Judge Gives Initial OK to $82.2 Million Varsity Brands Cheerleading Settlement

A federal judge has granted preliminary approval to an $82.5 million settlement in a class action lawsuit against Varsity Brands, accused of creating a monopoly in the cheerleading industry and inflating prices for participation.

Consumers Affected: Parents and guardians of cheerleaders who participated in Varsity Brands programs and events between 2016 and 2024.

Reason for Lawsuit: Allegations that Varsity Brands, along with its founder and two private equity investors, conspired with the U.S. All Star Federation to artificially raise prices for cheerleading activities and products.

Settlement Amount: $82.5 million (preliminarily approved)

Court: U.S. District Court for the Western District of Tennessee.

It looks like the end is near for a long running legal battle between Varsity Brands and cheer parents, with a federal judge in Tennessee giving preliminary approval to an $82.5 million settlement between the parties. 

U.S. District Judge Sheryl H. Lipman recently ruled that the settlement, which was proposed in May, was fair and equitable, paving the way for the funds to be paid to two indirect purchaser classes. 

The settlement will bring to an end a class action lawsuit that accused Varsity Brands, its founder, and two private equity investors of colluding with the U.S. cheer governing body, the U.S. All Star Federation, to artificially raise prices for cheer participation through exclusive deals.  

Cheerleading Monopoly Alleged in Lawsuit Against Varsity Brands

The lawsuit, which accused Varsity Brands and the other defendants of violating antitrust laws, was first filed in 2020. The parents alleged the organization had broken federal and state laws by creating a monopoly in cheer competitions, camps, and apparel markets through its acquisition of competitors and by making deals with All Star Gyms and schools. 

Through the agreements with All Star Cheer, Varsity Brands also allegedly stifled competition which resulted in higher prices for cheer products.

Judge Gives Preliminary Nod to $82.2 Million Cheerleading Antitrust Settlement

Varsity Brands and the other defendants didn’t admit to the claims lobbed at them by the parents, but did decide to settle the lawsuit. In May, it was made public that the parents and Varsity Brands had reached the $82.2 million settlement agreement, when they called on the courts to certify it. As part of the agreement, Varsity and the other defendants will also drop some of the exclusive agreements they had made with hotels, gyms, and schools.

Once finalized, those affected by Varsity Brands alleged monopoly on the cheer world between 2016 and 2024 will be entitled to relief.

Athlete Power Rising as Varsity Brands Case Joins Wave of Legal Challenges Against Sports Industry

The settlement follows an earlier settlement between Varsity Brands and a California-based cheerleading gyms, in which the gyms were granted $43.5 million. But Varsity Brands is far from the only sports-adjacent company facing legal action. 

Recently two former Kansas basketball stars Mario Chalmers and Sherron Collins filed a new proposed class action lawsuit, accusing the NCAA of profiting from their imaging and not passing on any of those earnings. The two are among 16 who filed the lawsuit against the NCAA and multiple conferences, the latest in a slate of legal action against the association, claiming they are profiting from the unauthorized use of their names, images and likenesses in promoting and monetizing the March Madness tournament in an ““illegal profit scheme.” 

In 2022, after six years of litigation, the members of the World Cup-winning United States women’s soccer team reached a multimillion-dollar settlement over unequal pay, which included a promise by the federation to equalize pay between the men’s and women’s national teams, The New York Times reported.

Case Details

• Lawsuit: Jones, et al. v. Bain Capital Private Equity, et al.
• Case Number: 2:20-cv-02892
• Court: U.S. District Court for the Western District of Tennessee

Plaintiffs' Attorneys

• Joseph R. Saveri, Ronnie Seidel Spiegel, David Seidel, Kevin Rayhill and Elissa A. Buchanan (Joseph Saveri Law Firm LLP)
• Van Turner (Turner Feild PLLC)
• Richard M. Paul III and Ashlea Schwarz (Paul LLP)
• Jason S. Hartley (Hartley LLP) 
• Daniel E. Gustafson, Daniel C. Hedlund and Daniel J. Nordin (Gustafson Gluek PLLC)