Tuesday, January 27, 2009
– The Country Music Hall of Fame and Museum is launching a $l.1 million fundraising campaign to defray costs associated with the institution's acquisition of four instruments associated with Maybelle Carter, Johnny Cash and Bill Monroe.
The effort follows approval of a $750,000 settlement with the Robert W. McLean estate in the United States Bankruptcy Court for the Middle District of Tennessee last week. McLean was involved in a Ponzi scheme and later committed suicide. He had agreed to give the hall of fame the instruments, but they were tied up in lawsuits resulting from the fraud.
The Precious Jewel Fund launches with leadership gifts including a $150,000 donation from Scott Siman of Nashville-based RPM Management and a $300,000 gift from the Academy of Country Music headquartered in Los Angeles.
With Museum Board President Steve Turner as co-chair, Siman will lead the campaign in the music and business communities. Monroe's musical legatee, Grand Ole Opry star Ricky Skaggs, will lead the national appeal to music fans.
Under the terms of the compromise agreement, the museum is required to pay the $750,000 settlement by Feb. 22. As part of the agreement, the museum agreed to provide additional value to the creditors by subordinating its own $870,850 proof of claim against the McLean estate, which means the institution has no chance of recovering even a small percentage of the unpaid pledges that facilitated the acquisition of the Carter and Monroe instruments.
"Like their lifelong partners, these beloved instruments can now rest in peace," Skaggs said. "This outcome means that we, the public, remain the owners of these treasures, and it reminds us that we are fortunate to have them protected and accessible under the stewardship of one of the finest museums in the country. As owners, we have an obligation to help with these costs, and I believe fans will be honored to have the opportunity."
"Settling with the McLean estate has allowed us to more swiftly serve his creditors," said Museum Director Kyle Young. "This compromise allows us to finally set a fundraising goal that can be easily understood and accepted by the largest possible audience. We know these are not the best of times. We understand that many of our brothers can't spare a dime, but we trust in the nobility of those who are more fortunate."
"We are deeply grateful for the leadership of Scott Siman, who was the first to call and offer not only a financial commitment, but also volunteered to lead the fundraising campaign," Young said. "He has been quietly accessing potential donors on our behalf throughout this struggle. To say that he has given us strength and courage is a gross understatement."
"Our friends at the Academy of Country Music also rushed to our aid early on and long before the picture really fully developed," Young said. "Even as the economy went into a tailspin, their commitment and moral support remained firm.
The approved settlement concludes more than a year of lengthy negotiations with Robert Waldschmidt, the Trustee for the Robert W. McLean Bankruptcy Estate. McLean was accused of operating a Ponzi scheme, defrauding investors of more than $67 million over a period of years.
The museum had entered into confidential purchase agreements for the acquisition of Mother Maybelle Carter's Gibson L-5 guitar and Bill Monroe's Gibson F-5 Loar mandolin, two of the most significant instruments in popular music history. McLean also donated two familiar and historically compelling Johnny Cash instruments, including his Martin D-35 acoustic guitar and his Martin prototype guitar, to the Museum's permanent collection. Since McLean's involuntary bankruptcy and his death in 2007, the Museum has continued to honor all the terms of the purchase agreements that he had pledged to fund.
Waldschmidt had sought to recover approximately $l.54 million from the museum. The figure represents McLean's total cash payments to the museum plus the value of the two Cash guitars. As an alternative, Waldschmidt had asked the court to order the surrender of the instruments so they could be sold to satisfy the claims of McLean's creditors.
"We did not have the money and, because we hold the instruments, like all of our collection, not for ourselves but in trust for the benefit of the public, we could not merely turn them over to the Trustee," Young said. The museum's unique collection, considered the largest and finest of its kind in the world, does not appear on the institution's balance sheet and cannot be used as collateral.
As a nod to Monroe, who was fond of passing out quarters to his fans, Skaggs will encourage fans to contribute to the Precious Jewel Fund in increments of 25. "This is an equal-opportunity challenge to the greatest fans in the world," he said. "Twenty-five cents is as significant as a gift of $25,000. The important thing is that we all stand up and be counted. After all," he laughed, "we'll want to have something to report when we run into Maybelle, Monroe and John R. at that famous gate down the road."