Under Armour Inc. agreed to pay UCLA more than $65 million to settle dueling litigation that started when the university sued the company, alleging that the firm wrongfully reneged on its $280 million sports apparel deal with the school in 2020 due to fallout from the coronavirus pandemic.
The settlement agreement, dated May 26, called for Under Armour to pay the school $67.5 million, with a deduction allowable for $8,725 in costs for a mediator’s services.
“The parties acknowledge and agree that each party’s obligations under the sponsorship agreement, to the extent any survived Under Armour’s termination, have terminated as of June 22,” the settlement agreement further states.
The accord also includes a mutual non-disparagement agreement.
A lawyer for the UC Regents, acting on behalf of UCLA, filed court papers with Santa Monica Superior Court Judge H. Jay Ford III on Wednesday asking that all litigation be dismissed “with prejudice,” meaning it cannot be refiled.
“UCLA is one of the most recognized and respected collegiate names around the globe. We are gratified to have resolved this matter in a way that benefits our student-athletes and the entire Bruin community,” said Mary Osako, UCLA vice chancellor of strategic communications.
The UC Regents sued Baltimore-based Under Armour in September 2020, alleging that Under Armour told UCLA it was invoking a clause in the agreement due to the coronavirus pandemic to terminate the contract.
“This was not only the most expensive exclusive college sponsorship deal that Under Armour entered into — it was the most lucrative college sponsorship deal by any sportswear company in history,” the suit stated.
The judge, in denying a motion by Under Armour to dismiss the case last August, concluded that the company did not show that its cancellation of the contract was specifically allowed under the clause cited.
At UCLA’s request, Under Armour still provided apparel in the fall of 2020 when the football team began playing again, according to the lawsuit.
In its countersuit filed last Sept. 15, Under Armour alleged UCLA breached the record-breaking contract by failing to provide marketing benefits while teams were unable to perform due to the suspension of college sports in 2020 due to the pandemic. Under Armour also alleged UCLA violated a separate agreement by using social justice patches to cover up the brand’s logo on uniforms provided to the university after the original sponsorship deal was terminated.
When UCLA’s football team resumed play, the Bruins covered up the Under Armour logo on their uniforms with a patch to express support for social justice issues.
UCLA announced a new deal with Nike’s Jordan brand in December 2020.