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Under Armour Settles UCLA Dispute as Adidas Signs Up College Stars

Under Armour will pay UCLA $67.491 million to settle a lawsuit the school filed after the company backed out of a 15-year, $280 million contract 12 years early, the Los Angeles Times reported Friday.

The settlement resolves the original lawsuit the Regents of the University of California brought in August 2020, as well as a countersuit that Under Armour filed last fall that alleged UCLA violated the former partners’ record-breaking contract by not providing marketing benefits while teams were unable to perform early on in the Covid-19 pandemic.

“Under Armour remains committed to all student athletes and wishes UCLA and the entire Bruin community well,” the Baltimore athletic firm said in response to the settlement.

According to the lawsuit UCLA filed in August 2020, Under Armour first communicated that it would terminate its agreement on June 22, 2020. The university claimed it received no prior notice of an intent to terminate.

Under Armour reportedly attempted to justify the termination by claiming the NCAA and Pac-12’s decision to pause certain athletic events due to the Covid-19 pandemic constituted a “Force Majeure Event” that relieved it of its obligations. It also invoked a provision that would theoretically allow it to terminate the agreement if a “core team” missed at least 50 percent of regular season games and accused the school of failing to “take reasonably appropriate action(s)” following the arrest and indictment of a former UCLA soccer coach in connection with the “Operation Varsity Blues” college admissions scandal.

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UCLA characterized each of these arguments as “illegitimate.” Under Armour had no basis for declaring itself “the affected party” under a “Force Majeure” clause as nothing about Covid-19 made it “impossible or impracticable” for either party to meet its obligations under the agreement, it argued. For its part, the school said, UCLA’s teams and athletes continued to engage in team meetings, voluntary workouts and game preparations while wearing Under Armour products that they were under an obligation to wear.

The university further argued that it had not failed to participate in a complete regular season because the agreement created no obligation “to play in non-existent, cancelled, or ‘un-scheduled’ games.” Finally, it pointed out that the school had placed the former soccer coach on leave the same day as his arrest and “promptly” accepted his resignation a few days later.

UCLA’s original lawsuit laid out multiple claims, including breach of contract and breach of the implied covenant of good faith and fair dealing. In both cases it contended that it was entitled to recover contractual damages exceeding $200 million. The school also alleged Under Armour failed to deliver all “supplied products” it ordered prior to June 22, 2020 in a timely manner and that some of the delivered products were “defective.” It sought damages in excess of $75,000 for this last claim.

When Under Armour first announced its “record partnership” with UCLA in May 2016—it went into effect July 1, 2017—it touted the agreement as “the largest apparel deal in the history of the NCAA.” As part of the 15-year partnership, the sportswear company was contracted to exclusively design and supply the footwear, apparel and equipment for training and game-day uniforms of all 25 men’s and women’s varsity athletic teams.

“With 113 NCAA Championships, UCLA is the most decorated athletic program in history, the benchmark for excellence in performance,” Under Armour founder and then-CEO Kevin Plank said in a statement at the time. “Under Armour’s commitment to growth through innovation and an unwavering mission to make all athletes better aligns seamlessly with UCLA and the pioneering figures that helped build the program, and we look forward to reaching new heights with the Bruins.”

One year after Under Armour terminated its agreement with UCLA, the university began a new, six-year partnership with Nike, Inc. Under the agreement, first announced in December 2020, Nike has become the official supplier of uniforms, footwear, apparel and equipment for 22 of the university’s 25 varsity athletic teams. The Jordan Brand, meanwhile, is outfitting the football and men’s and women’s basketball programs, making UCLA the only school in the Pac-12 Conference to wear Jumpman products. It is the fifth university in the U.S. to partner with Jordan Brand on football and men’s and women’s basketball.

The agreement also supports UCLA Athletics’ student-athlete development program, with Nike offering two summer internships per calendar year to university students and annually hosting a group of selected students at its headquarters “for an educational experience.”

“Our student-athletes deserve every resource in their pursuit of excellence. We sought to work with the best in the world; that is Nike and Jordan Brand,” Martin Jarmond, UCLA’s Alice and Nahum Lainer Family director of athletics, said in a statement at the time. “I want to thank [UCLA] Chancellor [Gene] Block for his leadership and support in establishing a relationship that will make the entire Bruin community proud.”

Adidas announces NIL deals

Thirteen months after an 11th-hour vote by the National Collegiate Athletic Association (NCAA) opened the door for college athletes to sign name, image and likeness deals, Adidas is finally kicking its “wide-sweeping” NIL network into gear.

The German sportswear giant announced NIL agreements with 15 female student-athletes last week. The women, who span assorted colleges and sports, join the world’s top female amateur golfer, Stanford University’s Rose Zhang, who became the first student-athlete to enter into a NIL endorsement agreement with Adidas in late May.

Adidas announced new NIL partnerships with 15 student-athletes last week
Adidas announced new NIL partnerships with a slate of student-athletes last week. Adidas

Adidas’ new partners will represent the company while playing and training and feature in brand marketing campaigns promoting its athletic apparel and footwear. The 15 athletes include students at NC State, University of Miami, University of Louisville, Texas A&M, University of Washington, University of Nebraska, Indiana University, University of Kansas, Georgia Tech, Mississippi State, Grambling State, Rutgers University and Arizona State University. They compete in track and field, soccer, basketball, tennis, softball, volleyball and gymnastics.

Adidas first unveiled plans for its NIL network in March. The program will give more than 50,000 student-athletes across 23 sports and 109 Division 1 NCAA schools the opportunity to become paid affiliate brand ambassadors, it said. The company called last week’s slate of NIL agreements “just the start” and promised to use the new opportunities to “further promote and invest in equality initiatives that will increase awareness and representation.”

Alongside the signings, Adidas is also partnering with WNBA player Candace Parker on a mentorship program that will provide newly signed student-athletes with guidance as they “navigate the NIL era.” The brand also committed to expanding its partnership with Athlete Ally, a non-profit LGBTQI+ advocacy group, “to drive education, policy reform and organizing of student-athletes to spur equity on campus and in sport,” it said.