It’s not the $200 million they’re suing for, but the Bruins were able to end the controversial Under Armor saga with a little extra cash in their pocket.
A day after City News Service reported that UCLA and Under Armor had dropped dueling lawsuits against each other, details of the out-of-court settlement between the two sides became public. Under Armor agreed to pay UCLA $67.491 million to end their relationship and legal battles on May 26, as Ben Bolch of the Los Angeles Times first reported Friday.
Under Armor was required to make its full cash payment to UCLA within 30 days of the effective date, according to the settlement agreement reviewed by All Bruins.
“UCLA is one of the most well-known and respected collegiate names in the world,” UCLA Vice President for Strategic Communications Mary Osako said in a statement provided to All Bruins. “We are pleased to have resolved this matter in a manner that benefits our student-athletes and the entire Bruin community.”
UCLA and Under Armor agreed to a 15-year, $280 million exclusive partnership in 2016 – the largest apparel agreement in college sports history. However, Under Armor terminated the contract in 2020, claiming that the Bruins failed to fulfill their end of the bargain by failing to provide the necessary marketing benefits while competition was suspended during the COVID-19 pandemic.
Although this allowed Under Armor to invoke a clause in the contract, UCLA sued them for $200 million in damages for breach of contract, arguing that voiding the rest of the deal was not an expressly permitted consequence in the agreement. A judge agreed with the Bruins when Under Armor tried to dismiss the lawsuit in August 2021, prompting Under Armor to file a countersuit in September.
Under Armor has agreed to provide minimum apparel to UCLA’s teams for the 2020-2021 academic year, although it has already canceled the last 12 years of the deal. However, the Bruins covered the Under Armor logo on all of their game jerseys with a “Stand Together” patch, which Under Armor says is an attempt to undermine their brand under the guise of promoting social justice.
Attorneys representing UCLA said at the time that there was no intent to be petty or vindictive by hiding or damaging the Under Armor logo in any way.
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The money the Bruins lost when Under Armor left played a key role in sending the athletic department into the red the past three years. Although the school was able to turn around and strike a new deal with Jordan Brand and Nike, the six-year, $46.45 million deal didn’t do enough to save UCLA Athletics from $103 million in debt.
UCLA made a big move in June that could eliminate those financial woes in short order, announcing that the school will leave the Pac-12 in favor of the Big Ten starting in 2024. The Big Ten is currently negotiating a new media deal and with the addition of UCLA, USC and the Los Angeles market to their portfolio, conference payouts will reportedly reach $100 million annually.
The combination of the upcoming Big Ten money and the money from the Under Armor settlement could give UCLA Athletics enough cash to climb out of the hole and directly into the black.
Meanwhile, Under Armor has faced financial struggles of its own, with its stock rising from over $52 per share in September 2015 to below $10 in July 2022.
In May 2021, Under Armor agreed to a $9 million settlement with the Securities and Exchange Commission after being accused of misleading investors about revenue growth during the initial negotiation process with UCLA.
Regardless, Under Armor now officially has another payment arrangement in place.
Read more stories from UCLA: Sports Illustrated’s UCLA Bruins
Read more news from UCLA: Sports Illustrated’s UCLA News