Judge dismisses suit by Bill Graham’s sons over inheritance

1971: Rock promoter Bill Graham during a press conference. 1971: Rock promoter Bill Graham during a press conference. Photo: William Young, The Chronicle Photo: William Young, The Chronicle Image 1 of / 7 Caption Close Judge dismisses suit by Bill Graham’s sons over inheritance 1 / 7 Back to Gallery

A federal judge has dismissed a lawsuit by the sons of the late rock impresario Bill Graham against their father’s executor, saying there was no evidence that the executor cheated them out of millions of dollars worth of concert posters or the trademark to the Fillmore auditorium.

Graham, a trend-setter among pop music promoters for a quarter century, died in a helicopter crash near Vallejo in October 1991 at age 60. His sons, David Graham, then 23, and Alexander Graham-Sult, 14, inherited almost $10 million apiece from a $36 million estate after a 3½-year battle among Graham’s survivors, overseen by his executor, Nicholas Clainos.

Separate company

In 2010, the sons sued Clainos over the rights to 174 posters with the images of performers, including Bob Dylan, Aretha Franklin and the Rolling Stones, and to the trademarked name of the Fillmore, site of many of Graham’s concerts.

They said Clainos, one of a group of employees who bought Bill Graham Enterprises for $4.5 million in 1994, never told the sons that the sale included the music memorabilia. The sons said they first learned about the disposal of the artifacts when they were rummaging through boxes of documents in 2009 at the former headquarters of Bill Graham Enterprises. As their father’s heirs, they had a right to object to the sale of any of his personal possessions and acquire the property for themselves.

But U.S. District Judge Claudia Wilken of Oakland ruled that the posters, though commissioned by Graham, were actually owned by Bill Graham Enterprises and sold as part of an above-board transaction. She said the sons each received $778,000 from the sale along with 10 percent shares of the new company.

Graham had established the company to benefit from its corporate structure, staged the concerts under the name Bill Graham Enterprises and paid the poster artists out of company funds, Wilken said in her Oct. 5 ruling. She also said the Fillmore trademark was part of the company sale, for which the sons were compensated.

Wilken had dismissed the suit once before, in 2011, ruling that it had been filed too late. She said Clainos had disclosed the sales of the music artifacts to a lawyer for Graham’s sons in 1997, setting in motion a four-year deadline for any legal challenges. The Ninth U.S. Circuit Court of Appeals in San Francisco reinstated the suit in 2013, saying the notice to the sons’ lawyer never mentioned that the sale included Graham’s copyrights and trademarks.

Appeal likely

A lawyer for Graham’s sons said they would probably appeal Wilken’s latest ruling.

“We will likely end up in the Ninth Circuit and hope that our clients have an opportunity to present their case to a jury,” said attorney Arturo González.

Clainos’ lawyer, Zia Modabber, said the ruling vindicates Graham’s executor.

“I hope that Alexander and David move on with their lives and get rid of their misguided fears that somebody wronged them,” Modabber said.

Bob Egelko is a San Francisco Chronicle staff writer. E-mail: begelko@sfchronicle.com Twitter: @egelko