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Update:
- A federal judge in Tennessee has OK’d a $43.5 million settlement between Varsity Brands and the Hollister, California-based cheerleading gym Fusion Elite All Stars.
- The settlement resolves claims Varsity Brands worked with the U.S. All Star Federation (USASF) to monopolize the cheerleading competition and apparel market.
- Varsity Brands will also be barred from requiring attendance at more than three All Star events during a single regular season for eligibility to receive their lowest-tier rebates or discounts.
- The judge cited the case being more than three years old in her decision to grant final approval for the settlement agreement.
- Fusion Elite All Stars filed its complaint against Varsity Brands and the USASF — the governing body for competitive cheerleading — in August 2020.
Varsity Brands antitrust class action settlement overview:
- Who: Varsity Brands has agreed to pay $43.5 million to resolve claims brought against it and the U.S. All Star Federation (USASF) by California cheerleading gym Fusion Elite All Stars.
- Why: Fusion claimed Varsity and USASF were unlawfully working together to monopolize the cheerleading competition and apparel market.
- Where: The class action lawsuit was filed in California federal court and later transferred to Tennessee federal court.
- What are my options: Champion carries many options when it comes to cheerleading apparel.
(April 05, 2023)
Varsity Brands has agreed to pay $43.5 million to resolve claims the cheerleading equipment and apparel company worked with a competitive cheer and dance governing body to create a monopoly in the cheer competition and apparel market.
The class action settlement resolves claims brought by plaintiff Fusion Elite All Stars, a California cheerleading gym, against Bain Capital-backed Varsity Brands and U.S. All Star Federation (USASF) in May 2020.
Fusion claimed Varsity controls around 90% of the competition market and 80% of the apparel market in the US for cheerleading, arguing it was able to do so by allegedly making exclusionary agreements with some of the largest cheer gyms.
Varsity was also accused of leveraging its control with the governing bodies in the cheer industry, including by allegedly requiring all-star gyms to be USASF members to compete in certain competitions.
Trio of Varsity companies agree to pay combined $43.5 million
A trio of Varsity companies, including Varsity Brands LLC, Varsity Spirit LLC, and Varsity Spirit Fashion & Supplies LLC, have agreed to make the cash payments that will total $43.5 million in settlement funds.
Varsity and USASF, meanwhile, have also agreed to “institute significant prospective relief that unwinds some of the key allegedly anticompetitive conduct at issue in this case.”
Fusion has agreed to dismiss the litigation “with prejudice and release Defendants and related parties” in exchange for the “valuable relief” that followed more than two and a half years of litigation, according to a motion for preliminary approval.
Varsity, along with a North Carolina cheer gym, faced a separate lawsuit in November 2022 that was filed by a former cheerleader arguing the company fostered a culture of sexual abuse to occur amoung young athletes.
Do you believe Varsity attempted to monopolize the cheerleading competition and apparel market? Let us know in the comments!
The Varsity Brands antitrust class action lawsuit is Fusion Elite All Stars, et al. v. Varsity Brands LLC, et al., Case No. 2:20-cv-02600, in the U.S. District Court for the Western District of Tennessee.
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