What’s Happening With Dame Dash’s Shares of Roc-A-Fella?
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On 2002’s “Hovi Baby,” Shawn “Jay-Z” Carter shouted out the Roc-A-Fella Records braintrust, calling it, “’The Dynasty,’ no not Ming but Shawn’s / Dame, Kareem, nigga it’s the gangsta team.” The trio of Carter, and executives Dame Dash and Kareem “Biggs” Burke are the big three behind Roc-A-Fella Records, one of rap’s most legendary movements. From Ye and rapper turned sports analyst Cam’ron to industry movers and shakers like Gee Roberson and Chaka Pilgrim, the Roc’s fingerprints are still in popular culture.
Even with Dash estranged from Shawn “Jay-Z” Carter and Burke since the label’s 2004 split, they were still together on paper — but that may be changing. In February, a New York judge ordered Roc-A-Fella Inc to deliver Dash’s shares of the company to the US Marshals to satisfy an $823K judgment from movie producer Josh Webber and Muddy Waters Films. The judgment is the latest in a string of financial woes that have befallen Dash since parting ways with Carter, and then Burke: in 2019, he was arrested for failing to pay more than $400,000 in child support to his ex-wife Rachel Roy. Last November, on the The CEO Show with Dr. Taje Moreno he called himself a “proud broke,” noting that he couldn’t afford annual child support payments of $300K to $400K to Roy. Dash did not respond to a request for comment on this story.
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Manhattan Lawyer Richard Roth of The Roth Law Firm says that the recent ruling has Dash in “big trouble” as far as his Roc-A-Fella Inc. shares go.
“The only thing that would maybe slow it down would be a bankruptcy,” Roth explains. “If he files a bankruptcy, that could stop everything from happening. But other than that, these shares are going to be sold and sold to the highest bidder. And if the price is greater than the amount that the creditor is owed, then he’ll get the balance. If it’s less than the amount, the shares are gone and he gets nothing.”
Christopher Brown is an attorney at Brown & Rosen. He represented Webber in his suit against Dash, and now controls the judgment process. He says that the Roc-A-Fella shares will be put up for auction within the next six months, allowing someone to own one-third of Roc-A-Fella Inc., which owns Jay-Z’s Reasonable Doubt album. Brown tells Rolling Stone that despite rappers Cam’ron and Mase hinting at “hypothetically” having Dash’s share, no one has purchased them, and that only he and the Marshal can sell off the judgments.
In 2022, Carter and Roc-A-Fella Records Inc. successfully received a restraining order to block what they allege was Dash’s plan to sell his stake in Carter’s Reasonable Doubt debut in an NFT auction.
At the time, Dash’s lawyers claimed that Carter’s action was “completely meritless since Dash never claimed, tried to sell, transfer, assign, or dispose of any interest in the copyright to the Reasonable Doubt album, which is owned by RAF; and, Dash never minted any NFT of the Reasonable Doubt or his one-third interest in RAF.” Their legal documentation also alleges that Carter’s restraining order was a ploy to get Dash to sell the label to Carter for “an amount far below its potential market value.” The two sides settled and stipulated that no shareholder has any individual rights to Reasonable Doubt.
In a recent interview on his America Nu Network YouTube channel, Dash admitted that despite his lawyers saying otherwise, he was previously attempting to auction his Reasonable Doubt shares in 2022 and is seeking to do so again to “fund his other businesses.” He noted that the judge essentially ruled “Those bylaws that you put in 2021 are not applicable. You can’t tell that man he can’t sell his private property,’ adding, “So now I get to take it to auction like I originally wanted to.” But now, Dash doesn’t have control of the auction.
Below, we’ve decided to go more in-depth to explain just what’s going on with Dash’s shares of Roc-A-Fella Inc.
Why are Dame Dash’s Roc-A-Fella shares for sale?
In 2018 Dash was fired as director on Muddy Waters Pictures 2016 film Dear Frank, with movie producer Josh Weber saying in a since-deleted Instagram Post that he felt the former music mogul was unfit for the position and was often high on set.
Dash claimed that Muddy Waters filmed the movie at his Sherman Oaks home with his equipment, hence making the film his property. In 2019 Weber sued Dash for defamation and copyright infringement for attempting to sell Dear Frank as a film called The List and for comments such as calling Weber.
Muddy Waters won an $805K judgement against Dash in 2022. But, according to Radar Online, Dash has yet to pay, so a Judge recently ordered Dash to turn over his shares of Roc-A-Fella to the US Marshal’s Service within 180 days to satisfy the judgment.
Roc-A-Fella Records co-founders Shawn “Jay-Z” Carter and Kareem “Biggs” Burke, who own the other two-thirds of Roc-A-Fella Inc, previously attempted to block the recent ruling. They claim that their company bylaws prevent one of the three men from selling their shares without full approval from the company’s board. But U.S. Magistrate Robert W. Lehrburger ruled against Carter and Burke’s claim, noting that the board-approval clause was instituted at a 2021 Roc-A-Fella Inc board meeting that Dash wasn’t present for.
Kevin Casini is a music lawyer and law professor at Quinnipiac University School of Law. He says that, “The court admonished RAF for not having clear by-laws but no court is going to let any by-laws prevent the execution of a judgment.” Essentially, there was nothing the other shareholders could do to block the ruling.
What exactly is for sale?
Dash’s share of Roc-A-Fella Inc., the company that owns Jay-Z’s Reasonable Doubt album, is up for auction. But there’s an important distinction to make between Roc-A-Fella Inc. and Roc-A-Fella LLC.
In 1996, Dash, Carter, and Burke incorporated their brand, creating Roc-A-Fella Inc and releasing Jay-Z’s Reasonable Doubt album through the company. In early 1997, the trio established a 50/50 joint venture with Def Jam Records. In June of 1997, they established Roc-A-Fella LLC, which houses the rest of the label’s catalog. In 2004, the men collectively sold their 50% stake in the LLC to Island Def Jam Records for $10 million — but they still shared stake in Roc-A-Fella Inc until the recent ruling
It’s worth clarifying that the ultimate purchaser wouldn’t have a third of interest in the entire Roc-A-Fella catalog, but in Roc-A-Fella Inc., the company that houses Reasonable Doubt.
Who is trying to buy?
Christopher Brown bemoans that the news cycle has been rife with misinformation about the auction, which he blames on Dash implying that he’s spearheading the sale. “His shares have actually been assigned to United States Marshal, [at] my request,” Brown says. “So he actually doesn’t have anything to sell. He’s not even in possession of this stock.”
In February, rappers Cam’ron and Mase went viral for a segment on their It Is What It Is show where they implied that they “hypothetically” had a one-third stake in Roc-A-Fella. They also hinted that a former rival of Jay-Z was attempting to buy the shares from them. During a March interview on his America Nu Network YouTube channel, Dash said “What I can say is this, in this very moment, [Cam’ron and Mase] could have it.” He added, “I’m just celebrating the fact that I can freely sell it and that I have the option to sell it to Cam and Mase, and I’m not saying that I haven’t… I like to pass the torch, you know, and I like what they’ve done. They didn’t fold, they from Harlem, we all came up together, and it would be fun to see them running Roc-A-Fella.”
But on March 8, Brown released a statement where he clarified “Damon Dash has no control over the auction process,” warning, “buyer beware.” Elsewhere in the statement, Brown revealed that four entities were seeking to purchase the judgments: two “prominent New York rappers,” World One TV, and another network. “Both networks are willing to pay an amount in excess of the judgments, understanding the value of this once-in-a-lifetime opportunity,” the statement read.
Brown tells Rolling Stone that since that March 8 statement, another mystery entity has emerged that he calls the new “front runner.” The entity, which he plans to publicly reveal shortly, is an entertainment company with desires to purchase the shares and revive Roc-A-Fella Records — though they would need to come to an agreement with Carter and Burke to do so.
Brown also notes that some of the interested buyers may not be interested in purchasing the judgment to own the Roc-A-Fella shares ultimately, but merely to own the judgments, which allow them to spearhead the auction process. Brown says that controlling the auction would be positive publicity, as it recently was for Cam’ron and Mase.
“The exposure [Cam’ron and Mase] are getting right now is tremendous,” Brown says. “Can you imagine if that was a network? Could you imagine that that was Universal [or] Sony? Could you imagine if that was [an] upstart? Could you imagine the blitz that would happen for whoever controls this process? Some folks place a premium on that kind of exposure.”
if someone like Jay-Z, somebody who has another one-third interest, they have much more incentive to spend more money because they’re going to go from one-third to two-thirds, right? So it’s more valuable to the insiders, so that they can have a controlling interest of the company, than it is an outsider.
How will the shares be sold?
At this point, Brown plans to go through a traditional auction, which attorney Roth says are run in Manhattan at the federal courthouse. “The process takes a few months because the creditor is obligated to give public notice to anyone and everyone who may have an interest,” he clarifies. “Many times, I will go to the courthouse and I will see an auction of real estate, an auction of goods, and whoever gets notice has a right to go and put an offer in and the highest bidder takes it and pays the money.“
Though an Auction seems likely, Roth says there are still alternative resolutions for the shares. If Dash declares bankruptcy, there would be a stay on the auction. And if Dash paid off the judgments, he could also retrieve the shares from the US Marshals.
But Roth adds that there is room for someone to purchase the judgments in order to work out a deal with Dame before the auction. He adds the entity could keep itself private.
“Let’s assume Jay-Z forms a company called ZJ LLC. ZJ LLC can say, ‘Listen, he owes $823,000. I will buy that judgment or I will pay the debt. Everything he owes, the $832,000, the $30,000, everything else. Don’t have an auction and I will get you your money.’ The creditor doesn’t care how they get their money. [ZJ can say] ‘I will get you every dollar you’re entitled to and I will work it out behind-the-scenes how I’m going to,’ and he works on a deal with that. He says [to Dash], “Listen, I’m putting out a million bucks for you. I want, whatever, 18% of your interest so I now have 51%, and you’re going to owe me, on a note, X dollars.”
Roth says that the lucrative nature of the Roc-A-Fella shares makes him believe that Carter, Burke, and Dash are “going to work something out, pay the creditor off, and then it’ll be private.” But he adds in that scenario, “Dash gives all of his shares, Dash gives some of his shares, or Dash doesn’t give any shares, but signs a note” which states that he owes the buyer, not the creditors.
privately and prevent an auction. He says that the current Roc-A-Fella shareholders could have to “keep it in the family.”
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