The Business Rusch: The Gift That Keeps On Giving
I have been down the rabbit hole, and it is labeled “Philip K. Dick.” I had a simple question: Who benefits directly from the Philip K. Dick estate? I found websites, wikipages, arguments, lawsuits over movies, and all kinds of other things, none of which directly answered my question. Until I located an interview conducted by the Library of America with Jonathan Lethem and Laura Leslie. The LoA interview coincided with LoA’s 2008 publication of Philip K. Dick: Five Novels from the 1960s and 1970s.
Who handles the Dick estate? Well, here’s Leslie’s quote from the article:
My sister, Isa, my brother, Chris, and I created the Philip K. Dick Testamentary Trust to keep our father’s works together rather than divide them among the three of us. Each of us owns one-third of our father’s collective body of work. We work collaboratively on every important decision—and in the 26 years since our father died, we have never had a disagreement. Recently, Isa has been the catalyst to propel us to develop a production company, Electric Shepherd Productions (ESP), which is dedicated to promoting and developing adaptations of our father’s work across media.
Philip K. Dick does have a rather pretty website devoted to his work, on which Electric Shepherd is listed, but the Trust is not (except through its lawyers and representatives).
I was looking at the Dick estate for a variety of reasons. The primary one is this: When Philip K. Dick died at the age of 53, he was a middlingly successful science fiction writer. Only the faithful had heard of him—I had, being involved only peripherally in the sf community at the time—but most people hadn’t heard of him at all. Most of his novels and short stories were out of print.
A film of his short novel, Do Androids Dream of Electric Sheep, was under production and not only did the filmmakers change the title, Dick wasn’t real fond of the script.
Dick had two strokes in February and was taken off life-support in early March of 1982. On June 25, 1982, Blade Runner, staring Harrison Ford and Rutger Hauer, debuted to mixed reviews and fantastic word of mouth. From that moment on, Philip K. Dick the author became one of Hollywood’s and publishing’s hottest properties. The New York Times said that so many movies were being made from Dick’s work that it had become “a cottage industry” and by 2007, more than 30 of Dick’s novels and “scores” of his short stories had come back into print.
One of the rabbit holes I slid down for a while was the Adjustment Bureau lawsuit which was mostly about whether or not the Dick story that provided the foundation for the film was in the public domain or not. (An arcane side of copyright law that I dodged by being published after 1977 meant that writers had to renew their works every 28 years or the work went into the public domain.) Fascinating reading—when you have the time, which I definitely do not.
My point in sharing these various rabbit holes with you is this: You cannot predict the future. (And, for you Dick fans, reality isn’t real. But you knew that. Sorry. I digress.) You have no idea if that drooling fan boy in the corner will grow up to be one of Hollywood’s biggest directors and will want your novel, which he read at 12, to be his latest blockbuster film. Or if that gamer who approaches you with an offer to pay you a small pittance for your “world” will turn that world into one of the biggest games of the decade, with all the marketing spin-offs that entails.
Nor do you know whether or not you’ll live to see any of it. Since we’re speaking of science fiction writers, let me remind you that Ray Bradbury wrote the screen play for John Houston’s 1956 film, Moby Dick. Moby Dick was based on a novel of the same name, written by Herman Melville, who died in 1891, long before movies and “opening weekends” were part of life or the vernacular. And no, I don’t know if there’s a Melville estate (although I doubt it) and no, I’m not going to look. I have much more to do than search for that particular Great White Whale.
My very first post on estates was titled “Want To Be Read 100 Years From Now? Here’s How.” The upshot of that post? If you don’t have some kind of estate planning in place, your work probably won’t be read—or made into a toe-nail vid — 100 years from now.
I’ve been blogging about estates as I learn about them, and there’s a lot I’ve decided that I’m not going to discuss. Some of this is because I am just learning about this stuff and am in no way an expert. Most of it, however, is because I’m not a lawyer nor do I play one on TV. Lawyers have semesters on Wills, Estates, and Trusts in law school, and then learn the nitty-gritty of much of this stuff while they practice law.
Recently, I interviewed a lawyer for an upcoming podcast, and while he handled simple estates for clients, he called himself a “dirt lawyer” or someone who handled real estate. He made it very clear to me that he preferred not to talk about estates in depth because estate law is so very tricky that he was afraid of making a mistake. Yet he knows a thousand times more about estates than I do, which is why at some point in this series, I will simply tell you all to find a lawyer and get all this work done.
Until then, we’ll discuss what I feel comfortable with. And one of those things is beneficiaries.
I am not going to discuss the five types of beneficiaries listed in Nolo Press’s Plan Your Estate book. (For the curious, those five are primary beneficiary, alternate beneficiary, life estate beneficiary, final beneficiary, and residuary beneficiary. See why I’m staying quiet about most of this????)
I’m also not going to talk with you about your real property or your children, except to say this: If you appoint someone as guardian of your children in the case of your death and do not ask that person ahead of time, then you are asking for trouble for everyone involved, particularly the children. (My sister made me guardian for her son when he was little, and she checked with me many, many times before she did so. When I divorced, she informed me that my life was too unsettled for him and she changed guardians. She informed me of that too, and I concurred. That was the year I moved six times. Imagine subjecting a grieving little boy to that.)
What I am going to talk with you about is this: your writing. Unlike your house, which can be sold if the person who inherits it doesn’t want it, your writing is a burden that your beneficiaries must make decisions about even if they don’t want to.
For example, you’ve devised a simple will, naming your closest relative—your cousin Doofy—as your beneficiary. You didn’t tell Doofy. Then you die. He’s happy to get the money. He sells your house for a tidy profit. He has no idea what to do about that writing stuff, so he ignores it.
Then Super Really Big Director, you know, the kid from the previous made-up anecdote, decides he wants your book My First Novel into his next film. In tracking down the rights, his very good (and expensive) legal team figures out that you’re dead and your entire estate went to Doofy. They contact Doofy, offer him what seems like tons o’money to Doofy (maybe $50,000) for the rights to My First Novel. Doofy doesn’t care. He signs it all away, along with book rights, etc.
And My First Novel lives on in perpetuity. The rest of your novels—all 35 of them—are too much for Doofy to handle even if he knew how, and they die a quick obscure death. Doofy only saw that $50,000, and doesn’t realize that had he hired a lawyer to negotiate his side of the contract, he would have made so much more. My First Novel goes out of print, but the movie made from it A Novel Film becomes a classic and no one knows that it came from an obscure little book, except cinephiles who read every word of the scrolling credits at the end of a film.
A Novel Film ended up having nothing to do with My First Novel besides the spark. Unlike the Dick estate, your estate did not maximize your 15 minutes of fame, and your work is now lost forever.
If that doesn’t matter to you, fine. But if it does, then you need to get in touch with Doofy before you make him beneficiary of your worldly goods, and inform him that in addition to all your money and your house, he will also get copyrights that he will need to cherish and guard.
Yes, I know, before the rest of you pile on, you can—and should—have an executor who will manage your literary estate. Yes, I know, there are things like trusts and businesses and tax dodges and all of that stuff you can do before you die to maintain the estate after you die. That’s what these blog posts are about, and next month (unless I figure that something else needs to go first) will be about executors.
But this month, we’re assuming that you did a cover-your-ass will that’s pretty damn vague and Doofy is the only guy who inherits. I would suggest that you let him know what he’s in for, and let him say no right now.
Don’t talk about what he can earn. Talk about how much he’ll have to learn if you die before you put your wishes in something other than that CYA will.
Most people don’t realize that you can say no to an inheritance, but doing that—which is called disclaiming the inheritance—can be as much work as accepting the inheritance. Most folks who disclaim do so for financial reasons—they don’t need the extra money or it’ll cause an undue tax burden. They also do it if they inherit something like a business that has more debt than income.
Rather than have Cousin Doofy disclaim your inheritance after you’re dead (if Old Doof is smart enough to do that [and wealthy enough to hire the lawyer who’ll shepherd him through the process]), give him the chance to back out now. Once he understands the lifetime of work he’s going to inherit, he might simply say fuggetabooutit.
Once you get past that CYA will, there are a million ways to handle beneficiaries and the ways that they benefit from your estate. This is study you’ll have to do before going to that lawyer we’ll talk about in future posts. Figuring out if you need a trust or a will, if you need to put all your writing in a separate corporation and creating a new business, or if you just want to let it all fade away is entirely up to you.
Your beneficiaries can receive income from your copyrights, but have no say in how those copyrights are managed. Your beneficiaries can manage the copyrights or the bulk of beneficiaries can get a one-time payout from your estate, with someone getting the rest (and the responsibilities).
Make sure you consider who you’re leaving things to as carefully as you would consider someone who might be a guardian for your children. Because your copyrights are your legacy, and you want them in the hands of someone who actually will care about them, not Cousin Doofy, even if he is a really nice guy.
One option a lot of writers and entertainers use is this: They give a one-time (large) cash inheritance to family members, bestow real property (from houses to jewelry and collectibles) on those family members, and give the copyrights and their management to a charity or a variety of charities. People who have no family have similar options.
The estate books have entire chapters on charitable giving. If you’re doing a simple line item in your will–$25,000 to Charity A—you need to do a few things, like make sure you have $25,000 when you die. Some wills do the single payout with a formula: the charity will get 1/3 of the cash in the estate at time of death. That way, if you die with $30,000 in the bank, there’s money left to pay for your funeral and pay the charity. $5,000 isn’t enough to bury people these days—and so many don’t have funeral insurance. (Even cremation costs money.)
A lot of estate attorneys create charitable trusts for their wealthier clients, and I’m not going to get into that landmine except to say that this might be a place to put your copyrights as the basis of the income, with a payout from the earnings of those copyrights. Here’s the nice thing about doing it that way: the charity or charities that get your bequest will make sure there is income from those copyrights by monitoring the trust’s manager and its books. If the charities believe that the copyrights should be earning money after the author’s death (see the Dick estate above), then the charities will do everything in their power to make sure the copyrights are properly exploited. (“Exploited” being a good word here, not a bad one.)
For example, Dorothy Parker left her estate to Dr. Martin Luther King. When he died, her estate went to the NAACP. They didn’t like the way that writer Lillian Hellman, the executor, was handling the estate and she didn’t like that they inherited. Lawsuits ensued. Hellman lost and got deposed as executor. The upshot? Dorothy Parker’s work is still in print.
Some charitable trusts are created by the individual—you want to create a trust that will start an animal shelter in your small town, for example—and I have no idea how much work that is. I imagine it’s a lot.
Most charitable trusts give money to an existing charity or charities. You’ll want to investigate those charities before you invest in them. There are a million ways to investigate. The Better Business Bureau has a book called The Wise Giving Guide that you might want to check out.
There are also websites that will help you investigate charities. Two are the Better Business Bureau’s www.give.org and www.guidestar.org (which examines non-profits). The website estateplanninganswers.org has a checklist to follow when you consider charitable giving. I know there are many more resources, some listed on those sites.
Or you can go the direct route, like Joan Kroc did just before she died. Kroc was, for those of you who don’t know, the widow of Ray Kroc who built MacDonald’s into a multinational business. She had billions to give away, one familial heir, and a commitment to philanthropy. She spent her last year investigating the organizations that would receive her donations. The Los Angeles Times featured a long piece on her giving method, and it’s fascinating reading.
Is this all work? Yes, of course it’s work. Every time I write one of these estate posts, I give you more work or at least, things to think about. I’m thinking about them too.
Mostly, I think about them because I love reading gossip magazines and writer histories, most of which are strewn with tales of inheritance gone wrong.
One of the other reasons I initially started investigating the Dick estate for this piece was that I know a friend of mine testified at some trial (or gave a deposition) in a dispute over who should be a beneficiary for Dick’s estate. I couldn’t find that information quickly, and I didn’t think it important enough to e-mail the friend for links.
But that’s the other thing about leaving bequests. If there is someone whom you know will expect to inherit from you, and you have cut them out of your will deliberately, say so. List that person in the will and say they will not inherit anything. There’s specific language that you should use—particularly if that person is a blood relative—to make sure the person does not inherit. A lawyer will help with that.
You can decide all of this is way too much work and simply ignore estate planning altogether. Or, in some cases, you can do an end-run around it all.
Although I haven’t read any articles specifically stating this, I’m pretty sure George Lucas did an end-run around his copyright/trademark/estate issues. When he sold Lucas Film to Disney, he got to choose who would manage his intellectual property after his death. He also got a boatload of money for his estate. His beneficiaries will get the money without the copyright/trademark/management issues of such a beloved property.
If you have valuable copyrights, you can do something similar, either by creating a business that will handle those copyrights or selling them to someone or something that can.
In this instance, think of your writing as the family business—you know, that corner store that your father and grandfather ran, and your children want nothing to do with. Sell the store, and put the cash into your estate.
There are a million ways to handle the future of your writing work. You just have to be creative enough to figure it all out. And, as I’ve been saying, have ideas and a general plan as to where you want to go before you hire the attorney.
That includes who will inherit and what they will inherit. Yeah, I know. Another list. And research, if you decide to add charities. But it’s called estate planning for a reason.
In a few weeks, I’ll deal with executors and attorneys and other important documents. Until then, think beneficiaries and inventories and get that CYA will if you haven’t yet.
I write a business blog every Thursday for writers. Usually I focus on the publishing industry, but sometimes I do writer-specific pieces like this one. The blog, which is outside of my normal fiction writing, needs to be self-sustaining. So, if you got any benefit from this post, please leave a tip on the way out.
“The Business Rusch: “The Gift That Keeps On Giving” copyright © 2013 by Kristine Kathryn Rusch.
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