Directly prior to the Beatles' first American visit, Brian Epstein wanted someone to manage the escalating volume of merchandising requests that NEMS found itself unable to cope with, and asked his lawyer, David Jacobs, to oversee this task.

Completely unaware of the potential market that existed, particularly in the United States, Epstein agreed to the deal, and subsequently lost the Beatles an estimated $100,000,000 in possible income.

Epstein was able to renegotiate a more favourable commission of 49% in August 1964, but then became embroiled in a three-year court battle with Byrne regarding payment of monies due, during which time potential sponsors lost interest.

[2] When Beatlemania stormed the UK in 1963, Epstein was besieged by novelty goods companies wanting to use the Beatles' name and images on plastic guitars, drums, disc racks, badges, belts and a huge variety of assorted merchandise.

[3] When NEMS was swamped with offers of endorsements from the United States following the success of "I Want to Hold Your Hand", Epstein, who was usually meticulous in matters involving the Beatles, decided to delegate this responsibility as he felt it was distracting him from his main task of managing his expanding roster of artists.

[7] Jacobs knew of a Chelsea socialite, a 37-year-old divorcé called Nicky Byrne, and when encountering him at a friend's cocktail party offered him the project,[8] saying that "Brian [Epstein] has made a terrible mess out of this [merchandising]."

[9] He had also previously been involved in music publishing, clothes design, theatre production, managing the Condor club in London, and was also known as being a part of a group of people who called themselves "The King's Road Rats".

[13][14] This lapse of shrewdness set the scene for what would later become a legal battleground which deprived the Beatles and Brian Epstein of such large sums of money they would have easily overshadowed any royalties they would receive in the medium term from the sale of records.

"[12] Epstein would later realise that he had made a colossal error of judgment, as Byrne charged 10% commission to the merchandisers for a licence (receiving $10 out of every hundred) and then giving 10% of that to NEMS, which was $1.

[16] During the first Beatles' flight to the United States, Epstein was offered numerous samples of products by merchandisers who required a licence to be allowed to sell them such as clocks, pens, plastic wigs, bracelets, and games.

(The Green Duck metal stamping company was based at 1520 West Montana, Chicago, operating from 1906 until the late 1960s, making election badges for politicians, as well as memorial spoons).

[28] Due to the legal battle, Woolworth's, Penney’s, and other companies refused to finalise any merchandising agreements, cancelling orders worth $78 million.

[20] Epstein, in 1967, launched Maximus Enterprises Ltd.,[29] to try to capitalise on the merchandising boom,[30] but as so many companies had withdrawn their interest in the wake of the Seltaeb fiasco,[20] and Lennon had angered America's bible belt with his remark that the Beatles were "more popular than Jesus", the opportunity had passed.

[34] Many investors had also missed out on massive profits following the cancelling of contracts, and Byrne would later claim of having received two mysterious phone calls foretelling of Epstein's death.

[36] Days before his death Jacobs had asked for police protection, telling a private detective, "I'm in terrible trouble, they're all after me," and going on to list six well-known showbusiness people.