Photo Credit: Prince by World’s Direction
The battle between Prince’s family members and executives from Prince Legacy LLC for the late musician’s estate rages on. A court has ruled against Prince’s relatives’ attempt to oust two executives from the estate, deeming their attempt to amend the company’s operating agreement as invalid.
Prince’s family members, who manage his estate following his sudden death from a fentanyl overdose in 2016, have been attempting to amend an operating agreement with Prince Legacy LLC, one of the companies that also manages the late musician’s estate. Their goal is to oust two executives at the company, L Londell McMillan and Charles Spicer, changing the operating agreement without their involvement. A Delaware court has ruled against them, calling their attempts at amending the agreement invalid.
The dispute hinged on whether Prince’s relatives could call a meeting to amend the operating agreement without involving McMillan and Spencer. Last year, the family held such a meeting and amended the agreement to remove the two executives as managing members of the company.
The company, Prince Legacy LLC, was established following the artist’s death with several other family members, including Prince’s half-sisters Sharon and Norrine Nelson, niece Breanna Nelson, and nephew Allen Nelson. Together, the executives and family members became shareholders, with the company being run according to the terms of the operating agreement.
Meanwhile, other Prince family members formed their own separate company, Prince Oat Holdings, in a partnership with Primary Wave. A significant legal battle ensued, with the estate’s assets ultimately split between the two companies. As the musician did not have a will in place upon his passing, his six siblings had inherited equal interests in the estate, which led to the battle over its operations in the first place.
Half of Prince’s siblings, upon forming Prince Legacy LLC, assigned their combined 50% interest to the company, while granting McMillan and Spicer each a 10% interest in Prince Legacy, alongside broad management authority. But Sharon Nelson came to regret that decision, leading the effort to remove McMillan and Spicer as managing members by amending the LLC agreement.
The executives’ lawsuit alleges that Sharon improperly tried to “insert herself” into management decisions, even demanding that the entire staff of the Paisley Park Museum in Minnesota be replaced. Further, she accused McMillan and Spicer of fraud, and attempted to sell her interests in the LLC without the required consent of the other members.
McMillan and Spicer, despite their claims of successfully managing the estate’s assets under Prince Legacy LLC, saw tensions build with the family member shareholders. They disagreed with the family over how the agreement should be interpreted, with the Court of Chancery ruling that the two executives’ interpretation of the agreement was “the only reasonable one,” calling it “unambiguous.” Chancellor Kathaleen St. Jude McCormick added that accepting the family members’ interpretation of the agreement would lead to “absurd results.”
Further, McCormick ruled that McMillan and Spicer can pursue a claim that the family breached the LLC agreement by acting without authorization to amend it in order to remove the two executives.
The lawsuit is just one part of a continually complex legal battle over both the size and beneficiaries of Prince’s estate. In 2022, the IRS and the administrator of the estate agreed to end a court battle, valuing the estate at around $156 million.
