Legal
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You might not be seeing many headlines these days about the massive litigation underway in Houston over the deadly 2021 disaster at Travis Scott‘s Astroworld festival. That’s by design.
In a ruling Tuesday, an appeals court in Texas refused to lift a strict gag order that for more than a year has barred attorneys and others from discussing the sprawling litigation over the crowd crush at Astroworld, which left 10 dead and hundreds physically injured.
ABC News had challenged the “sweeping” restrictions, arguing they clearly violated the First Amendment’s protections on free speech and had created a “news desert,” in which almost no reliable information about an important case was being shared with the public.
But in its decision on Tuesday, a three-judge panel from the Court of Appeals For The First District of Texas rejected those arguments. Ruling on a battle over judicial transparency, the appeals court did not issue any written explanation for why it had denied ABC’s challenge.
Starting hours after Nov. 5, 2021 incident, lawyers claiming to represent more than 4,900 victims eventually filed more than 400 lawsuits against Scott, Live Nation and other organizers. The cases, later consolidated into a single “multidistrict litigation,” accuse the Astroworld organizers of being legally negligent in how they planned and conducted the event, including not providing enough security and having insufficient emergency protocols in place. Combined, the victims are seeking billions in damages.
But for a case dealing with a mass-casualty event at a popular music festival with billions at stake, relatively little is known about the Astroworld litigation.
Shortly after Judge Kristen Brauchle Hawkins was appointed to oversee the cases, she issued a “publicity order” that largely prohibited attorneys from speaking about the case, citing concerns that “extensive media coverage” threatened to deprive the parties of their right to a fair trial by tainting the jury pool.
The Feb. 15 ruling was both specific and broad – banning attorneys from discussing a wide range of particular topics, including “the strength and weaknesses of any party” and “rulings of the court,“ but also imposing catch-all restrictions on “any other information” that would “prejudice the trial.”
In challenging that order to the appeals court, ABC News argued that it had deprived the public of information about important judicial proceedings over a newsworthy event. The network warned that attorneys were refusing to share even basic information about the case with journalists, out of “fear of violating its broad and vague provisions.”
“The Gag Order, coupled with the lack of transparency from local and state officials, has created a news desert where many questions raised in the days after the Astroworld Festival remain unanswered,” the company wrote. “By [lifting] the Gag Order, this court would provide those connected to both the Astroworld Festival and the litigation the ‘breathing space’ needed to freely share their experiences, the press the ability to hold them to account, and the public the valuable information they need to better understand the events of November 5, 2021.”
But on Tuesday, the appeals court rejected those arguments. In a one-paragraph decision, the panel recounted ABC News’ argument and said simply: “We deny the petition.”
ABC News can appeal the ruling to the Texas Supreme Court. An attorney for the company did not return a request for comment on Wednesday.
A Grammy Award-winning composer who is suing YouTube over access to its anti-piracy tools is now asking a federal appeals court to postpone her looming trial, filing an emergency motion that says the upcoming proceedings will be “enormously wasteful.”
With a trial set to kick off next week, Maria Schneider asked the U.S. Court of Appeals for the Ninth Circuit on Monday to “stay” the proceedings, arguing she needs time to litigate her appeal that seeks to overturn a ruling last month that refused to let the case proceed as a class action.
Schneider says that decision, which means the case will not include tens of thousands of other copyright owners, was not only “manifestly erroneous” but also came “only three weeks before trial” – a sudden change that “gravely undermines” the goals of her case.
“The named plaintiffs here joined the case to litigate class claims, and to vindicate their view that YouTube tramples on the rights of independent artists and smaller copyright holders overall, not just those of the individual plaintiffs,” her lawyers told the appeals court.
“A brief stay here to allow this court to … ensure that the district court’s last-minute, haphazard, and erroneous conclusion that this case cannot be tried on a classwide basis does not endanger the progress of this litigation,” Schneider’s attorneys wrote.
Schneider’s lawsuit claims that YouTube has become a “hotbed of piracy” because the platform provides “powerful copyright owners” like record labels with tools including Content ID to block and monetize unauthorized uses of their content, but fails to do the same for “ordinary owners.” She says songwriters and other smaller rights holders are forced instead to use “vastly inferior and time-consuming manual means” of policing infringement, allowing piracy of their material to flourish.
For its part, YouTube says it has done nothing wrong. In court documents, the company has argued that it’s spent “spent over $100 million developing industry-leading tools” to prevent piracy, but that it limits access because “in the hands of the wrong party, these tools can cause serious harm.”
The case was filed as a class action, aiming to let potentially tens of thousands of aggrieved copyright owners team up to fight what Schneider’s lawsuit called “institutionalized misbehavior.” An expert retained by her legal team said the class could include between 10,000 and 20,000 rightsholders.
But in a May 22 ruling, Judge James Donato refused to “certify” the case as a class action, dramatically reducing the scope of the lawsuit. Under federal law, class-action accusers must share very similar legal concerns – and the judge said Schneider’s fellow rightsholders would have widely different cases against YouTube.
“It has been said that copyright claims are poor candidates for class-action treatment, and for good reason,” the judge wrote at the time. “Every copyright claim turns upon facts which are particular to that single claim of infringement [and] every copyright claim is also subject to defenses that require their own individualized inquiries.”
Following that ruling Schneider quickly moved to postpone the trial, which is set to kick off on June 12, while she launched an appeal. But at a hearing days after the ruling, Judge Donato said he would stick to the schedule: “I’m not going to do that. You got a trial set on June 12th. This is a 2020 case; okay. It’s showtime.”
In Monday’s emergency petition to the appeals court, Schneider’s lawyers argued that such a decision was unfair, forcing them to proceed to an expensive trial when the ruling on class certification might later be overturned on appeal.
“The class should not be forced into a situation where an appellate victory would be illusory, placing them back at square one, and the fruits of three years of hard-fought litigation evaporate even when the district court’s failure to certify a class has been confirmed as erroneous,” her lawyers wrote.
A response to the emergency motion from Google is due by the end of Wednesday.
Read the entire petition here:
This is The Legal Beat, a weekly newsletter about music law from Billboard Pro, offering you a one-stop cheat sheet of big new cases, important rulings and all the fun stuff in between.
This week: Prosecutors move to seize R. Kelly’s funds held by Sony Music and Universal Music Publishing Group; Dua Lipa wins the first round in her copyright battle over “Levitating”; a federal judge rules that Tennessee’s anti-drag law is unconstitutional; and much more.
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THE BIG STORY: Feds Move to Seize R. Kelly’s Royalty Funds
In the wake of criminal convictions that will see him spend decades in prison, R. Kelly is also facing hundreds of thousands of dollars in fines and restitution payments. Last week, the feds told his record label and music publisher to help him pay up.
Prosecutors in Brooklyn asked a federal judge for so-called writs of garnishment against Sony Music and Universal Music Publishing Group (UMPG) — court orders that would compel the two companies to hand over funds tied to Kelly. The two companies are “in possession of property” belonging to Kelly, the filing said, that could be used to pay down the $504,289 he owes to victims and the government.
It’s unclear how much Sony Music and UMPG are holding in Kelly-tied money, but the feds aren’t the only ones trying to get at it.
R. Kelly victim Heather Williams, who won a $4 million civil judgment against the singer, is also seeking to tap into the Sony Music account — as is Midwest Commercial Funding, a property management company that won a separate $3.5 million ruling against Kelly over unpaid rent at a Chicago studio.
In March, the Illinois Supreme Court ruled that Williams had priority to the funds over Midwest Commercial Funding because she was the first to properly demand the money from Sony. But that ruling left unclear whether she’ll enjoy similar priority over federal prosecutors.
For the full story, go read the entire article, which includes access to the full legal documents filed in court.
Other top stories this week…
DUA LIPA WINS ROUND ONE – A federal judge cast serious doubts on a copyright lawsuit claiming Dua Lipa stole her smash hit song “Levitating” from a little-known reggae track by a band called Artikal Sound System, saying she’s seen no evidence that Lipa ever even heard the song she’s accused of copying.
ADIDAS DROPS YEEZY MONEY CASE – And just like that, it was over. After a whirlwind week of litigation, Adidas abruptly dropped a federal court case aimed at freezing $75 million held by Kanye West’s Yeezy brand. But the two companies will continue to battle it out in a private arbitration case, in which Adidas will likely argue that West’s “offensive conduct” caused the breakdown of their long-standing partnership.
KANYE SUED OVER PAPS CLASH – In other Kanye legal news, the embattled rapper was hit with a civil assault lawsuit over an alleged incident in which the rapper grabbed a paparazzo’s phone and threw it into traffic.
TENN. DRAG LAW RULED UNCONSTITUTIONAL – A federal judge ruled that Tennessee’s first-in-the-nation law restricting drag shows violates the First Amendment, barring prosecutors in Memphis from enforcing the new statute and sending the closely-watched legal battle to a federal appeals court.
DIDDY ACCUSES BOOZE GIANT OF RACISM – Sean “Diddy” Combs filed a scathing lawsuit against alcohol giant Diageo for allegedly breaching their partnership deal for a brand of tequila, leveling accusations of racism at the company and claiming it has treated his product line “worse than others because he is Black.”
HOV WINS $7M OVER COLOGNE DEAL – A New York state appeals court sided with Jay-Z in his long legal battle against a fragrance company called Parlux over a cologne endorsement deal that went bad, ordering the company to pay him nearly $7 million in unpaid royalties.
PRODUCER ACCUSED OF HARASSMENT – A new lawsuit filed in Los Angeles claims that Grammy-nominated dance music producer and DJ Paul Oakenfold repeatedly masturbated in front of his former personal assistant. He quickly denied the accusations, calling them “a calculated attempt to tarnish my reputation and extort money.”
SHEERAN CASE HEADS TO APPEAL – A month after Ed Sheeran won a high-profile jury verdict that his “Thinking Out Loud” did not infringe Marvin Gaye‘s “Let’s Get It On,” his copyright accusers formally launched their appeal at the U.S. Court of Appeal for the Second Circuit.
INDIE ROCKERS SETTLE CEREAL SPAT – The band OK Go reached a confidential settlement to end a bizarre legal battle with Post Foods over a new line of on-the-go cereal packages called “OK Go!,” which the band believed infringed the trademark rights to its name.
K-POP INSIDER TRADING? – Three employees at the record label HYBE could reportedly be prosecuted for insider trading in South Korea for allegedly using non-public information about K-pop group BTS’ planned hiatus before the news was given to investors.
A federal judge has serious doubts about a copyright lawsuit claiming Dua Lipa stole her smash hit song “Levitating” from a little-known reggae track, saying she’s seen no evidence that Lipa ever even heard the song she’s accused of copying.
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The band Artikal Sound System sued the star last year, claiming her 2020 song – which spent 77 weeks on the Billboard Hot 100 chart – borrowed its core hook from their 2017 tune “Live Your Life.”
But in a ruling on Monday, U.S. District Judge Sunshine S. Sykes said there was no sign that anyone involved in creating “Levitating” had had “access” to the earlier song – a key requirement in any copyright lawsuit.
Artikal Sound System offered a complex theory: that one of Lipa’s co-writer had previously worked with a woman who was allegedly taught guitar by the brother-in-law of one band member. But in her ruling, Judge Sykes was clearly unimpressed.
“These attenuated links, which bear little connection to either of the two musical compositions at issue here, also do not suggest a reasonable likelihood that defendants actually encountered plaintiffs’ song,” the judge wrote.
The band also claimed that the song was so widely-available that the “Levitating” writers must have heard it, citing the fact that it had been played at concerts, that they had sold “several hundred” physical CDs, and that it was available on some streaming platforms.
But Judge Sykes said those arguments were “too generic or too insubstantial” to sustain a lawsuit.
“Plaintiffs’ failure to specify how frequently they performed “Live Your Life” publicly during the specified period, where these performances took place, and the size of the venues and/or audiences precludes the Court from finding that Plaintiffs’ live performances of the song plausibly contributed to its saturation of markets in which Defendants would have encountered it,” the judge wrote.
In technical terms, Monday’s ruling dismissed the lawsuit against Lipa. But the case isn’t over: the judge ruled that Artikal Sound System could try to fix the mistakes she had identified and refiled a so-called amended complaint.
Attorneys for both sides did not return requests for comment on Tuesday.
“Levitating,” released on 2020 on Lipa’s second studio album Future Nostalgia, was a massive hit, eventually peaking at No. 2 on the Hot 100 and securing the honor of being the longest-running top 10 song ever by a female artist on the chart.
Artikal Sound System is a reggae band based out of South Florida, founded in 2012 as a duo before later adding additional musicians and vocalist Logan Rex. The band released “Live Your Life” on its 2017 EP Smoke and Mirrors.
In their March lawsuit, the band said the songs sounded so similar that it was “highly unlikely that ‘Levitating’ was created independently.” The lawsuit also named Warner Records, as well as others who helped create the hit track.
But in November, Lipa’s lawyers made counter-arguments that were largely adopted in Monday’s ruling, claiming that the band’s efforts to show that Lipa or the other writers ever heard “Live Your Life” were “tortured” and “nothing more than a speculative.”
“Plaintiffs are essentially seeking to plead access,” the star’s legal team wrote, “by alleging that someone who knows someone who knows someone might have met one of the ‘Levitating’ writers.”
Following Monday’s decision, Artikal Sound System has until June 16 to refile their case.
The band OK Go has reached a confidential settlement to end a bizarre legal battle with Post Foods over a new line of on-the-go cereal packages called “OK Go!”
Just months after OK Go — a power pop band best known for its viral music videos — vowed to fight back against a “big corporation” that “chose to steal the name of our band to market disposable plastic cups of sugar to children,” attorneys for both sides asked a Minnesota federal judge to dismiss the lawsuit permanently, with each side paying their own legal bills.
The filing said that the two sides had “settled this action on terms agreeable to all parties,” but did not include specific terms of the agreement in public court records, like whether the band would be paid or if Post would change the brand name. Neither side immediately returned requests for comment on Friday (June 2).
The settlement will resolve an unusual legal dispute that pitted a pop band against a multinational food company, asking the question: Will consumers who see a portable snack package of Fruity Pebbles on a supermarket shelf think that a band with a similar name had endorsed it?
The fight started in September when an attorney for the band sent a cease-and-desist letter warning Post that OK Go was “surprised and alarmed” to see Post’s new product line. He claimed the name infringed the trademark rights to the band’s name since it would “suggest to consumers that OK Go is endorsing Post’s products,” or falsely imply that the cereal company had received permission to use it.
“Our client regards this matter with the utmost seriousness and has authorized us to take all steps necessary in any venue to protect its rights,” OK Go’s attorney wrote in the September letter. “If we do not hear from you within 10 days of the date of this letter, we will assume that Post does not wish to resolve this matter amicably.”
A week later, an attorney representing Post responded, saying that the company must “respectfully disagree” with the band’s accusations. The attorney argued that rock music and breakfast cereal were “clearly unrelated” products and that the phrase “OK Go” was merely a common term that had previously been used by many other companies on their products.
In January, Post took the battle to court, asking a federal judge for what’s known as a “declaratory judgment” — meaning a pre-emptive ruling that the company did nothing wrong. Post argued that the trademark rights of a rock band like OK Go don’t extend to an unrelated product like cereal and that the new cups are clearly marked with Post’s own brand names to avoid any confusion.
“Without resolution by this court, Post will be unfairly forced to continue investing in its new OK GO! brand while under the constant threat of unfounded future litigation by defendants,” the cereal company wrote in its lawsuit.
In a statement to Billboard at the time, the members of OK Go said they’d been surprised to learn of Post’s lawsuit.
“A big corporation chose to steal the name of our band to market disposable plastic cups of sugar to children. That was an unwelcome surprise, to say the least,” the band wrote. “But then they sue US about it? Presumably, the idea is that they can just bully us out of our own name, since they have so much more money to spend on lawyers? I guess that’s often how it works, but hopefully, we’ll be the exception.”
According to Post’s lawsuit, the company had offered to pay the band as part of a “good faith effort” to resolve the dispute without resorting to litigation, despite its belief that the accusations lacked legal merit. The company claimed OK Go rejected that offer and made no counter-proposal, leaving Post with no choice but to file a lawsuit.
A month after Ed Sheeran won a high-profile jury verdict that his “Thinking Out Loud” did not infringe Marvin Gaye‘s “Let’s Get It On,” his copyright accusers have formally launched their appeal.
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The heirs of Ed Townsend — who co-wrote the iconic song with Gaye – filed a so-called notice of appeal Thursday in Manhattan federal court, the first step toward asking a federal appeals court (the U.S. Court of Appeals for the Second Circuit) to overturn the outcome and revive their lawsuit against Sheeran.
The upcoming appellate battle will mark the next chapter in nearly seven years of litigation over “Thinking Out Loud” — a commercial and critical success that hit No. 2 on the Hot 100 before eventually winning the Grammy Award for song of the year.
In their suit, Kathryn Townsend Griffin and other Townsend heirs claimed that Sheeran had “knowingly and intentionally infringed” the earlier tune, stealing the “heart” from one of the most “instantly recognizable songs in R&B history.”
The two songs at issue in the case do sound similar, as even Sheeran has seemingly acknowledged: The star was captured on video at a 2014 concert toggling back and forth between them, drawing huge applause from the audience. But his lawyers say that’s simply because the two tracks share commonplace musical building blocks – elements that are free for all to use and cannot be “monopolized” under copyright law.
After years of delay, the case finally went to trial in April. Lawyers for the Townsends urged the jurors to “give credit where credit is due,” playing that concert video of Sheeran and calling it a “smoking gun.” But Sheeran’s lawyers, supported by testimony from the star himself that included a brief guitar performance, argued the star had done nothing wrong by using “the scaffolding on which all songwriting is built.”
On May 4, jurors sided with Sheeran, finding that he and his co-writer had independently created “Thinking Out Loud” without copying it from “Let’s Get It On” and clearing him of millions in potential legal damages.
A verdict against the singer would have reverberated throughout the music industry, much like an infamous 2015 verdict against Robin Thicke and Pharrell Williams over their megahit “Blurred Lines,” which made musicians and companies more cautious about similar-sounding songs. Instead, his case represents the latest lawsuit in which such claims were rejected, following a 2020 ruling on Led Zeppelin’s “Stairway To Heaven” and a 2022 ruling on Katy Perry’s “Dark Horse.”
Thursday’s motion – procedural first step in any appeal in federal court – does not include detailed arguments; those will be filed later at the Second Circuit. But they will likely include challenges to what evidence the judge allowed to be used in the case and how he conducted the trial in April. Such appeals typically face an uphill climb, particularly when a case was decided by a jury rather than by a judge.
Briefs will be filed at the Second Circuit in the coming months. It could take the court well over a year to issue a final ruling.
Federal prosecutors are formally moving to seize R. Kelly’s money held by Sony Music and Universal Music Publishing Group (UMPG), saying it will be used to pay victims and fulfill outstanding fines.
Two years after they won a jury verdict convicting the disgraced singer of sex trafficking and racketeering, prosecutors in Brooklyn have asked a federal judge for so-called writs of garnishment against the label and publisher — court orders that would compel the two companies to hand over funds tied to Kelly.
Sony Music and UMPG are believed to be “in possession of property” belonging to Kelly that could be used to pay down the $504,289 that he currently owes in victim restitutions and criminal fines, the feds argued.
It’s unclear how much of Kelly’s funds each company currently holds. A court ruling in March disclosed that Kelly’s royalty account with Sony held $1,544,333 as of 2020.
Neither Sony Music nor UMPG immediately returned requests for comment on the filings.
After he was sentenced last summer to 30 years in prison on the sex trafficking and racketeering charges, Kelly was ordered to pay more than $480,000 in fines and restitution. After he was sentenced again in February on separate child pornography convictions in Illinois, another $42,000 was tacked on.
Thursday’s filings are the latest efforts by the government to collect on those judgments. Last fall, prosecutors confiscated nearly $30,000 in Kelly’s prison commissary account. But the feds have competition for that money.
R. Kelly victim Heather Williams, who won a $4 million civil judgment against the singer, is also seeking to tap into the Sony Music account — as is Midwest Commercial Funding, a property management company that won a separate $3.5 million ruling against Kelly over unpaid rent at a Chicago studio.
In March, the Illinois Supreme Court ruled that Williams had priority to the funds over Midwest Commercial Funding because she was the first to properly demand the money from Sony. But that ruling left unclear whether she’ll enjoy similar priority over a slew of additional monetary penalties that Kelly owes to victims as a result of his federal criminal convictions.
Federal prosecutors in both Illinois and New York declined to comment on that decision at the time.
In a statement Thursday (June 1), Kelly’s lead attorney, Jennifer Bonjean, told Billboard that she and her client believe that the restitution order against him is incorrect and will be overturned on appeal. But she said they have “no opinion” on prosecutors seeking to garnish funds held by Sony Music and UMPG.
A New York state appeals court has sided with Jay-Z in his long-legal battle against a fragrance company called Parlux over a cologne endorsement deal that went bad.
In a ruling issued Thursday, a panel of appeals judges upheld a 2021 jury verdict that cleared the superstar of wrongdoing and potentially $67 million in damages. It also affirmed a judge’s ruling last year that it was actually Jay-Z, and not Parlux, that was owed money — nearly $7 million in unpaid royalties.
“There were multiple rational bases for upholding the jury verdict, and plaintiffs have not set forth a sufficient basis … to overturn it,” a five-judge panel ruled unanimously.
Barring further appeals, the decision could finally mean the end for more than six years of litigation over “Gold Jay-Z,” a cologne brand that the superstar, whose real name is Shawn Carter, launched in 2013 through a partnership with Parlux.
In its 2016 lawsuit, the company accused the rapper and his S. Carter Enterprises of failing to properly promote the brand, breaching his contract and dooming the product to failure. Jay-Z quickly countersued, claiming he had fulfilled his obligations despite numerous missteps from Parlux – and that the company still owed him money.
After a three week trial in late 2021, featuring heated testimony from the star himself, jurors largely sided with Jay-Z and found that Parlux was entitled to nothing. Then in August, New York Supreme Court Justice Andrew Borrok ruled Parlux owes Jay-Z $6.78 million in unpaid royalties, including interest.
Seeking the overturn the verdict on appeal, attorneys for Parlux argued that the trial judge had improperly instructed the jury about requirements in the contract about Jay-Z’s personal appearances and the need for Parlux to provide a “product development plan.”
But in Thursday’s ruling, the appellate panel was unmoved: “The court correctly instructed the jury on the burdens of proof, and any error in characterizing the notice requirement for personal appearances and the PDP as ‘conditions precedent’ was harmless when considering the overall instructions.”
Parlux can still challenge the outcome once more, taking the case to the Court of Appeals, New York’s top appellate court. An attorney for the company did not immediately return a request for comment.
Sean “Diddy” Combs is suing alcohol giant Diageo for allegedly breaching their partnership deal for a brand of tequila, leveling accusations of racism at the company and claiming it has treated his product line “worse than others because he is Black.”
In a complaint filed Wednesday (May 31) in New York court, attorneys for the star’s Combs Wines and Spirits claimed that Diageo had “typecast” his DeLeon Tequila as a “Black brand” that could only be sold to “urban” consumers, harming its sales and potential for growth.
“Cloaking itself in the language of diversity and equality is good for Diageo’s business, but it is a lie,” Combs’ lawyers wrote. “While Diageo may conspicuously include images of its Black partners in advertising materials and press releases, its words only provide the illusion of inclusion.”
Combs claims the “unequal treatment” DeLeon has received from Diageo has left his brand lagging behind competing Diageo brands like Casamigos and Don Julio — and that the company then used those lower sales figures to offer even less support for the brand.
“Combs Wines seeks to finally put an end to Diageo’s longstanding misconduct,” the star’s lawyers wrote. “Diageo must be ordered by a court to give Combs Wines the same treatment it gives its other, successful tequila brands. It is time that Diageo’s actions match its words.”
In a statement to Billboard, a Diageo spokesperson said the company was “disappointed our efforts to resolve this business dispute amicably have been ignored, and that Mr. Combs has chosen to damage a productive and valued partnership.”
“This is a business dispute, and we are saddened that Mr. Combs has chosen to recast this matter as anything other than that,” the company said. “Our steadfast commitment to diversity within our company and the communities we serve is something we take very seriously. We categorically deny the allegations that have been made and will vigorously defend ourselves in the appropriate forum.“
In technical legal terms, the lawsuit claims that Diageo has violated a specific provision of the operating agreement that governs the Combs-Diageo joint venture that owns DeLeon. It’s not entirely clear what that provision requires — much of the legal complaint is heavily redacted — but the lawsuit claims it was included in the deal to ensure equal treatment.
“Because he knows that contracts matter more than press releases, Mr. Combs insisted that Diageo agree to certain terms to ensure his brands were not ignored or relegated to second-class status,” Combs’ lawyers wrote.
Among other alleged breaches, Combs claims Diageo violated that provision by placing DeLeon in “far fewer outlets than its other tequila brands” and failing to produce enough of it to keep store shelves stocked.
But Combs’ lawyers repeatedly stressed that their case was not simply a run-of-the-mill breach of contract lawsuit: “Similar to the realities experienced by many people of color in the United States, Diageo’s treatment of its business relationship with Mr. Combs was tainted by racial prejudices.”
At one point, Combs claims he was directly told that “things would be different if he were a white, not Black, celebrity.”
“Diageo, in other words, openly admitted that it viewed Mr. Combs merely as a Black man thatmight prove useful in marketing to Black consumers,” Combs said. “Nothing more.”
Read the entire complaint against Diageo here:
After a whirlwind week of litigation, Adidas has abruptly dropped a federal court case aimed at freezing $75 million held by Kanye West’s Yeezy brand, saying it will instead pursue the money solely through private arbitration.
In a legal filing Tuesday evening, attorneys for Adidas and Yeezy said they had reached an agreement that would see the sneaker giant voluntarily dismiss the case. It came just hours after a federal judge refused to grant Adidas an emergency order re-freezing the $75 million held by Yeezy.
But the dismissal is hardly the end of the dispute. Adidas and Yeezy will continue battle it out in a private arbitration case, in which Adidas will likely argue that that West’s “offensive conduct” caused the breakdown of their long-standing partnership.
Adidas, which operated a lucrative sneaker collaboration with West for nearly a decade, was one of many companies to terminate its relationship with the embattled rapper (sometimes known as Ye) last fall in the wake of his antisemitic statements and other erratic behavior.
It’s been a messy breakup for Adidas. The split contributed to a loss of $655 million in sales for the last three months of 2022, helping drive the company to a quarterly net loss of $540 million. Last month, CEO Bjorn Gulden said the company would begin selling its $1.3 billion worth of unsold Yeezys, but would “donate money to the organizations that help us and were harmed by what Ye said.”
Days after Adidas announced the split with West, newly-unsealed court records show that it demanded Yeezy return $75 million that had allegedly been deposited in its accounts. When Yeezy refused, Adidas secretly filed its case in federal court, seeking a so-called “attachment” order immediately freezing those funds. While the real issues will be decided via arbitration, Adidas wanted the court to use its power to ensure that the money did not disappear while those private proceedings play out.
Court records show that Judge Valerie E. Caproni quickly granted the asset freeze in November, doing so not only in secret, but also on an “ex parte” basis — meaning without giving West or Yeezy a chance to make counter-arguments. Adidas argued, and the judge agreed, that there was a serious risk that Yeezy would have moved the money if given advanced notice.
But last week, after Yeezy’s attorneys challenged the freeze order, the judge finally lifted it — ruling that Adidas had run afoul of procedural requirements for such asset attachments and had thus “deprived” Yeezy of a fair chance to fight back.
In the wake of that order, lawyers for Adidas scrambled to have it reimposed. They argued that Yeezy currently holds $75 million “to which it has no legal right,” and warned that a court order was needed to maintain the status quo.
“Yeezy is likely to comingle the funds with an unknown balance of funds in its possession at other financial institutions, such that it would be more difficult if not impracticable to audit those accounts and determine which monies are owned by Adidas,” lawyers for Adidas wrote. “In addition, Ye faces a clear risk of insolvency, giving rise to a risk of irreparable harm.”
But this time, Judge Caproni was unswayed. While she said that Adidas would likely win its arbitration case against Yeezy, the judge ruled that the sneaker company had not met the difficult legal requirements for a new temporary restraining order: “Adidas’s motion for a TRO is denied.”
While the ruling only denied the emergency motion, Adidas could have still won a more conventional order in the coming days reimposing an asset freeze on Yeezy. But hours after Judge Caproni’s ruling, Adidas moved to drop its federal case.
Looking ahead, it’s unclear how long the pending arbitration case will take to play out, or what exact issues are being disputed. But in court documents, Adidas has said that West’s “racist, antisemitic, and other offensive public statements and conduct” caused “considerable damage to its brand.”
“Adidas has multiple causes of action against Yeezy, resulting from Ye’s highly public and offensive conduct described above, which violated the terms of the Agreement and justified adidas’s termination of that contract,” the company wrote. Those broader causes of action, as well as the dispute over [issues], will be resolved through arbitration.”
Reps for both sides did not immediately return a request for comment.