In a significant development for the cheerleading industry, Varsity Brands and Fusion Elite All Stars have secured final approval from a Tennessee federal judge for their $43.5 million settlement. The lawsuit accused Varsity Brands and the U.S. All Star Federation of monopolizing the cheer competition and apparel market, and this settlement marks a substantial resolution to the case.
U.S. District Judge Sheryl H. Lipman granted final approval on Wednesday, also signing off on a $14.5 million counsel fee deemed “reasonable” by the court. The expenses incurred by the co-class counsel – Berger Montague, DiCello Levitt LLP, and Cuneo Gilbert & LaDuca LLP – totaled nearly $1.7 million. Judge Lipman noted that these costs would have escalated significantly if the litigation had progressed to summary judgment and trial, emphasizing the complexity and potential duration of the case as further justification for the settlement.
The lawsuit, initiated in mid-2020, claimed that Varsity Brands and the U.S. All Star Federation colluded to dominate the cheerleading apparel and competition market. According to Fusion Elite’s complaint, Varsity held approximately 90% of the competition market and 80% of the apparel business. The complaint accused Varsity of locking cheer gyms into exclusionary agreements that stifled competition.
Fusion Elite described how Varsity’s agreements required gyms to purchase apparel exclusively from Varsity and attend a mandated number of Varsity events each season. These events come with a hefty price tag, reportedly costing a minimum of $30,000 per event in registration fees alone. Additionally, gyms were required to be federation members and report their event attendance, further tightening Varsity’s grip on the industry.
