Jermaine Dupri Refutes SunTrust Bank’s $2 Million Lawsuit
Music executive and producer Jermaine Dupree has filed his Answer and Counterclaims in connection with the lawsuit commenced recently by SunTrust Bank.
As previously reported, SunTrust Bank’s complaint alleges that Dupri is indebted to it for approximately $1.9 million dollars representing the outstanding balance on a larger loan made in 2009 for nearly $5 Million.
J.D.’s counterclaims allege that the bank breached its contract with him, converted his funds to their own use and fraudulently rewrote the terms of his loan without his knowledge among other claims.
In Dupri’s Answer and Counterclaims, he details his course of dealings with SunTrust and it’s executives in connection with his loan and the modifications of that loan in 2010. Specifically, the original loan provided that SunTrust would allocate certain portions of the royalties which it was to receive from EMI Music Publishing in repayment of the loan to satisfy Dupri’s Federal and State income taxes. SunTrust Bank did not make such payments which resulted in tax liabilities being assessed against Dupri.
The Counterclaim reveals that in order to cover up its mishandling of Dupri’s funds, SunTrust Bank executives restructured the loan in December 2010, removing the provision requiring them to make the tax payments. In good faith, and relying upon the trust and established relationship that had existed with SunTrust over many years, Dupri executed a new loan agreement and related documents which modified the original 2009 loan to his detriment.
The loan was restructured from a variable to a fixed payment arrangement, with payments unilaterally determined by SunTrust which were not based on realistic projections of Dupri’s income. Dupri states in his Counterclaim that he was not provided an opportunity to have his legal and financial representatives review the documents prior to signature and that when he left the SunTrust offices after signing the new agreements, he was not provided with a set of the closing papers.
In his Answer, Dupri clearly details how the misrepresentation and breach of duties by SunTrust resulted in a commercial loan which was not in default at the time of the December 2010 signing being converted to a loan with unachievable payment terms of which he was unaware.
Due to the fact that the loan was restructured from a variable to a higher fixed payment arrangement, the loan went into default and SunTrust acted without attempting to resolve this matter and filed an action against him. As a result of SunTrust’s actions, Dupri is currently addressing tax assessments levied by the IRS and Georgia Department of Revenue and is forced to challenge SunTrust’s attempt to foreclose on and seize his assets.
Dupri has engaged Alan S. Clarke, Esq. of the Atlanta-based Entertainment Law group to represent him in his defense of this lawsuit.
Now Jermaine’s tax problems are starting to make sense but his defense seems a little suspect when he stated that
he was not provided an opportunity to have his legal and financial representatives review the documents prior to signature and that when he left the SunTrust offices after signing the new agreements, he was not provided with a set of the closing papers.
You would think that after being in the music business for over 20 years and having a pops like Michael Mauldin help guide you along the way as well and having mentors like L.A. Reid that Jermaine Dupri would not go into the meeting without his financial and legal team by his side.
Q-Tip said it best with Industry Rule #4080, Record Company people are shady and so are the banks if you’ve watched the news a few times in the past few years with all the bank bail outs. Looks like J.D. made a rookie mistake but we’ll keep you updated as this So So lawsuit continues.
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