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Business News/ Companies / News/  Adidas accuses Kanye West of ‘mishandling’ $75 million fund: Report
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Adidas accuses Kanye West of ‘mishandling’ $75 million fund: Report

Adidas is seeking to recover $75 million from Kanye West (Ye) over alleged mishandling of marketing funds. The dispute is under arbitration.

Adidas decided to end its partnership with American rapper Ye, formerly known as Kanye West in October 2022Premium
Adidas decided to end its partnership with American rapper Ye, formerly known as Kanye West in October 2022

Adidas is attempting to recover $75 million from Kanye West, also known as Ye, alleging mishandling of funds.

As reported by Business Insider citing Bloomberg, the rapper is currently embroiled in a legal dispute with the sportswear giant, and the matter is under arbitration. The disagreement centers around a $100 million annual marketing fund, as disclosed in court documents viewed by Insider.

Adidas alleges that it deposited $75 million into two Yeezy bank accounts, but according to Bloomberg, Kanye West (Ye) and his associated companies "mishandled almost all of the marketing funds." They reportedly failed to maintain proper separation of the funds and used them for unauthorized purposes.

Also Read: Adidas drops $75 million case against Kanye West's Yeezy brand. Here's all about the case

Insider, which has seen the contract signed by both parties, confirms that the marketing fund should not be "commingled," and if any funds are utilized improperly, Yeezy would be required to reimburse Adidas.

As per the report, the court filing has redacted the contract's definition of appropriate marketing purposes.

In a 2020 interview on Nick Cannon's podcast, Kanye West (Ye) revealed that he utilized $50 million of the Yeezy marketing funds for his gospel choir tour called "Sunday Service," which also involved arranging flights to Jamaica for 120 individuals.

"The Yeezys, they were selling themselves," he said. "So instead of paying for ads, I invested it in the church." He did not specify whether this money had come from Adidas.

In May, Adidas attempted to freeze the eight-figure sum in court, but their bid was unsuccessful. However, US District Judge Valerie Caproni expressed the likelihood of Adidas recovering the funds through arbitration, as reported by Bloomberg.

Also Read: Adidas terminates partnership with Kanye West over rapper’s anti-semitic remarks

While many of the case documents are redacted or sealed, new details inadvertently came to light when a reporter entered the courtroom unnoticed by the lawyers, despite the judge's prior warning about such potential occurrences, according to Bloomberg.

Following the dissolution of the Adidas-Ye partnership in the previous year, Adidas disclosed holding $1.3 billion worth of Yeezy stock.

In a statement made in May, the sportswear company declared its intention to sell the Yeezy shoes and contribute the proceeds to organizations representing individuals who were impacted by Kanye West's (Ye's) anti-Semitic remarks.

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Updated: 21 Jul 2023, 07:28 AM IST
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