Wednesday, April 4, 2012
Reebok can't sell Tim Tebow items
NEW YORK -- A judge rejected Reebok's bid to overturn his ban on its sale of Tim Tebow New York Jets jerseys Wednesday, saying the public can wait a few weeks for Nike Tebow jerseys to show up in stores.
U.S. District Judge Kevin Castel said Nike Inc. had shown a "probability of success" in its quest to permanently halt Reebok sales of Tebow jerseys and T-shirts during a daylong hearing that follows the filing of a lawsuit last week. Castel temporarily blocked Reebok from selling 6,000 Tebow-Jets jerseys and 25,000 T-shirts a week ago.
Reebok International Ltd. argued for the ban to be lifted Wednesday, saying it had found evidence that the Canton, Mass.-based company, an Adidas AG subsidiary, was within its rights to create the jerseys and T-shirts even though its agreement with the National Football League Players Inc. to use players' names and numbers had expired at the end of February. Its 10-year NFL licensing deal for players' apparel expired at the end of March, when Nike began its own five-year deal.
Julian Friedman, a lawyer for Reebok, told Castel that Reebok is permitted to sell leftover apparel for two months after the NFL licensing agreement expired and should be allowed to sell the Tebow Jets merchandise until the end of May. He also said Reebok was allowed to stamp jerseys and T-shirts with the names and numbers of up to five players who switched teams after its contract with NFL Players expired.
Nike's effort to build its brand wasn't damaged because only about 680 of the Reebok Tebow jerseys and none of the T-shirts carried the Reebok name, Friedman said. The sale of the Reebok merchandise would allow the public to buy Tebow-Jets apparel before Nike's jerseys arrive on store shelves in late April.
The judge said that wasn't an issue.
"It is a minor hardship to Jets and Tim Tebow fans to have to wait till April 27 to get their jerseys," the judge said.
Castel also criticized Reebok's effort to capitalize on the change in teams for some big-name players such as Tebow and quarterback Peyton Manning, who left the Indianapolis Colts for the Denver Broncos. He said a sell-off clause in its apparel contracts was designed to let it sell leftover clothing.
"It's not your termination bonus; it's so you don't get stuck with unsold merchandise," he said.
Randolph Foster, a Nike lawyer, showed the judge that Tebow-Jets shirts made by Nike were already on store shelves when he displayed one he had obtained during a lunch break. Foster asked the judge to extend his ban to include jerseys by other Jets players after a Reebok executive testified that thousands of blank Jets jerseys were stamped with the names of the team's most popular players and readied for sale. The judge declined.
Castel also boosted from $80,000 to $120,000 the amount of money Nike must post in the event Reebok ultimately wins the case but loses up to $200,000 in profits by not selling its Tebow apparel.
The judge's ruling continued the ban he imposed after Nike sued Reebok last week, days after Tebow was traded from Denver to New York. The trade came just as the Beaverton, Ore.-based Nike was preparing to take over the NFL's merchandising contract from Reebok.
After the hearing, Friedman declined to comment about Reebok's next move.