Roc Nation Invokes Force Majeure Clause and COVID-19 in Lawsuit With Landlord Over NYC Offices

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Roc Nation

Jay Z's entertainment company blames hardships caused by the pandemic and failure to approve subleasers, while its landlord says it does not constitute force majeure.

Jay Z's Roc Nation is suing its New York City landlord for declaring the entertainment company in default on rent for its Garment District office space. Roc Nation says it temporarily stopped paying rent due to the “unforeseen hardships caused by COVID," according to court papers filed Tuesday (June 16).

Roc Nation filed the lawsuit Tuesday in New York Supreme Court against landlord company 1411 IS-SIC Property LLC at 1411 Broadway where it rents the 38th and 39th floors. Per the lawsuit, Roc Nation is tied into its lease agreement until 2024. The space was Roc Nation's headquarters until 2018 when the company outgrew the offices and moved operations to a different building.

According to the lawsuit, Roc Nation has been asking the landlord prior to the COVID-19 outbreak to permit it to sublease more than 10,000 square feet to two separate companies, but the landlord had repeatedly denied the request to approve the sublets.Then on April 20 Roc Nation informed the landlord that the effects of the coronavirus pandemic triggered the force majeure clause of their lease contract because it created unforeseen hardships. The company argues the pandemic represents an "act of God" and because of that it began temporarily withholding rent as it could not make use of the premises.

However, the property company maintains that "mere financial difficulty is not a force majeure event" and has insisted the Roc Nation pay its full rent payments. The property company is now seeking to draw on the $1.3 million line of credit that Roc Nation put down as collateral, according to court papers.

Roc Nation is urgently requesting that that a judge step in and order its landlord to allow them to sublease the property and to confirm it is entitled to temporarily withheld rent payments as a result of COVID-19. It is also asking the court to bar its landlord from being able to draw on that line of credit.

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