The class action lawsuit against Adidas, which accused the company of knowingly overlooking Ye and his erratic behavior, has been dismissed with prejudice, meaning it cannot be refiled.
The suit, originally filed by the HRSA-ILA Funds, claimed that Adidas failed to disclose concerns about West’s conduct between 2013 and 2018, as well as internal reservations about continuing to work with him. However, the court ruled there was not enough evidence to prove that Adidas made misleading statements to investors.
Judge Immergut, in her ruling, stated that the plaintiffs did not adequately demonstrate that Adidas had committed securities fraud by deceiving investors. “Has [HRSA-ILA Funds] sufficiently pleaded facts showing that Adidas misled investors and thereby committed federal securities fraud? On the current record before this Court, the answer is no,” she concluded.
The case was formally dismissed based on the court’s previous opinion, leaving no option for re-filing. Ye, formerly Kanye West, was generating over a billion dollars in revenue through his Adidas-Yeezy partnership by 2021.
That deal accounted for 8% of Adidas’ total revenue and over 40% of its profits. Despite the financial success, the lawsuit alleged that investors had long been aware of potential risks associated with West’s unpredictable behavior.
The situation reached a breaking point in 2022 after West’s antisemitic outbursts on social media. Adidas decided to cut ties with him, even though the decision resulted in a significant financial hit—losing $1.3 billion in revenue in the aftermath of the split.
Ye and Adidas feud continues as the brand has filed their own lawsuit against the icon. At his South Korea concert, Ye yelled “F*ck Adidas” to the crowd while shouting out others he admires. A Ye-signed “F*ck Adidas” album went to auction in May.
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