Varsity Spirit

Last updated
Varsity Spirit, LLC
IndustryCheerleading
Founded1974
FounderJeff Webb
Headquarters Memphis, Tennessee, U.S.
Area served
Worldwide
Key people
Bill Seely
(President)
Owner Varsity Brands
Parent Bain Capital
Website www.varsity.com
Varsity Spirit cheerleader MGS57795.jpg
Varsity Spirit cheerleader

Varsity Spirit, LLC, also known as Varsity, is an American cheerleading company owned by Varsity Brands. Founded in 1974 as the Universal Cheerleaders Association, the company is a manufacturer of apparel for cheerleading and dance teams, organizer of cheerleading competitions, and operator of training camps and sanctioning bodies.

Contents

The company's vertical integration of competitive cheerleading has faced criticism, including accusations of anti-competitive and monopolistic practices (including opposition to cheerleading being sanctioned as a sport), conflicts of interest via control of governing bodies, and institutionalizing high financial costs for participation in competitive cheerleading. [1] [2] In 2023 and 2024, Varsity and its previous owners agreed to settle multiple class action lawsuits, including those surrounding high financial costs, and conflicts of interest with the U.S. All Star Federation.

History

Varsity Spirit was founded by Jeff Webb, [3] a yell leader at the University of Oklahoma contemplating law school. After working as a summer camp instructor for Lawrence "Herkie" Herkimer's National Cheerleaders Association (NCA), [4] he attempted, but failed, to acquire part of the company. [5]

In 1974, Webb established the Universal Cheerleaders Association (UCA), in an effort to raise the profile of cheerleading, initially by establishing training camps, and later through promotional campaigns and its National College Cheerleading Championship (which was first held in 1978) and its National High School Cheerleading Championship (which was first held in 1980). [6] [7] Cheerleading had seen declines in participation due to the growth of women's sports following the introduction of Title IX. [8]

Webb first operated the company out of his apartment, and only made a profit of $850 during his first year of operations. By 2002, Webb estimated that Varsity Spirit held about half of the market, and that 60% of its revenue came from apparel. [9] In 2003, Varsity backed the formation of the U.S. All Star Federation, a sanctioning body for "all-star" cheerleading competitions involving teams from private gyms. [10]

In 2004, Varsity acquired National Spirit Group, owner of the NCA (which Webb estimated to have a 25% market share in 2002), [11] [9] giving it control of the sheer majority of the cheerleading industry. [12] In 2005, it acquired the Knoxville-based Athletic Championships LLC and Premier Athletics LLC. [11] In 2007, it backed the formation of USA Cheer, a non-profit led by Webb which aimed to be a sanctioning body for cheerleading (with a goal to back cheerleading as a proposed Olympic event). [10]

In 2011, Varsity Brands merged with Herff Jones, an Indianapolis-based manufacturer of class rings, caps and gowns, and yearbooks; [13] [14] Webb was named president and COO in December 2012, [15] and the merged company took on the Varsity Brands name in 2014. [14] In 2012, it acquired American Cheerleader magazine from Macfadden Communications Group, with the publishers of Memphis-based teen magazine Justine producing the magazine. [16] Charlesbank Capital Partners acquired Varsity Brands in 2014, after which it began to place a larger focus on club-based "all-star" cheerleading. [17] In 2015, it acquired JAM Brands, which had been the company's main competitor in the 2010s. [5]

In 2016, Varsity Brands sued Star Athletica, a competing manufacturer of cheerleading uniforms established by The Liebe Company (which was formerly contracted with Varsity), for copyright infringement over similarities in designs between their products. [18] The Supreme Court ruled in favor of Varsity, establishing that aesthetic elements of a useful article can be protected if they are a copyrightable artistic work, and are identifiable as art when mentally separated from the practical aspects of the item. [19]

In 2017, BSN Sports CEO Adam Blumenfeld replaced Webb as CEO. [17]

In July 2019, the company introduced a new division, "Varsity Pro", which focuses on providing apparel and services for professional cheer and dance teams, such as those of professional sports franchises. The division's first partnership as outfitter was with the NBA's Memphis Grizzlies. [20] It also acquired SA Feather Co. and Stanbury Uniforms to expand into the band market. [21]

On December 9, 2020, Webb announced that he would step down from Varsity. In a 2021 interview with Sportico after the International Olympic Committee (IOC) voted to recognize the ICU, Webb stated that he had divested himself of Varsity, recently had "a very favorable liquidity event", and "was looking around with what I want to do with this phase of my life." Varsity's former vice president of corporate alliances and business development, Marlene Cota, stated that Webb's role in the company had begun to lessen after the sale to Charlesbank. [17] After his departure, Webb became the new co-publisher and senior news editor of the conservative publication Human Events. [17]

Market position

Varsity Spirit at a parade in London. MS LNYDP 010120 033.jpg
Varsity Spirit at a parade in London.

Varsity Spirit has been described as having a monopoly position in cheerleading in the United States, due to extensive vertical integration of apparel businesses, training camps, affiliated gyms, cheerleading competitions, and sanctioning bodies, as well as acquisitions of competitors. [10] [5] [2] [12]

Varsity has been accused of engaging in anti-competitive practices; the company signs gyms to multi-year agreements, under which they receive rebates if they exclusively purchase apparel from the company, and participate in Varsity-run competitions. [5] Only Varsity-owned brands are allowed to exhibit and market their apparel at its events, hindering the ability for competitors to do the same. Although there are no restrictions on use of non-Varsity apparel by participants in the competitions proper, [5] in 2010 Webb testified that in at least one competition, teams received more points if they used Varsity-produced props. [12]

Varsity also has effective control of affiliated governing bodies for cheerleading. [1] USA Cheer, a non-profit governing body for cheerleading, was established by Varsity Spirit with a no-interest loan, and is staffed by six contracted Varsity Spirit employees. [10] The U.S. All Star Federation (USASF), a governing body for private cheer and dance squads, was formed in 2003 with financial backing by Varsity Spirit via a no-interest loan. [10] Although Varsity Spirit officially states that it does not own the USASF, [22] its board was effectively controlled by Varsity Spirit by means of six of its 15 board members, and by-laws requiring seven seats to be filled by representatives of a group of Varsity Spirit-controlled cheerleading and dance associations. The company also paid the salary of its president, and its vice president of events and corporate alliances. [23] In 2011, the USASF threatened to ban its members from participating in Varsity-run events if they participate in competing world championships not run by the company. [10] Varsity was also involved in the establishment of the International Cheer Union (ICU). [10] Under a "Stay Smart" scheme, attendees of events were also required to book accommodations with specific providers vouched by Varsity, which were accused of having paid kickbacks to the company. [24]

Classification of cheerleading as a sport

Varsity Spirit and its affiliates have lobbied against proposals for cheerleading to be sanctioned as a sport, including proposals by California, and Texas's University Interscholastic League (UIL), arguing that this would result in increased oversight and regulation that would be detrimental to its business and self-oversight. [12] In 2015, the UIL announced a pilot "Spirit Championship", and that it would "partner with Varsity Brands to provide and train judges for the contest." [10]

In 2010, Webb was called upon as an expert witness in a Title IX case involving Quinnipiac University, which had redirected money out of women's sports to its all-women cheerleading team under the argument that it was a sport. [25] In his testimony, Webb stated that he did not consider cheerleading to be a sport, as he primarily considered Varsity's competitions to be a promotion for its lines of business. [12] A federal judge held that cheerleading "does not qualify as a varsity sport for the purposes of Title IX". [26] [12]

Antitrust settlements

In 2020, a proposed class action lawsuit was filed against Varsity Brands, alleging that it used its "undue influence and control" over affiliated bodies to maintain its monopoly in competitive cheerleading and scholastic apparel, including requiring participation in Varsity-run training camps in order to attend its competitions, participation in its insurance plans, and the aforementioned rebate program, which institutionalized financial costs for participation in competitive cheerleading. Varsity responded to the suit, arguing that they "welcome the kind of competition that enhances the cheer marketplace", and accused competitors of "seeking to chill that marketplace through the Courts. We are contesting this flawed diversion from an otherwise dynamic industry with energy, resources and determination." [27]

In March 2023, Varsity Brands agreed to pay $43.5 million to settle one of the antitrust cases, Fusion Elite All Stars, et al. v. Varsity Brands LLC, et al,, targeting "direct purchasers".; under the settlement, Varsity also agreed to stop paying the salaries of USASF executives, and prohibit its board members from occupying seats on the USASF board. In addition, the USASF agreed to not allow any one cheerleading body from controlling more than 40% of the voting seats on its board. [28] In May 2024, Varsity settled Jessica Jones, et al., v. Varsity Brands, LLC, et al., with the company and its prior owners agreeing to pay out $82.5 million to "indirect" purchasers who paid for registration fees or purchased apparel from Varsity. As part of the settlement, Varsity also agreed to no longer require competitors to participate in its training camps, phase out the "Stay Smart" scheme, and to restrict the sharing of confidential information from other USASF members to Varsity.. [24]

Sexual misconduct

In September 2020, USA Today published a report accusing governing bodies tied to Varsity Spirit of allowing 180 individuals (including coaches, choreographers, and others) indicted for child sexual abuse — 140 of whom having been convicted — to continue participating in activities. It found that their list of blacklisted individuals only contained 21 people, and was only amended and expanded following reports made by the paper. [23]

In September 2022, a federal lawsuit was filed in Memphis against Varsity Brands, Varsity Spirit, and the estate of Scott Foster (a gym owner who had killed himself while under investigation for child sexual abuse), by six alleged victims of Foster. The suit alleged negligence in violation of the Protecting Young Victims from Sexual Abuse and Safe Sport Authorization Act of 2017, including that Varsity made no effort to prohibit Foster from attending its sanctioned events, even after his suspension from the USASF in 2018. [29] [30]

All Star Scoring

All Varsity Spirit competitions follow a shared scoring system. This system varies slightly per team depending on the age, level, and coed of the division. Unlike previous seasons the 2021-2022 scoring system is based on 50 points instead of 100. This resulted in major shifts in the allocation of points within the sections of the cheerleading routines.

Before the 2021-2022 season, the scoring system in Varsity Spirit and USASF governed competitions was straightforward. The scoring followed the main divisions of an all star cheerleading routine, stunts, pyramid, jumps, tosses, running tumbling, standing tumbling and dance. Each of these sections were allocated ten points, five for difficultly and five for execution except for dance. The scoring also allocated ten points for both performance and routine composition, five points to for stunt and pyramid creativity, and five points for stunt quantity. Lastly for coed teams five points were used to score coed stunts, non-coed teams were given a five. This scoring results in 100 possible points without deductions. [31]

The 2021-2022 season scoring system changed most dramatically in that the major sections of the routine were no longer scored evenly. Stunts, pyramid, standing tumbling and running tumbling are allocated eight points, four for difficultly and four for execution; tosses and jumps were allocated four, two for difficulty and two for execution; and dance was only given two points. The amount allocated to routine composition dropped to two points while performance was dropped entirely, instead there are now two points allocated to a similar category, overall impression. Stunt and pyramid creativity are now allocated one point each. Another large change, mainly for all girl teams, is the change of the scoring sheet from coed teams to not coed teams. Meaning, coed teams still get scored on their coed stunts, unless they are an international team, however, the all-girl and international coed teams have the coed scoring section replaced with stunt quantity. [32] This scoring results in 50 possible points which is doubled to obtain 100 possible points. [33]

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References

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  4. ↑ "NCC Nationals: Continuing a rich tradition". Philstar.com. 23 February 2015. Retrieved 6 August 2015.
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  11. 1 2 "Varsity Brands acquires Athletic Championships and Premier Athletics". Memphis Business News. 2005-07-06. Retrieved 2020-09-30.
  12. 1 2 3 4 5 6 Reigstad, Leif (2015-07-21). "Varsity Brands Owns Cheerleading and Fights to Keep it From Becoming an Official Sport". Houston Press. Retrieved 2020-09-30.
  13. ↑ Hirsch, Lauren (2018-06-19). "Bain to acquire Varsity Brands, a top maker of cheerleader uniforms and school spirit items, for roughly $2.5 billion". CNBC. Retrieved 2020-09-30.
  14. 1 2 "Rebranding spreads Varsity name around". Memphis Business News. American City Business Journals. 2014-06-03. Retrieved 2020-09-30.
  15. ↑ Michael Sheffield (11 December 2012). "Jeff Webb Named President, COO of Herff Jones". Memphis Business News. Retrieved 6 August 2015.
  16. ↑ Ioanna Opidee (26 January 2012). "American Cheerleader Sold to Varsity Spirit Corp". Folio Magazine. Retrieved 6 August 2015.
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  21. ↑ "Varsity Spirit adds to squad, buys two companies". Memphis Business News. Retrieved 2020-09-30.
  22. ↑ "Varsity Spirit FAQ". Varsity.com. Retrieved 2020-09-30.
  23. 1 2 "Cheerleading has a list of people banned from the sport. It was missing 74 convicted sex offenders". USA Today. Gannett. Retrieved 2020-09-30.
  24. 1 2 Libit, Daniel (2024-05-14). "Varsity Cheerleading, Bain Agree to $82.5 Million Antitrust Settlement". Sportico.com. Retrieved 2024-05-25.
  25. ↑ Bill Cloutier (23 June 2010). "Quinnipiac trial: Legitimacy of cheerleading as sport focus of plaintiffs". New Haven Register News . Retrieved 6 August 2015.
  26. ↑ Goldman, Russell (2010-06-21). "Federal Judge: Cheerleading Is Not a Sport". ABC News. Retrieved 2020-09-30.
  27. ↑ "Federal lawsuit aims to break up alleged Varsity monopoly in cheerleading business". Memphis Business Journal. 2020-07-29. Retrieved 2020-10-01.
  28. ↑ Libit, Daniel (2023-03-27). "Varsity Strikes $43 Million Settlement With Antitrust Accusers". Sportico.com. Retrieved 2024-05-25.
  29. ↑ "Memphis-based Varsity named in federal lawsuit over sexual abuse in cheerleading". localmemphis.com. September 27, 2022.
  30. ↑ Libit, Daniel (2022-09-07). "Varsity Cheerleading Faces Sex Abuse Claims Amid Antitrust Litigation". Sportico.com. Retrieved 2022-10-16.
  31. ↑ "2019 - 2020 ALL STAR SCORING SYSTEM - BUILDING LEVEL 1 – 5 & 6 JR" (PDF). April 18, 2019.
  32. ↑ "Scoring & Judges". Varsity.com. Retrieved 2022-03-24.
  33. ↑ "VARSITY ALL STAR SCORE SHEET BREAK DOWN" (PDF).
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