Skechers Sues Adidas Claiming The Brand Made "Secret" Payments to Player Prospects

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It accuses Adidas of "funneling hundreds of thousands of dollars in secret payments to players, their coaches, and family". It should be noted that Adidas were indicted on bribery charges relating to college basketball gift baskets, all but 8 months ago.

Filed in Los Angeles, the lawsuit alleges that unlawful payments made by Adidas and its employees "effectively blocked Skechers and other companies from competing on a level playing field for young, NBA-level endorsers, and unfairly bolstered consumer perception of adidas' overall brand quality and image well beyond the basketball footwear market".

In a statement emailed to FN, an Adidas spokesperson said, "The Skechers complaint is frivolous and nonsensical and should be summarily dismissed".

"The competitive harm of adidas" egregious misconduct is substantial", the lawsuit says.

In September 2017, Jim Gatto, Adidas' director of global sports marketing, was arrested on charges of fraud, bribery and corruption following an FBI investigation dating back to 2015.

They are scheduled to go on trial at U.S. District Court in NY in October.

The same panel, in a 2-1 vote, also reversed a similar injunction barring Skechers from selling its Cross Court shoe, which has three stripes on its side, finding no proof Adidas would suffer irreparable harm. On Thursday, a USA appeals court ruled that Adidas can protect its famous Stan Smith tennis shoe and decided that an alleged Skechers knockoff looked too much like the famous all-white shoe.

Judge Jacqueline H. Nguyen stated in the court's decision, "The evidence supports an inference that Skechers meant to confuse consumers; it not only created a almost identical shoe to the Stan Smith, but then used metadata tags to direct consumers who searched for "adidas stan smith" to the Onix web page".

Skechers did not immediately respond to requests for comment.

In contrast, Nguyen said Adidas failed to show that consumers would associate it with Skechers' Cross Court, causing the dilution of Adidas' reputation as a "premium" brand.