Adidas AG intensifies its legal battle as it seeks dismissal of a lawsuit accusing the sportswear giant of failing to disclose the potential fallout from its collaboration with musician Ye, formerly Kanye West, after his controversial remarks. Investors claim Adidas neglected to warn about the risks associated with Ye’s behavior before terminating their partnership in 2022.
Adidas Looks To Kick Investor Suit Over Ye Contract: Allegations and Defenses
The lawsuit, initially filed in May and recently amended in December, alleges that Adidas overlooked the risk posed by Ye’s “overtly antisemitic and other racially offensive remarks.” However, Adidas contends that its risk disclosures adequately covered the potential hazards of partnering with creative figures like Ye. The company argues that its contracts generally contain clauses allowing termination for improper conduct, a clause invoked to sever ties with Ye.
Adidas Looks To Kick Investor Suit Over Ye Contract: Legal Maneuvers
Adidas refutes claims of misleading disclosures, emphasizing that its risk disclosures never implied innocence regarding Ye’s past behavior. The company cites instances where it did not endorse all of Ye’s statements, asserting transparency about potential risks to the partnership. Furthermore, Adidas challenges the investors’ assertion of prior knowledge of Ye’s actions, dismissing it as “fraud by hindsight.”
Adidas Looks To Kick Investor Suit Over Ye Contract: Causal Link and Representation
Addressing allegations of a decline in stock price following the partnership termination, Adidas disputes a causal relationship between the alleged misrepresentations and stock fluctuations. Legal representatives for both parties refrained from immediate comment on the matter.
Legal Representation
Investors are represented by legal counsel from the Rosen Law Firm PA and Ransom Gilbertson Martin & Ratliff LLP. Meanwhile, Adidas is defended by legal teams from Debevoise & Plimpton LLP and Markowitz Herbold PC.
The Case Continues
The lawsuit, titled HRSA-ILA Funds et al. v. Adidas AG et al., is being heard in the U.S. District Court for the District of Oregon (case number 3:23-cv-00629), as Adidas vigorously contests the allegations leveled against it.
