Copyright and Royalties: Estate Planning Considerations
We have lost several well-known artists this past year: David Bowie; Alan Rickman; Glenn Fry; Harper Lee; Garry Shandling; Prince; Gene Wilder; George Michael; and most recently Carrie Fisher and her mother Debbie Reynolds. These names are a few among a long list of sports and political figures, writers, musicians, actors and otherwise well-known celebrities who passed away in 2016. One glance at the full list and you will likely agree that those of us who are alive and well are witnessing an unprecedented transfer of intellectual property from those who created artistic and literary works in the 20th century to their heirs.
As we’ve seen in the past with celebrity deaths, it is likely that we will hear of both the estate planning successes and blunders of these great talents. Though estate planning for entertainers and authors is, at its core, much like that of the rest of us, when it comes to copyright and royalties, added care will pay off for heirs. Copyrights and other forms of intellectual property rights survive well beyond the death of the author or creator, continuing to generate royalty income for heirs and successors if careful preparations are made in advance.
Specifically, in the case of literary works, at an author’s passing, his or her works become part of the estate, as do other assets such as investments, real and personal property. Literary copyrights and related intellectual property rights such as digital and film rights can represent a significant legacy to heirs, and they require specialized management to ensure a favorable result. In some cases, a literary executor may be the optimal solution, for the limited purpose of managing copy and related property rights for the author’s heirs.
Literary executors act on behalf of beneficiaries, and are responsible for entering into contracts with publishers, existing or future movie producers; collecting royalties; maintaining copyrights; and, where appropriate, evaluating depositories such as university libraries or historical societies for letters, unpublished manuscripts, and other literary materials. If a writer doesn’t want particular works published after death (personal memoirs, perhaps), this must be clearly stated in a will or trust.
Unless a family member has a legal background in the industry, naming a specialized executor experienced in the entertainment and/or publishing industry can be crucial to the beneficiaries. As noted above, copyrights in the US can last many years posthumously so identifying the professional executor and establishing a plan for selecting successors for that role is prudent. Of course, like choosing a general executor, selecting an executor who will honor the deceased’s and heirs’ wishes, has patience, good communications skills and can get along well with heirs will minimize turmoil.
When an artist dies without a will or trust, their property can wind up in the hands of an heir who has little or no interest in preserving his or her legacy, and who may even deplete, waste, or sell an artist’s valuable works to the highest bidder. The challenges associated with effective estate planning for authors, artists of all types, athletes, and innovators require specialized strategies, to protect and manage their intellectual property. Individuals with this specific need should consult with their estate planning attorney to ensure their great works are preserved.
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