Although no confirmation has been given, reports are in that Atlantic Records has reportedly dropped its backing and distribution for the Atlanta-based Block Entertainment.

The company, run by Russell “Block” Spencer, took to the mainstream in 2004 with its affiliation with Bad Boy Records in releasing an album from the group Boyz N’ Da Hood, introducing many listeners to Young Jeezy. After the star segued into a solo deal with Def Jam, the label replaced Jeezy in the group with Gorilla Zoe.

The imprint found success in 2006 with Yung Joc‘s New Joc City, backed by the hit-single “It’s Going Down.” This year, after slumped sales from Yung Joc‘s Hustlenomic$ follow-up and a sophomore release from Boyz N’ Da Hood, Block Entertainment appeared to have a difficult year. Despite success from Gorilla Zoe‘s “Hood Nigga,” the label failed to match previous chart success.

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Perhaps in the wake of Yung Joc‘s arrest last week in Cleveland and subsequent failure to appear in court yesterday, Atlantic Records has no longer desired to align with Block Entertainment.

For 2008, Block was reportedly planning to release albums from Big Gee and the long-delayed effort from Jody Breeze.

HipHopDX will keep you informed as this report is confirmed from both parties.