R. Kelly Co-Defendant Testifies About Early Allegations Made Against R&B Singer

R. Kelly’s former business manager and current co-defendant said he didn’t believe early allegations that the R&B singer had sexually abused minors in the 1990s, stating he thought such claims were not only false, but were the “cost of doing business” in the entertainment industry.

Derrel McDavid, who worked as Kelly’s business manager, testified Thursday about his relationship with Kelly, and how the singer dealt with early lawsuits against him that claimed he’d had illicit sexual relations with underage girls.

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McDavid testified about a 1997 lawsuit brought by Tiffany Hawkins, who first claimed she was pregnant with Kelly’s child, and then later alleged Kelly had sexually abused her while she was a minor.

He recalled Kelly’s entertainment lawyer Gerald Margolis telling him they would settle with Hawkins, even though they did not believe her claims to be true.

“You could almost consider it a cost of doing business,” McDavid recalled Margolis telling him, adding that it would be better to settle and keep the allegations secret, as even a rumor of these “frivolous claims” could hamper Kelly’s music career.

While Hawkins sued Kelly for $10 million, she eventually settled for $250,000, according to McDavid. Asked what that settlement made him think about the allegations, McDavid said: “They’re not true. This young lady told so many different stories and so many different lies it was obvious something was wrong.”

McDavid testified that the same lawyer who represented Hawkins also represented multiple other accusers who similarly made allegations against Kelly. But he believed those civil claims were “bulls–t.”

McDavid testified that in 2001, he learned another woman had been told to file a false police report claiming she and Kelly had sexual contact when she was underage. He alleged the woman was put up to this by Demetrius Smith, Kelly’s former tour manager, who’d had a falling out with the singer.

McDavid said he believed the whole situation was a “set up” by Smith to get a payout from Kelly if he settled a lawsuit with the woman.

“It made me sick,” he said. “Demetrius and Robert were once friends. I know Demetrius had his issues with Robert, but the fact he would actually go out and get someone to lie to get a cut of the money was disgusting to me.”

According to McDavid, Kelly called him in late 2000 and told him law enforcement was harassing his goddaughter, “Jane,” about an alleged sexual relationship between her and Kelly. When he asked Kelly whether or not it was true, he testified that Kelly told him:  “Are you out your g-dd–n mind? This is my goddaughter. Of course there’s no truth to this.”

McDavid said he didn’t believe the allegations because “Jane” had denied them in an interview with police, and because “Jane’s” aunt hated Kelly because she believed Kelly had ruined her music career.

“Jane” testified last month that Kelly had sexually abused her “hundreds” of times while she was underage.

Kelly was charged in this case in 2019 on allegations he sexually abused multiple minor girls and recorded some of those acts on video. McDavid and Milton “June” Brown are also charged with conspiring to conceal evidence to obstruct law enforcement.

In their opening statements, McDavid’s attorneys claimed their client never obstructed justice, but was simply working to ensure Kelly had the best possible defense for his 2008 child pornography trial in Cook County because he truly believed Kelly was innocent.

Charles Freeman, another of Kelly’s former associates, previously testified he was contracted by the singer, through McDavid and Kelly’s private investigator Jack Palladino, to recover a video tape that allegedly showed Kelly sexually abusing an underage girl.

But McDavid denied that allegation, stating Freeman already had the tape and was threatening to sell it. He said Kelly didn’t deny a sex tape could exist and then called Margolis to decide on their strategy.

“He said even the rumor of a sex tape could destroy a client’s career,” McDavid testified, adding that he believed the video depicted Kelly with an adult woman, not a minor. “We had to be very careful. We had to get the tape back.”

McDavid is the only defendant in this case who is expected to testify in his own defense. Kelly and Brown said they do not intend to do so.

McDavid testified that he began working as Kelly’s accountant in the late 1980s or early 1990s, but he eventually became Kelly’s business manager.

As Kelly’s superstardom grew in the mid-1990s, he and McDavid fought often over expenses and financial constraints on Kelly’s tour. But even so, he said they had a friendship and McDavid even saw Kelly as a son.

During this time, Kelly also began associating with more and more women, McDavid testified. But he said those always appeared to be adults, not minors.

Music reporter won't testify

Before testimony began Thursday, U.S. District Judge Harry Leinenweber ruled that music reporter Jim DeRogatis will not have to take the witness stand in the trial as the fourth week of proceedings got underway.

Leinenweber granted an emergency motion filed by DeRogatis and The New Yorker, which sought to quash a subpoena compelling the reporter's testimony in the case.

McDavid’s attorneys, who had subpoenaed DeRogatis, wanted to question him about a 2002 videotape he received that allegedly showed Kelly sexually abusing an underage girl. They specifically wanted DeRogatis to authenticate the physical VHS tape previously shown to jurors in this case, arguing that prosecutors had not shown a proper chain of custody for the video.

But Leinenweber previously ruled the video would be admissible because other witnesses, including “Jane” — who allegedly appeared in the video as a minor — testified the footage is indeed authentic.

“I don’t see any basis to call Mr. DeRogatis,” Leinenweber said.

Wednesday marked the first day of testimony in the high-profile case since last Thursday, following a long Labor Day weekend and “building-wide system failures” that forced a courthouse closure Tuesday.

This is a developing story. Check back for details.

Contact Matt Masterson: @ByMattMasterson[email protected] | (773) 509-5431

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