Damon Dash’s one-third stake in Jay-Z’s Roc-A-Fella Records will be auctioned later this month, but it might come with some key limitations, a source told Billboard. The United States Marshals Service will auction Dash’s 33.3% interest in the label. This action is to satisfy an $823,000 judgment. The judgment stems from a lawsuit filed by movie producer Josh Webber. The lawsuit was over a failed film partnership.
The auction, set for August 29 at a Midtown Manhattan hotel, requires a minimum bid of $1.2 million and a $240,000 deposit to participate. The sale is for Dash’s stake in Roc-A-Fella Inc., whose primary asset is Jay-Z’s debut album “Reasonable Doubt.” Other music from Roc-A-Fella, which ceased operations in 2013, is owned by other entities and not included in the sale.
Jay-Z and cofounder Kareem “Biggs” Burke tried to stop the auction. They altered company bylaws and intervened in the lawsuit. However, a judge rejected these efforts in February. Despite the potential value, a source told Billboard there are limitations for the buyer: “Whomever buys Dame’s stake in Roc-A-Fella will be a minority owner without authority over any decision-making,” they said. Additionally, “There’s also an expiration date on the master ownership for the company, which means revenue and the only asset doesn’t have many years left.” This likely refers to Jay-Z’s right to reclaim the album rights. He can do so 35 years after its release in 1996. This means the new owner has until 2031.
Webber’s attorney, Chris Brown, is coordinating the auction. He disputes claims of an expiration date. Claiming these are an attempt to lower the auction price. He said the buyer would gain “substantial revenue” from streaming royalties and licenses. However, Brown admitted the difficulty of thorough due diligence since Roc-A-Fella isn’t obligated to share documents.
Webber won his judgment in 2022 over a failed film partnership with Dash. The auction proceeds will first be used to satisfy Dash’s $145,096 debt. This debt is owed to the New York City Department of Social Services for unpaid child support. Any remaining funds will address additional debts owed to Brown and photographer Monique Bunn. Any remaining funds will go to Dash, whose attorney expects a robust auction with high bids. In 2021, Dash tried to sell a stake in “Reasonable Doubt” as an NFT. However, he later agreed he had no right to sell it. This came after a legal challenge from Jay-Z and Roc-A-Fella.