A) MS. YOUNG SUES MR. YOUNG
Nicole Young’s lawsuit alleges her husband music mogul Andre Young, (“Dr. Dre”), made fraudulent transfers to hide assets. Ms. Young’s lawsuit claims during the couple’s divorce, Mr. Young secretly transferred his 5 “DR. DRE” trademarks & 1 for “THE CHRONIC“. Ms. Young recently filed her lawsuit in the Superior Court of the State of California, in Los Angeles County. According to the lawsuit, the trademarks are community property under California Family Code § 760. Therefore, Ms. Young has an ownership interest in the trademarks, the lawsuit claims.
B) MR. YOUNG ASSIGNS THE TRADEMARKS
On April 27, 2020 Mr. Young assigned all his rights to his 6 trademarks to ARY Trademarks, LLC (“ARY”). Mr. Young is thought to have formed ARY two weeks before his April 27th assignment. Mr. Young is a manager or member of ARY and ARY is believed to be a shell company. Mr. Young reportedly transferred his 6 trademarks to ARY with the help of lawyers. Page 2 ¶ 1 at Ms. Young’s lawsuit describes Mr. Young’s transfer of the trademarks as a “scheme”:
Andre’s transparent and reprehensible scheme to transfer these assets away, without Nicole’s knowledge or consent, so he could retain more for himself in a divorce from his wife of 24 years, and the mother of his three children, is an epic failure and revels the true nature of his character, or lack thereof.
C) BADGES OF FRAUD & RED FLAGS
The judge deciding whether Mr. Young fraudulently transferred the 6 trademarks will likely consider Cal. Civ. Code § 3439.04. It is the statute which covers fraudulent transfers in California. Section 3439.04 (b) lists what is commonly referred to as the “badges of fraud.” Courts generally consider these kinds of “badges” when deciding whether a party had actual intent to make a fraudulent transfer. Red flags that Mr. Young might have tried to place his 6 trademarks beyond Ms. Young’s reach are:
- Mr. Young’s apparent use of a newly formed shell company, ARY Trademarks LLC, during his divorce.
- Mr. Young’s suspected use of lawyers (i.e. gatekeepers) to facilitate the transfer of his trademarks during his divorce.
Copyright 2020 Fred L. Abrams