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“It creates an inherent conflict of interest”: Jacksons v AEG Update

By | Published on Wednesday 19 June 2013

Michael Jackson

A former Capitol Records president has told the LA court hearing the Jacksons v AEG case that, having reviewed “an enormous amount” of material and an “extraordinary number of emails”, he is convinced that the live giant believed it was in charge of Dr Conrad Murray as the ‘This Is It’ venture got underway in spring 2009. Adding that for a concert promoter to have that kind of relationship with an artist’s personal medic was “highly unusual” and “highly inappropriate”.

As much previously reported, the Jackson family wants AEG to be held liable for the death of Michael Jackson four years ago, because it paid Murray, the doctor convicted of involuntary manslaughter for causing the late king of pop’s demise through negligent treatment.

The Jacksons say that AEG hired and then mismanaged Murray, putting pressure on the doc that led to him employing dangerous treatments. AEG counters that Jackson chose and managed Murray, it just agreeing to advance monies to pay him.

David Berman, a former entertainment lawyer and Capitol Records exec who these days specialises in giving expert testimonies in music business related lawsuits, was testifying at the request (and expense) of the Jackson family.

He said that, despite AEG insisting Jackson himself hired and controlled Murray, the live giant acted as if the doctor was in its employ. It negotiated the medic’s terms and contract directly, it submitted the paperwork required for Murray to work in the UK during the ‘This Is It’ London residency, and of course there’s that email, where AEG Live co-CEO Paul Gongaware wrote: “We want to remind [Murray] that it is AEG, not MJ, who is paying his salary. We want him to understand what is expected of him”.

And while the actual contract between AEG, Murray and Jackson had yet to be signed when the singer died (the doctor had signed on the dotted line, but the singer and promoter had not), Berman said that there was a valid oral agreement between the three parties, adding that in the music industry it was common for written contracts to follow late in the day, after the work outlined in a contract is already well underway.

As for AEG hiring Murray – if you buy the argument that’s what happened – Berman continued, according to CNN: “I have never heard of it being done, and indeed, it is my understanding up until this case, AEG had never done it. It creates an inherent conflict of interest on the part of the physician. The physician has dual obligations to the patient and the entity that is engaging them and who is paying his compensation. That, in of itself, is a conflict. [And] it’s a more egregious conflict in the circumstances in this case”.

Berman then returned to Murray’s financial woes, which, the Jacksons argue, made the doctor more susceptible to breaking medical codes in order to please his paymaster. Berman noted that AEG’s Randy Phillips, in an email trying to reassure a panicked ‘This Is It’ director Kenny Ortega, noted – incorrectly on all counts as it turned out – “this doctor is extremely successful (we check everyone out) and does not need this gig so he is totally unbiased and ethical”. That statement, Berman argued, shows that Phillips was aware that if Murray did in fact “need this gig”, such a position could hinder his ethics.

And, Berman continued, AEG should have made it their business to know that Murray desperately needed the Jackson gig to avoid financial oblivion. Not least because the doc initially asked for a $5 million fee for his work on ‘This Is It’. “That is a pretty bizarre amount”, Berman argued, and so high a figure it should have raised suspicions at AEG HQ.

The £150,000 a month agreed on was still “an exorbitant amount, more than any other person on the tour was paid; [and] even more of a red flag since AEG was aware of another doctor who was willing to take the job for $40,000 a month. It’s indicative of something out of whack”.

Responding to Berman’s testimony, AEG’s lawyers, of course, will be keen to throw the usual doubt that is thrown on any paid witness, while also stressing that Berman’s experience is more in the record industry than the live sector. The case continues.