Cingular slaps NASCAR with a lawsuit
The motion was filed in U.S. District Court in Atlanta, where the company also filed its lawsuit against NASCAR. A hearing on the motion has not yet been scheduled.
AT&T sued NASCAR on March 16 after racing series officials refused to allow AT&T to put its logo on Burton's car because of NASCAR's deal with Nextel, which sponsors NASCAR's top series — the Nextel Cup.
"We must bring this issue to resolution," John Burbank, vice president of marketing for AT&T, said in a statement. "The season is well under way and so are our rebranding efforts. This filing is a logical next step for us in the process, and one we must pursue so that we can simply move forward with our paint scheme — something our agreement with NASCAR allows us to do."
03/16/07 The suit, filed Friday in U.S. District Court in Atlanta, asks for unspecified damages as it alleges, among other things, that "NASCAR has violated the implied covenant of good-faith and fair dealing in the Cup Series agreement by its purposeful attempt to exclude Plaintiff from NASCAR."
In its complaint, AT&T says that when it was negotiating the Nextel contract in 2003, NASCAR never mentioned that Cingular would not be able to change its name, only that it could not increase its branding presence and could not move to another team.
AT&T said Cingular has invested more than $100 million in the seven years of sponsorship of the No. 31 car, a contract that is scheduled to expire at the end of this year.
"NASCAR met with plaintiff in June 2003 and promised to 'grandfather' Plaintiff as a NASCAR sponsor, provided only that Plaintiff (1) did not increase its brand position on the vehicle or (2) shift to another race team," the complaint states.
"NASCAR not only made this pledge to Plaintiff, but also incorporated it into its agreement with RCR and, on information and belief, Sprint Nextel."
"NASCAR's effort to block Plaintiff from altering the design of the #31 Car is directly contrary to the promises NASCAR made to Plaintiff and incorporated into its agreements with RCR and Sprint Nextel," the complaint states, adding later, "NASCAR never communicated to Plaintiff that as a continuing sponsor of NASCAR, Plaintiff would be precluded from changing its trade name, brand, logos or marks."
The suit asks for AT&T to be allowed to alter the marks anywhere on the car.
[Editor's Note: Because NASCAR is monopolizing almost all racing sponsorship it has created these conflicts whereby one competitor tries to block another from entering so that NASCAR remains their personal domain for that product line. Maybe it's time some of these sponsors start to branch out into other forms of motorsports.]
03/16/07 AT&T (Cingular) is suing NASCAR for the right to use its brand on the No. 31 Nextel Cup car driven by Jeff Burton in place of the Cingular brand, which is being phased out this year. AT&T spokesperson Clay Owen told SportsBusiness Daily the company will file the suit later this afternoon in U.S. District Court in Atlanta. Owen said AT&T has been in negotiations with NASCAR "for months" and that the lawsuit is "a last resort. We've been faithful to both," Owen said. "We believe we have the right to change brands."