Good Golly Little Richard
Who you select to manage your affairs after you die is of paramount importance. Selecting the right “fiduciaries” is among the lessons we can learn from the estate of Little Richard.
The estate of Richard Wayne Penniman, the legendary singer, songwriter and recording artist known as Little Richard, who passed away in 2020, owned intellectual property and publicity rights. Little Richard created a will bequeathing the rights to his royalties to nine beneficiaries. The beneficiaries included his brother, Peyton Penniman, and his sister, Freka Merrell. Along with his longtime attorney William Sobel, he also named them as co-personal representatives with fiduciary obligations over the estate.
In his will, Richard Wayne Penniman instructed the nine beneficiaries to jointly manage his publicity rights by forming a Tennessee LLC or another suitable entity. By that designation, he transformed nine beneficiaries into nine fiduciaries, with legal and moral obligations over assets.
In the section of the will titled Special Provision for Rights to Publicity, the will provided that the personal representatives could only distribute the estate after the majority of beneficiaries agreed upon a plan for managing the publicity rights. It required the personal representatives to adopt any plan favored by the majority of beneficiaries. The section further provided that any beneficiary who prevented the plan’s implementation would lose their publicity rights share.
A leading independent music publisher, Primary Wave Entertainment, offered to purchase the estate’s intellectual property and publicity rights. Five of the beneficiaries voted in favor of negotiating and accepting the offer. However, one co-executor and beneficiary, Little Richard’s brother Peyton Penniman, strongly opposed the sale. Pennimen sent an email to attorney Sobel and Primary Wave, among others. The email listed Mr. Penniman’s grievances, raised concerns of elder abuse and racism, and threatened informing the public. The next day, the music publisher withdrew their offer, resulting in significant economic loss for the estate. Since the withdrawal, the beneficiaries did not receive a comparable or better offer from any entity looking to purchase the rights.
Following the co-executor’s actions, which obstructed the sale and violated his fiduciary duties, the majority beneficiaries filed a motion to remove him as both a beneficiary of the publicity rights and a co-personal representative of the estate. The trial court agreed, finding that his conduct cost the estate a substantial amount and constituted a breach of his responsibilities. As a result, the co-executor was removed, and he forfeited his interest in the publicity rights and ordered to pay attorney’s fees and costs. He subsequently appealed the decision. The Tennessee Court of Appeals has affirmed the trial court’s decision, finding that the co-executor’s actions obstructed a valid plan, which justified his removal and forfeiture of rights. In the Estate of Penniman (Tenn. Ct. App. No. M2023-00075-COA-R3-CV, September 6, 2024).
What are the lessons for us?
- Courts have authority to review the actions of an estate’s executor. While Trusts are less susceptible to lawsuits, a breach of fiduciary duty is always fair game for the courts. When fiduciaries and beneficiaries fight in court, everyone suffers.
- Often, the greater number of people invested with authority over an estate, the more likely conflict will ensue. Pick your fiduciaries wisely and sparingly!
- Some decisions should be left to disinterested third parties. Family members have no right to serve as fiduciaries. Emotions will influence the decisions of relatives.
- Read your wills and trust documents carefully. In fact, read them aloud! If you do not understand anything you read, then it is too complicated or not clearly written sufficient to guide your fiduciaries after you die.
Learn these lessons. Avoid an estate that has a lot of shakin’ going on!
Evan J. Krame
