fbpx
Subscribe
Menu

Jay-Z’s Attorneys Say He’ll testify, But SEC Subpoena Is Part Of ‘Celebrity Hunt’

Jay-Z’s Attorneys Say He’ll testify, But SEC Subpoena Is Part Of ‘Celebrity Hunt’

Written by Ann Brown

May 09, 2018

Subscribe

After five months of avoiding the U.S. Securities and Exchange Commission’s requests to testify in a federal investigation, music mogul Jay-Z has agreed to appear in court on May 15.

Jay-Z was ordered to appear May 8 by a New York City judge regarding an SEC investigation.

His lawyers said that the SEC is engaging in a “celebrity hunt” by trying to compel the hip-hop mogul to testify. The SEC is investigating Jay-Z’s former fashion brand, which he created and sold more than a decade ago.

It’s not that Jay-Z was refusing to testify, said his lawyers. He will do a full day of testimony, but will not participate in “day-to-day until completed” testimony.  In a court filing, his lawyers wrote that Jay-Z is worried that the agency’s request “is driven more by governmental fascination with celebrity and headlines than by any proper investigative purpose.”

“The SEC sought a court order last week to compel the rapper to provide testimony as part of its investigation of accounting practices at Iconix Brand Group Inc. The retailer paid $200 million to acquire assets from his Rocawear apparel brand in 2007. The retailer wrote down the value of those assets by $169 million in March 2016 and another $34 million this year,” Bloomberg reported.

“Mr. Carter will commence a global tour consisting of 45 shows on June 6, 2018. Suffice to say, the professional and publicity demands on his time are enormous,” they wrote.

The SEC has been investigating Iconix, whose brands include Candie’s and Joe Boxer, since December 2015 regarding the company’s accounting practices.

After a no-show by Jay-Z on May 8, 2018, a federal judge in New York ordered the rap mogul to testify on May 15. U.S. District Judge Paul Gardephe said: “The testimony has been delayed for five months, and I do not intend to tolerate any further delay.”

The SEC has said it wants to question “Jay-Z about his personal involvement with Rocawear and about transactions between his companies and Iconix,” Reuters reported.

The SEC wants to see Jay-Z’s e-mails and phone calls concerning “the value of the Rocawear trademark and his involvement with that brand after the sale to Iconix,” New York Post reported:

In fact, Jay Z was very much involved with Rocawear when it allegedly ran into financial issues in 2012 — and Iconix, then led by Chief Executive Neil Cole, started to lend Jay Z’s company much-needed cash, according to a lawsuit filed last year by an Atlanta pension fund.

The pension fund, which represents firefighters and cops and is an investor in Iconix, claimed that Cole knew Rocawear faced financial issues but made contrary statements — misleading investors.

Rocawear was launched in 1999 by Roc-A-Fella Records co-founders Jay-z and Damon “Dame” Dash. Before it was sold it had annual sales of $700 million. The company sold clothes for men, women, children and juniors; socks and sandals; leather, suede, and fur outerwear; handbags and belts; lounge wear; big and tall; headwear; jewelry; and sunglasses. After selling the company in March 2007, Jay-Z retained his stake in the company and continued to oversee the marketing, licensing, and product development. By 2012, Rocawear was raking in nearly $500 million globally.

Roc Nation credit line Robinhood App

✖