This past April, we wrote a post about rapper Young Buck filing for Chapter 7 bankruptcy. At that point, as is the case in this type of bankruptcy filing, the trustee assigned to his case was orchestrating the liquidation of his assets. In addition to selling cars and real property, the trustee was attempting to find a buyer for intellectual property owned by the rapper. That property included: trademarks, copyrights, masters, compositions, royalties, rights, licenses and rights of publicity.
In the last five months, things have changed however. The trustee recently indicated that due to actions taken by Curtis Jackson, (perhaps better known as 50 Cent), his record label, (G-Unit) and Universal Music Group, such a sale is not viable. This is because the three claim as exclusive recorders, publishers and distributors of the music made by the artist in bankruptcy, they have the rights to any of Young Buck’s intellectual property. Though the trustee assigned to Young Buck’s case could engage in litigation to obtain the right to sell the intellectual property rights, she has determined that it is not worth the effort.
This decision, along with the reality that under the rapper’s current contracts, creditors will not be able to recoup royalties going forward, leaves the trustee in the difficult position of trying to create a plan to repay Young Buck’s creditors. In addition to disbursing a one-time royalty payment of $211,000 to creditors deemed to be top-ranking, she is also attempting to reduce the dollar amount owed, currently $11.7 million, down to under $339,000.
In addition to negotiations with the Internal Revenue Service to reduce amounts owed to it, she is also seeking to reduce the amount owed to creditors by having the judge dismiss a claim filed by G-Unit for $10 million and another by 50 Cent, for $171,000.
Source: The Wall Street Journal, “Trustee: Young Buck IP Sale No Longer Worth It,” Jacqueline Palank, Sept. 4, 2012