The world famous singer passed away, at age 50, from a cardiac arrest in Los Angeles, California in June of 2009.
People has obtained court documents, filed on June 21st, that indicate that Jackson was in debt for over half a billion dollars, had half a dozen pending lawsuits and 65 creditors at the time of his death.
Jackson’s over-spending
The large sum reportedly accumulated as a result of the singer’s “exorbitant spending habits,”
In 2013, the Los Angeles Times had reported that Jackson’s lavish lifestyle was amounting to a debt of $30 million a year.
The publication reported that William R. Ackerman, testifying as a defence witness on behalf of AEG Live in the wrongful-death trial in August 2013, provided a detailed look at Jacksons finances. Ackerman told the court that he spent a lot of money on donations to charity, gifts, travel, art and furniture.
“He spent a lot of money on jewellery. He was tapped out,” Ackerman had told the jury.
The beginning of Jackson’s money troubles
The King of Pop’s financial troubles had begun long before his passing. Reportedly in 1993, Jackson had accrued a debt of $140 million, which grew by about $170 million by June of 2009.
According to the New York Times, Jackson had used his stake in a song catalogue as part of collateral for about $270 million in loans from Bank of America.
The former CEO of AEG Live, Randy Phillips, told Rolling Stone in 2009 that Jackson “wanted people to see his work and not just talk about his lifestyle…Michael was a very smart marketing person. People say he was feeble and manipulated, but he was powerful and a manipulator. He was ready,”
Phillips went on to say “He wanted to clean up his finances. He was ready to stop living like a vagabond and settle down and earn money again.”
The March 2024 petition
Estate executors attorney John Branca and A&R executive John McClain claimed, in a March 2024 filing, that the estate was completely saddled with debt and on the verge of bankruptcy when Jackson passed in 2009. The estate is now valued at over $2 billion.
The petition claims Jackson had over “half a dozen lawsuits pending worldwide”. As well as that, more than “65 creditors claims were filed in the Estate, spawning additional lawsuits” of which many had resulted in litigation.
The petition continues on to explain that Executors were able to renegotiate many of the financing arrangements for lower interest rates. This enabled the Estate ” to avoid the loss of any assets to the lenders and ultimately to satisfy the encumbrances that existed at the time of Michael’s death.”
The renegotiations included the debt (over $70 million at the time of his death) secured by the pop singers catalogue ‘Mijac Music’ as well the estate’s interest in Sony/ATV3 and the mortgage on his Hayvenhurst estate and Lindley Avenue condominium.
From July through to December of 2018, several firms collectively sought over $3.5 million in legal fees dating back six years via the petition.
“Although the Executors have eliminated the Estate’s debt, have resolved virtually all of the creditors’ claims and litigation, and have successfully solidified the MJJ business as a significant entity in the music industry, there remain challenging business, tax and legal issues that the Executors and their counsel continue to deal with,” the petition reads.
Read the full report from People HERE.
