ESC

The Government Really Wants to Talk to Jay-Z

Jay-Z’s got 99 problems and the government is definitely one. In November 2017, the Securities and Exchange Commission (SEC) subpoenaed Jay-Z over its investigation into Iconix Brand Group. That’s the company that bought his Rocawear in 2007 for $204 million.

Jay-Z being the alpha male that he is has ignored their request. Now the government is asking the U.S. District Court for the Southern District of New York to force Jay-Z to comply with the subpoena and testify in the case.

If you came here for some nitty-gritty details on government investigations into federal securities crimes, well, congrats.

…the SEC is investigating potential violations of the federal securities laws related to the financial reporting of New York-based Iconix Brand Group, Inc., which paid Carter more than $200 million to acquire intangible assets associated with Carter’s Rocawear apparel brand. After the acquisition, Carter and Iconix maintained publicly-disclosed partnerships related to the Rocawear brand.

In March 2016, Iconix publicly announced a $169 million write down of Rocawear, and in March of this year, Iconix announced a further write down of $34 million.

That does seems fishy. They bought it for $204 million, yet wrote down the whole purchase. Granted that happens with failed purchases. Yet, what does the government have on Iconix and what does Jay-Z know? The purchase was for “intangible” assets. That could mean a whole bunch of made-up stuff.

Iconix doesn’t sound like it’s doing too well. Shares have dropped a lot and supposedly they’re looking to be bought. The company owns 28 brands, including Danskin, Starter and Joe Boxer. Uhh, ok. And Rocawear. But Rocawear can’t be found anywhere unless you count Rocawear cologne at Wal-Mart and random items at Burlington Coat Factory. Jay-Z for sure does not shop at Burlington Coat Factory, so it sounds like Iconix screwed up Rocawear.

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