Key takeaways:
- Investors have filed a lawsuit against Adidas, alleging the sportswear giant failed to disclose the risks of its partnership with rapper Ye.
- The lawsuit claims that Adidas was aware of the risks of working with Ye as early as 2018, but only “generally” alluded to the risks in a report to shareholders.
- The lawsuit seeks unspecified damages, as well as a jury trial. It is unclear how the lawsuit will affect Adidas’ relationship with Ye in the future.
Adidas has been hit with a lawsuit from investors alleging the sportswear giant failed to disclose the risks of its partnership with rapper Ye, formerly known as Kanye West.
The lawsuit, filed Friday in federal court in Oregon, claims that Adidas’ former chief executive officer, Kasper Rorsted, and chief financial officer, Harm Ohlmeyer either “intended to deceive” investors or “acted with reckless disregard for the truth” by failing to disclose issues between the company and Ye.
According to the lawsuit, Adidas was aware of the risks of working with Ye as early as 2018, but only “generally” alluded to the risks in a report to shareholders. The company began working with Ye in 2015 and the partnership eventually led to the company having to cut ties with the rapper in October. The move resulted in unsold products from the rapper’s Yeezy shoe line and battered the company’s earnings.
In response to the lawsuit, a spokesperson for Adidas said in a statement: “We outright reject these unfounded claims and will take all necessary measures to vigorously defend ourselves against them.”
The lawsuit seeks unspecified damages, as well as a jury trial. It is unclear how the lawsuit will affect Adidas’ relationship with Ye in the future.
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