Jay-Z Is Ordered to Testify in Case Involving His Former Fashion Brand

Jay-Z Is Ordered to Testify in Case Involving His Former Fashion Brand

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Alex Spiro, a lawyer representing Jay-Z, leaving court on Tuesday in Manhattan.CreditJemal Countess/Getty Images

A federal judge on Tuesday ordered the rapper and entrepreneur Jay-Z to testify as part of a securities investigation into a company that paid him more than $200 million in 2007 for assets including some related to the Rocawear brand.

During months of back and forth in response to subpoenas, lawyers for Jay-Z sought to limit his testimony in the case. They said that he had been on tour when his testimony was first requested and that he was now preparing for another.

Last week, the Securities and Exchange Commission filed court papers asking that a judge order Jay-Z, whose actual name is Shawn Carter, to comply with a subpoena to testify. In their most recent response, the lawyers sought to limit any testimony to a single day. But the S.E.C. resisted limits, and the judge sided with its lawyers.

“I’m granting the S.E.C.’s application to enforce the subpoena,” Judge Paul G. Gardephe of Federal District Court in Manhattan, said in court Tuesday. “The testimony has been delayed for five months, and I do not intend to tolerate any further delay.”

The S.E.C. is investigating whether federal securities laws were violated in connection with Iconix Brand Group Inc.’s “reporting of intangible assets, including the Rocawear assets.” Iconix wrote down the Rocawear brand by about $169 million for the year ending 2015 and by about $34 million for the year ending in 2017.

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Jay-Z in January. His lawyers had argued that he was busy preparing for a world tour.CreditMichael Zorn/Invision, via Associated Press

The government wrote that after the sale, Iconix reported that Mr. Carter remained involved with the Rocawear brand and that he and Iconix maintained certain business partnerships. The S.E.C. said that it wanted to question him about, among other things, the value of the Rocawear trademark; his involvement with the brand after the sale; and “multiple emails, meetings and phone calls related to Iconix.”

After briefly conferring on Tuesday, lawyers told Judge Gardephe that Mr. Carter would testify on May 15, an agreement that would appear to resolve a standoff over the scope of the subpoena and how much time Mr. Carter should make available.

In court papers, the S.E.C. had said that an examination of Mr. Carter would “take at least a full day of testimony.” The S.E.C. said that it sent subpoenas to Mr. Carter in November and February but that in emails and phone calls his lawyers said he would not comply unless the testimony was limited to four hours. Mr. Carter eventually agreed to a full day, and his lawyers wrote that the S.E.C. had “no legal warrant to insist upon more.”

In court papers, Mr. Carters lawyers said the S.E.C.’s request should be denied because the government had not shown that his testimony was relevant and because compliance would impose an unreasonable hardship. The S.E.C., they added, had rejected their offers to provide information through a lawyer or telephone interview.

They called the S.E.C. request “unreasonably and unnecessarily burdensome” and said it was “driven more by governmental fascination with celebrity and headlines than by any proper investigative purpose.”

Judge Gardephe suggested that it was not up to Mr. Carter’s lawyers to determine what information the S.E.C. should pursue, and he declined to institute time restrictions for his testimony.

“Limits sometimes incentivize respondents to waste time,” he said, adding that they might then want to “in effect, run out the clock.”

A version of this article appears in print on , on Page B2 of the New York edition with the headline: Jay-Z Forced To Testify In Inquiry. Order Reprints | Today’s Paper | Subscribe

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