Kanye West‘s YEEZY empire has been fraught with allegations of dubious business. Now a black-owned tech company is throwing a new $20 million lawsuit into the mix, claiming Ye once again failed to pay for work.
According to a new report by TMZ, the tech company MyChannel, which specializes in video and e-commerce tech, claims it linked up with Kanye in Spring 2018 to help Ye maximize revenues for his Yeezy merchandise. MyChannel alleges that it provided services to West for six months “based on a series of business promises,” such as a $10 million investment from the rapper.
Per the lawsuit, MyChannel held up their end of the bargain, putting in 10,000 man-hours — including relocating their headquarters twice to make Kanye happy — and investing $7 million into the project. It further alleges that West rebranded the company as YZY Tech during business meetings with companies like adidas and presented “ideas such as those of [MyChannel] as his own.” The lawsuit then says that after talks with West fell apart, MyChannel’s founders noticed that a copied version of their technology was utilized to sell merch in Kanye’s Sunday Service videos.
After a six-month period, it became clear to MyChannel that Kanye would not hold up the terms of the agreement and proceeded to sever ties with the rapper. However, after the fact, Kanye proceeded to use its copied technology to drive Sunday Service merchandise sales.
In the lawsuit, MyChannel accuses West and Yeezy Apparel of breaching the oral partnership agreement, thus preventing the tech company from earning millions, encouraging the company to invest millions, withholding a promised $10 million investment, and violating MyChannel’s non-disclosure agreement by copying their video e-commerce technology. The company is seeking damages in excess of $20 million.
This isn’t the first time YEEZY’s shady business tactics have inspired a lawsuit. Last year, YEEZY was sued for $624,000 for breaching a contract with Japanese fabric company Toki Sen-I Co. Then again, earlier this year, a Colorado-based company accused YEEZY of failing to pay fees of up to $125,200 or responded to invoices for using its software.
So, is Kanye simply a bad businessman or a clever, conniving one?
The self-proclaimed “Christian Genius Billionaire” illustrates a frequent issue with big businesses: buffering their companies with the work and ideas of smaller businesses, which need the association to get ahead, and making off with millions in the process. Notably, during the coronavirus crisis Yeezy apparel brand received $2 million in government assistance, while some very small companies struggled to access aid from the program.
The issue at hand is not that Kanye cannot afford to pay for the services of these smaller businesses he has partnered with, it’s that companies such as YEEZY know they can easily get away with ripping off small, low-collateral companies they partner with.