How A Social Media Tweet Compromised The Relations Between Adidas And Kanye West, Resulting In Tremendous Loss To Both Parties?

Adidas chose to re-release Yeezy sneakers last week after unexpectedly abandoning a federal court action aimed at freezing $75 million held by Kanye West’s Yeezy business. Instead, Adidas CEO Bjrn Gulden indicated in May that the company would sell part of its leftover inventory and give it to charitable organisations. The news comes months after the company announced that its association with American rapper Ye, formerly Kanye West, will end in October 2022.

Adidas severed relations with Kanye West following the rapper’s anti-Semitic statements, which sparked outrage on social media platforms. Kanye West is well-known in the United States for his scandals and has made several offensive comments. 

Kanye West has been fighting the company in court since November 2022, when their commercial alliance was dissolved during the height of his anti-Semitic comments. According to sources, a court dismissed the sports company’s plea to re-freeze $75 million on May 30, indicating that Ye will retain possession of a significant part of the proceeds from his Yeezy sneakers. Adidas filed the motion because they were concerned about how the rapper would spend the money, claiming their brand would suffer “irreparable harm.”

The verdict, however, does not end the case because it only addresses the German shoe company’s emergency move. The company may still seek that the assets be re-frozen using a separate order.

Collaboration between Adidas and Yeezy.

Kanye West and the German sportswear firm collaborated on the Adidas-Yeezy collection. The collaboration began in April 2015 and included limited edition shoes, shirts, coats, track trousers, socks, slides, lingerie and slippers.

Kanye West previously teamed with Nike, another major player in the sportswear business, to develop Air Yeezy in 2009. The collaboration ended in 2013, and Kanye West opted to cooperate with Adidas in 2015, signing a contract that would extend through 2026.

Conflicts occur regularly.

Even before the official split, Kanye West and Adidas were feuding, with the rapper expressing his discontent with the sportswear company on many social media sites. In addition, Kanye West accused Adidas of excluding him from meetings and making decisions without his permission. Officially, Adidas management never remarked on any concerns with the relationship, but insiders stated that the management did not like Kanye West.

The decision was made to terminate connections.

The ultimate nail in the coffin for Adidas and Kanye West was when the American rapper voiced anti-Semitic remarks on his Twitter account in October 2022.

Kanye West’s tweet meant that he was a little sleepy tonight, but when he woke up, he was gonna death con 3 on JEWISH PEOPLE. This was in reference to the US military readiness code DEFCON.

The remark sparked outrage on social media, and major firms like as Balenciaga, Gap, and JPMorgan Chase stated that they would no longer work with Kanye West. Adidas later announced their intention to cancel the deal.

A costly decision- A broken relationship hurts both parties, in this case, professionally.

Adidas’ choice is costly for both the firm and Kanye West, as the sportswear brand presently has about $1.3 billion in unsold Yeezy sneakers on hand. The breakup lost the corporation $655 million in sales for the last three months of 2022, increasing the company’s loss to about $550 million.

Kanye West’s net worth dropped from $2 billion to $400 million following the breakdown of his relationship with Adidas, according to Forbes. The brand claims to be the exclusive owner of all existing product design rights. Adidas has claimed that Kanye West’s disrespectful behaviour was the cause of the contract breakup. 

The case was dropped, but the legal squabble between Adidas and Kanye West is far from over, and the parties are anticipated to fight it out in private arbitration.

Ye’s struggle with Adidas isn’t the only one he faces. Two former workers of the rapper’s Donda Academy sued him in April, citing bizarre allegations about the school, including its excessive sushi budget and prohibition on forks and seats, and claimed they were dismissed for reporting various health, safety, and educational breaches.

Kanye West has also filed a counter-suit against his former business partner Thomas St. John, who sued Ye for $4.5 million he claims he owes him.

Conclusion.

Kanye West may not be all over social media right now, but he’s had a lot going on behind the scenes, so we’ll have to wait and watch how each of these court challenges plays out and if he retains possession of that $75 million.

Proofread & Published By Naveenika Chauhan