Report: UCLA Reaches $67 Million Settlement With Under Armour
It isn't the $200 million they sued for, but the Bruins have managed to end the contentious Under Armour saga with a bit of extra cash in their pocket.
A day after City News Service reported that UCLA and Under Armour had dropped dueling litigation against each other, the details from the out-of-court settlement between the two sides have gone public. Under Armour agreed to pay UCLA $67.491 million to bring their relationship and legal battles to a close on May 26, as the Los Angeles Times' Ben Bolch first reported Friday.
Under Armour 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 recognized and respected collegiate names around the globe,” UCLA vice chancellor for strategic communications Mary Osako said in a statement provided to All Bruins. “We are gratified to have resolved this matter in a way that benefits our student-athletes and the entire Bruin community.”
UCLA and Under Armour agreed to a 15-year, $280 million exclusive partnership back in 2016 – the largest apparel agreement in college sports history. However, Under Armour terminated the contract in 2020, claiming that the Bruins failed to uphold their end of the deal when they did not provide the required marketing benefits while competition was suspended during the COVID-19 pandemic.
While that did allow Under Armour to invoke a clause in the contract, UCLA sued them for $200 million in damages for breach of contract, arguing that voiding the remainder of the deal was not an expressly permitted consequence in the agreement. A judge agreed with the Bruins when Under Armour tried to have the suit dismissed in August 2021, leading Under Armour to countersue that September.
Under Armour agreed to provide minimal apparel to UCLA's teams for the 2020-2021 academic year, despite already calling off the final 12 years of the deal. However, the Bruins covered up the Under Armour logo on all of their in-game jerseys with a "Stand Together" patch, which Under Armour claimed was an attempt to undercut their brand under the guise of promoting social justice.
Lawyers representing UCLA said at the time that there was no intention to be petty or vindictive by hiding or damaging the Under Armour logos in any way.
The cash the Bruins lost out on when Under Armour walked away played a key role in sending the athletic department spiraling into the red over the past three years. While the school was able to pivot and strike a new deal with Jordan Brand and Nike, the six-year, $46.45 million contract did not do nearly enough to save UCLA Athletics from its $103 million of debt.
UCLA made a big move in June that could wipe away those financial concerns in short order, though, announcing that the school would be leaving the Pac-12 in favor of the Big Ten starting in 2024. The Big Ten is currently in negotiations for a new media deal, and with UCLA, USC and the Los Angeles market joining their portfolio, conference payouts will reportedly top $100 million annually.
The combination of the upcoming Big Ten money and the Under Armour settlement money could give UCLA Athletics enough cash to dig themselves out of the hole and squarely into the black.
Under Armour, meanwhile, has faced financial struggles of its own, with the value of its stock going from over $52 a share in September 2015 to under $10 in July 2022.
In May 2021, Under Armour 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 Armour now officially has another settlement to pay out.
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