion of all sides and all possibilities surrounding the purchase of MJ’s share. The podcast also featured an interview with Lynton Guest – the author of “The Trials of Michael Jackson”. While listening to the show, I realized Lynton Guest provided some new and interesting insights to the Sony/ATV purchase. We as fans operate on limited available information so for me any piece of new information is quite valuable to better understand the situations. Therefore with permission from The MJCast, I prepared a transcript of a short section of the Lynton Guest interview.
The full The MJCast podcast can be listened to here :
or can be accessed from The MJCast webite at http://www.themjcast.com/episode-027-sonyatv-purchase-roundtable/
The below transcript starts at 01:13:00 (or 73 minute) mark.
As you may recall, last October Sony triggered the “buy-sell” clause in the partnership agreement which provides for one partner to buy out the share of the other at the highest possible price. As has now been announced, the Estate and Sony have signed a memorandum of understanding for Sony to purchase the Estate’s interest in Sony/ATV. A copy of the official press release is also being sent to you. In the intervening months, we explored several options that would have positioned the Estate as the buyer, rather than Sony, and we had substantial interest from potential partners to work with us in doing so. Ultimately, however, Sony’s offer was in the best interest of Michael’s children and we made the difficult decision to accept that offer. The arrangements will further secure the financial future of Michael’s heirs. The amount that Sony is paying, $750 million, is a substantial premium on the Estate’s interest in the company after taking into account the debt of the company, the Purchase Option and other adjustments required under the partnership agreement. It is also a huge testament to Michael’s business acumen that his original investment appreciated so substantially over the last 30 years.
There are several reasons that led to our decision. We will use a portion of the proceeds to repay the loan balance on monies borrowed by Michael and secured by his interest in Sony/ATV which means that after starting with more than $500 million in debt seven years ago, the Estate is now completely debt free with substantial assets in cash and other property. The balance of the proceeds from this sale, after taxes, fees and expenses, will be held by the Estate and ultimately will be transferred to a trust for the benefit of Michael’s beneficiaries. Furthermore, the transaction allows the Estate to diversify assets which, to date, have been highly concentrated in music intellectual property.