Last year, Adidas sued Kanye West’s Yeezy brand for allegedly owing the company $75 million. Recently, the sportswear giant dropped the case. The controversial rapper-turned-businessman had reportedly diverted the $75 million to another account, leading Adidas to seek an emergency order to freeze the assets. However, it saw the case dismissed by a judge in January.
Despite the setback, Adidas made renewed efforts to pursue the lawsuit. In a hearing last week, a judge denied the company’s bid, acknowledging that Adidas was likely to succeed in arbitration proceedings. However, the court concluded that Adidas had failed to show how the assets in question posed an immediate threat of being dissipated.
Adidas has stated that the fallout from its partnership with West contributed to a significant loss of revenue. The company’s Q4 2021 earnings report revealed a staggering $655 million in lost sales and a net quarterly loss of $540 million. Adidas is now pursuing a private arbitration case, alleging that West’s “offensive conduct” caused the end of their relationship.
The contentious relationship between Adidas and Yeezy dates back to 2013, when the two announced a partnership aimed at revolutionizing the athletic footwear industry. West had a creative role in the collaboration, designing a range of sneakers and apparel. However, the two sides have been at odds over numerous issues, including royalties, marketing campaigns, and ownership of Yeezy’s intellectual property.
The legal wrangling comes at a sensitive time for Kanye West, who has been in the spotlight for his erratic behavior and public outbursts. In recent years, the rapper has become increasingly involved in politics, running for president in 2020 and pledging to start his own political party. Some critics have accused him of promoting a dangerous, anti-vaccine agenda and spreading misinformation about COVID-19.
The Yeezy brand, which operates independently from Adidas, has been a runaway success, with revenue estimated at over $1 billion in 2020. West has positioned himself as a disruptor in the fashion industry, releasing limited-edition clothing and footwear that are highly sought after by his legion of fans. The rapper has also been vocal about his desire to democratize fashion, making it more accessible to everyday people.
The dropping of the Adidas lawsuit is a significant victory for Yeezy and Kanye West, who has faced numerous legal challenges in recent years. However, the fallout from the dispute is likely to have long-lasting implications for both companies. Adidas will have to find new ways to offset the loss of revenue, while Yeezy will need to navigate a tricky path in the competitive world of fashion and athletics. Only time will tell who will emerge victorious in this ongoing saga.
