Without the Ye, is it Yeezy? Identify the new “sole” owner
Kanye West once sung, “When it starts to become crazy, then run away.” Adidas took his counsel.
Where do I begin? Adidas severed relations with Ye, the musician once known as Kanye West (and formerly known as a billionaire), following a social media outcry, adding to the lengthy list of companies who have broken connections with the singer following his antisemitic media tour.
Adidas announced that it will “cease all payments to Ye and his enterprises, and end production of Yeezy-branded goods.” Adidas will immediately discontinue operating its Adidas Yeezy business.
However, if you scroll down and read the company’s announcement carefully, you’ll notice an unusual sentence that is causing industry scepticism (and that appears to have been written by Adidas’ legal department).
“Adidas is the exclusive owner of all design rights to the partnership’s products, including past and future colorways.”
The phrase “Sole owner of all design rights” should be underlined.
I spoke with numerous legal professionals about the relevance of that line and what Adidas can and cannot do moving forward despite the fact that the Yeezy/Adidas contract isn’t publicly available.
Shahrina Ankhi-Krol, a New York City fashion lawyer, informed me that Adidas would be the one to own everything, despite the fact that Kanye is the owner of the trademark for his brand, with the proviso that she hadn’t seen the Adidas/Ye deal.
However, the phrase leaves more open than it does answered. According to legal experts I spoke with, while the Adidas statement formally ends the sale of Yeezy-branded goods, it permits them to rename the current Yeezy styles without Ye.
Simply said, Ye might be the owner of “Yeezy.” However, the Yeezy sneaker designs are Adidas’ property.
The designs themselves they can reuse because they control them, according to Nicole Haff, litigation and entertainment partner at Romano Law. “They won’t be able to use his specific trademarks,” she added. Haff forwarded me to this piece that examines Adidas’ patent applications and demonstrates that, with the exception of the Yeezy Slides, the firm asserts ownership of all Yeezy/Adidas designs. All of those are Kanye.
According to Haff, Ye is being given a legal “warning shot” by Adidas’ use of the phrase “sole owner” in its statement. He’s been making a lot of claims to the press, she added, including that his designs have been copied and that money is owed to him. “What I believe is taking place is that Adidas has been outlining their [legal] stance,” the author said.
The morality clause in the Yeezy/Adidas contract, which might offer Adidas legal cover to end their relationship, could be the deciding factor in that legal position. That there isn’t a morals clause is incomprehensible, said Haff. Kanye’s actions “certainly affect the Adidas brand and its reputation”
The Fashion Law has an excellent article that goes into great detail regarding the legal issues surrounding the Yeezy/Adidas split.
Could Ye now launch his own Yeezy clothing line? That might be a huge task, according to Teri Agins, author of “Hijacking the Runway: How Celebrities are Stealing the Spotlight from Fashion Designers.”
Agins claims that, in contrast to apparel, sneaker designs are more tightly related to technology and patents, which shoe corporations zealously guard. All of the characteristics that distinguish a shoe from others are protected by trademarks, according to Agins. He lacks the necessary infrastructure; you cannot accomplish that on your own.
Take a step back: In September, West publicly ended his two-year association with Gap. The business declared today that it would close down YeezyGap.com and immediately stop selling products bearing the Yeezy name in its own stores. The website is currently redirected to Gap’s main page.
For the business, ending production of the current Yeezy products was a no-brainer. With its main designer publicly quitting and trashing the company, it was already a zombie brand.
Adidas, in contrast to Gap, has established a very successful business selling products with the Yeezy name. Adidas’ Yeezy sneakers were among the most sought-after and well-known pairs of footwear, frequently fetching thousands of dollars on the secondary market. You might not be aware of the significant impact that Kanye West’s Yeezy brand has had if you haven’t been paying attention to fashion trends over the past ten years.
According to Lawrence Schlossman, co-host of the menswear podcast Throwing Fits, “Ye has undoubtedly had the most influence on fashion over the previous ten years, which just makes his most recent nuclear fall from grace that much more sad.”
Influence brought money, which helped West become a billionaire (from which he has since fallen) and improved Adidas’ financial situation. According to a report by Cowen analyst John Kernan last month, the Yeezy brand generates between 4 and 8% of all sales for Adidas. About 19.3 billion euros are the market capitalization of the business.
Based on the chance that the Yeezy partnership will break, Cowen had downgraded the stock.
Adidas stock has decreased by more than 18% since the beginning of the month, proving Cowen’s analysis to be accurate. One of the lyrics from his 2010 hit song “Runaway” reads, “When it starts to become crazy, then runaway…runaway as fast as you can.” But from whom are they fleeing?
Analysts’ predictions for GM’s third-quarter profits were well exceeded as demand for pickup trucks and SUVs remains strong.
The new (old) trend in index funds?
Investing passively is a trend.
Buying meme stocks is so 2021 whereas index funds seem to be making a comeback, just like thin jeans are out and ridiculously big chinos are back in.
According to S&P Dow Jones Indices, over the past 25 years, investing in index funds has saved investors more than $400 billion in fees.
By stating that “index provider S&P Global has a vested interest in pushing passive funds backed to various benchmark indexes,” CNN’s Paul La Monica provides context for such figures.
The joy of gambling—sorry, I mean, “investing”—in high-risk individual stocks that went up and down depending on the day was lost if you passively held onto equities during the heady boom times of 2021. However, as the adage goes, “in a bull market, everyone seems like a genius.”
According to a report published this month by Morningstar’s Bryan Armour, director of passive strategies research for North America, “Actively managed funds have struggled to survive and exceed their benchmarks, especially over longer time horizons.”
Armour cited the statistic that, over the ten years ending in June, only one out of every four active funds were able to outperform their passive counterparts.