Even though the economy is beginning to recover, it seems as though no one was left unaffected by the recession. This is indicated by rapper Young Buck’s recent decision to file for Chapter 7 bankruptcy in a federal court located in Tennessee. Included in the rapper’s liquidation are rights to his intellectual property, which were not considered to be a bankruptcy exemption.
It’s often the case that Chapter 7 filings include a significant asset liquidation process. The trustee assigned to the rapper’s case decided that rights to his compositions and music royalties would be sold to pay back creditors. Young Buck, legally known as David Darnell Brown, could not formulate a workable business plan, so the court assigned the trustee to do that for him. This move limited his ability to determine which assets would be exempt from the bankruptcy process.
In most bankruptcy liquidation cases, physical assets are liquidated, rather than something intangible, such as intellectual property. Dealing with the legalities of liquidating intellectual property adds another layer of complexity to already dense bankruptcy regulations. Now that Young Buck is no longer the owner of his music, someone will be able to buy his work and reap the benefits.
Knowing that bankruptcy can be a complex and arduous process, it may be beneficial to seek advice regarding which assets can and should be exempted from the bankruptcy liquidation process. Just because you decide to file for bankruptcy does not mean you will necessarily lose your car, home or other valued possessions.
Like everyone else who files for bankruptcy, Young Buck is looking to emerge in a more stable financial situation. At this point, the artist is looking to return to the music industry. His plans include a possible comeback on his old record label, which is owned by fellow rapper 50 Cent. Hopefully the Tennessee man will be able to find success with his career after the bankruptcy proceedings are complete.
Source: The Wall Street Journal, “Young Buck Songs, Royalties on the Block,” Jacqueline Palank, April 6, 2012