Correction: Rihanna Wins Multi-Million Dollar Settlement Against Accountants

Rihanna

Rihanna

Rihanna Fenty has won a multi-million dollar settlement against her former accountants. The singer is reportedly signing a $10 million settlement from accountant Peter Gounis and the firm, New York-based Berdon (FY12 net revenue of $97 million), who, says Complex Music.

“The defendants advised Ms. Fenty by e-mail that purchasing a home in Los Angeles ‘would be a good investment’ despite knowing Ms. Fenty was experiencing financial difficulties,” says Rihanna’s lawyer Edward Estrada.

Rihanna apparently could not afford the home and her accountants did not forewarn her. In addition to being a bad financial purchase, Rihanna’s lawyers claim that the accountants knew that the house was “rotting from water and mold damage” and would require millions in improvements.

In legal documents, Rihanna claimed that her accountants’ mismanagement caused her to go “effectively bankrupt” by the end of 2009.

UPDATE 3/12/14

Berdon: No Settlement with Singer Rihanna

Berdon LLP has not settled entertainer Rihanna’s pending lawsuit against the firm, a Berdon spokesperson told INSIDE Public Accounting, countering widely published reports of a $10 million out-of-court settlement of the case.

“We were surprised by news reports that a settlement has been reached. There is no settlement,” says Kayte Steinert-Threlkeld, the chief marketing officer of New York-based Berdon (FY12 net revenue of $97 million). In an email, INSIDE Public Accounting asked Steinert-Thelked, “Has anything regarding a settlement been filed?” She responded no.

Several news outlets, including the New York Daily News, New York Post, the Daily Mail in London and others, recently reported that the 25-year-old singer, whose real name is Robyn Fenty, was signing a $10 million settlement that stemmed from a $35 million lawsuit filed in 2012. The firm is contesting the suit in Federal District Court of Manhattan.

The suit claims that Rihanna was advised her to buy a $7 million Los Angeles home in 2009. The home allegedly needed more than $1 million in improvements due to water and mold damage. The expense, according to court papers, caused the singer to go “effectively bankrupt” by the end of that year. Rihanna is now worth a reported $43 million.

“These allegations are false,” Thomas Manisero, a lawyer for Berdon LLP, told the Daily News Feb. 12. “Berdon acted properly concerning Ms. Fenty’s affairs.” In court papers in December, the firm contends the celebrity spent her money on clothes, jewelry and private jets. “At the core of her claim is this belief: someone else is responsible for her conduct and its consequences.”

UPDATE 4/21/14

Rihanna and her former accountants at New York-based Berdon (FY12 net revenue of $97 million) have reached an undisclosed settlement to the $35 million lawsuit she filed two years ago, the firm announced Friday.

Manhattan Federal Judge P. Kevin Castel on April 17 ended the legal proceedings against Berdon and accountants Peter Gounis and Michael Mitnick, according to the New York Daily News.

Rihanna, whose real name is Robyn Fenty, accused the firm and its accountants of giving bad advice, including a recommendation to buy a $7 million Los Angeles home that was damaged by water and mold in 2009, causing her to lose tens of millions of dollars.

The firm contended it acted properly, and in a statement Friday the firm said that terms of the settlement preclude either party from disclosing terms of the agreement.