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Post by huskerjen on Jun 28, 2020 20:08:55 GMT -5
Also, UA got in a bidding war, really wanted to "beat" its competitors and probably overpaid for UCLA and Cal to establish a West Coast presence (remember, California represents approx. 1/8th of the U.S. consumer market). Well, now they're in trouble and they overpaid. Let's be honest, UA's leadership was/is terrible. CA is a professional sports market, Nike and Adidas weren't going to make it rain on those schools. I can just imagine the theft that UCLA and Cal thought they were getting away with when signing those contracts.
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Post by c4ndlelight on Jun 28, 2020 20:10:58 GMT -5
Also, UA got in a bidding war, really wanted to "beat" its competitors and probably overpaid for UCLA and Cal to establish a West Coast presence (remember, California represents approx. 1/8th of the U.S. consumer market). Well, now they're in trouble and they overpaid. Let's be honest, UA's leadership was/is terrible. CA is a professional sports market, Nike and Adidas weren't going to make it rain on those schools. I can just imagine the theft that UCLA and Cal thought they were getting away with when signing those contracts. Do we know the size of Notre Dame's contact or can we confirm that UCLA is their biggest?
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Post by geddyleeridesagain on Jun 28, 2020 20:13:59 GMT -5
Yes, the Pac-12 has a trash commissioner who has negotiated terrible TV deals. The SEC and ACC are both owned and operated in partnership with ESPN which is a huge factor in their success. If you are only taking into account revenue generating sports, yes the Pac-12 is a huge under-performer. However, the same cannot be said across all sports. That's only what we're talking about. UA could care less about rowing/swimming/field hockey or whatever else the PAC is good at. does. Revenue sports is where they want to shine, that's where they're putting their money to receive the marketing benefits. You’d be surprised how much Nike and UA care about collegiate sports like softball and soccer, but of course the primary focus is revenue sports. The Pac12 has struggled in football and basketball the past few years, no question. But what is overlooked - and what will always give the Pac 12 a boost when it comes to apparel companies and other sponsors - is the footprint of the Pac12 encompasses more major media markets than any other conference. That’s not to say the Pac can suck indefinitely and still rake in corporate sponsorships, but there will always be interest just based on the number of potential eyeballs seeing a swoosh or that UA logo on TV. As for UCLA, perhaps a perceived decline in brand value is involved here, but what I’m mostly seeing is a company desperate to cut expenses. UA revenue has tanked, its market value has tanked, 7,000 employees furloughed, and execs taking big pay cuts. UA wildly overpaid UCLA to begin with (I think they over-compensated Cal as well, but not horribly so), which makes UCLA a primary target. And I very much doubt these attempts at cost cutting will be limited to the Pac12.
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Post by Deleted on Jun 28, 2020 20:14:02 GMT -5
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Post by jayj79 on Jun 28, 2020 20:16:03 GMT -5
I was talking about Cal not publicly discussing the deal possibly being broken. Which they haven’t addressed until a press release today. Under Armour has not as yet formally notified Cal they’re cancelling the deal and Cal doesn’t believe UA has any avenue to actually do it - unlike UCLA, where there are apparently some questions as to whether UCLA has fulfilled all its commitments listed in the contract. We’ll see how it turns out, of course, but I predict many lawyers will be involved. That's the thing. I think most people here aren't focusing enough on the legal implications of UA simply walking away from the deal. That would be a clear breach of contract. UCLA would then be entitled to sue for damages for non-compliance from UA. I don't think UA can simply get up and walk away whenever they feel like it. Of course, it always depends on the specific clauses in the contract, whether UA has a "get out of jail" card to allow it to dump UCLA when its finances go south. That depends on interpretation of the clause. The devil is in the details, as they say. As always in situations like this, the only ones benefiting are the lawyers. I suspect a more reasonable outcome would be UA and UCLA renegotiating the deal to allow UA to lower its commitments and lessen the financial pressure. But that is only if both sides are willing to play ball... Highly doubt there is any "breach of contract". My bet would be that the contract includes clauses that allow for termination under certain circumstances. And possibly the cancellation of sports seasons and championships is one of those circumstances.
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Post by horns1 on Jun 28, 2020 20:20:00 GMT -5
So, did UCLA start with Nike before switching to adidas? At least they have previous relationships to try and rekindle.
Texas started with Reebok before switching to Nike. Hard to believe we were a Reebok school.
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Post by ironhammer on Jun 28, 2020 20:20:35 GMT -5
Also, UA got in a bidding war, really wanted to "beat" its competitors and probably overpaid for UCLA and Cal to establish a West Coast presence (remember, California represents approx. 1/8th of the U.S. consumer market). Well, now they're in trouble and they overpaid. Let's be honest, UA's leadership was/is terrible. CA is a professional sports market, Nike and Adidas weren't going to make it rain on those schools. I can just imagine the theft that UCLA and Cal thought they were getting away with when signing those contracts. Regardless, once UA signed the contract, they are stuck. They cannot get up and walk away without some hefty damages they will have to pay for breaching the contract with UCLA. Sure the contract would draft some "exceptions", but does the current pandemic qualify? It can be a long-drawn out legal battle that will further diminish the coffers of UA. Should have thought about that when they signed the dotted line. As they say, when things are going great between the parties, the contact might as well not exist. But when things turn south, each and every word of the contract will be scrutinized very very carefully by the lawyers.
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Post by jagdpanther on Jun 28, 2020 20:20:47 GMT -5
So, did UCLA start with Nike before switching to Adidas? At least they have previous relationships to try and rekindle. Texas started with Reebok before switching to Nike. Hard to believe we were a Reebok school. Nothing like Central Michigan being a New Balance school until really not that long ago.
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Post by ironhammer on Jun 28, 2020 20:23:53 GMT -5
That's the thing. I think most people here aren't focusing enough on the legal implications of UA simply walking away from the deal. That would be a clear breach of contract. UCLA would then be entitled to sue for damages for non-compliance from UA. I don't think UA can simply get up and walk away whenever they feel like it. Of course, it always depends on the specific clauses in the contract, whether UA has a "get out of jail" card to allow it to dump UCLA when its finances go south. That depends on interpretation of the clause. The devil is in the details, as they say. As always in situations like this, the only ones benefiting are the lawyers. I suspect a more reasonable outcome would be UA and UCLA renegotiating the deal to allow UA to lower its commitments and lessen the financial pressure. But that is only if both sides are willing to play ball... Highly doubt there is any "breach of contract". My bet would be that the contract includes clauses that allow for termination under certain circumstances. And possibly the cancellation of sports seasons and championships is one of those circumstances.I suspect so. But again, the devil is in the details. Does the current pandemic qualify as one of those exceptions? The lawyers are going to have a field day interpretating the clauses. Times like this remind you that Shakespeare in Henry VI has hit on something when he said: "Let's kill all the lawyers!"
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Post by volleyguy on Jun 28, 2020 20:32:11 GMT -5
Huskerjen's gobbledegook aside, Nike also recently posted bad revenue figures and saw stock price declines. I don't know how anyone thinks this is a good time for Universities or Conferences to renegotiate apparel or media rights contracts. Like I said, it it's UA, then I'm waiting for ND, Wisconsin, and Auburn. I understand why UA wants out, but I don't think it's beneficial for the parties on the other side.
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Post by geddyleeridesagain on Jun 28, 2020 20:32:36 GMT -5
In retrospect, the Notre Dame deal looks pretty good for UA. They might want to leave that one alone.
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Post by horns1 on Jun 28, 2020 20:37:11 GMT -5
If this is a sign that UA is starting to bow out of collegiate sponsorships/relationships, those schools who chose UA over their previous partner (adidas or Nike) better start making some phone calls . . .
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Post by volleyguy on Jun 28, 2020 20:39:58 GMT -5
Highly doubt there is any "breach of contract". My bet would be that the contract includes clauses that allow for termination under certain circumstances. And possibly the cancellation of sports seasons and championships is one of those circumstances.I suspect so. But again, the devil is in the details. Does the current pandemic qualify as one of those exceptions? The lawyers are going to have a field day interpretating the clauses. Times like this remind you that Shakespeare in Henry VI has hit on something when he said: "Let's kill all the lawyers!" Notwithstanding the clauses, it's unlikely that a contract of this type would be enforced by a judge if one of the parties is unable or is unwilling to perform, as I imagine the UA argument will be. The exception would be a specific liquidated damages clause.
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Post by geddyleeridesagain on Jun 28, 2020 20:44:55 GMT -5
I suspect so. But again, the devil is in the details. Does the current pandemic qualify as one of those exceptions? The lawyers are going to have a field day interpretating the clauses. Times like this remind you that Shakespeare in Henry VI has hit on something when he said: "Let's kill all the lawyers!" Notwithstanding the clauses, it's unlikely that a contract of this type would be enforced by a judge if one of the parties is unable or is unwilling to perform, as I imagine the UA argument will be. The exception would be a specific liquidated damages clause. Sounds like my first marriage.
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Post by volleyguy on Jun 28, 2020 20:48:05 GMT -5
Notwithstanding the clauses, it's unlikely that a contract of this type would be enforced by a judge if one of the parties is unable or is unwilling to perform, as I imagine the UA argument will be. The exception would be a specific liquidated damages clause. Sounds like my first marriage. LOL!
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