Christopher Little signed up Rowling in 1996 after spotting the potential in the first three chapters of Harry Potter and the Philosopher’s Stone. The book series went on to become a worldwide phenomenon.
Once dubbed “the luckiest agent ever”, Little represented Rowling until just before the premiere of the final film in the series in 2011 when she appointed his business partner, Neil Blair, as her new agent.
The acrimonious split was ultimately settled and Little, who died this year, never spoke publicly about it.
Almost a decade after the break-up, details of the £10 million payout to Little have emerged as Mr Blair sues his former accountant over a tax bill which stems from the deal that was struck in January 2012.
In High Court papers filed by lawyers for Mr Blair, his wife Debra and their literary agency, The Blair Partnership, Rowling is referred to only as the “principal client”.
“The books and intellectual property of the principal client became extremely successful. For many years prior to 2011, Mr Blair was the partner responsible for the affairs of the principal client,” writes Philip Jones QC, leading the legal team for the Blairs.
“In mid-2011, relations between the principal client and (Little) broke down and the principal client no longer wished to be represented by the (Little’s) literary agency.”
When Rowling sent her first manuscript to Little in the mid-1990s during her search for a book deal, he reportedly dismissed the work but was prompted to look again when it was rescued from the rejection pile.
The High Court papers reveal Mr Blair and his new agency needed to agree a settlement with Little in 2011 to avoid complex negotiations over money.
Mr Blair says he was advised by his accountant, Richard Rosenberg and his firm SRLV Accountants, to pay the agreed £10 million “lump sum” to Little using a loan from Rowling to his new company.
He claims he was promised it would deliver tax relief, but by 2018 HM Revenue and Customs was chasing a tax bill of more than £2 million.
Mr Rosenberg is accused of issuing a demand to Mr Blair for £1.5 million in 2019, before trying for a High Court order to wind-up The Blair Partnership over the alleged “debt”. Mr Blair is suing Mr Rosenberg for damages over the dispute. Stewarts Law, representing Mr Blair, said the case is a “negligence claim against SRLV in connection to advice relating to the restructuring of his business”.
Lawyers for Mr Rosenberg have been contacted by the Evening Standard.