Timebase Pty Ltd v. Thomson Corporation, The

Filing 129

CERTIFICATE OF COMPLIANCE WITH LR 37.1 re: 124 MOTION to Compel Responses to Interrogatories 1 and 7 and Various Document Requests filed by Timebase Pty Ltd by Timebase Pty Ltd. (Hosteny, Joseph)

Timebase Pty Ltd v. Thomson Corporation, The

Doc. 129

Exhibit A

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Thomas Fox
Statement in Case concerning:Trek and Greg LeMond
I have been in consumer marketing since 1985 and have spent the p t 2 1 years in the area of Sports Marketing with The NBA, N m Gatorade I, and the Wasserrnan agency,

Sports Marketing can encompass a wide range of marketing activities, . from buying media time around sporting events on television, creating
an "official"sponsor relationship with leagues, teams or athletes and entering into licensing agreements with other sports brands, to name the most common.

In my capacities as a marketing and sports marketing executive with NIKE and Gatorade f either negotiated or approved sponsorship/endorsement agreements with dozens of professional athletes, all of the major US sports leagues, most of the professional teams within these leagues as well as over 70 college athletic departments. While at the NBA I packaged and sold sponsorships to NBA league partners and managed their usage of NBA rights and marks. During my time in Asia I opened and staffed offices in Hong Kong and Tokyo and organized, Iicensed television rights and sold sponsorships to both multinational and Japan based companies for 2 NBA regular season games played in Tokyo, Japan

I have reviewed the following documents in preparing for this case:

- All deposition transcripts - The original and amended licensing agreements between Trek
and Greg LeMond

..
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LCI's summons and complaint Files Marked as Dealer comments FiIes marked as Consumer Comments Magazine and Newspaper articles containing statements from Nr. Lewnd

The opinions expressed in this statement are held to a reasonable degreeofeertainty in my field.

After review of these materials it is my opinjon that Mr.LeMormd's actions and statements are at odds with the very essence of what a company such as Trek should expect from someone with whom they have an endorsement reladonship, let alone a kensing partnership. His conduct as a paid endorser based on industry standard and custom were unacceptable with what's reasonable and expected in the market
place. Any company that signs an atMete to endorse their product or licenses ak the m r s of another brand, such as sports leagues and teams, to be used in conjunction with their own does so to enhance their own brand value and further their business objectives.

reputation. These statements also cast aspersions on Trek's star endorser at a time when his pursuit of cycling greatness and elevation to icon status should have been a marketing boon to the Trek brand and their dealers. And given Lance's popularity and people's nationalistic pride in what he was accomplishing, it stands to reason that consumers and dealers would be upset by this activity.

Mr, Lemond's pubIic statements about Lance Armstrong's alleged and unproven use of performance enhancing drugs damaged his own

Every brand rookingto compete in the marketplace must find a way to differentiate itself from its competitors. Without a meaningful point of difference you risk becoming a commodity and therefore sell predominantly on price. For brands seeking to operate in the premium end of a category this exercise is particularly valuable. The lack ofa real meaningful point of differencebetween Coke and Pepsi is why there is a cola war; in the minds of many consumers the products are interchangeable and the consumer often buys whichever brand has the

lowest price promotion at any given time. On the flip side, it's also why neither Coke nor Pepsi could ever dent Gatorade's market share with fieir own sports drinks and why the margin for that product was far

higher than other beverages.

Brands use many different tactics to differentiatethemseIves f o one rm another; the quality of their ingredients, the design of their logo, their packaging, the company vahes an&in some case5 by associating with other popular brands. As stated previously, every company that engages in the exercise of licensing another brand's rights to use with their own expects that other brand to differentiate them from their competition in a way that is meaningful, relevant and ultimately helps sales. Sport is a uniquely powerful marketing partner in this way because If consumers are passionate about sports and there is an emotional connection that they feel to their teams and athletes and 21 sports very easily have the abiiity to communicate superior performance to the consumer.
NASCAR is a terrific exampie of both. Fans support the products that sponsor their favorite driver because they know that without:their sponsorship money, the team won't be competitive and their driver won't win. They also believe that if car companies can make a car that wins on Sunday, then that technology must also play a role in the car that they make to serve their needs.

When Trek chose to align their brand and company with Mr. LeMond, they had a right to expect that this association would both tap into people's passion around a three-time Tour winner and American icon and tell a differentiating story of superior performance for their products because they bore the name of a true innovator in the sport who won at the highest level.
Once linked together, either through an endorsement or licensing relationship, it is a fundamental expectation of any company that the athlete will behave in a way that adds value to his/her own brand and the company that they now represent. It is well understood in the sports marketing industry that when you agree to accept a substantial sum of money from a company to use your name and likeness that there are then restrictions that come with the compensation.

generation of cycling enthusiasts to another, both uncler contract to use their name and popularity to help build the Lemond and Trek brands and sell more products. Trek wasp&xd as never before to rake advantage of the "Lanceeffect`, indeed to be the leader in defining what that meant to the inihstry.
Trek company spokesperson violates industry standardsand expectations for the roIe that a compensated athlete endorser and business partner is obiigated to provide and ukimaWlJtharmed T&S business.

two most marketable cyclists in American history, a bridge from one

From a marketing perspective once Lance started winning, Trek had the

Nr.LeMond's disparaging statements about anather cyclist and a fellow

Thomas E. Fox