Shareholders claim the shoemaker should have warned them about the risks of cooperating with the rapper
The shareholders of Adidas have taken the German athletic apparel and sportswear producer to court over its partnership with controversial pop star and fashion designer Kanye West.
The lawsuit was filed on Friday at US District Court in Portland, Oregon, which is home to the company’s headquarters in North America.
The investors claimed that Adidas was well aware of the risks posed by its cooperation with the artist, who has officially changed his name to Ye, but kept them in the dark about it. The rapper himself is not part of the lawsuit.
West worked with Adidas for nine years and designed the massively successful Yeezy line of shoes for the company, which earned more than $1 billion by September 2019. However, the Grammy-award-winning artist was dropped by the German firm last October after he made a series of anti-Semitic comments.
Among other things, he tweeted that he was ready to go “death con 3 On JEWISH PEOPLE,” a reference to the ‘defcon’ US defense-readiness alert system, and told InfoWars podcast host Alex Jones that he “sees good things about Hitler.”
In February, Adidas announced that the whole scandal with West might see the company losing over $1.3 billion in profits in 2023, while operating at a financial loss for the first time in three decades.
In their action, the shareholders cited a report by the Wall Street Journal last November, which claimed that the leadership of the German firm had for long been concerned about the rapper’s controversial views and had already considered ending partnership with him in 2018.
They specifically mentioned the remarks made by the artist in an interview with TMZ earlier that year, that slavery “sounds like a choice” due to its having lasted “for 400 years.”
According to the lawsuit, Adidas’ former CEO Kasper Rorsted and chief financial officer, Harm Ohlmeyer, either “intended to deceive” investors deliberately or “acted with reckless disregard for the truth” by concealing from its investors those problems that the company had with West.
READ MORE: Adidas braced for substantial losses following Kanye split
The German firm’s annual report for 2018 “ignored serious issues affecting the Partnership” with the artist “and the resulting potential risk to shareholders,” it claimed.
When addressed about the lawsuit a spokesperson for Adidas said that “we outright reject these unfounded claims and will take all necessary measures to vigorously defend ourselves against them.”
May 02, 2023 at 09:10PM