Michael Jackson has no end of troubles, including financial, and no, I don’t think people are out to get him because he is eccentric: I think they are concerned that he is truly dangerous. Regardless of the outcome of the most recent charges, one does not dangle a baby over thin air where one slip would mean instant death without being considered a danger. That is still for me the single most troubling (uncontested) bit of behavior in this ongoing saga.
- Mr. Jackson has spent millions of dollars on legal fees over the past two decades, hiring a who’s who of high-priced entertainment lawyers and public relations experts to represent him in hundreds of lawsuits.
He is an inveterate spender, with the upkeep of his Neverland ranch costing nearly $4 million a year, say colleagues who know him. According to accounts of executives close to his record company, Sony Music Group, and published reports, he has borrowed millions of dollars to pay for his lavish lifestyle.
In June Mr. Jackson settled a lawsuit filed by Myong-Ho Lee, a former business adviser, who said Mr. Jackson had been in financial trouble. The amount of the settlement has not been divulged. Earlier this year, a jury in Santa Maria, Calif., said Mr. Jackson owed a German concert promoter $5.3 million for backing out of two concerts in 1999.
For many musicians, the plummeting album sales Mr. Jackson has experienced would be career-ending. But people who know him say that in fact most of his wealth comes from his joint venture with Sony Music Entertainment, the music publishing arm of his record company.
….Reports about the decline of Mr. Jackson’s financial health began to surface in June 2002, when the singer clashed with the former head of the Sony Music Group, Thomas D. Mottola, over the promotion of Mr. Jackson’s album “Invincible.”
The album, which received lackluster reviews, sold only two million copies in this country, a far cry from Mr. Jackson’s 1982 best seller “Thriller,” which sold 23 million copies.
Mr. Jackson then complained that Epic Records, which is owned by Sony, did not support the release of his album, which led to the poor sales. But executives close to Sony said that the record company had spent $25 million to promote the album and that when the album did not take off the company did not want to spend more.
….People who have advised Mr. Jackson said much of his wealth in recent years had come from his ownership stake in Sony/ATV, a 50/50 music publishing joint venture between Mr. Jackson and Sony Music Entertainment, which merged their two music publishing catalogs in 1995 to create a money machine that included not only Mr. Jackson’s works but also more than 250 Beatles songs.
….People close to Sony said at the time that Mr. Jackson was running out of money, an assertion that Mr. Jackson has denied. But before 2002, Mr. Jackson took out a loan against his share in the joint venture that the record company guaranteed based on the future earnings of their partnership, the people close to Sony said.
If Mr. Jackson defaulted on the loan guaranteed by Sony, these people said, the record company had the right to buy Mr. Jackson’s share. According to a Vanity Fair article written by Maureen Orth last April, court filings in the case involving the business adviser, Mr. Lee, show that Mr. Jackson secured nearly $240 million in loans from 1998 to 2000, but not all the loans were guaranteed by Sony. The catalog, according to the article, was valued at $700 million to $1 billion. [NY Times]
That’s a damn deep pool, but not a bottomless one.