The City of New York, represented by the NYC Department of Social Services (NYCDSS), has requested a premotion conference and a stay of the auction sale of Damon Dash’s stock interest in Roc-A-Fella Records due to comments made by Jay-Z.
The request, submitted to United States Magistrate Judge Robert W. Lehrburger, comes amid allegations that Jay-Z has made public statements designed to devalue the stock and deter potential bidders.
The City argues that Jay-Z’s claims about his right to terminate RAF’s copyright for his album Reasonable Doubt are false and have significantly impacted the auction’s potential to generate sufficient funds.
According to Gerald E. Singleton, the attorney representing the City, Jay-Z has publicly stated that the rights to Reasonable Doubt will revert to him in 2031, a claim that Singleton asserts is untrue.
“Jay-Z has issued widely publicized statements warning potential bidders that copyright ownership will revert back to him in 2031,” Singleton wrote in the letter to Judge Lehrburger. “Those statements are false and extremely damaging to the City’s interests in ensuring that the auction will generate sufficient funds to satisfy all existing child support arrearages and secure future child support payments.”
The City contends that Jay-Z has no termination right under the Copyright Act because Reasonable Doubt is considered a “work made for hire.”
The agreement between Jay-Z and Roc-A-Fella, signed in 1995, explicitly states that all masters recorded under the contract are deemed “works made for hire,” granting RAF ownership of the copyright until 2098.
In addition to Jay-Z’s statements, lawyers for Roc-A-Fella have been accused of refusing to provide critical royalty information in response to a subpoena.
This information is deemed essential for potential bidders to accurately value the stock.
The City has indicated that it will likely file motions for turnover orders against Roc-A-Fella and its controlled affiliates to compel the release of this information.
“The auction should be conducted in a manner that will bring the highest price for the benefit of affected judgment creditors,” Singleton emphasized, citing previous court rulings that public auction sales should be conducted in an environment calculated to bring the highest possible price.
The City is seeking a stay of the auction until the court can rule on whether Jay-Z possesses a right to terminate RAF’s copyright and whether discovery concerning the valuation of such copyright rights should be allowed.
The City also requests an order compelling Roc-A-Fella to provide the necessary royalty information and to produce a knowledgeable person for deposition.
Damon Dash ripped Jay-Z in a post on Instagram.
Damon Dash is trying to auction his 33.3% stake in Roc-A-Fella Records to satisfy an $823,000 debt after losing a legal battle with film producer Josh Webber over the film “Dear Frank.”
A New York court ordered the sale to cover the debt, which stems from Dash’s alleged attempt to sell the film under a different title after being removed as director because of his on-set antics.
The auction was originally set for August 29, 2024 and was supposed to start at $1.2 million, with a $240,000 deposit required.
Because Dash owes money to multiple parties, Judge Robert Lehbruger granted a request to extend the timeline.
Damon is also offering an original Roc-A-Fella chain as an incentive for bids over $10 million, the buyer will have limited decision-making power, as major decisions require a majority vote.
If the auction surpasses $10 million, the rest of the money earned would go to New York State to settle Damon Dash’s $8 million tax bill and other debts.
