Jay Z’s Roc Nation is suing a New York licensing firm, accusing them of cheating Roc Nation and being apart of a “colossal accounting scandal.”
According to the suit filed on Thursday in state court in Manhattan, Roc Nation claims Iconix has been fabricating financial reports to falsely inflate its earnings, since the beginning of their brand partnership in 2013.
But Roc Nation isn’t alone, Iconix is accused of luring other companies, including Ecko, Ed Hardy and PONY into doing business with them, by lying about their finances and then running off with their client’s money without providing a service, Page Six reports.
The allegations against Iconix, arise “out of a massive years-long fraud perpetrated by Iconix and its affiliates to amass a portfolio of trademarks under false pretenses, in the process defrauding its licensees and partners, and setting off a colossal accounting scandal the depths of which are still being uncovered,” the suit says.
The suit also claims, Iconix then “absconded with its licensees’ money without providing the branding and retail support it promised”.
Roc Nation’s sold its men’s clothing brand Rocawear to Iconix for $204 million in 2007.
ABC News also reported, Iconix scheme “sent its share price from a peak of more than $400 per share in 2014, to less than a dollar today.”
The court documents also claim, “Plaintiffs never would have entangled their business interests with Iconix had it disclosed the true condition of its business or the massive accounting fraud in which it was engaged”.
Roc Nation is now requesting that Iconix pay for the companies legal fees. Roc Nation’s CEO, Jay-Z, who’s given name is Shawn Carter was forced to testify about the fraud allegations to the SEC. The suit specifies Roc, “have incurred substantial legal expenses in connection with, among other things, the federal government’s investigations into Iconix’s massive fraud.”
Roc Nation is seeking payment of legal fees and unspecified damages.