Rihanna litigated her ex-accountants Thursday, accusing them for tens of millions of dollars in losses, sloppy bookkeeping, a failure to recommend she cut down expenses when a 2009 tour was causing losses and an ongoing audit by the Internal Revenue Service.
The case in federal court in Manhattan sought damages against New York-based Berdon LLP and two accountants. A Berdon spokesperson said the company had no comment, at present.
Rihanna filed the lawsuit under her Christian name, Robyn Fenty, and claimed through her attorneys that the defendants drained millions of dollars from revenues while she did four national and international tours over a five-year period.
By the "Last Girl on Earth" tour in 2009, Rihanna discovered that the tour had managed "significant net losses" even with robust revenues, though the defendants had managed to take 22 percent of the tour's revenues, Rihanna was getting 6 percent of revenues only, the lawsuit said.It also stated that Berdon's abnormal accounting practice of paying itself a percentage of gross tour revenue as commissions left it no incentive to "counsel" Rihanna to reduce expenses or put in place suitable financial controls.
The lawsuit claimed that the practice of paying itself a percentage of the revenues was not standard in the accounting industry and created a clear conflict of interests.
Rihanna's lawyers also held the accounting firm responsible for an IRS audit of her tax returns, saying she was forced to spend a considerable portion of resources to make up for errors resulting from carelessness.
Since dismissing the firm along with its accountants in September 2010, Rihanna's fortunes are looking up, according to the lawsuit. The "Loud" tour from June 2011 to December 2011 generated a net profit of over 40 percent of total tour revenues, it added.
Rihanna employed the accountants in 2005 when she was a 16-year-old from Barbados beginning her career, the lawsuit said. The singer claimed that they repeatedly violated their agreements, engaged in misconduct and malfeasance, took excessive commissions, created entities regardless of their effect on her taxes and failed to keep track of the revenue and expenses and implement a proper budget.
The lawsuit also blamed the company for Rihanna's 2009 purchase of a new home, saying that competent professionals would have informed her that her tour was losing money and that it would be inadvisable to purchase such an expensive house at that time.
Last year, Rihanna filed a suit against a real estate company in Los Angeles over the $6.9 million purchase of a house in 2009, claiming it had structural faults that made it inhabitable.
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