Lance Armstrong, Sponsors, And Lawsuits - Here's A Twist

There hasn’t been much in the way of news on Lance Armstrong lately, and then I bumped into an article that states Lance is kicking around a confession, here, to get his lifetime ban reduced so he can compete in sanctioned triathlons.  Reading that article reminded me of a post I’d intended on doing back when there were rumors that his sponsors would (or could) seek monetary damages or demand the return of money paid during his TdF reign as champion.  The New York Times did a pretty fair write-up, here, about the unlikelihood of that happening but they only glossed over the key reason why this should never be allowed by quoting his attorney…

Here’s the quote:

Mr. Herman, Mr. Armstrong’s lawyer, seemed prepared for this line of argument [that because Armstrong denied allegations of doping, the US Government was defrauded, that Lance garnered funding by making false statements - Paraphrased]. He said that from 2001 to 2004 the Postal Service paid Mr. Armstrong’s team $32.27 million and received a return on its investment of $103.63 million. He cited what he said was a study commissioned by the Postal Service on the indirect benefits from the relationship.       

“You have an annual return on investment of 320 percent,” he said. “I hit my knees every night hoping someone defrauds me like that.”

Then the New York Times presents the other side like this:

Still, it is easy to see how double damages for the entire sponsorship period, along with legal fees, could erode Mr. Armstrong’s wealth.

And then this:

Mr. Herman said he expected many people to try to sue Mr. Armstrong. I imagine this group could include the dozens of cyclists, spouses and trainers whom Mr. Armstrong is said to have bullied into silence. That could chip away at his wealth, too, but Mr. Herman intimated that he did not think these people would have much success because Tailwind, the corporation that owned the team, was “the contracting party.”       

This is another way of saying that Mr. Armstrong put a layer of legal protection between himself and the money. And if nothing else, it shows that he has had good legal counsel over the years.

So here’s the short version:  Companies like Nike, FRS and the US Government (USPS) paid Armstrong handsomely for the use of Lance’s name over that time and profited even more handsomely in the process, 320% according to the study done on the USPS.  I can only imagine the percentages involved with the Armstrong/Trek, FRS or Nike deals.  So yes, while it could be argued that Armstrong is a dirt-bag for doing what most in his profession did to stay competitive, what you can’t argue is that for the period in question, with years in between his retirement from the sport and any concrete evidence being presented to the public who supported those companies with their cash (the public paid for those products using Lance’s name and the public is, generally speaking, far more ignorant than industry insiders) were the one’s who were technically defrauded – the companies still profited on the relationship.  For any of those companies or the US Government to try to go back and recoup their initial “investment” money after he doubled or tripled that investment is, I would argue, far more contemptible than Armstrong doping in the first place.

In fact, I find that so egregious I will be following this story to see which companies try to sue for their money back – and I can guarantee you I will never buy a product from those companies again and I’ll make the biggest possible stink that I legally can get away with about them here.  To put this in perspective, can you imagine anyone deciding not to buy another Nike product or using the US Postal Service because they sponsored Lance and Lance doped?  That seems pretty unlikely if you ask me – and beyond unlikely, it would be stupid.

So, a note to Trek:  Fellas, I haven’t seen your name in any of the press regarding seeking to sue Lance, but in case you’re contemplating it, please let it go because I love your bikes and it’d break my heart to have to switch to someone else’s…  For what that’s worth.

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