Under Armour Can’t Escape UCLA Suit Over Sports Sponsorship Deal
Under Armour Can’t Escape UCLA Suit Over Sports Sponsorship Deal
(Bloomberg) -- Under Armour Inc. can’t avoid a University of California at Los Angeles lawsuit claiming the company used the Covid-19 pandemic as a pretext to end the largest athletic-apparel sponsorship deal in the history of American college sports.
A Los Angeles state judge said Thursday in a tentative ruling that Under Armour couldn’t show that it was excused from its contractual obligations because the pandemic was a “force majeure event” that frees parties of obligations under a contract in light of extraordinary events. UCLA had argued that the pandemic hadn’t stopped either party from carrying out sponsorship obligations.
The judge confirmed the ruling later Thursday after giving Under Armour a chance to contest the preliminary decision, Mary Osako, the university’s vice chancellor of strategic communications said.
Under Armour declined to comment on the ruling.
Under Armour apparently decided that its agreement with the University of California at Los Angeles was too expensive for a troubled company, the university said in breach-of-contract case filed last September in Los Angeles Superior Court.
A 15-year deal valued at $280 million that Under Armour struck with UCLA in 2016 is at the heart of the dispute. The university is seeking more than $200 million in damages.
The case started in federal court before it was moved to state court. Nike struck a sponsorship deal with the university after the Under Armour deal fell through.
The case is The Regents of the University of California v. Under Armour Inc., 20SMCV01205, California Superior Court, Los Angeles County.
©2021 Bloomberg L.P.