AT&T, Childress extend
deal through 2010

$100 million suit filed by NASCAR doesn't scare Burton's sponsor

DAVID POOLE / The Charlotte Observer

Monday, Jun. 18, 2007

• NASCAR sues AT&T, demands $100 million in sponsorship flap

An expert in sports marketing said Monday that NASCAR countersued AT&T in a dispute over sponsorship of a Nextel Cup race team to show its corporate partners it is willing to defend their interests.

"NASCAR is trying to reinforce to its partners how willing it is to fight to protect each of them," said David Carter, executive director of the Sports Business Institute at the Marshall School of Business at the University of Southern California.

"NASCAR is not simply trying to make a statement about how vigilant it will be; it also is looking for an outcome to suggest how strong it can be at protecting those partners."

NASCAR filed its countersuit seeking at least $100 million in damages after AT&T sued NASCAR for the right to change the logos on the No. 31 Chevrolet owned by Richard Childress Racing from the Cingular brand to AT&T.

Undaunted by the countersuit announced Sunday, AT&T said Monday it has signed a three-year contract extension to remain as primary sponsor on the cars driven by Jeff Burton through 2010.

RCR, meanwhile, said it reached agreement on a contract extension with Burton.

Burton has driven with the AT&T logos on his car since the NASCAR Nextel All-Star Challenge at Lowe's Motor Speedway in Concord on May 19. A judge granted AT&T that right in a temporary injunction in its lawsuit. An appeal of the injunction is scheduled to be heard Aug 2.

NASCAR contends its 10-year, $750 million contract with Nextel as the title sponsor of its top series allows Cingular to remain in the sport, but prohibits the change in branding.

NASCAR's countersuit alleges "breach of contract, fraud and misrepresentation, and conspiracy to aid and abet wrongful interference with Nextel's exclusive sponsorship agreement."

Carter said the dizzying pace of mergers and acquisitions, especially in a rapidly changing industry such as wireless communications, makes it harder than ever for sports marketing deals to be worked out.

"These deals are becoming a lot more complicated," Carter said. "NASCAR and sports marketing are both evolving, and big business is changing at a speed we have never seen.

"When you add all of that up, appreciating everything that might come to pass is virtually impossible. You can't expect anyone to get his arms around everything as quickly as it is all moving."

Carter said he believes it's imperative for NASCAR, its teams and its sponsors to come to terms on a way to move through these complexities in a way that doesn't always lead them to a courtroom.

"Nobody wants their favorite sport to be the subject of repeated legal proceedings," he said. "With as much money as there is involved, I am sure everyone hopes to find a solution. Neither side wants this thing to become more problematic."

If not, Carter said, fans might become weary.

"It's important to remember that most people follow sports as a diversion," he said. "For NASCAR fans, it's more, it's a way of life. But a tremendous amount of legal wrangling could lead to fan fatigue.

"Fans want to follow racing because they love it and they want their favorite drivers to be able to concentrate on driving and having the corporate support needed to be competitive."

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