Legal and Management

Kanye West Sued by E-Commerce Company for Allegedly Stealing Tech

Kanye West
Robin Marchant/Getty Images for Ralph Lauren

Kanye West attends Jim Moore Book Event At Ralph Lauren Chicago on Oct. 28, 2019 in Chicago.

Black-owned company MyChannel Inc claims West broke a deal and used their proprietary and confidential technology to fuel his Yeezy online store.

Kanye West is being sued by a Black-owned video and e-commerce company called MyChannel Inc (MYC) that claims the artist breached their mutual non-disclosure agreement and took “their proprietary and confidential technology and information to fuel the e-commerce engine" of his Yeezy brand. The federal lawsuit that was filed in California Central District on Tuesday (Aug. 25) alleges West and his Yeezy brand made “lavish promises to MYC of millions of dollars in economic reward” in the formation of a partnership, but didn't follow through.

MYC says they relied on those promises and devoted “tens of thousands of hours” to Yeezy. Yet instead of a lucrative partnership, they say West cut off contact and took their proprietary and confidential technology and used it for his own Yeezy e-commerce engine.

In its 32-page complaint, the company claims that it "invented a new way of using novel technology and artificial intelligence to seamlessly marry e-commerce to video content." West became interested in their project in spring 2018 and convinced MYC company founders CEO Julian Duggan and COO Gibran Gadsden to devote their full attention to him and his brand, the lawsuit claims, including moving their headquarters from Pennsylvania to Yeezy’s headquarters, first in Calabasas, California, and then Chicago, and working full time on the West project to their own cost of $7 million. Over a six-month span of time, West, they say, encouraged them “to devote millions of dollars in time and to the venture, to develop, build-out, operate and manage the Yeezy e-commerce business." That included hundreds of thousands of dollars relocating executives on “personal living and travel expenses from living both in California and then Chicago at Mr. West’s demand.”

West also allegedly promised them he would make a $10 million dollar strategic investment in MYC and allegedly agreed to a non-disclosure agreement with MYC to protect their trade secrets. Yet, in the end, MYC says West exploited their proprietary information and then used a copycat video e-commerce technology to drive merchandise sales on his Sunday Service platform.

“He later inexplicably reneged on his promises seemingly on a whim and walked away from the successful partnership while misappropriating MYC’s proprietary and trade secrets, netting Kanye hundreds of millions of dollars off the back of MYC,” according to the complaint.

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MYC attorney Ben Meiselas posted this statement on social media: “Attorney Michael Popok and I just filed a federal lawsuit against Kanye West for misappropriating proprietary information and not paying his business partners. We will hold Mr. West accountable, as well as those who aided and abetted his conduct, and bring justice to our client."

The plaintiffs are seeking compensatory damages in an amount to be determined at trial.

West's rep did not respond to a request for comment a time of publishing.