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800-Meter Champion Berian Eventually Outpaces Nike Endorsement Suit... Or Did He?

World 800-meter champion Boris Berian is seemingly capable of out-running just about anything these days. Berian is just a year removed from sprinting out of a McDonald's kitchen and into track lore – essentially trading a fry cook apron for track shorts and blowing away the competition en route to gold at the 2016 world indoor championships. Some months later, the American track star appears to have, at least for the moment, finally put some distance between himself and his former sponsor with the news last month that Nike has decided to drop its breach of contract lawsuit against the soon-to-be Olympian. So, why did Nike split with this up-and-coming track star?

The relationship between Berian and Nike started, as these things typically do, quite harmoniously. After an unexpected second place finish at the Adidas Grand Prix in June 2015, Berian, until then having attracted attention largely for his previous work as a McDonald's fry cook, caught the eye of several suitors hoping to sponsor him, ultimately selecting the Oregon shoe giant because it came in with the highest offer.

Yet just as quickly as runner and corporate sponsor fell in love, they puzzlingly split. As early as January 2016, Berian was spotted racing in New Balance gear. At the time, Berian's agent explained that his client's contract with Nike had expired and that any contractual restrictions against signing another footwear endorsement contract had lapsed.

If the middle distance champion thought he had left Nike in the dust, he was quite mistaken. In April, Nike dashed to court and filed a breach of contract lawsuit. (Nike USA Inc. v. Berian, No. 16-00743 (D. Or. filed April 29, 2016)). Berian was served with notice of the suit seemingly during the only time Nike could catch him: while the runner stood still and watched others compete at a track meet in Los Angeles.

In the complaint, Nike claimed that it had a right of first refusal to match a $125,000 sponsorship deal that Berian had signed with New Balance. Nike further alleged that it had exercised its right of first refusal and matched the New Balance offer, which included $125,000 a year plus a performance bonus, and that therefore Berian had breached the endorsement deal in eloping with New Balance. Nike further asserted that its offer was a match even if it contained reductions (which Nike stated are standard in track and field endorsement contracts) because the New Balance offer was only a brief term sheet (with omitted reductions) and not a complete contract. As a result of the alleged violation, Nike sought an order enjoining Berian from entering into an endorsement relationship with any Nike competitor and from competing while wearing or otherwise endorsing any Nike competitor's product. Nike claims that it would suffer irreparable harm if Berian is allowed to compete in a competitor's product, particularly in an Olympic year.

In a response in opposition to a motion for an expedited hearing and discovery on the injunction issue, Berian maintained that he had not breached the deal because Nike did not truly match New Balance's offer. The crux of Berian's argument focused on the insertion of the reductions clause in Nike's offer that allowed Nike to reduce Berian's compensation in certain circumstances relating to performance, as opposed to New Balance's offer, which did not contain any reductions.

Nonetheless, in early June, Nike obtained a temporary restraining order barring Berian from wearing New Balance products.

That temporary victory, however, came with rather limited fanfare, a reaction that perhaps served as an indicator of what awaited Nike, both in the courtroom and out. Inside the courthouse halls at oral argument, the judge set to rule on the injunction request reportedly appeared skeptical of the merits of Nike's case. That perceived skepticism also took the form of criticism in the court of public opinion, with members in the track community decrying the proverbial Goliath for singling out a modern-day David.  

Within several weeks, however, Nike had changed course, deciding to drop the suit altogether, in the process adding another chapter to what had quickly become a tumultuous saga. Nike, while maintaining the validity of its breach claims, stated that it opted to drop the suit to eliminate any distraction for Berian who was preparing for the Olympic trials. Berian placed second in those trials and earned a trip to the Rio Olympics at summer's end. And he did so wearing a New Balance kit.

Ironically enough, Berian's performance in the trials means that the saga continues into the present.

Nike is the official sponsor of USA Track and Field and, as such, all track and field athletes representing the United States at the Rio Olympics will be outfitted in Nike-branded national team attire in competitions, award ceremonies, official press conferences, and other official team functions.

Berian's prize, then, for securing a trip to Rio by placing second at the trials?

Glory, sure. And a clean Nike uniform to don at the starting line.

© 2021 Proskauer Rose LLP. National Law Review, Volume VI, Number 213



About this Author

L. Robert Batterman, Labor, Management, Sports, Attorney, Proskauer, Law Firm

A partner since 1974, Bob Batterman has considerable experience representing both individual employers and multi-employer groups in union relations and collective bargaining. Much of Bob’s time is spent in day-to-day contact with clients, often in “crisis” situations where a rapid resolution of union-related problems is vital.

Bob is a senior member of our nationally recognized Sports Law Group, serving as labor counsel to the National Hockey League, Major League Soccer and the National Football League. He has extensive experience in collective...

Michael Cardozo, Commercial Litigation Attorney, Proskauer, Law Firm

Michael A. Cardozo is a Partner in Proskauer’s Litigation Department and the former Corporation Counsel for the City of New York. As the city's 77th and longest serving Corporation Counsel, he was the city’s chief legal officer, headed the city's Law Department of more than 700 lawyers, and served from 2002 through 2013 as legal counsel to Mayor Michael Bloomberg, elected officials, the city and its agencies.

Michael’s experience managing large litigations in both the private and public sectors provides him with unique insight into litigation assessments, risk management and...

Robert L. Freeman, Technology, Media, Sports, Attorney, Proskauer, Law Firm

Robert E. Freeman is a Partner in the Corporate Department and a member of the Sports Law Group and Technology, Media & Communications Group.

Rob began his career as an intellectual property litigator before shifting the focus of his practice to intellectual property-related transactions. Today, he helps lead a team of media, sports and entertainment attorneys representing clients such as Time Warner Cable, Discovery Communications, the WTA, the Orlando Magic, Scripps Networks, Armstrong Cable, the PAC-12, Insight Communications and CBS Sports. Rob’s work for these clients...

Howard Ganz, Sports, Employment Attorney, Proskauer, Law Firm

Howard Ganz is co-head of the Sports Law Group and former co-Chair of the Labor & Employment Law Department.

Howard represents and counsels clients with respect to a wide variety of labor and employment matters, such as employment discrimination, sexual harassment, wrongful discharge, defamation, breach of contract, discipline, and large-scale reductions-in-force. His litigation experience has run the gamut, from single plaintiff lawsuits to major class actions, in federal and state courts in New York and elsewhere. The clients Howard has represented include the National...

Wayne D. Katz, Finance, Sports, Attorney, Proskauer, Law Firm

Wayne D. Katz is a Partner in the Corporate Department, specializing in the sports industry.

Wayne's experience includes the representation of the National Basketball Association and National Hockey League in their various corporate matters, including team ownership transfers and team financings. Major transactions he has worked on for the leagues include the NBA’s purchase and sale of the New Orleans Hornets; the NBA's grant of expansion franchises to Toronto, Vancouver and Charlotte; the NHL's grant of expansion franchises to Nashville, Atlanta, Columbus and Minnesota; the NBA’s $...