Business
Kanye West ordered to pay former contractor $140,000 over Malibu mansion lawsuit
A jury found Ye, the controversial music impresario formerly known as Kanye West, liable in the legal dispute brought by his former contractor and ordered him to pay $140,000.
Tony Saxon, who also worked as Ye’s security guard and caretaker at the Malibu property, sued the rapper in Los Angeles Superior Court in September 2023, claiming a slate of labor violations, nonpayment of services and disability discrimination.
The $140,000 judgment announced Wednesday is far less than the $1.7 million in damages that Saxon’s lawyers had originally requested. Ye will also have to pay for Saxon’s legal fees, which is expected to put the total sum that West will have to pay at more than $1 million.
Although Saxon’s attorneys at the Los Angeles-based firm West Coast Trial Lawyers called the verdict a “mixed” one, they characterized it as as a “vindication for our client.”
“Ye’s lawyers called him a liar, a fraud, and a malingerer in court. His medical records, bank records, and personal family history were dissected, mocked, and vilified,” said attorney Ronald Zambrano in a statement.
“In true David-vs.-Goliath fashion, Mr. Saxon stood firm against one of the biggest celebrities in the world, with the truth on his side,” Zambrano said.
Saxon alleged that while working as a security guard on the property, he was forced to sleep on the floor and was fired in November 2021 for failing to comply with Ye’s “dangerous requests.” He also said that he frequently complained to West about these and other issues, but that the rapper failed to address them.
In a statement, Ye’s spokesperson noted the jury had “rejected almost all of his [Saxon’s ] claims,” and that Saxon only recovered “a small fraction of what his lawyers demanded.”
“The jury also found that Saxon acted in the capacity of a contractor and did not qualify for the employee exception under California’s contractor licensing statutes,” according to the statement. “We believe the damages award is legally barred and we’ll be seeking post-trial relief from the court.”
Ye purchased the beachfront concrete mansion in 2021— designed by Pritzker Prize-winning Japanese architect Tadao Ando — for $57.3 million. He then gutted the property on Malibu Road, reportedly saying, “This is going to be my bomb shelter. This is going to be my Batcave.”
Three years later, the hip-hop star sold the unfinished mansion (he had removed the windows, doors, electricity and plumbing and broke down walls), at a significant loss to developer Steven Belmont’s Belwood Investments for $21 million.
In court filings Ye denied Saxon’s allegations. In a November 2023 response to the complaint, he disputed that Saxon “has sustained any injury, damage, or loss by reason of any act, omission or breach by Defendant.”
In January, Ye sued Saxon and his law firm over a $1.8 million lien placed on the Malibu mansion, alleging they “wrongfully” placed an “invalid” lien on the property “while simultaneously launching an aggressive publicity campaign designed to pressure Ye, chill prospective transactions, and extract payment on disputed claims already being litigated in court.”
The Malibu mansion that Ye purchased and gutted was later purchased and restored to its original design.
(The Oppenheim Group / Roger Davies)
That case is pending.
Ye’s spokesperson said the lien “clouded the home’s title and interfered with its sale, destroying substantial value at the time of sale.”
In recent years, the mercurial superstar has faced a number of public and legal dramas.
In 2022, Ye lost numerous lucrative partnerships with companies like Adidas and the Gap, following a raft of antisemitic statements, including declaring himself a Nazi on X (which he later recanted).
Two years later, Ye abruptly shut down Donda Academy, the troubled private school he founded in 2020.
Ye, the school and some of his affiliated businesses faced multiple lawsuits from former employees and educators, alleging they were victims of wrongful termination, a hostile work environment and other claims.
In court filings, Ye has denied each of the claims made against him by former employees and educators at Donda.
Several of those suits have been settled.
With the flow of energy through the Middle East still mostly blocked and oil prices rising, policymakers in Europe are confronting the immediate impact of higher costs and trying to decipher the potential economic damage of a prolonged conflict.
On Thursday, officials at the European Central Bank and Bank of England are expected to hold interest rates steady, but investors are betting that each central bank will raise rates at least twice later this year. Economists and lawmakers will be watching closely for signs about how the central banks will respond to jumps in inflation.
The effective closing of the Strait of Hormuz, a vital waterway for fuel and other commodities off Iran’s southern coast, has sharply increased energy prices. Brent crude, the international benchmark, has pushed well above $100 a barrel, while European natural gas prices are nearly 40 percent higher since the United States and Israel attacked Iran at the end of February.
The war had an almost immediate impact on European inflation, increasing gasoline prices at the pump, airfares and other fuel-intensive activities. In Britain, the annual inflation rate climbed to 3.3 percent in March and is expected to stay around 3 percent through the second quarter, a percentage point above the central bank’s target. For the 21 countries that use the euro, inflation averaged 2.6 percent in March, up from 1.9 percent a month earlier.
But for the central banks, the question is whether higher prices will ripple through the economy and eventually push up wages, potentially setting off a spiral of escalating prices that would warrant aggressive rate increases like those in 2022. For now, analysts say there isn’t enough information on how the war, seemingly in a holding pattern, will affect the economy. While President Trump has extended a cease-fire in the region, traffic through the strait remains sparse.
At the same time, the concern about inflation is being weighed against the possibility that the war damages economic growth. In that scenario, policymakers wouldn’t want to tighten financial conditions. Consumer sentiment in Germany, the eurozone’s largest economy, dropped to its lowest level in three years, data this week showed. This month, the International Monetary Fund said the bloc’s economy would grow 1.1 percent this year, but that assumed a relatively quick resolution to the war and the recovery of global energy markets.
“The E.C.B. will stay in ‘wait and see’ mode, at least for now,” analysts at HSBC wrote in a note. But “the risk of prolonged energy supply disruption, coupled with risks of second-round effects on inflation,” increase the probability of the central bank’s raising interest rates later.
It’s a dilemma facing central banks farther afield as well. This week, the Bank of Japan voted to hold interest rates steady, but it was a split decision with several officials preferring an increase in rates. The central bank raised its inflation forecast while warning that economic growth is likely to slow this year.
On Wednesday, the Federal Reserve also held interest rates steady. It acknowledged the war’s effect on the economy, saying inflation had ticked up because of the “recent increase in global energy prices.”
Paramount Skydance has asked the Federal Communications Commission for permission to exceed foreign ownership rules for U.S. media companies to pave the way for its takeover of Warner Bros. Discovery.
David Ellison’s media company is expecting to receive $24 billion from three Middle Eastern royal families, who would become part owners of the combined Paramount-Warner Bros. Discovery. Paramount on Monday asked the FCC for authorization to include the royal families and other foreign investors to help finance the company’s proposed $81-billion transaction.
U.S. law restricts foreign investors from owning more than 25% of a company that holds an FCC broadcast license — unless the commission determines that such an ownership structure would “serve the public interest.”
The FCC disclosed that Paramount had asked for such a “public interest” ruling to allow the merged entity to exceed the 25% foreign ownership cap.
The FCC, which did not indicate whether it will go along with Paramount’s request, initiated a review.
Paramount, in a statement, described the move as a “customary petition,” one that was required because of “the recent equity syndication.”
The Larry Ellison family will retain control of the company through its voting interests, the company said.
“When the transaction and equity syndication close, the Ellison family and RedBird [Capital Partners] will collectively hold the largest equity stake in the combined company and continue to be the sole owners of Class A Common Stock, representing 100% of the voting shares,” Paramount said.
The Ellisons must come up with $47.2 billion in equity and more than $60 billion in debt financing to pull off the deal, which is valued at $111 billion, including Warner Bros. Discovery’s existing debt.
The $24 billion expected from the sovereign wealth funds — representing the royal families of Saudi Arabia, Abu Dhabi and Qatar — would together represent about 49% of the equity in the new company. As part of the investor group, Saudi Arabia’s Public Investment Fund has agreed to contribute $10 billion, according to regulatory filings.
The FCC is involved because of Paramount’s ownership of CBS and 28 television station licenses granted by the FCC. That gives FCC Chairman Brendan Carr influence over the ownership structure of the combined company.
Paramount, as it is currently constituted, has foreign investors — although not enough to approach the ownership cap. Some of those investors are expected to roll over to the larger Paramount-Warner Bros. when that merger is complete.
Several Democrats in Congress, including Sens. Cory Booker (D-N.J.) and Elizabeth Warren (D-Mass.), have expressed alarm about the prospect of allowing foreign entities to hold such an enormous stake in a major U.S. media company, particularly one with two prominent news outlets: CBS News and CNN. The two senators previously cited national national security concerns.
Paramount has long maintained the foreign ownership issue was largely resolved because the Middle Eastern families would not have voting representatives on the company’s board.
However, the FCC on Monday noted that, under its rules to calculate foreign ownership levels, the agency considers “a voting interest equal to [an entity’s] equity interest for purposes of seeking specific approval.”
The FCC has allowed other media companies to have significant foreign investment. Years ago, the FCC agreed to allow Mexico City-based Grupo Televisa to own much of Univision, the U.S.-based Spanish-language company. More recently, struggling radio giant iHeartMedia Inc. gained FCC approval for foreign owners to buy up to 100% of the company’s stock.
To get the Warner Bros. Discovery deal over the finish line, billionaire Larry Ellison agreed to guarantee the entire $47.2 billion in equity needed. Warner Bros. Discovery board members had demanded that Ellison — one of the world’s richest men — backstop the deal’s financial structure due to initial concerns about it.
Despite the commitment, the Ellisons want the flexibility to include the Middle Eastern royal families and additional foreign investors.
Paramount wants “greater access to capital, including from foreign sources,” the FCC said in its notice.
The proposed Paramount-Warner Bros. would carry $79 billion in debt, making it one of the largest leveraged buyouts ever.
The Justice Department is separately reviewing whether the merger violates U.S. antitrust laws. State attorneys general, including California Atty. Gen. Rob Bonta, also are scrutinizing the transaction.
More than 4,000 filmmakers, actors and industry workers, including Ben Stiller, Jane Fonda, J.J. Abrams and Damon Lindelof, have signed an open letter calling for regulators to block the deal, saying it “would reduce the number of major U.S. film studios to just four.”
The Ellison family, which holds close ties to President Trump, has expressed confidence that the deal will be approved. Paramount also must garner the consent of regulators in markets where it conducts business, including Europe.
Paramount has said it expects to gather all of the regulatory approvals by this summer.
Oil prices continued to climb on Wednesday as the disruption to Persian Gulf energy supplies persisted. The effects are being felt far beyond the region, with the average price of U.S. gasoline setting a record high since the start of the war in Iran.
The rise in energy costs is a concern for investors, but stock markets have been buoyed by solid corporate earnings, keeping indexes elevated. Traders are also looking to officials at the Federal Reserve, who announce their latest decision on interest rates on Wednesday, for guidance on the outlook for inflation, economic growth and interest rates.
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