Monday, June 21, 2021

Coordinating Business and Estate Planning Documents: The Not-so-happy Lesson from TV Painter Bob Ross

Celebrity estates often serve as object lessons of how, and how not to, design estate and business plans.  The estate of Bing Crosby is widely hailed as instructive in the use of trusts to avoid probate and protect privacy.  Unfortunately, the estate of TV painter Bob Ross, serves as a cautionary tale regarding the failure to coordinate estate and business planning documents.  

Bob Ross rose to fame in the 1980s as the host and instructor of the wildly popular Joy of Painting TV show. Viewers were drawn to his artistic techniques, mesmerizing voice, and congenial manner. The result of his death was less than congenial as  nasty legal war erupted between his business partners and family. 

Bob Ross Inc. was formed by Ross, his wife Jane, and their friends Walter and Annette Kowalski. Although the four were equal partners, Ross was its widely recognized public face. From 1986 through 1994 the company registered several trademarks using Bob Ross’ name and likeness, with Bob’s written consent, and also signed several licensing agreements with third parties, also with Ross’ consent.

In 1992, Bob’s wife Jane passed away. The business structure required that any shares of a deceased partner were to be distributed equally among the surviving partners. And that is how Ross, despite being the public face of the Bob Ross juggernaut, found himself with only a one-third interest in the company.

Shortly after Jane passed, Ross developed lymphoma. The prognosis was sadly grim. In 1994, while battling the disease that would take his life one year later, the Kowalskis approached Ross. They presented him with a contract giving the Kowalskis all commercial rights to Ross’ name, image, voice, biographical material, and creative works. In return, the Kowalskis would pay Ross or his surviving heirs ten percent (10%) of Bob Ross Inc, profits,  but only for the next ten years.  After ten years the Kowalskis, and not the Ross family, would own and receive all income from Bob Ross, Inc. 

Ross was reportedly infuriated and refused to sign the agreement. Instead, he modified his estate plan in an attempt to keep intellectual rights to everything Bob Ross in his own family. He created the Bob Ross Trust in 1994, assigning 51% of the interest in all intellectual property to his brother, Jimmie Cox, and 49% to his son, Steve Ross.

Ross died July 4, 1995 at age 52, leaving an estate valued at $1.3 million, half of which was his interest in Bob Ross Inc. The Kowalskis, unsuccessful at gaining control of the business while Ross was alive,  sued the estate. In addition to asking for all intellectual rights, the Kowalskis wanted all of Ross’ finished paintings and tools.

Unable to finance a prolonged legal battle, Cox, the estate executor, settled with the Kowalskis. The Estate and the Trust also signed separate Mutual Releases with Bob Ross Inc. stating that the parties and their heirs, assigns, successors in interest, etc., “do, now and forever, absolutely and irrevocably, hereby release each other in and from any and all claims, suits, liabilities, complaints, losses, damages, and charges of every kind and character arising prior to the date of execution hereof.”

Two decades after the lawsuit settled, Steve Ross, the son, realized there was a clause in his father’s trust that bequeathed to him all rights to his father’s name, likeness, and publicity. By then, Bob Ross had become an even bigger and more lucrative business, with the sale of Bob Ross bobbleheads, chia pets, mugs, and even action figures. The streaming services Twitch and Netflix had since picked up The Joy of Painting shows. Calm, the meditation app, even offered a Bob Ross sleep app.  The Kowalskis had deftly managed and grown the Bob Ross business enterprise.

Armed with this newfound knowledge about his father’s trust, Steve sued Bob Ross Inc. He alleged that all the Bob Ross Inc. business deals and products that used his father’s likeness were unauthorized. He demanded compensation. Unfortunately for Steve, the federal judge didn’t agree. The court ruled that Ross’ trust could not have given away the rights to Steve, because the trust did not own those rights to begin with. The ruling stated: “Plaintiff would not own the intellectual property at issue because the Trust never owned it. Similarly, because Bob Ross gave BRI his right to publicity during his lifetime, it could not have transferred to his son on his death.”

Bob Ross’ trust said Steve was to inherit the intellectual rights, but the trust was never funded with the rights, and could not, therefore, direct them.  The business agreement prevailed. Steve received nothing from the business empire built on his father’s likeness, reputation, or artistic techniques.


Source: "TV Painter Bob Ross’ Son Loses Lawsuit In Battle Between Father’s Trust And Business Agreement," (June 13, 2021) (last accessed 6/17/2021). 

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