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Oakley Sues Nike, Pro Golfer Over Breach of Contract

It claims Rory McIlroy ignored its attempts to match Nike's offer


NikeNike (NYSE:NKE) is being sued, along with Irish professional golfer Rory McIlroy, in a California court for breach of contract by athletic apparel-maker Oakley.

Oakley alleged that McIlroy was under contract to represent its brand when Nike offered him a significantly larger contract. Though Oakley had the “right of first refusal” to try to match any competing offer, the company claimed that McIlroy’s representatives ignored its counteroffer, ESPN notes.

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Media reports say McIlroy’s new deal with Nike is worth about $200 million. The lawsuit didn’t disclose the size of the Nike deal, but it said Oakley’s contract was worth about 30% of the Nike contract.

McIlroy’s management company claims the golf star has complied with his contract and that the lawsuit is “baseless.” Emails between McIlroy’s agent and an Oakley executive will play an critical role in any trial. In one email, an Oakley executive signals that the company was “out of the mix” in contract negotiations with the golf pro. However, Oakley contends that negotiations continued after that email.

Oakley is suing to block the new contract and is requesting unspecified damages.

Despite news of the lawsuits, Nike shares rose fractionally in Tuesday midday trading.

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