$75 Million Yeezy Asset Freeze Overturned by Judge – Billboard

A federal judge on Friday (May 26) lifted a court order that Adidas secretly won last year that froze $75 million in bank accounts owned by Kanye West’s Yeezy brand. chance to fight the freeze.

A week after the federal case against Yeezy was made public, judge ruled Valerie E.Caproni ruled that Adidas had not “confirmed” the injunction against Yeezy with additional court proceedings — a key requirement under state law authorizing such asset freezes.

“The petitioner launches a volley of inconclusive arguments in an attempt to excuse his failure to comply with the plain language of the statute,” the judge wrote Friday. “Without a confirmation hearing, Yeezy was deprived of an early opportunity for the Court to consider its substantive challenges to Petitioner’s arguments.”

The judge said that the freeze on Yeezy’s bank accounts had not only been lifted, but was actually “voided some six months ago when Adidas failed to take action in time to uphold the order.”

A lawyer for Yeezy did not return requests for comment on Friday. An Adidas spokesperson declined to comment.

Adidas filed the case against Yeezy on Nov. 11, just weeks after the German sneaker company publicly ended its long-term relationship with the embattled rapper (aka Ye) over his anti-Semitic statements and other erratic behavior. Adidas did this because it believes about $75 million of its money is currently in Yeezy’s bank accounts, and it wanted to make sure that money didn’t disappear while the two companies litigate their business separation through private arbitration.

Judge Caproni quickly granted the company’s request for such an “seizure” on a so-called ex parte basis — meaning the judge issued the freeze without giving Yeezy a chance to make counterarguments. She did this because she judged there was “a risk that Yeezy would remove or displace assets” if he were given advance notice of Adidas’ case.

The case and ruling were filed “sealed” until last week when the judge issued an order to make the records public.

In recent weeks, lawyers for Adidas and Yeezy have been discussing whether the asset freeze should remain in place going forward. Adidas lawyers said West had exhibited a “pattern of volatile behavior” and was in “severe financial stress”, putting the company in jeopardy to recover the funds it believes it will win in the ongoing arbitration battle.

But lawyers for Yeezy said Adidas had “failed to demonstrate that it was ever entitled to such an injunction.” They strongly argued that Adidas had failed to comply with the requirements for such an order, in particular by failing to “confirm” the order within five days.

In Friday’s ruling, Judge Caproni concurred, ruling that “Adidas’s failure to file a motion for confirmation overturns the seizure order.” The ruling means that Yeezy’s bank accounts will no longer be frozen by the previous order.

But it doesn’t mean Yeezy or West are off the hook. The arbitration suit brought by Adidas — the original reason it tried to freeze the money — remains pending, and Yeezy could still owe some or all of that money if the case is finally decided.

The judge also left the door open for Adidas to “renew its request” in future proceedings, meaning it could try again to freeze Yeezy’s assets in some capacity. Only this time it will probably come about through a procedure with detailed arguments from both parties.

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