Russell Simmons Accused of Inflating the Value of Phat Farm

Tuesday, May 17, 2005
By: brooklyniteOne

According to recent reports in the The New York Times, Russell Simmons may have purposely inflated the value of his Phat Farm clothing line.

Claims about misrepresentation of the true value of the clothes line stem from testimony Simmons provided in a civil suit between former CEO of Island Def Jam Music Group, Lyor Cohen and President and founder TVT Records, Steve Gottlieb.

In a deposition, Russell Simmons stated, "It is how you develop an image for companies. So in other words, you give out false statements to mislead the public so they will then increase in their mind the value of your company."

According to reports Russell Simmons had been widely quoted as saying Phat Farm made 350-million dollars in sales, but the real amount is reported to be closer to 15-million dollars. Inevitably since Phat Farm was never publicly traded firm, he wasn’t legally obligated to reveal its true worth.

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