Adidas is seeking to recover $75 million from Kanye West, also known as Ye, over allegations of mishandling funds. According to Business Insider, the rapper is currently involved in a legal dispute with the sportswear giant, with the matter being under arbitration. The disagreement revolves around a $100 million annual marketing fund, as revealed in court documents seen by Insider.
Adidas claims to have deposited $75 million into two Yeezy bank accounts, but Bloomberg reports that Kanye West and his associated companies “mishandled almost all of the marketing funds.” The funds were allegedly not appropriately separated and were used for unauthorized purposes.
The contract between the parties, seen by Insider, confirms that the marketing fund should not be mixed with other funds, and if any misuse occurs, Yeezy would be obligated to reimburse Adidas. However, the court filing redacts the specific definition of appropriate marketing purposes.
In a 2020 interview on Nick Cannon’s podcast, Kanye West revealed that he utilized $50 million of the Yeezy marketing funds for his gospel choir tour called “Sunday Service,” which also involved arranging flights to Jamaica for 120 individuals.
In May, Adidas attempted to freeze the disputed sum in court, but their bid was unsuccessful. Nevertheless, US District Judge Valerie Caproni expressed the likelihood of Adidas recovering the funds through arbitration, as Bloomberg reports. Some details of the case inadvertently came to light when a reporter managed to enter the courtroom unnoticed by the lawyers, despite the judge’s prior warning about such potential occurrences.
After the dissolution of the Adidas-Ye partnership the previous year, Adidas disclosed holding $1.3 billion worth of Yeezy stock.
In a statement made in May, the sportswear company announced its intention to sell the Yeezy shoes and donate the proceeds to organizations representing individuals impacted by Kanye West’s anti-Semitic remarks.
