Varsity Brands, the cheerleading company owned by Bain Capital, has agreed to settle one of three federal antitrust lawsuits that have been filed against it.
On Tuesday, attorneys representing a group of competitive gym cheerleading clubs and Varsity filed a joint notice in the case, Fusion Elite All Stars v. Varsity Brands, informed the judge that they are in the process of preparing a settlement agreement which they will submit to the court. court.
“While we believe Varsity Spirit has always acted appropriately and with the best of intentions, reaching this collective agreement is a positive outcome for everyone involved,” wrote Varsity Spirit president Bill Seely in a message to his employees, provided to Sportico. “This allows gym owners, cheerleaders, families, and each of you to focus on what matters most—our sport.”
Seely indicated that Varsity’s decision to reach a settlement was motivated, in part, by “momentum” coming from the USOPC’s recent recognition of USA Cheer, the University-backed national governing body, as well as the NCAA’s decision to grant cheerleading round-off sport STUNT pop-up status. at Division II level.
The terms of the proposed settlement were not disclosed in the filing, and attorneys representing the University and plaintiffs did not respond to emails seeking comment prior to publication.
The lawsuit, filed in August 2020, alleges Varsity, its affiliated companies, and U.S. The All Star Federation, the regulatory body created by Varsity, colluded in an “exemption scheme” that stifled industry competition and ultimately violated the Sherman Antitrust Act.
The plaintiffs, seeking class certification, allege that Varsity maintained a monopoly over the entertainment market by first usurping rivals and then forcing all-star gyms to exclusively cover Varsity clothing and competitions.
Specifically, the lawsuit takes aim at contracts, such as the “Network Agreement,” which Varsity signed with larger all-star gyms, that are “required to commit to exclusive attendance at All-Star Competitions and fully exclusive protection by Gyms and All-Star Team members.” Their Star Apparel.”
The litigation initially attempted to link Varsity’s alleged monopolistic practices to a growing sex abuse scandal within the sport, which Varsity vehemently denied. The case is scheduled to go to jury trial in early 2024.
Varsity is still a defendant in two other antitrust cases—one on behalf of a cheerleading show producer and another on behalf of a customer—and in a dozen sexual harassment lawsuits. It’s unclear the extent of resolution in Fusion Elite v. Varsity will affect other antitrust cases, which are also seeking class action status.
(This story has updated the headline and added the case name Fusion Elite All Stars v. Varsity Brands in the second paragraph.)
