Even if Nike matched the terms the contact is not binding until BB signs it. Just because he had a contract in the previous year with a ROFR does not mean that Nike can automatically match the offer and say the contract in then binding.
BB would still have to sign a contract. Until he signs the '2016 contract' he can run unattached in as many races as he wants and negotiate contract with whatever Nike competitor he wants.
Nike cannot infer BBs signature because of a ROFR clause.
I've read the complaint and here are my initial thoughts.
1) I'm told under CA contractual law (which may not apply since case filed in Oregon and Boris apparently agreed to jurisdiction) concerning right of first refusal clauses, when Nike met NB's counteroffer that created mutual acceptance by Berian and Nike of Nike's counter offer thereby creating a binding contract. However, Nike neither cites the operative language or attaches the complaint (both infirmities would get their case kicked in PA) so it's hard to be sure the clause upon which Nike relies.
2. If Boris accepted Nike's money then that's a rather clear indication he accepted the terms of Nike's contract.
3. Generally you don't get specific performance under contract law. This means the Court can't order Boris to become a Nike athlete. A more likely resolution is Boris gives Nike's money back.
4. Nike's irreparable harm arguments are weak. Nike argues that athlete sponsorship at Oly trials and Olympics are unique sponsorship opportunities. The former point was tacitly rejected by the Court in Run Gum and Nike already has exclusive sponsorship of Olympic track and field athletes. Rule 40 significantly limits a non-Olympic sponsored athlete from advertising during the Olympics.
5. Nike's monetary damages are highly speculative. Other than the money Nike apparently already paid Berian under the contract, I don't know how you reliability value the damages Nike suffered as result of Berian not being a Nike endorsed athlete. How do you value what Nike's sales would have been had Berian become a Nike athlete instead of N?. There are way too many other factors that affected Nike's sales.
One final comment on the Mo Farah situation from an insider -
adidas knew it would have Farah in an adidas kit in the 2012 Olympic and had the foresight to know they would take advantage of all that marketing and imaging, thus easing the decision to let him go train with Salazar and be part of the NOP.
Millions have watched these videos,
https://www.youtube.com/watch?v=C93qwVmBseE
Over 1 billion impressions of Farah in an adidas kit.
Me thinks adidas was quite brilliant in not having to continue the $2M+ per year salary, yet still capitalize on Farah being an adidas athlete in the Olymipcs and World Championships.
2016 Mo Farah will be in adidas as well for those interested.
What we are seeing here now is just how bad an agent can screw up a deal.
The athletes sign an agent to handle the contract negotiations, agent comes to athlete with the various packages they discuss and decide. Contact cut to agent is typically 10% of the deal done. The agents paid job is to manage all aspects of the contract as this is their supposed area of expertise.
In this case agent has has mis read and mis interpreted contract language and made a terrible assumption.This mistake and careless disregard for the athletes well being should cause for agents firing, loss of his athletes representation credentials.This poor management leads to the damage of athletes lost wages and being potentially tainted athlete. Boris's ability to sign with anybody while this whole scenario is being dealt with in court adds insult to injury.
This is athlete abuse at its finest by the agent.
Pull your negative Nike emotions out of this and lets look at the facts we know, contract language and who is responsible, agent.Nike called agents bluff.
I don't know what was in the terms of the original contract.
But Nike is a savvy corporation who knows contracts. I would imagine if they put right of first refusal in a contract they would put in if an athlete sent them a contract offer from another company and they matched the athlete had to sign the Nike contract. It seems to me Boris sent the contract to Nike to leverage New Balance to raise their offer, which would usually not be allowed by right of first refusal. Boris could have rejected the New Balance offer and if he got a better offer he was willing to sign from them he would then send it to Nike. If I were Nike him sending the contract to me would constitute he was going to accept the offer. Sending an offer he had no intention of accepting over was stupid.
What constitutes a match is a whole other issue. I would think in the original Nike contract "Match" was defined from a financial and compensation standpoint. Obviously the contracts couldn't be identical since different companies mean different gear. Nike's not going to sign Boris and let him wear another companies gear.
Remember also Boris's agent and Nike are not exactly buddy buddy. The Keflezghi's and Nike don't exactly see eye to eye.
First right of refusal is easy to beat in a court of law.
The defense is WORKING CONDITIONS. Even if the numbers are the same working for someone else may be less stressful and therefore not THE SAME contract.
This defense has worked before.
This defense would enable every ex athlete that has been shit on by Nike to say why conditions are not the same. Good times.
Memphian wrote:
Another thing that gets me about this is that to avoid all of this he had to race unattached for 6 months DURING AN OLYMPIC YEAR. Sure, he could have then signed with any company he chose, ran the US Trials, but then once on the team he has to wear Nike anyway in the Olympics.
Nike crafted this contract to screw his marketability so shame on them. Shame on his agent for accepting the terms, and shame on the sport for allowing itself to be run by bullies. No one is winning here.
This is how other shoe company's craft their contracts too, so your argument of them being bullies is irrational. This idea that other company's wouldn't enforce their contracts if someone wants to leave is ridiculous. It's why athletes stay with the same shoe sponsors. Athletes in other sports hold out, without pay and the ability to play. BB could have still competed and his biggest concern would have been what he has to race in over those 6 months and signed a nice contract with whoever that had a nice signing bonus to cover whatever his expenses for the past 180 days.
The issue is that his agent screwed up this one. He thought he could force his way out, but unfortunately the offer he got BB was something Nike was wikling to match and he is subject to the New Balance offer with Nike. Obviously this is speculating that Nike did in fact match the contract. If there was principle difference like less money or failure to match the coaching stipulations, that would obviously not be a matching offer.
kjVC wrote:
One final comment on the Mo Farah situation from an insider -
adidas knew it would have Farah in an adidas kit in the 2012 Olympic and had the foresight to know they would take advantage of all that marketing and imaging, thus easing the decision to let him go train with Salazar and be part of the NOP.
Millions have watched these videos,
https://www.youtube.com/watch?v=C93qwVmBseEOver 1 billion impressions of Farah in an adidas kit.
Me thinks adidas was quite brilliant in not having to continue the $2M+ per year salary, yet still capitalize on Farah being an adidas athlete in the Olymipcs and World Championships.
2016 Mo Farah will be in adidas as well for those interested.
Your insider's given you bad information. adidas was keen on keeping Farah coming off of 2010 but Farah wanted to work with Salazar. He wore adidas the requisite time into the first part of 2011 and then formerly got a new deal with Nike.
rojo wrote:
Recovering Attorney. wrote:Here is a Nike agreement with ROFR language. Granted it's with ASU and not an individual but it seems to track what they say in the complaint.
http://media.oregonlive.com/pac10/other/Arizona-State-Nike-Sponsorship.pdfRecovering attorney, that's a GREAT post. Where did you find that>
Just a wild guess here, but I think he found it on oregonlive.com
(You really shouldn't be allowed to post)
OtherSports wrote:
If BB wanted out of Nike so badly, he should not have negotiated a deal until 180 day mark and lived off an interest free loan from his agent. That happens in holdouts of other sports all the time. Race unattached until he 181st day, sign a deal that is over inflated to cover all your expenses from the prior 180 days and pay your agent back. BB didn't do this and messed up (assuming Nike did match the offer).
Isn't there a fair amount of risk here? The 180 day period would have been from Jan1 to June 30 if what we've read is true. Suppose BB, for whatever reason, starts running consistent 1:47's during that period. Wouldn't offers likely dry up?
In general, a good deal of the comments on this topic are sourced in "I hate Nike" which isn't a good legal position. Those that actually have a background to assess the situation may be able to chime in here in foretelling whether this likely just comes down to a judge ruling whether a match was made and Nike had the right to enforce.
I am in agreement that this very likely never gets that far.
Left Said Fred, you don't know what you are talking about. Thanks.
Steve on a cell in Brooklyn wrote:
OtherSports wrote:If BB wanted out of Nike so badly, he should not have negotiated a deal until 180 day mark and lived off an interest free loan from his agent. That happens in holdouts of other sports all the time. Race unattached until he 181st day, sign a deal that is over inflated to cover all your expenses from the prior 180 days and pay your agent back. BB didn't do this and messed up (assuming Nike did match the offer).
Isn't there a fair amount of risk here? The 180 day period would have been from Jan1 to June 30 if what we've read is true. Suppose BB, for whatever reason, starts running consistent 1:47's during that period. Wouldn't offers likely dry up.
That's the risk that he, his agent and inner circle had to manage. They mismanaged this situation and Nike called their bluff that they would just sit back and not do anything. Hopefully BB can forget about this and continue to train. Additionally, had they waited the 180 days, BB would have a US championship, World Gold Medal, and potentially title of Olympian, which would have made his deal far better. At the end of the day he received bad advice, shouldn't have submitted an offer to Nike, and then after it was matched, went ahead and breached his contract with Nike. I believe his agent thought Nike would let him leave to New Balance without matching the offer (based on who his coach is, who he trains with, etc), but they didn't. He gambled and lost. If this is solely the agents doing, time to fire him. If it's the advice of people on his team, time to find a new one. If it's just an honest mistake, time to step up, be a big boy, and deal with the fallout.
Recovering Attorney. wrote:
Here is a Nike agreement with ROFR language. Granted it's with ASU and not an individual but it seems to track what they say in the complaint.
http://media.oregonlive.com/pac10/other/Arizona-State-Nike-Sponsorship.pdf
I'm quoting the ROFR language to highlight an odd glitch:
"(c) During the Term and for a period of ninety (90) days thereafter, NIKE shall have the right of first refusal for Product Supply/Endorsement, as follows:
.
If UNIVERSITY receives any bona fide third party offer at any time on or after the Exclusive Negotiating End Date with respect to any Product Supply/Endorsement, UNIVERSITY shall submit to NIKE in writing the specific terms of such bona fide third party offer. NIKE shall have fifteen (15) business days from the date of its receipt of such third party offer to notify UNIVERSITY in writing if it will enter into a new contract with UNIVERSITY on terms no less favorable to UNIVERSITY than the material, measurable and matchable terms of such third party offer. If NIKE so notifies UNIVERSITY within such 15-day period, UNIVERSITY shall enter into a contract with NIKE on the terms of NIKE's offer.
If NIKE fails or declines to better the material, measurable and matchable terms of such third party offer within such 15-day period, UNIVERSITY may thereafter consummate an agreement with such third party on the terms of the offer made to UNIVERSITY."
I find it inexplicable why the bolded language shifts Nike's obligation from one of offering terms "no less favorable" (as one would expect) to a burden of actually "better[ing]" the third party terms.
It would be amusing if the same glitch appears in the Berian contract and Nike gets called on it.
What we are seeing here now is just how bad an agent can screw up a deal.
Berian's agent at the time he signed the Nike contract is that lady in Atlanta. One likely reason the Big Bear people dumped her (Brenda Martinez also left her for Hawi) was Berian's bad contract. Wonder if that agent got a kickback from Nike? That could be worth investigating.
Don't know anything about Hawi, but he is a lawyer. That LA crowd are a bunch of lightweights.
Hawi didn't do it wrote:
What we are seeing here now is just how bad an agent can screw up a deal.Berian's agent at the time he signed the Nike contract is that lady in Atlanta. One likely reason the Big Bear people dumped her (Brenda Martinez also left her for Hawi) was Berian's bad contract. Wonder if that agent got a kickback from Nike? That could be worth investigating.
Don't know anything about Hawi, but he is a lawyer. That LA crowd are a bunch of lightweights.
Hawi made a bad situation worse.
Nike will very likely survive a motion to dismiss and the case will go through discovery and summary judgment because you'll need discovery on whether Nike ever matched NB's offer. That will involve document and deposition discovery related to the negotiations. Getting to that point will likely cost BB more than he gained from the better offer. I hope they reach a quick resolution so BB can focus on getting to Rio.
Memphian wrote:
Another thing that gets me about this is that to avoid all of this he had to race unattached for 6 months DURING AN OLYMPIC YEAR. Sure, he could have then signed with any company he chose, ran the US Trials, but then once on the team he has to wear Nike anyway in the Olympics.
Nike crafted this contract to screw his marketability so shame on them. Shame on his agent for accepting the terms, and shame on the sport for allowing itself to be run by bullies. No one is winning here.
Stupid.
It's far more likely he was offered a boilerplate contract.
uhm, yowzaas wrote:
Memphian wrote:Nike crafted this contract to screw his marketability so shame on them.
Stupid.
It's far more likely he was offered a boilerplate contract.
Gotta agree. It's an endorsement contract. How does screwing Berian's marketability further NIKE's interest in marketing its shoes?
Thrown under the bus wrote:
First right of refusal is easy to beat in a court of law.
The defense is WORKING CONDITIONS. Even if the numbers are the same working for someone else may be less stressful and therefore not THE SAME contract.
This defense has worked before.
Does BB have enough money to make it work? Magic eight ball says "Outlook not so good."
There has to be more going on here for Nike than pursuing one broke-@ss runner.