I don't think this news is a Hoax as it is coming from Yahoo

Jackson virus and spam spreads on Internet;
San Francisco, July 3 (DPA) Security researchers warned Thursday of the increasing levels of viruses and spam using Jackson's name to snare unsuspecting users.
One e-mail carries the subject line 'Remembering Michael Jackson' was circulating with a worm in tow. The e-mail has a zip file attached that infects victims if downloaded.

'The e-mail, which claims to come from sarah@michaeljackson.com, says that the attached ZIP file contains secret songs and photos of Michael Jackson,' Graham Cluley, senior technology consultant at Sophos, wrote on a blog. 'However, the reality is that opening the attachment exposes you to infection - and if your computer is hit you
will be spreading the worm onto other Internet users.'
Cluley said that the malware also spreads via USB memory sticks. Another e-mail promises an exclusive look at a YouTube video of the 'last work of Michael Jackson,' but instead installs a malicious program that steals passwords. reports yahoo.