Shareholders have decided to sue the Adidas brand. The latter felt that they had been cheated after the failure of the partnership with the American celebrity. Adidas had been forced to break its contract with the rapper last October following several controversies.
The equipment manufacturer Adidas is sued in the United States by a group of shareholders who consider themselves cheated by the costly failure of the partnership with Kanye West, and according to which the German group could have limited the damage. A class action has been brought before the district court of Oregon, a state in the northwest of the United States where the group’s American headquarters are located, according to the procedure consulted by AFP and dated 28 april.
Adidas was forced last October to end its juicy collaboration with American rapper Kanye West, now known as Ye, with whom the three-stripe brand produced the successful Yeezy sneakers. This rupture came after a series of slippages by the star, in particular pinned down for remarks of an anti-Semitic nature. The plaintiffs allege Adidas was aware of the potential harm Ye’s behavior could cause the company, including pointing to problematic statements dating back to 2018 where the rapper suggested slavery was a “choice.”
Allegations dismissed
The lawsuit, which represents an unspecified number of shareholders who purchased Adidas securities between May 3, 2018 and February 21, 2023, also claims that Adidas failed to take steps to limit financial losses if the partnership with Ye had to end. The complaint cites a Wall Street Journal article from last November, according to which group executives, including CEO Kasper Rorsted dismissed at the end of 2022, had discussions in 2018 on the risks associated with the rapper’s behavior.
In a reaction to this procedure sent to AFP on Tuesday, Adidas said it “categorically rejects these unfounded allegations”. The group will take “all necessary measures to defend themselves vigorously”. Adidas has warned that due to the end of the Kanye West collaboration, its operating income will be, at best, zero this year. The equipment manufacturer could even record an operating loss of 700 million euros, depending on the fate reserved for the millions of Yeezy shoes still in stock, the fate of which has not been decided.