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Adidas Battles UW In Mediation Case

Monday, April, 16, 2012

In Wisconsin, Interim UW Chancellor David Ward released a statement last week that asserted that he is committed to mediation services that will resolve the continued dispute between Adidas and the university.

Mediation Services Agreed Upon by Both Sides


The school's deal with the athletic company is slated to go through June of 2016 and is valued at about $2.5 million per year in both royalties and equipment. At this point, both sides have found a mediation service that will handle the dispute. The university fears reputation backlash owing to a recent factory worker issue that originated in overseas. However, both sides wish to resolve the issue and the Chancellor seems confident that a mutually beneficial agreement can be met.


"Once the mediator has been selected, the parties and the mediator will schedule dates on which the mediation will occur and for the submission of position statements in advance of the mediation," Ward stated.

The Path to Civil Mediation Between UW and Adidas


The dispute began in February when Ward informed Adidas that unless Indonesian workers who lost their jobs in a plant closing were paid, the licensing and sponsorship agreement with the university could end. On the advice of the Labor Licensing Policy Committee, the university would simply drop its relationship with the sports giant. Concerns about the reputation of the university when seen in light of the defunct factory and its wayward former owner were cited in the mediation case.


PT Kizone, former owner of the plant in question fled and did not pay over 2,800 workers in excess of around $3.2 million in severance pay. As an Adidas subcontractor, the factory manufactured not only items that carried the UW logo, but other collegiate apparel as well.


Adidas, which recently settled a $10.6 million lawsuit involving fitness game miCoach, has yet to issue any statements involving the UW case.