OU’s new licensing initiative, which would reduce licenses held by manufacturers in an effort to produce consistent OU branded goods, is coming under fire for possibly violating antitrust laws.
Steven Bradbury of Dechert LLP issued a letter to 27 universities — including OU — demanding they “cease and desist from implementing or maintaining the Sideline Plus 1 initiative.”
In the letter, Bradbury accuses Sideline Plus 1 of being an “anticompetitive restraint of trade.”
OU’s Trademark Advisory Committee decided to enter into the Sideline Plus 1 agreement, which went into effect July 1, OU licensing director Renata Hays said. The initiative limits the number of licensees in some of the men’s apparel departments.
Bradbury accuses OU of working with other universities to suppress competition by decreasing the amounts of licenses held by manufacturers.
“While an individual licensor is free to choose how to license its trademarks, the antitrust laws prohibit licensors from acting in concert to suppress competition in markets for licensed goods,” Bradbury said in his letter.
Hays refutes Bradbury’s allegations and said OU did not get together with other schools when deciding to enter into the Sideline Plus 1 agreement.
“We always do what’s in the best interest of the university, our fans and our licensing department,” Hays said. “We didn’t speak to any other schools in the process.”
When The Daily requested documents pertaining to the Sideline Plus 1 initiative, no correspondence between other universities was found.
OU’s licensees were reduced by 30 percent, from 500 to 350, during the last few years across all channels, said Kenneth Mossman, athletic department spokesman.
The initiative is not decreasing licenses for all of OU’s branded apparel, but a portion of the mid-tier channel — which features men’s T-shirts, fleece and hoodies — has been reduced from about 30 to 40 licensees down to eight or 10, almost a 75-percent reduction.
Licensees in the broader mid-tier channel have not been eliminated and can continue to do business with OU, Hays said. Women’s apparel, men’s fashion and children’s apparel have remained unchanged.
Having a larger number of licensees causes inconsistencies in the quality of apparel, Hay said. One of the biggest problems fans have is color consistency, Hays says.
“We have many different companies producing a crimson garment, so that crimson isn’t always going to be the same shade,” Hays said.
Hays said one of the biggest benefits OU will see as part of the Sideline Plus 1 initiative will be quality and consistency.
“People are still going to be able to get the same shirt at the same price,” Hays said.
Dechert LLP is representing the Collegiate Stakeholders Against Consolidation, a trade association that believes if left unchecked, the Sideline Plus 1 initiative will extend to additional channels such as bookstores and other market segments, according to an email issued to collegiate market stockholders.
The Collegiate Licensing Company believes the Collegiate Stakeholders Against Consolidation is led by a few disgruntled licensees, who remain unnamed by Dechert LLP, in an effort that is misguided, said Bruce Siegal, counsel to the Collegiate Licensing Company.
The company represents Oklahoma as its licensing firm, according to the company’s website.
In a series of letters between the legal representatives of the Collegiate Licensing Company and the Collegiate Stakeholders Against Consolidation, the licensing company accused the stakeholders of spreading misinformation in an attempt to harm the licensing company’s reputation and discourage other collegiate institutions from considering and implementing initiatives like Sideline Plus 1.
A letter from Kilpatrick, Townsend and Stocking, the licensing company’s legal representatives, emphasized each university has the right to manage in the ways it believes best maintain brand integrity and increase its value.
“This is true even if that means the brand owner will limit the number of licensees and earn higher royalties,” attorneys Constance Robinson and Peter Boyles said in a letter issued to Bradbury.
Dechert LLP said the licensing company is recommending universities increase royalty revenues by reducing the number of mid-tier licenses. Bradbury of Dechert LLP’s letter said the CLC has urged colleges to take a leadership role with these licensing initiatives in hopes the whole market will follow.
At this time, both legal groups are exchanging letters and collecting information, and no antitrust lawsuit has been filed.
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Okie3L 10 months, 1 week ago
The OU licensing department has consistently hurt the smaller manufacturers--the ones that just want to print for OU student groups. They aren't looking for "color consistency" as they claim, they just want to control the market and not let new producers enter, even if those producers do quality work.
braceyourself 9 months, 3 weeks ago
“'We have many different companies producing a crimson garment, so that crimson isn’t always going to be the same shade,' Hays said."
Umm...are we really that spoiled?