Chance the Rapper Wins Second Trial Against Pat the Manager Over Merch Vendor ‘Secret Profits’

Chance the Rapper has won the second round of his legal battle against former manager Pat Corcoran, securing a financial judgment that the artist’s reps predict will ultimately come out to around $1.5 million.

Back in March, a Chicago jury sided with the rapper (Chancelor Bennett) in his bitter legal feud with Corcoran, who was known as Pat the Manager during their long partnership. Chance won only $35 at that point for breach of contract and tortious interference, but he still had a remaining claim for breach of fiduciary duty against Corcoran. That allegation was the subject of a second mini-trial before a judge in May, resulting in a Tuesday (Oct. 13) court ruling.

Related

In Tuesday’s ruling, obtained by Billboard, Judge James E. Hanlon Jr. held that Corcoran indeed breached his fiduciary duties to Chance by demanding, without the rapper’s knowledge, his own side payments from merch vendors. The judge ordered Corcoran to give up these “secret profits” to Chance, and also to return all the 15% commissions he earned on merch during this period.

“The trial exhibits should allow the parties to compute the figure,” wrote Judge Hanlon. “If the records leave a real doubt about whether a given payment related to Bennett’s orders, the court will resolve the doubt against Corcoran, whose company kept those records and took the payments.”

A follow-up court conference is scheduled for late November to address this calculation. Chance’s reps tell Billboard they believe that amount will ultimately come out to around $1.5 million. Corcoran has also been ordered to return the domain chanceraps.com, and it’s possible that interest could be added to the judgment as well.

That award will be less than the nearly $11 million sought by Chance’s team. That’s because Judge Hanlon found that Corcoran’s fiduciary duties only extended to music, touring and merch, meaning he was free to make side investments in a Chicago theater project, media startup and film company.

“Corcoran performed years of valuable work in music and touring that Bennett accepted and profited from, work that was not tainted by self-dealing,” added the judge. “Stripping Corcoran of all his compensation across the life of the relationship would hand Bennett a windfall and would punish loyal work along with disloyal work.”

Related

Notably, Tuesday’s ruling determined that Corcoran was not always a credible witness. Judge Hanlon said Corcoran’s testimony during the two trials conflicted at times with the evidence; for example, he denied seeking equity in UnitedMasters during deal talks with Chance, despite text messages clearly showing Corcoran asked CEO Steve Stoute for such a stake.

The judge also pointed out that Corcoran’s description of his job duties shifted over time: “Before the jury, Corcoran described himself as the architect of Bennett’s success,” wrote Judge Hanlon. “He took credit for the merchandise business, the radio strategy, the now-famous ‘3’ hat, and more, and he called himself the ‘CEO’ of Bennett’s enterprise. At the bench trial, where his duties were the question, he shrank the role to that of a ‘sounding board’ who offered ‘input on operational things.’”

In the wake of the ruling, Chance said in a statement, “I’m grateful to finally close this chapter of my life and can’t wait to eventually tell my side of the story. I’m thankful to the courts and, more importantly, to God for remaining faithful.”

Reps for Corcoran did not immediately return a request for comment on Wednesday (Oct. 14).

Corcoran was the one to initiate the legal fight back in 2020, when he filed a lawsuit alleging Chance owed him nearly $4 million in commissions, including under a so-called “sunset clause” that he said should have gotten him paid for three years post-termination. Chance denied the existence of a sunset clause and countersued Corcoran for exploiting career opportunities to his own benefit.

The case was novel because Corcoran and Chance never had a written contract, instead operating under a handshake deal. While this sort of casual arrangement is common in artist-manager relationships, there’s very little settled case law about how to interpret oral contracts.

Following the first two-and-a-half week trial in March, a Chicago jury rejected all of Corcoran’s claims and determined he was not owed any extra commissions. The jurors also sided with Chance on some of his counterclaims, awarding only $35 but teeing up the second mini-trial that led to Tuesday’s court ruling.