Shareholders of the Adidas company have filed a lawsuit against the giant sportswear company due to the termination of the company's collaboration with famous rapper Kanye West.
In the lawsuit filed Friday in the U.S. District Court in Portland, the shareholders claimed that the company's executives were aware of the dangers posed by West's behavior several years before the dispute, but did not take precautionary measures, NBC news reports.
"In the Workforce Risk section of the 2018 Risk Report discussion, the Company praised its commitment to an equitable workplace, and its strategic workforce management process, known as the 'People Strategy', while failing to discuss how it repeatedly ignored bad behavior from Kanye West,” it read in part.
Citing a November 2022 Wall Street Journal report, the plaintiffs further said that Adidas' former CEO, Kasper Rorsted, and chief financial officer, Harm Ohlmeyer, "intended to mislead" investors or "acted without regard for the truth" by keeping shareholders in the dark about issues between the company and the rapper.
Citing people familiar with the matter, the WSJ report revealed that the company's chief executive and top officials in Germany had discussed since 2018, the risks of maintaining a relationship with the 'Monster' rapper, which they feared could explode at any time.
Back in 2018, West had also made provocative statements about slavery. During an interview with TMZ, the rapper said that the 400 years of slavery suffered by black people in America "sounds like a choice".
Shareholders further blamed the executives for not specifically mentioning in the annual reports "that the Company had considered terminating the partnership due to West's personal conduct, or how the Company's reputation might be affected if his conduct, as related to the Company, were affected if it were made public."
The German company finally cut ties with Ye in October last year following a series of anti-Semitic statements he made through various media platforms last year.
The company faced a lot of pressure from the public after the artist doubled down on his statement despite the initial backlash and being banned from social media.
The failed Yeezy collaboration cost both sides, as West lost his billionaire status last year. In February, Adidas also revealed that the discontinuation of the fashion collection will cost the brand $1.3 billion in sales this year.