Jay-Z, born Shawn Carter, has taken investment firm Highland Capital Management LP to court over a dispute involving loan guarantees. A lawsuit was filed Wednesday, Feb. 3 in federal court in New York.
The suit claims Highland and co-defendant NexBank SSB are attempting to “bleed” from him funds in excess of those he and two other men pledged to pay when they guaranteed the non-principal obligations of a company planning to build a hotel in Manhattan’s west side neighborhood of Chelsea.
The complaint charges that Highland and NexBank acted in bad faith when they declined to clear Carter and his fellow guarantors of their obligations after receiving a deed in lieu of foreclosure on the property.
“In August 2007, a company controlled by Mr. Carter borrowed $52 million as a loan to purchase Manhattan property for a future boutique hotel,” Nina Devlin, a Highland spokeswoman, said in a statement e-mailed to Bloomberg News.
“Highland Capital Management believes the claims asserted by Mr. Carter are meritless and will vigorously defend itself and intends to pursue the obligations owed to Highland’s investors,” Devlin continued.
The rap star is seeking a declaratory judgment that he has met those obligations. He’s also seeking damages of more than $3.7 million for the additional interest and other costs incurred while still being held liable under the agreements. –gerald radford
