Citing racial bias, Jay-Z seeks to halt arbitration against Iconix

Jay-Z on Wednesday sued to halt his private arbitration with clothing company Iconix Brand Group Inc, saying the company’s inability to find an African-American arbitrator to hear the trademark dispute was unfair.

Reuters

The multimillionaire rapper said in a petition filed in Manhattan Supreme Court that the lack of racial diversity among arbitrators at the American Arbitration Association (AAA) was discriminatory under New York’s state constitution and a New York City human rights law.

Iconix could not immediately be reached for comment, and a spokeswoman for the AAA declined to comment.

The dispute is the latest in a series of legal wranglings arising from Jay-Z’s 2007 sale of his Rocawear clothing brand to Iconix for about $204 million.

Iconix has since written off almost the entire value of the brand, and in 2017 sued Jay-Z in Manhattan federal court over trademark rights. That case remains pending.

In 2015, Jay-Z, whose real name is Shawn Carter, and Iconix settled some disputes, and agreed to address future claims in private arbitration, according to Jay-Z’s petition.

Last month, Iconix accused Jay-Z of breaching the 2015 settlement and demanded an AAA arbitration.

But Jay-Z said the AAA found only three potential African-American arbitrators, out of the hundreds it uses, for his case, and one already represented Iconix in related litigation.

He argued that the lack of “more than a token number of African-Americans” made the arbitration contract void.

“It would stand to reason that prospective litigants - which undoubtedly include minority owned and operated businesses - expect there to be the possibility that the person who stands in the shoes of both judge and jury reflects the diverse population,” the petition said.

In May, a federal judge ordered Jay-Z to respond to a U.S. Securities and Exchange Commission subpoena related to the Rocawear sale.

The SEC said it was looking in to writedowns by Iconix, and wanted to ask Jay-Z about his personal involvement with the brand.

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