AEG Trial Session 31: The company tried to control Michael Jackson’s personal doctor

Today, David Berman, a music industry executive, sat in the witness stand all day and was questioned by William Blass, the lawyer for the Jacksons, and Sabrina Strong, the company’s lawyer.

David Berman has been one of the lawyers and executive figures in the music industry for ۴۵ years. He studied business at two universities—Michigan and Harvard. Over the years, he has represented artists and drafted their contracts. He has worked with people such as Madonna, the band Queen, Paul McCartney, Guns N’ Roses, the Eagles, Peter Gabriel, and Prince. He has worked for companies such as Warner Bros. and Capital Records. After retiring in ۲۰۰۱, he has appeared as a witness and expert in many court cases. Berman said that last December, the Jackson family’s lawyers approached him to testify in court. He said he was faced with a huge collection of documents, interrogations, statements, and emails that he had to review in order to give testimony. Today, he appeared in court as an expert to provide his professional opinion regarding the case. He was paid $۵۰۰ for each hour of work on this case. In total, he worked sixty hours on the opinions he presents in this court.

Berman said that the main customers of concert companies are not ticket buyers, but the artists. That’s why companies must feel a greater commitment to their artists than to their ticket buyers. Regarding the present case, he said that AEG had failed in this respect when it came to Michael Jackson.

“Without the artist, companies have nothing to sell.”

Berman said he believes that AEG’s hiring of Dr. Murray for the This Is It tour created a conflict of interest.

Berman said the company’s attempt to hire Dr. Murray on Michael’s behalf was “very inappropriate” and “very unusual.” He added that he had never seen or heard of a company packaging hiring a personal doctor for its artist, and that this would create a conflict of interest.

“In this situation, the doctor is responsible to both his patient and the company.”

The Jacksons’ lawyer showed emails that had been passed around among company executives and Michael’s tour colleagues under the title “Problems at the Front Line” just a few days before Michael’s death. In one of the emails, tour director Kenny Ortega wrote to Randy Phillips, the company’s CEO, that Michael was not ready for the tour and had become physically weaker.

Berman said: “This email is very clear to me.”

In response to Ortega’s concerns, Phillips wrote that he should not see himself as a doctor or psychologist. Berman said from the stand that Phillips hadn’t given Ortega’s words the necessary importance, and besides that, he was also aware of the potential unethical and prejudicial behavior of Dr. Murray.

Berman: “My understanding is that AEG did nothing to investigate Dr. Murray. This shows that they were aware of potential conflicts.”

When Blass asked how conflicts of interest could be prevented, Berman said: “By hiring a doctor without AEG’s involvement.”

Randy Phillips had said in a previous court session that Conrad Murray’s request for a five million dollar salary meant success for his career.

Today, Berman said that this request was a warning bell even after it was opposed.

Berman: “Even the $۱۵۰,۰۰۰ per month salary that was agreed upon is an excessive amount. It was higher than any other salary paid to tour personnel.”

Berman said AEG knew that another doctor named Finkelstein, who had previously worked with Michael, was willing to do the same job as Murray for $۴۰,۰۰۰ per month. He said MJ should have been informed about the Finkelstein offer, but he wasn’t.

Berman: “If there was a replacement at a lower price for Dr. Murray, this information should have been given to MJ.”

The company’s defense lawyer repeatedly objected to Berman’s statements, which led to long discussions between the lawyers and the judge several times. But in the end, Berman was given the opportunity to announce that although AEG had not signed Murray’s contract, by negotiating it, it had created unethical conduct and a conflict of interest.

Berman said he learned that Paul Gongwer, the company manager who had previously testified in court, had been negotiating with Murray about his contract with the company. In other words, the company was involved in the process of contracting with Murray to become Michael’s doctor.

Referring to an email that Gongwer had written on May ۶, ۲۰۰۹—“Done, with a salary of $۱۵۰,۰۰۰ per month as stated by MJ”—Berman said that while it doesn’t prove Murray was hired by the company, it shows that the company had reached an agreement with him.

The judge explained to the jury that “you are the ones who decide whether Dr. Murray was hired by the company or not.”

Berman added that the email about the agreement with Murray was not sent to MJ personally, and it seemed that one of the parties had been deprived of information.

Blass showed Berman the tour budget dated May ۱۶, ۲۰۰۹, in which a salary of $۳۰۰,۰۰۰ was specified for Murray. Berman said that this $۳۰۰,۰۰۰ corresponds to two months of May and June with what was said in the agreement—$۱۵۰,۰۰۰ per month.

Berman stated that based on the May ۶ email from Gongwer, Dr. Murray felt he was a contracted party and was actually performing his duties during those days.

Berman pointed out that Dr. Murray had written: “According to our agreement, I will perform my services for the client and provide them.”

Berman said he had never seen a company hire a doctor for its artist, and to his knowledge, AEG had not done this before Michael.

The witness said that having a personal doctor on tour for artists is not unusual. He said he believes AEG inserted itself into the agreement between MJ and Murray so it could take control of Michael’s doctor within its own administration.

The company says that since it had not signed Murray’s contract, it cannot be held responsible for Murray’s performance. But Berman says even verbal consent is enough.

Blass: “In the industry you work in, can agreements be verbal?”
Berman: “Of course, that’s normal.”
Blass: “When does an agreement begin?”
Berman: “Generally, when they announce it verbally.”

Berman refers to Michael’s contract with AEG to confirm his point. The contract for ۳۱ concerts was mentioned, but the company says they had verbally agreed to perform fifty concerts. Therefore, without this being written in the contract, the tour budget increased from $۷.۵ million to $۳۰ million by increasing the number of concerts.

Berman added that there is no written evidence showing that MJ approved this budget increase.

Tour production funding was provided by the company, but Michael was required to reimburse it to the company.

When Strong asked the witness, he said that if he worked ۸۰ hours a week at $۵۰۰ per hour for the plaintiff’s lawyers (Katherine Jackson), he would earn $۴۰,۰۰۰. Berman responded: “With all due respect, I’m ۶۹ years old. I don’t work ۸۰ hours a week for anyone.” (Jury laughter)

Strong then asked Berman whether his testimony should be ignored because the plaintiff’s lawyers paid him.

Berman: “My salary as an industry expert who testifies in court is equal to other expert witnesses.” He added that he knows experts who even request higher pay.

Strong asked whether the witness also specializes in doctors’ salary rates. Berman said no, but he knew another doctor was willing to do Murray’s job for $۴۰,۰۰۰ per month. Murray’s salary was $۱۵۰,۰۰۰. He said that having Murray earn more than the other doctor (Finkelstein) wasn’t a problem by itself. The issue was that this high salary indicated there was a problem.

The defense lawyer also tried to dismiss this part of Berman’s testimony where he said Murray’s salary was the highest on the This Is It tour. He said the salary for Ortega, the tour director, for five months of work was one million dollars. Berman said he didn’t know the details of Ortega’s contract.

Strong asked about an insurance company’s request for access to Michael’s medical records. Berman said this would have benefited AEG and Michael.

Berman also said he believes Michael’s representatives were not allowed into the circle of decision-makers.

Berman: “I know that Mr. Delio (program director) became aware of Dr. Murray. But I don’t know whether he was involved in the negotiations regarding the contract.” He also emphasized that not sending Murray’s contract to Michael’s representatives was very unusual.

Strong then displayed a signed statement from Frank Delio dated July ۲۰۰۹, saying he had been informed about negotiations with Murray. The statement said Randy Phillips opposed hiring Murray, but MJ wanted Murray’s doctor.

Berman said this statement doesn’t provide anything about whether the contract reached the people on Michael’s side or whether MJ was aware of it.

In another email, Randy Phillips wrote that he had checked everything about Dr. Murray and knew he was a successful doctor and didn’t need money. But in reality, he hadn’t done any investigation.

Strong asked Berman whether, when he served as president of Capital Records, he checked the financial background of the executives he hired. Berman said his job level had nothing to do with such checks, and it was up to the human resources department to conduct investigations.

Strong concluded her questions and Blass began again.

Using Berman’s testimony that the number of tour concerts was not recorded in writing, Blass asked whether there was any document proving that Michael Jackson agreed to perform fifty concerts. Berman answered no.

Blass: “Did anyone think this was a problem?”
Berman: “Apparently not.”

Blass then asked why Berman was fired from Capital Records. Berman said he had been hired by a manager he respected a lot, but then the manager changed and someone else replaced him—someone he didn’t respect much. Berman asked the company to either support him or fire him. He didn’t want to work with the new manager, so he wasn’t willing to resign because then he wouldn’t earn money. But if he were fired, he would be compensated.

Blass asked about Frank Delio’s statement signed after Michael’s death. Berman said he thought the statement was meant to win over Michael’s representatives’ agreement to confirm the tour budget. The tour budget was paid by the company, but Michael had to return it to the company—something his foundation did after his death.

In a signed letter dated the fifth month of ۲۰۰۹ (May ۲), Michael assigned Frank Delio as one of his new representatives and tour manager. Michael also wrote that “whenever he gives instructions,” Delio could act on his behalf in business matters.

Berman found this letter strange and said it contradicted Delio’s claim that he had been Michael’s representative since the third month of ۲۰۰۹.

At the end of the session, the company’s lawyer asked Berman whether he knew if MJ had told Randy Phillips to negotiate with Frank Delio instead, or whether he knew what date Delio was hired. Both answers were no.

Source: eMJey.com / AP & ABC News