On Thursday the SEC filed a subpoena for Shawn ‘Jay-Z‘ Carter to testify about the more than $200M Iconix paid to acquire his fashion brand, Rocawear.
The SEC has been looking more into Iconix financial reporting and in relation to Rocawear, they more than $200 million they paid to acquire “intangible assets” associated with the brand.
This isn’t the first subpoena that the SEC has served Carter. The initial subpoena was issued on November 16th, 2017. Carter gained new counsel in February 2018 and the SEC subpoenaed him again for his testimony. The agency said, “Carter has failed to appear as required by the subpoenas and, through his counsel, Carter has declined to provide any additional dates on which he will agree to appear for investigative testimony.’
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The SEC feels the subpoena is appropriate as the “information sought from the witness (Carter) is relevant to the investigation.” The agency also added that the application, “does not reflect a determination by the SEC or its staff that Carter has violated provisions of the federal securities law at issue in the investigation.”
A representative for Jay-Z tweeted to CNBC, “We are aware that the SEC is seeking information on Iconix financial reporting. Mr. Carter has no role in that reporting or Iconix’s other actions as a public company. Mr. Carter is a private citizen who should not be involved in this matter.”
In March 2016, Iconix said it would write-down where the $169M in relation to Rocawear and in March 2018, there was an additional write-down of $34M. Shares of Iconix plummeted in December 2015 after the company publicly confirmed that the SEC was conducting a formal investigation into its accounting issues.