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Scooter Braun hit with a $50M lawsuit by former Goldman Sachs partner

Music exec Scooter Braun, best known for his ugly public spat with Taylor Swift, lured a high-flying financier into a dead-end job by name-dropping stars like Kanye West, according to a new lawsuit. 

Former Goldman Sachs partner Peter Comisar says Braun duped him into leaving his lucrative gig at Guggenheim Securities by promising him a role at the top of a new boutique investment firm that he claimed would be backed by media titans like Apple’s Jimmy Iovine, Hollywood magnate David Geffen as well as the billionaire Soros family.

“Braun, by all outward appearance, was the real deal,” the lawsuit said. But when it came time to secure funding from his high-powered pals, he turned out to be a “sheep in wolves clothing,” the suit said.

Taylor Swift Getty Images for MTV

Comisar’s Los Angeles state court lawsuit alleges that Braun “aggressively courted” him from 2016 to 2017 to launch Scope Capital Partners together with business manager David Bolno. 

According to court papers, the courtship kicked off in 2016 with Bolno touting Braun’s success “reigniting Calvin Klein underwear through a campaign with Justin Bieber and creating the Yeezy brand for Kanye West.”

The courtship hit a fever pitch in 2017 when the slick Hollywood manager behind singers like Ariana Grande, Demi Lovato and Carly Rae Jepsen “personally executed contractual commitments to support the new venture,” the lawsuit claims.

The contract committed Braun to a $7-million-a-year operating expense for Scope over three years, including a $3-million-a-year salary for Comisar, the suit said. 

In luring Comisar, Braun allegedly boasted that he could raise between $500 million and $700 million from “close friends” like Iovine, Geffen and the media and entertainment scion Haim Saban. He also name dropped billionaires like Soros, Mittal and Reuben families, the suit says.

To prove his connections, Braun went so far as to describe Geffen, the Hollywood bigwig behind Dreamworks and cult films like “Beetlejuice” and “Risky Business,” as his “godfather,” court papers say.

David Geffen was touted by Braun as a potential investor in Scope, according to the lawsuit.Imeh Akpanudosen

But those investors never panned out, the suit said.

“Braun had to explain to Comisar, tail between his legs, how he had asked David Geffen, his supposed Godfather, to invest in Scope, only to be told by Geffen that he did not view Braun as someone with whom Geffen would invest.”

Braun allegedly got “the same brush-off from Jimmy Iovine, Haim Saban and the Reuben Soros and Mittal families.”

“The truth was that Braun’s relations valued him as someone to socialize with, but to whom they could never and trust their millions,” the lawsuit claimed. “When it came to fundraising, Braun turned out to be a sheep in wolves clothing.”

Music producer Jimmy Iovine was part of a group of Scope investors cited by Braun, the lawsuit said.REUTERS

Behind the scenes, meanwhile, Braun was allegedly double-dealing Comisar with private equity titan Carlyle Group to invest in his Ithaca Holdings, which has since been sold, in a deal that would allow him to make the same type of entertainment and consumer space investments that were to be the focus at Scope, the lawsuit claims.

Because Scope’s private equity strategy was in “direct conflict” with Carlyle’s deal, his contact was nullified, he claims. By April 2018, the former talent manager stopped funding Scope and paying Comisar’s salary. 

Comisar is seeking $50 million in compensatory damages plus unspecific punitive damages in what amounts to a breach of contract suit against Braun, Bolno, Ithaca and Scope.

The lawsuit claims Bolno later told Comisar that “people in the entertainment industry do not honor their contractual obligations” and that if Comisar decided to go after them for breach of contract, “Braun would trash Comisar’s pristine reputation” and “ruin him financially.”

The suit says that Bolno threatened Comisar, telling him that “Braun is an expert in the media and would destroy his reputation in a press and litigation process.”

Braun and Bolno also separately had conversations with Comisar alluding to a “smear campaign” in which they would assert that the Wall Street veteran had been fired from his partner job at Goldman and that his career had come to an end at Guggenheim, both of which are not true, the suit says. 

Comisar formally put Braun and Bolno on notice that they breached his contract, and not long after that, court papers said that the duo “falsely accused” Comisar of racism as a “predicate for his removal.” The suit did not spell out the racism claim. 

The lawsuit claims that Carlyle’s acquisition for a slice of Ithaca closed mere months after the formation of Scope, and included a $100 million for investments and acquisitions.

Braun of course has a history with Carlyle, which helped Ithaca buy the rights to Swift’s old music. That deal attracted the wrath of the “Shake it Off” singer who called out the investment bank and other Braun backers at a Hollywood awards show in 2019.

In April, Braun sold Ithaca to South Korea entertainment giant HYPBE, which is home to boy band BTS, for $1 billion.

FireEye selling its products business and name for $1.2 billion

The FireEye logo is seen outside the company’s offices in Milpitas, California, December 29, 2014.Beck Diefenbach | ReutersFireEye said Wednesday it’s selling its products business, including the FireEye name, to a consortium led by private-equity firm Symphony Technology Group for $1.2 billion in cash.The U.S. cybersecurity firm said the sale will split Mandiant Solutions, its cyber forensics unit, from its cloud security, network and email products.Shares of FireEye were relatively flat after hours. The company said the deal is expected to close by the end of the fourth quarter.FireEye was the subject of a cyberattack in December of last year, which it believes was state-sponsored. Microsoft in February credited the company’s transparency about the breach in helping it discover that had also been attacked.FireEye CEO Kevin Mandia said the sale will help it grow its Mandiant Solutions business.”After closing, we will be able to concentrate exclusively on scaling our intelligence and frontline expertise through the Mandiant Advantage platform, while the FireEye Products business will be able to prioritize investment on its cloud-first security product portfolio,” continued Mandia.The sale is just the latest example of a big-dollar tech deal going to private equity.With the exception of special purpose acquisition companies, seven of the 12 largest tech acquisitions in the U.S. in 2021 have been carried out by private equity firms, according to data from FactSet.In Wednesday’s announcement, FireEye also said that its board had approved a share buyback program of up to $500 million.

Tesla recalls 6,000 cars over risk of loose bolts

In this articleTSLATesla China-made Model 3 vehicles are seen during a delivery event at its factory in Shanghai, China January 7, 2020.Aly Song | ReutersTesla is recalling 5,974 of its electric vehicles over concerns that their brake caliper bolts might loosen, which could potentially cause a loss of tire pressure and increase the risk of a crash, according to documents made public by the National Highway Traffic Safety Administration.Cars that are part of the voluntary recall include certain 2019-2021 Model 3 vehicles and 2020-2021 Model Y vehicles. Tesla said it is not aware of any crash or injury resulting from the potential defect. It will inspect and tighten or replace the caliper bolts as necessary for free.The company’s stock closed down 3%.Tesla said it was made aware of an issue in December of a field incident involving a 2021 Model Y with a missing fastener on the driver-side rear brake caliper. It has since taken measures to prevent the issue during assembly.The recall follows one in February that involved 36,126 Model S and Model X vehicles in China and 134,951 cars in the U.S. that was requested by the NHTSA over touch-screen failures. In 2020, it recalled nearly 50,000 cars in China over faulty suspension and 9,500 Model X and Model Y cars in the U.S. over roof and bolt issues. In 2018, Tesla voluntarily recalled 123,000 Model S vehicles because of an issue with the power steering component.Subscribe to CNBC on YouTube.

South Street Seaport transformation continues with Carne Mare

South Street Seaport’s effort to transform itself from a rowdy tourist destination to an actual hot spot will continue this month with the planned opening at Pier 17 of a new eatery by Michelin-rated chef Andrew Carmellini.

The chef behind Locanda Verde in Robert de Niro’s Greenwich Hotel is gearing up to open Italian chop shop Carne Mare on June 10 — the latest in a series of high-end eateries to take over the casual dining and fast-food restaurants that once dominated the downtown Manhattan Pier.

Think Florentine steak, spicy lobster spaghetti and salt-baked sea bass wrapped in fig leaves served tableside and finished with fermented chili and dandelion dressing.

It’s a long way from the days when the Fulton Fish Market ruled the area until it was forced out in 2005 amid development pressure. While there were efforts to revitalize Pier 17 after that, it was labeled nothing more than a tourist trap for years.

As a young chef, Carmellini used to go bar hopping at midnight — ending up at the Fulton Fish Market at 3 a.m. to shop.

Chef Andrew Carmellini stands on Pier 17 at Manhattan’s historic South Street Seaport, an area where he once enjoyed bar hopping as a young chef and where he’s just opened his newest restaurant, Carne Mare.Matthew McDermott

“It was great, but grungy, with Burger King and Yankee Candle Shop,” he said looking out at the tall ships on the water in front of the Pier. “Nirvana even did an early grunge promo shot outside Pier 17.”

Diners and patrons enjoy The Greens on Pier 17 in South Street Seaport. It’s one of a number of bars and restaurant helping to revitalize the area.Stephen Yang

That’s been changing since Howard Hughes Corp. scored a sweet deal in 2013 to lease the Pier for a mere $1.2 million a year — along with other big and sometimes controversial development plans for the neighboring area, including its historic district.

The Pier’s transformation started in earnest in 2019 with The Fulton by chef Jean-Georges Vongerichten. There’s also Momofuku’s Ssam Bar, Malibu Farm, Heineken Riverdeck and The Greens — Pier 17’s rooftop that became a popular destination last summer thanks to its socially distanced lawn chairs.

There’s also Cobble & Co., a gastro pub and a garden bar, along with locally owned, independent restaurants, like Seaport House.

Diners and patrons enjoy the little lawns, or patches of greenery, as well as a view of the skyline, at The Greens, located atop Pier 17 at Manhattan’s South Street Seaport.Getty Images for The Greens

Still to come: Chefs Wylie Dufresne and Josh Eden, opening an all-day cafe at nearby 1 Fulton Street.

Last month Carmellini opened Mister Dips — burgers and soft dip cones. Opening day on May 27 “was full — despite the rain,” Carmellini told Side Dish.

Of course, the area’s attempt at a renaissance comes at a difficult time. The Seaport, which depends on the office lunch crowd and tourism, was a ghost town during lockdown. And many New Yorkers still avoid it instinctively.

Carmellini said: “A lot of people, even friends, say, ‘You’re opening in the Seaport, really?’ I say, have you been down there recently?”

Chef Andrew Carmellini’s Carne Mare restaurant is part of the revitalization of Pier 17 at Manhattan’s South Street Seaport.Matthew McDermott

Some critics also disapprove of Howard Hughes’ transformation plans, which include a 324-foot tower on the site of a parking lot at 250 Water Street that was technically designated a historic landmark.

Said one real estate and restaurant insider: “They [HHC] feel like, if they build it, people will come. But their corporate culture is about a real estate play to turn a parking lot into a tower, without adding to the district’s soul.”

Others, however, support the changes. Lawyer and restaurateur Kian Khatibi, a South Street Seaport resident, says he launched nearby Seaport House, a 72-seat, 2000-square-foot eatery located on Front Street, which is slightly away from the Pier, last fall in part because of HHC’s investment in the district.

He says both tourists and locals have been returning to the area in recent months, including Alba DeMichael, a 44-year-old FiDi-based fashion designer who has become a Seaport House regular.

“I was passing by and came in —  and I’ve been coming back ever since for the seafood and cocktails,” she says.

Elliott Management owns big Dropbox stake, holds discussions

Activist investor Elliott Management owns a large stake in Dropbox and has been holding private discussions with the file-sharing service provider for some time, a source familiar with the matter said on Wednesday.

The hedge fund owns a stake of more than 10 percent, which is valued at more than $800 million, the person said, declining to reveal the exact size of the investment.

Dropbox, which was co-founded by Drew Houston who is currently the company’s chief executive officer, is valued at roughly $11 billion. The company, which allows users to store documents, videos and photos online, listed its shares in March 2018 at $21 a share.

A representative for Dropbox did not immediately respond to a request for comment.

On Wednesday, Dropbox was trading at $28.11, having jumped as much as 7 percent on news that Elliott has a stake and is holding discussions with management.

The Wall Street Journal first reported the stake.

It was celebratory for Dropbox in March 2018 when its CEO Drew Houston and co-founder Arash Ferdowsi (center) rang the opening bell at the Nasdaq in honor of the company’s IPO. News of Paul Singer’s Elliott Management owning a large stake in the company sent shares of the stock soaring Wednesday.Getty Images

Elliott has previously worked with companies that were being led by founders, including Twitter and SoftBank Group.

The hedge fund invests roughly $40 billion and currently owns stakes in Duke Energy, where it has urged the company to consider splitting into three companies, and drugmaker GlaxoSmithKline.

Facebook aims to make it easier for businesses and consumers to communicate

In this articleFBAttendees walk past a Facebook logo during Facebook’s F8 developers conference in San Jose, California, April 30, 2019.Stephen Lam | ReutersFacebook on Wednesday announced a number of new developer tools, including several messaging features for businesses, at its virtual F8 software developer conference. The event marked Facebook’s first software developer conference since 2019, as the Covid pandemic forced the company to cancel last year’s event.This year, Facebook placed a focus on new features to help businesses communicate with consumers directly via its messaging services. This is a key focus for Facebook, which is seeking to enable more e-commerce transactions directly on its services and enable businesses to handle more of their customer support via Messenger, WhatsApp and Instagram.Here are some key announcements:Messenger API for Instagram: Facebook announced that all businesses will now have access to the application program interface (API) for messaging on Instagram. This will make it easier for businesses to automate and manage direct message communication with users. For instance, businesses could create automatic responses or workflows for common questions like “What’s your return policy?” or “Please track my order,” before kicking off a chat with a live representative.Already, these types of tools exists for businesses to message folks via WhatsApp or Messenger, but now, they will also be able to build similar messaging experiences on Instagram.WhatsApp improvements for business communication: Facebook also announced a number of new tools for WhatsApp. These include list messages, which allow business to provide consumers with a menu of up to 10 options as they communicate. The company also announced Reply buttons, which allow users to choose pre-written responses as they communicate with businesses.The company also announced faster onboarding for its WhatsApp Business API so businesses can get set up to start messaging with consumers in minutes. The process used to take weeks. Multi-person augmented-reality: As part of its effort to enable more augmented-reality features for users, Facebook on Wednesday announced its Multipeer API beta program. This technology will make it possible for software developers to create AR effects that work synchronously for multiple users at the same time.So, for example, users could hop on a group video call over Messenger and apply an AR filter built using the Multipeer API. That filter would then apply to all of the participants on the video call. A demonstration showed four people in a video call, all wearing virtual party hats to celebrate a birthday together while in different locations.”Long-term, these foundational capabilities will underpin the content you’ll see overlaid in the AR glasses we’re building,” tweeted Andrew “Boz” Bosworth, Facebook’s head of hardware.

Tech workers are leaving San Francisco, NY for Austin and Nashville

Tech workers are fleeing San Francisco and New York for cheaper cities, but Miami isn’t a big destination, according to new data.

Austin, Texas, saw the largest influx of tech workers during the pandemic, with a net 217 software and information technology workers moving to the city per 10,000 existing workers. Nashville clocked in second with 154.7 net techies per 10,000, followed by Charlotte, NC, with 145.8; Jacksonville, Fla., with 136; and Denver with 130.4. 

Other cities in the top 10 include Seattle, Tampa Bay, Las Vegas and Dallas-Fort Worth.

Miami, however, came in 11th, attracting an inflow of just 76.6 software and information technology company workers per 10,000 existing workers between May 2020 and April 2021, according to LinkedIn data.

That’s despite Miami’s popularity with the Wall Street crowd, as well as the fact that Miami Mayor Francis Suarez has tried to court CEOs like Elon Musk on Twitter while seeking to pay public workers’ salaries in bitcoin and lobbying the state to let the city invest public money in cryptocurrency. 

The brunt of the tech migration has been borne by San Francisco, which lost 80.5 tech workers per 10,000. Boston lost 54.4 and New York City lost 42.3. Chicago, Cincinnati, Pittsburgh and Washington, DC, also lost substantial numbers of tech workers.

Nashville clocked in second with 154.7 net techies per 10,000 existing users.Getty Images

It’s unclear, however, whether the transplanted techies will stay put after the pandemic. Some tech giants like Microsoft and Twitter have told many employees they can work from home forever, while Apple is spending billions of dollars expanding offices in smaller cities like Austin and Raleigh, NC. 

Russia-linked cybercriminal group REvil behind meatpacker JBS attack

In this articleJBSS-BRWell-known hacker collective REvil Group is behind the cyberattack on JBS, according to a source speaking to CNBC on the condition of anonymity. It caused JBS, the world’s largest meatpacking company to shut down operations.The assault on the world’s largest meatpacker disrupted meat production in North America and Australia, at one point stoking concerns over the potential for rising prices and inadequate supply during the busy summer grilling season.REvil — pronounced like the letter “R” followed by the word “evil” — is mostly comprised of native Russian speakers. It is also believed to be based in a former Soviet state.The organization runs a site on the dark web, anachronistically known as the “Happy Blog.” If victims don’t comply with demands, the group posts stolen documents on its blog.”We know that they are protected most likely by Russian intelligence or the Russian government, as are most ransomware groups, which has allowed them to flourish over the last 18 months,” Marc Bleicher of Arete Incident Response, a cybersecurity firm that specializes in negotiations with criminal hackers, previously told CNBC.Packages of beef cuts are displayed at a Costco store on May 24, 2021 in Novato, California.Justin Sullivan | Getty ImagesBy Tuesday night, the company said that it had made “significant progress in resolving the cyberattack” and that the “vast majority” of the company’s beef, pork, poultry and prepared food plants will be operational Wednesday.White House spokeswoman Karine Jean-Pierre said the Biden administration is engaging directly with the Russian government on this matter, “delivering the message that responsible states do not harbor ransomware criminals.”– CNBC’s Eamon Javers contributed to this report.

Apple says consumers and advertisers spent more than $600 billion through apps last year

In this articleAAPLTim Cook on stage at Apple’s September 10, 2019 event.Source: AppleApple said Wednesday that its App Store facilitated an estimated $643 billion in billings and sales during 2020, according to a new study commissioned by the company.The figure marks a 24% increase from last year, as the Covid-19 pandemic pushed many consumers toward their phones and tablets.The latest figures come as Apple faces increased scrutiny over how it profits from in-app purchases. Apple takes a cut of between 15% and 30% from purchases of software or digital goods from apps distributed through the App Store.Developers have alleged that Apple’s App Store platform is unfair to smaller companies. Most recently, Epic Games sued Apple and argued in court that the company’s App Store is anti-competitive.Apple has denied the allegations and has said it “does not have a dominant market share in any category where we do business” and recently cut its App Store commissions to 15% for smaller companies. In response to the suit, Apple is arguing that it built the App Store and gets to set the rules, which are designed to ensure that apps are high quality and secure.The study from the Analysis Group includes both transactions that Apple handles, including paid apps and in-app purchases, as well as purchases and other economic activity that happened through apps where Apple wasn’t directly involved, such as sales of ads in apps. The report said that about 90% of total billings and sales facilitated by the App Store ecosystem in 2020 occurred outside of the App Store, meaning that Apple collected no commission on those sales.The report also comes ahead of Apple’s annual developers conference, WWDC, and highlights the company’s work with small businesses. Wednesday’s announcement suggests there’s a lot of money to make from apps, and is likely an effort to continue to attract people to build new services around Apple products.According to the study, the $643 billion generated through iPhone and iPad apps in 2020 is made up of:$511 billion from sales of physical goods and services through apps, including $383 billion from retail apps, $38 billion through travel apps, and $36 billion from food delivery and pickup$86 billion from digital goods and services$46 billion from in-app advertising– CNBC’s Kif Leswing contributed to this report.Subscribe to CNBC on YouTube.

Microsoft to unveil new version of Windows on June 24

Satya Nadella in New Delhi, India.Ramesh Pathania | Mint | Getty ImagesMicrosoft said Wednesday it will unveil “the next generation of Windows” on June 24. The move comes a week after CEO Satya Nadella teased major enhancements to the PC operating system for developers as well as creators.Windows, the dominant operating system for personal computers, is the source of 14% of total revenue for Microsoft, one of the most valuable companies in the world. The company has pushed two updates each year to its Windows 10 operating system since it first became available in 2015.Nadella made the Windows remarks last week shortly after the company announced that it won’t ship Windows 10X. That software was initially designed for dual-screen devices such as the Surface Neo, which has been delayed. Last month, Microsoft announced the latest Windows 10 update with only slight changes.The event will be held online at 11 a.m. ET, according to an invitation the company sent to reporters. Nadella will be there, along with Panos Panay, Microsoft’s chief product officer, who has been the face of the company’s Surface devices, the invitation said.WATCH: Microsoft unveils new products, Surface laptop