Mendenhall Sues Champion After Termination
CNBC Sports Business Reporter
Pittsburgh Steelers running back Rashard Mendenhall is firing back, suing the company that terminated him and asking for more than $1 million in damages.
In May, after Mendenhall’s sponsorship deal was severed by Champion due to tweets related to Osama Bin Laden’s involvement in Sept. 11, the company said they would immediately end the relationship with Mendenhall and wouldn’t pay him for the five years and the remaining $1 million-plus on his contract.
Mendenhall’s lawsuit was filed this afternoon in North Carolina District Court, where Champion’s parent company Hanesbrands has its headquarters.
“This case involves the core question of whether an athlete employed as a celebrity endorser loses the right to express opinions simply because the company whose products he endorses might disagree with some (but not all) of those opinions,” the suit reads.
While the series of tweets, which came soon after Bin Laden’s death was announced, were undoubtedly controversial, what’s not as clear is if Champion had the right to terminate Mendenhall. Champion’s contract with him, which ran through April 2015, does have a version of a morals clause, which specifically says that the company can terminate him if he “commits or is arrested for any crime or becomes involved in any situation or occurrence tending to bring Mendenhall into public disrepute, contempt, scandal or ridicule, or tending to shock, insult or offend the majority of the consuming public.”
Champion executives obviously thought that they were covered and issued a statement upon Mendenhall’s termination that said the company respected Mendenhall’s “right to express sincere thoughts regarding potentially controversial topics,” but “no longer believe(s) that Mr. Mendenhall can appropriately represent Champion.”
For what it’s worth, the general public seemed to have agreed as well.
A USAToday.com poll, with almost 15,000 respondents, revealed that 64 percent believed that Champion did the right thing by letting Mendenhall go, while only 23 percent said it was his freedom of speech (13 percent said they didn’t care).
But what a company should do and what they can do are two totally different things.
"Although the lawsuit seeks damages, this case is truly not about the money," said Mendenhall's lawyer Stephen Thompson, a partner of Ungaretti & Harris, a Chicago-based law firm. "In this age of widespread social media, Rashard believes (whether an athlete can be fired for his or her opinions) is an important question for all athletes who serve as celebrity spokespersons, and he intends to pursue this lawsuit to vindicate his rights and those of other athletes caught in this situation."
Over a period of three days following Osama Bin Laden's death, Mendenhall fired off a series of tweets, including this one: "What kind of person celebrates death? It’s amazing how people can HATE a man they have never even heard speak. We’ve only heard one side."
Another one said: “We will never know what really happened. I have a hard time believing a plane could take a skyscraper down demolition style.”
Mendenhall was paid $600,000 by Champion for his first three seasons with the brand. A four-year extension signed just days before his controversial tweets was to pay him at least $1,075,000, not including bonuses which ranged from $10,000 to $75,000. Champion only paid him $7,836 of that money since the contract only lasted 13 days.
What is interesting is that Hanes, which owns the Champion brand, had no problem hiring Charlie Sheen on its payroll even though he has said plenty of controversial things about 9/11.
“It seems to me like 19 amateurs with box cutters taking over four commercial airliners and hitting 75 percent of their targets, that feels like a conspiracy theory,” Sheen told a radio show in 2006. “It raises a lot of questions.
Hanes dropped Sheen in January 2010 because of domestic violence charges against the actor.
Morals clauses are usually ambiguous enough and do tend to lead to lawsuits.
In one of the most famous endorsement cases, an arbitration panel awarded Kings forward Chris Webber in 1999 with $2.6 million after it determined that Fila wrongfully terminated his shoe contract. The company severed its deal with him after he was caught with marijuana at an airport. Webber insisted the bag wasn’t his, but Fila still severed his contract under its good conduct clause.
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