Damon DashJay-Z's one-third stake in Roc-A-Fella Records will go up for auction later this month — but a source says Advertising sign that the shares may come with certain key restrictions.
According to federal court filings this week, the United States Marshals Service will auction Dash's 33.3 percent stake in the famed record label to satisfy an $823,000 judgment against it in a lawsuit filed by the movie producer. Josh Webber for a failed film collaboration.
The auction, set for Aug. 29 at a Midtown Manhattan hotel, will have a minimum bid of $1.2 million, and prospective bidders will be required to put down a $240,000 deposit to enter the process.
The sale will be for Dash's stake in Roc-A-Fella Inc., an entity whose primary assets are the rights to Jay-Z's iconic debut album Reasonable doubt. According to an article in April Rolling rockthe remaining catalog of music released by Roc-A-Fella, which dissolved as an operating company in 2013, is owned by other entities and is not involved.
The owners of the other two-thirds of Roc-A-Fella — label co-founders Jay-Z (Shawn Carter) and Kareem “Biggs” Burke — have already tried to stop the auction, including changing the company's charter and intervening in the lawsuit. But a federal judge rejected such opposition in February.
The chance to acquire a valuable piece of IP rap is sure to attract bidders, but a source with knowledge of the situation says Advertising sign that there are significant restrictions on what is auctioned — that is, that they are buying a share in a company with other members.
“Whoever buys Dame's stake in Roc-A-Fella will be a minority owner with no decision-making power,” the source says Advertising sign. “They will not be able to sell the copyright or borrow against the master, as all decisions require a majority vote.”
The source also warned that the clock was running on Roc-A-Fella's rights to Reasonable doubt: “There is also an expiration date on the main property for the company, which means income and the only asset does not have many years.”
The auction will be coordinated by Webber's attorney, Chris Brown. He did not immediately return a request for comment Thursday.
Webber won his judgment in 2022 after suing Dash for copyright infringement and defamation over their failed collaboration to produce a film titled Dear Frank. But Dash has yet to hand over the money, hence the court-ordered auction.
The director isn't the only one looking to cash in on Dash's Roc-A-Fella stake. The New York City Department of Social Services (NYCDSS) will actually be the first to pay, according to court documents, as Dash owes a total of $145,096 in unpaid child support to a woman named Rachel Roy for his two daughters and a woman named Cindy Morales. for his son.
Brown is also seeking to collect another $155,000 that Dash owes him and another customer, photographer Monique Bunn, in separate legal actions. But they have agreed that NYCDSS and Webber deserve to recover their debts from Dash first.
Any money left over from the auction will go to Dash himself. His attorney did not return a request for comment Thursday.
Back in 2021, attorneys for Jay-Z and Roc-A-Fella sued Dash after news broke that he planned to auction off a stake in Reasonable doubt as a non-tradable token (NFT). They argued that the label, not Dash himself, owned the rights to the album: “The bottom line is simple: Dash can't sell what he doesn't own.” A year later, Dash signed a settlement in which he agreed that he had no right to sell any part of Jay-Z's album – NFT or otherwise.
Last year, lawyers for Jay-Z, Biggs and Roc-A-Fella made a concerted effort to stop the court-ordered sale of Dash's stake in the company. After joining Webber's lawsuit, they told a federal judge that the auction would violate the company's bylaws, which they had amended in 2021 to prohibit such a sale.
But in February, the judge overseeing the case said the updated Roc-A-Fella regulations had been enacted without Dash's input and could not be enforced. Instead, he offered an alternative route for Jay-Z and Biggs that would still “easily address their concern” with the sale: “They can participate in the auction and submit the winning bid.”
