– By Ankit Dutta
Investors have filed a lawsuit against Adidas AG, claiming that the German sports behemoth
was aware of the dangers of its association with the rapper Ye before his anti-Semitic
remarks became public.
Adidas severed relations with Ye, also referred to as Kanye West, in October after he used a
string of divisive language. Investors contend in a lawsuit filed on Friday in federal court in
Oregon that senior corporate management considered the dangers of keeping Adidas’
association with the rapper as early as 2018.
According to a complaint, Adidas supposedly disregarded the substantial risks associated with partnering with Ye in their 2018 annual report published in March of the following year. While their report vaguely hinted at the risks, the complaint states that Adidas failed to disclose that they had considered ending their association due to West’s personal conduct.
According to the complaint, reports from the following years omitted the fact that West told Adidas employees he was considering naming an album after Adolf Hitler and made other anti-Semitic remarks. Adidas shares decreased as its association with Ye deteriorated until the agreement was cancelled, per the filing. An inquiry for comment from Adidas did not immediately receive a response.
Adidas continued to accept shipments of Yeezy clothing from manufacturers even after the arrangement was terminated. In an effort to mitigate the financial blow from the dissolution of the partnership with Ye, the firm is thinking about selling Yeezy items and donating the proceeds to charity. A significant amount of the newly arrived Yeezy merchandise at Adidas warehouses is valued at an estimated €1.2 billion ($1.3 billion) in retail.
Kasper Rorsted, the deposed former CEO of Adidas, is also named as a defendant in the
case, which seeks to represent investors who purchased Adidas securities between May 3, 2018, and February 21, 2019.
