After losing a very lengthy court battle and being forced to file bankruptcy earlier this year, well-known rapper 50 Cent has decided to sue his former attorneys.
The rapper filed a lawsuit Tuesday accusing the Wall Street firm Garvey Schubert Barer (GSB) of giving him bad representation during the legal fallout that followed his failed attempt to market headphones.
In 2010, 50 Cent, whose real name is Curtis James Jackson III, decided to invest over $2 million in a company called Sleek Audio that specializes in custom earbuds. After watching the success of Beats by Dre, the rapper wanted to create his own brand of headphones that would have been called “Sleek by 50,” the Wall Street Journal reports.
“Recognizing the financial success of these other hip-hop artists, Jackson decided to market his own line of headphones to take advantage of his status as a music celebrity and the value of his 50 Cent brand,” the court document states.
Jackson claims, however, that Sleek missed its launch deadline and his headphones were never placed on the market.
It was then that 50 Cent decided to abandon the partnership and found his own company. In 2011, the rapper officially opened SMS Audio and his new line of headphones, “Street by 50,” were released. Soon after, the legal problems began.
Sleek filed a lawsuit against 50 cent, accusing the rapper of violating a brand-licensing agreement. The claim basically stated that 50 Cent’s headphones were too similar to the headphones developed during their partnership. It was a lengthy court battle, but in 2014, Sleek won, and the rapper was ordered to pay $17.2 million to the audio company.
In the newly filed documents, 50 cent says the attorneys who represented him during that deal are actually to blame. The rapper says he should have been warned before ever investing with Sleek, and after the deal fell apart, his attorneys should have advised him that SMS Audio would breach the terms of his original partnership.
In his lawsuit, 50 Cent, who filed for Chapter 11 bankruptcy earlier this year, is seeking $75 million in damages, $25 million in actual damages, and $50 million in punitive damages. To most, the bankruptcy filing comes as a shock. Forbes estimates that the rapper had a net worth of $155 million in 2015.
CNBC reports that 50 Cent only filed after losing a second lawsuit, where he was ordered to pay $5 million to a woman who says he released a sex tape without her permission. Days after that order, the rapper filed papers that listed his total assets between the range of $10 and $50 million, a lot less than the $155 million predicted. Those documents also showed that his business liabilities were in the same range.
“This filing for personal bankruptcy protection permits Mr. Jackson to continue his involvement with various business interests and continue his work as an entertainer, while he pursues an orderly reorganization of his financial affairs,” said Jackson’s attorneys in a statement.
Craig Weiner, a partner at Robins Kaplan who is now representing 50 Cent in his bankruptcy proceedings, says the rapper only decided to file the lawsuit against GSB after determining that a settlement couldn’t be reached.
“In connection with this legal representation, as set forth in the Complaint Mr. Jackson became saddled with liabilities exceeding $18 million, not including the millions he spent in legal fees,” Weiner said in a statement.
According to the Wall Street Journal, GSB’s law firm did respond to 50 Cent’s allegations. The firm said while they understood the rappers disappointment with the outcome of the Sleek legal dispute, they did not believe that they were at fault.
“Our attorneys properly counseled Mr. Jackson and his sophisticated team of financial and operational advisers about the transactions and the arbitration’s with Sleek,” a spokesman for GSB said in a statement to Bankruptcy Beat.
[Photo by Janette Pellegrini/Getty Images for Cantor Fitzgerald]