'This Is It' Rehearsals

Michael rehearsing 'Black or White' June 23 2009

Michael rehearsed at The Forum 30 May – 19 June 2009, and at The Staples Center  22 - 24 June 2009. The Forum has yellow seating and The Staples Center has red seating, so I used this information to determine which venue the sections of ‘This Is It’ with Michael in it were filmed. In addition, a large LED screen was erected behind the stage at The Staples Center, so this is an added visual clue as to where rehearsals were filmed.

The singer Judith Hill said that the rehearsal of ‘I Just Can’t Stop loving you’ was the first time she had performed the duet with Michael. I am guessing then that The Forum was the first time the singers, dancers and musicians were all together for rehearsals with Michael.

At the time of writing, the trial of Conrad Murray is underway, and both the prosecution and defence have requested excerpts of film from ‘This Is It’, and these are listed in a court document Source. So we now know exactly what was filmed on 23-24 June 2009. I do not have definitive dates for The Forum or the other rehearsals at Centerstaging, so I have put the different rehearsals into the order I think they were performed, but please bear in mind that it is guesswork.

The Forum 30 May to 19 June 2009

The Forum Balmain jacket with white lapel and studs, red shirt, black trousers – Human Nature

The Forum Balmain jacket with white lapel and studs, red shirt, black trousers – I Just Can’t Stop Loving You

The Forum red shirt, black trousers – Thriller

The Forum red shirt, black trousers – Beat It

The Forum Blue and silver jacket, black t shirt, black trousers – Billie Jean

The Forum Blue and silver jacket, black t shirt, black trousers – Man In The Mirror

The Forum Military jacket with 3 rows of buttons, gold sparkly trousers, white t-shirt, trilby – Startin’ something correction

The Forum grey jacket, gold sparkly trousers, white t-shirt, trilby – The Drill

The Forum grey jacket, gold sparkly trousers, white t-shirt, trilby – Human Nature

The Forum silver jacket, gold sparkly trousers, white t-shirt, trilby – Smooth Criminal

The Forum silver jacket, gold sparkly trousers, white t-shirt, trilby – The Way You Make Me Feel

The Forum white shirt, gold sparkly trousers, white t-shirt, trilby – I’ll Be There acknowledgements to The Jacksons

The Forum Black and silver jacket, white T shirt – The Drill

The Forum Black and silver jacket, white T shirt – Smooth Criminal

Culver Studios 3 June to 11 June 2009

Culver Studios Black and silver jacket, white T shirt – The Drill

Culver Studios red leather jacket – watching filming of Thriller

Culver Studios – filming Smooth Criminal

The Forum, silver jacket, orange trousers, turquoise t-shirt – Startin’ Something

The Forum, silver jacket, orange trousers, turquoise t-shirt – Speechless

The Forum, silver jacket, orange trousers, turquoise t-shirt – Jam

The Forum, silver jacket, orange trousers, turquoise t-shirt – The Drill

The Forum, silver jacket, orange trousers, turquoise t-shirt – Human Nature

The Forum, Smooth Criminal jacket, orange trousers, turquoise t-shirt, black fedora – Smooth Criminal

The Forum, Smooth Criminal jacket, orange trousers, turquoise t-shirt, black fedora – The Way You Make Me Feel

The Staples Center 23 June to 24 June 2009

 23 June Staples Center, green and bronze metallic jacket, black t-shirt, black trouser with silver stripe – I’ll Be There

23 June Staples Center, white shirt, black t-shirt, black trouser with silver stripe – Black or White

23 June Staples Center red shirt with diamante 7s, grey jacket  - The Drill/They Don’t care About Us

23 June Staples Center red shirt with diamante 7s, grey jacket, black t-shirt – Startin’ Something

23 June Staples Center red shirt with diamante 7s, grey jacket, black t-shirt – Jam

23 June Staples Center red shirt with diamante 7s, grey jacket, black t-shirt – Human Nature

23 June Staples Center red shirt with diamante 7s, Smooth Criminal jacket, black t-shirt, white fedora – Smooth Criminal

23 June Staples Center red shirt, blue shirt – The Way You Make Me Feel

23 June Staples Center red shirt, blue pearly shirt, black t-shirt– Jackson 5 medley

23 June Staples Center red shirt, white shirt, black t-shirt– Shake Your Body

23 June Staples Center silver jacket, black trousers, trench coat – Beat It

23 June Staples Center silver jacket, black embellished overcoat, black trousers – Black or White

24 June Staples Center Curls for My Girls Tshirt, white shirt, black jacket, Ed Hardy trousers – Thriller

24 June Staples Center Curls for My Girls Tshirt, white shirt, black jacket, Ed Hardy trousers – Earth Song

‘This Is It’ concerts – $315m the Big Money

So were AEG the ‘good guys’ and helping Michael get out of the financial difficulties imposed on him by corporate bullies, or were they in it for themselves?

Let’s look at the AEG contract itself and see. As a layperson I do not understand all the terms and conditions in the contract, and for that I may have to defer to Leonard Rowe’s explanation in his book. But what I do understand is that the contract was for a maximum of 31 concerts between July 26 and September 30 2009, and the first leg had to be a minimum of 18 shows. A greater number of shows could be agreed, but the initial contract was as above, UNLESS AEG could prove that more shows were needed in order to recoup the advances it paid to Michael.

Leonard Rowe says that normally, production costs are taken from the gross revenue before the balance is split between the artist and promoter.

So for example if the gross revenue was $1 million and the production costs $300,000, the remaining $700,000 would normally be split between the artist and promoter.

In the AEG contract the gross revenue was split 90/10 in Michael’s favour BUT Michael PAID ALL The PRODUCTION COSTS from his 90%. So, using the same figures as above, Michael would get $900,000 minus the $300,000 production costs leaving him $600,000 and AEG would get the other $100,000. This looks OK at first glance, but then Michael also had to pay back other advances as well. So if the productions costs plus advances spiralled upwards, Michael could end up with $0 or even worse, owing AEG money, and AEG would STILL GET their $100,000.

It appears that the AEG contract did not put AEG in any financial risk. All the financial risk seems to be shouldered by Michael, the artist, without whom there would be no revenue in the first place.

Let’s look at the figures, to see if Michael was going to make any money from the concerts:

COSTS for 1 year

Rent of 100 Carolwood Drive for 1 year estimated at $1.2million

Rent of Foxbury Manor in Kent for 1 year – estimated at $1million

Production costs up to $7,500,000

Cancellation insurance premium for 1 year – estimated at $1.3m

Salary for Tohme Tohme at $100,000 per month - $1.2m

Salary for Conrad Murray at $150,000 per month - $1.8m

Producers Fee (5% of Artists Net Tour Income) – estimated at $3,825,000

COST TOTAL approximately $23 million in 1 year

MICHAEL’S INCOME for 50 shows

90% of the revenue for each 5 shows he completes (out of which the costs above are paid) – estimated at $85,000,000

MICHAEL’S INCOME (estimating $113 for each ticket sold) approximately $76.5m in 1 year.

Therefore, subtracting costs,

MICHAEL’S NET INCOME would be an estimated $53.5m in 1 year.

AEG would be making $8.5m.

This is a conservative estimate, but I think it shows that the AEG contract was going to make Michael a very large amount of money. The production costs would be unlikely to ever rise to $53m. Remember, this is just for the 50 shows.

If he had gone on to do a World Tour, the profits would have been even greater:

MICHAEL’S INCOME for 3 year World Tour

90% of the revenue for each 5 shows he completes (out of which the costs above are paid) – estimated at $255,000,000

MICHAEL’S  INCOME approximately $229.5m in 3 years

Therefore, subtracting costs as above for 3 years,

MICHAEL’S NET INCOME would be an estimated $180m in 3 years.

These figures do not include profits from concert merchandise, which were estimated to be $150m. If the 90/10 split also applied to merchandise, that is another $135m for Michael,

MICHAEL’S GRAND TOTAL $315m

"They don't care, they care about the money" - lyrics from "Money" by Michael Jackson. So what is happening to the will?

What you may not realise is that Michael’s will is still in probate.

Reading the estate’s report on the management of MJJ business, dated September 2010, in conjunction with the description of probate (below) these are the points that stood out:

Description of probate: “Probate is the court-supervised process of locating and determining the value of the assets owned in the individual name of a deceased person, referred to as a "decedent," paying the decedent's final bills and estate taxes and/or inheritance taxes (if any), and then distributing what's left of the decedent's assets to his or her heirs.”

Page 15 line 3 of the MJJ Business Report says “it appears likely that the administration of the estate will continue for an unusually long time”

Page 21 line 20 “the loans will be allocated to Mrs Jackson’s share of The Michael Jackson Family Trust upon its funding”.

So in effect I think that means that until all the debts have been paid, The Michael Jackson Family Trust is not being funded and the will is in probate.

The Estate have granted Mrs Jackson a monthly stipend of $86,000 and authorised some loans for her, until the Trust is funded. The loans will eventually be paid back from Mrs Jackson’s share of the Trust.

The largest debts that we know Michael has are the loans taken out on the Sony/ATV and Mijac catalogues.  Some business matters were not deemed public knowledge, and were not included in the report, so I am unable to comment on those. From what was included in the report we know this  :

·          the Sony/ATV loan from Barclays matured December 3 2010, (repayments were made from profits from the Sony/ATV catalogue, which is in the New Horizon II Trust). The loan was refinanced with UBS. My understanding is that when you refinance, you choose a lender with more favourable rates to take over the loan for the period of the original loan. But it is not clear if the loan has been paid up in full or extended.

·          The Mijac loan from Plainfield/HSBC was refinanced with HSBC, and matures in May 2011, although the report mentions a negotiation of a tax saving over 5 years, which could take it to 2014. (repayments are made from profits from the Mijac catalogue, which is in the New Horizon III Trust).

So initially, it looks like the largest debts could be repaid by May 2011, unless the loans have been extended. So my understanding is that if The Michael Jackson Family Trust has not been funded before then, it should certainly start being funded once these loans have been paid in full.

What was the size of Michael’s debts? They have been estimated between $250-500m. Some reports say that the loans on Mijac and Sony/ATV catalogues totalled $435m alone. We do not know what other debts he had, besides the mortgage on the Encino house.

If the estate has taken $1billion in the first year, as claimed in various reports, then this should have been enough to settle the two largest loans, leaving  $500m to pay for creditor claims and 10% fees for the Special Administrators. According to the business report, Exhibit A, action has been taken regarding $9,333,384 of claims, most of them paid in full. With $100m going to the Special Administrators, that leaves about $391m. Mrs Jackson is getting $86,000 a month leaving about $390m unaccounted for. Even unpaid tax bills since 2006 would not amount to $390m, so why has this money not been used to fund The Michael Jackson Family Trust? Where has it gone? And why are the loans still being paid off?

On the other hand, other reports say that the estate has only taken $310 million, and has paid out $159m Source to cover debt. That still leaves $58m after the outgoings listed above. As this is not enough to pay off the catalog debts outright, then this probably explains why the will is still in probate, but it does not explain why the Michael Jackson Family Trust is not being funded.

The two New Horizon Trusts were set up in 2006 specifically to pay off the loans on the catalogs. Either the income generated by the Trusts does not cover the repayments, and is being subsidised by the $58m, or the $58m is going somewhere else. If the loans mature but have not be paid back in full, then the estate will have to take out new loans, and work on new MJ business deals to generate more income, and the will could stay in probate for another few years. It is not clear from the business report if the Mijac loan was refinanced or whether it was paid in full, so I will have to wait until the next report to clarify that. Similarly, the Sony/ATV loan has been refinanced, but it is not clear if it matures in 2011 or 2014.

However, the longer the debts go unpaid, the longer the will stays in probate, and the longer The Michael Jackson Family Trust stays empty. By granting the executors 10% of the profits of the deals they make, it makes it very attractive for them to keep the debts unpaid and the will in probate. I’m assuming that once the debts are paid, the estate will be turned over to people who will run it like a business, and the executors will no longer be receiving any monies from it. I do hope the court is keeping an eye on things to make sure the executors are not lining their pockets at the expense of the Trust fund.

AEG Lawsuit – 30 December 2010 AEG Demurrer

Note: in the bulleted list below, my comments are in bold.

The attorneys for AEG Live have filed notice of a demurrer that they will use in court on 2 February 2011. This is in response to the complaint filed by Katherine Jackson on 15 September 2010, which sues AEG, and claims they breached their legal duties to Michael.

·         The demurrer says that Katherine lacks standing to assert any claims on behalf of Michael Jackson, because her complaint gets the law and the facts wrong, and her theories are just that. AEG claim that only Michael’s personal representative can prosecute them, not Katherine. There is a note in the footer which says the estate is in probate, and that John Branca and John McClain are therefore Michael’s personal representatives.

·         The demurrer say that rather than pleading recognised legal duties that Katherine alleges AEG had to Michael, she is trying to create new theories of liability.

·         They state that the performance contract did not create any special duty-of-care, just because AEG arranged for his housing and transport. AEG is not liable for premises liability nor for the actions of a third party within the premises. They say that because Michael had not yet signed the contract with Murray, AEG did not have to supply medical equipment for Murray to use. Various internet articles have stated that there are several monitors that should be used when giving a patient propofol, for example, and Katherine’s lawsuit set out to show that Murray asked for the equipment but that AEG did not provide it. So the demurrer is pointing out that Murray would not receive equipment until Michael signed the contract, and is implying that Murray should not have gone ahead with any treatment that required them. AEG attorneys also say that AEG could not have foreseen that a personal doctor would treat Michael with an anaesthetic that normally is only used in a hospital, and therefore they are not liable under duty of care.

·          AEG attorneys say that AEG and Michael did not have a ‘special relationship’ because Michael was not a dependant of theirs. Katherine’s lawsuit claims that AEG exerted ‘an extraordinary degree of control over Michael’ but AEG attorneys say they do not provide facts to back this up. They only back up that he was financially dependant on the money he was going to receive in advances. Now this is where it may get interesting, because AEG attorneys do not deny that Michael was financially dependant on the money he was due. If Katherine’s attorneys are canny they will home in on this, because I do feel they have a case to show that the contract could have made Michael financially dependant on AEG for 2 and a half years. Leonard Rowe says in his book that parts of the contract were not standard practice, and I think that the contract may have been worded in a way to KEEP Michael financially dependant on AEG for two and a half years or more. Leonard describes the AEG contract as grounds for malpractice and a breach of fiduciary duties. The demurrer goes on to say that despite the lawsuit alleging that Michael was threatened with cancellation unless he accepted Dr Murray’s services, which they claim indicated a ‘special relationship’, Michael was only under pressure financially. Here AEG attorneys are actually agreeing that Michael was under pressure financially and furthermore under pressure financially to accept Murray’s medical care. So he was dependant financially on AEG, and under pressure financially to accept Murray. So maybe it could be proven that he agreed to both under duress? AEG attorneys then say that Michael could have refused Murray and cancelled his contract with AEG. But they have just agreed that he was under pressure financially. His contract states that if Michael cancels, he has to pay back all advances plus all production costs incurred. That means the rent on the house, any cash advanced, transport costs, cancellation premiums, Tohme’s salary, rehearsal costs etc etc. How many millions was that? I estimate well in excess of $6m and may be as much as $36m. The cancellation insurance (paid by Michael, and benefitting AEG) would probably cover these costs, but what recompense would Michael get? Probably nothing, and his reputation and career would probably be extinct too.

·         It says that the complaint seeks to hold AEG liable for fraud without alleging any actual misrepresentations. Here Katherine was trying to show that AEG made false representations to Michael, when they went to his house on 18 June 2009, in that they said they were looking after his well-being and best interests, but actually were threatening him to accept only Murrays’ medical care. AEG attorneys say that the allegation does not specify what was said, by whom, and who had the authority to make the statements. As if anybody needs authority to make a threat! A threat is a threat. So they knew he was under financial pressure, and they threatened him with more. Great. The problem is, without witnesses, it is quite difficult to prove that any threat took place. Randy Phillips was there, with Murray and Michael. Who of these will testify a threat took place?

·         Katherine’s complaint holds AEG liable under respondeat superior , but the AEG attorneys says she does so without recognising that there was no special employer-employee relationship. (respondeat superior : Latin, Let the master answer.] A common-law doctrine that makes an employer liable for the actions of an employee when the actions take place within the scope of employment.AEG attorneys say that because Dr Murray was employed by Michael and not AEG, that there are no grounds for a employer-employee relationship regarding Murray. They also say that Katherine should have claimed for wrongful death due to medical negligence within one year, and she has failed to do so, so her claim should be dismissed.

·         AEG attorneys  say that Michael, not AEG, controlled his medical care and hired Dr Murray. They refer to the contract between Michael and Murray, which Murray had signed but which had not yet got Michael’s signature. They point out that the contract was between Michael and Murray, not AEG and Murray, and as it was not signed by all parties, was not yet in force. But as we saw above, Michael was later put under pressure by AEG financially to accept Murray’s medical care. We have been told in the past that Michael was told by AEG not to visit his dermatologist anymore, and only accept Murrays care, or AEG would pull the plug on everything. If Michael did not accept Murray or cancelled with AEG, they would want all their money back.

·         AEG attorneys say Katherine has not shown that AEG were told that Murray was unfit to be Michael’s doctor, nor has she shown that they knew Murray was giving Michael anaesthesia.

·         The demurrer says that the claim for Prince Jacksons’ emotional distress at seeing his father lying injured, should be dismissed because Prince did not witness the actual injury taking place. Maybe not, but he would have seen his father with an IV in his leg, and maybe various syringes and vials were being used as Murray was trying to resuscitate Michael. He would have known that something was wrong. It wasn’t as if Michael was just lying there under the bedcovers with his eyes closed. The scene must have been chaotic and a total shock.

Generally, this demurrer is nothing less than I would have expected. I don’t think they are not going to admit any wrongdoing or liability, and are only going to respond if accused of something directly. I have seen this tactic used before myself, although outside the courtroom:

I will only answer direct questions. If you don’t ask the right question I am not giving any extra information.

I will try and divert your attention onto less relevant issues, in the hope you will forget to ask me about the important issues.

Ding.Ding. Round 2.

UPDATE: A judge ruled in L.A. on 2nd February that the lawsuit can proceed. Judge Yvette Palazuelos stressed that Katherine's case would need to provide evidence of “fraud, negligent infliction of emotional distress and civil conspiracy”, adding that proof of the latter was currently lacking. Palazuelos said that any agreement that Dr Murray would ensure Michael made it to rehearsals was not, in itself, an illegal act, and that evidence would be needed that the implications of such an agreement were more sinister.
Kenny Ortega, who had worked with Michael before, and who was director of 'This Is It', was originally named as a defendant. But Katherine Jackson's attorneys recetly dropped him from the suit, citing new information.
The next hearing in Katherine Jackson's civil case is scheduled for March 22.
UPDATE: On March 21 2011 AEG filed their answer to the Lawsuit, denying every allegation.
UPDATE: 2 June 2011 the trial date has been set as 10 September 2012.