Skechers USA, Inc. v. Adidas America, Inc. Et Al

Case 2:18-cv-03882 Document 1 Filed 05/09/18 Page 1 of 30 Page ID #:1
1 DANIEL M. PETROCELLI (SBN # 97802)

dpetrocelli@omm.com
2 MARK A. SAMUELS (SBN # 107026)
msamuels@omm.com
3 JEFFREY A. BARKER (SBN # 166327)
jbarker@omm.com
4 CHRISTOPHER S. WHITTAKER (SBN # 274699)
cwhittaker@omm.com
5 O’MELVENY & MYERS LLP
1999 Avenue of the Stars, 8th Floor
6 Los Angeles, California 90067-6035
Telephone: (310) 553-6700
7 Facsimile: (310) 246-6779
8 Attorneys for Plaintiff Skechers USA, Inc.
9
10 UNITED STATES DISTRICT COURT
11 CENTRAL DISTRICT OF CALIFORNIA, WESTERN DIVISION
12
13 SKECHERS USA, INC., a Delaware Case No.
corporation,
14 COMPLAINT FOR:
15 Plaintiff, 1. FALSE ADVERTISING &
UNFAIR COMPETITION
16 v. UNDER THE LANHAM ACT, 15
U.S.C. § 1051 et seq.;
17 ADIDAS AMERICA, INC., an Oregon 2. FALSE ADVERTISING
corporation, and DOES 1-10, inclusive, UNDER CAL. BUS. & PROF.
18 CODE § 17500 et seq.; and
3. UNFAIR COMPETITION
19 Defendants. UNDER CAL. BUS. & PROF.
CODE § 17200 et seq.
20
21 DEMAND FOR JURY TRIAL
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27
28
COMPLAINT
1 Plaintiff Skechers USA, Inc. (“Skechers”) hereby alleges for its Complaint
2 against Defendant adidas America, Inc. and its corporate affiliates (collectively,
3 “adidas”) as follows:
4 GENERAL ALLEGATIONS
5 1. Defendant adidas has engaged in a deliberate, deceptive, and illegal
6 campaign to prop up the reputation and supposed brand appeal of its footwear
7 products. adidas would have consumers, investors, and the public believe that hot,
8 up-and-coming collegiate basketball players, as well as talented young players who
9 move on to the National Basketball Association (“NBA”), choose adidas’s products
10 due to their supposed superior performance and style. In fact, however, adidas has
11 coopted young players into wearing and expressly or implicitly endorsing its
12 products by funneling hundreds of thousands of dollars in secret payments to
13 players, their coaches, and/or family members in violation of National Collegiate
14 Athletic Association (“NCAA”) rules. These illicit payments denied competitors
15 like Skechers who play by the rules a fair opportunity to compete for the cachet of
16 having trend-setting high-school and college athletes seen in their products,
17 effectively blocked Skechers and other companies from competing on a level
18 playing field for young, NBA-level endorsers, and unfairly bolstered consumer
19 perceptions of adidas’s overall brand quality and image well beyond the basketball
20 footwear market.
21 2. On or about September 25, 2017, adidas’s scheme unraveled when
22 federal authorities commenced criminal proceedings against, among others,
23 adidas’s Director of Sports Marketing James “Jim” Gatto, adidas’s consultant Merl
24 Code, and Jonathan “Brad” Augustine, who was involved with an amateur
25 basketball league in Florida sponsored by adidas. The U.S. Department of Justice’s
26 criminal complaint revealed that adidas, through Gatto and Code, had made
27 improper payments of between $40,000 and $150,000 per athlete to entice at least
28 six high-school athletes to attend universities with basketball programs sponsored
2
COMPLAINT
1 by adidas and to commit in advance to signing endorsement deals with adidas when
2 those student-athletes become professional players in the NBA. At least one
3 participant in the scheme has pleaded guilty to date. Skechers is informed and
4 believes, and based thereon alleges, that adidas’s illegal corruption of amateur
5 sports in violation of federal and state law and NCAA rules may extend far beyond
6 the incidents thus far charged in that criminal complaint.
7 3. The competitive harm of adidas’s egregious misconduct is substantial.
8 The market for basketball shoes is driven as much by brand perception, attitude,
9 and style as it is by shoe performance. The ability to develop “street credibility” by
10 having talented young players and trendsetters wear a company’s shoes can make
11 or break a brand’s reputation. Some of the key ways that law-abiding shoe
12 companies get their products on players’ feet are through sponsoring youth
13 basketball programs, sponsoring college/university sports programs, and through
14 endorsement deals with professional players in the NBA. adidas’s illicit bribery
15 program, however, has corrupted all of these channels, tipping the scales unfairly in
16 adidas’s favor to the detriment of competitors, such as Skechers.
17 4. The effects of adidas’s illegal conduct are not limited to basketball
18 products. High-profile sponsorships and athletic endorsements have a positive
19 spillover effect on the overall image and reputation of a brand, as well as consumer
20 preferences outside of the sport itself. Skechers and companies like it that seek to
21 compete fairly within the bounds of the law have been gravely harmed by adidas’s
22 massive, secret payments to young basketball players, not only in their athletic
23 performance division but in all footwear categories in which they compete.
24 Skechers’ and other competitors’ basketball businesses cannot effectively compete
25 for players’ footwear choices while they are amateurs—or for their endorsements
26 when they turn professional—because adidas has sought to “lock up” players by
27 paying secret, illegal bribes to them and/or their families. Moreover, even if adidas
28 did not succeed in bribing a player or a player’s family, adidas’s pervasive conduct
3
COMPLAINT
1 has created expectations that law-abiding competitors cannot meet. In the

2 meantime, adidas achieved valuable marketing advantages as the players subject to
3 its bribes wore adidas’s products, impliedly suggesting that such products have
4 superior style or performance characteristics. adidas thereby unfairly and illegally
5 boosted its goodwill, image, and reputation and affected consumer preferences—
6 both in the athletic performance and athletic fashion footwear markets and in the
7 overall footwear market where both companies compete.
8 5. Skechers is informed and believes, and on that basis alleges, that
9 adidas’s illegal scheme may have involved more than the six college players who
10 have been publicly identified in connection with the criminal proceedings to date.
11 At an appropriate time, Skechers intends to amend this Complaint to address such
12 additional activities after having had an opportunity to conduct discovery.
13 6. Over the time that adidas’s scheme has been active (which also will be
14 the subject of discovery), Plaintiff Skechers has incurred increased advertising
15 and/or marketing expenses, lost sales and profits, and seen the value of its brands
16 relative to that of adidas diminish in the marketplace, all as a result of the activities
17 described herein. By this lawsuit, Plaintiff Skechers seeks recovery of adidas’s ill-
18 gotten profits, damages for lost sales and diminished brand value and increased
19 advertising and marketing costs, and an injunction preventing adidas from making
20 further illegal, undisclosed endorsement payments to amateur basketball players.
21 THE PARTIES
22 7. Plaintiff Skechers USA, Inc. is a Delaware corporation with its
23 principal place of business at 228 Manhattan Beach Blvd., Manhattan Beach,
24 California, 90266 USA.
25 8. Plaintiff is informed and believes and on that basis alleges that
26 Defendant adidas America, Inc. is an Oregon corporation with its principal place of
27 business at 5055 North Greeley Avenue, Portland, Oregon, 97217-3524 USA.
28 9. Plaintiff is informed and believes and on that basis alleges that James
4
COMPLAINT
1 “Jim” Gatto is an individual who, at all relevant times, held the title of Director of
2 Global Sports Marketing at Defendant adidas, was an agent and/or employee of
3 adidas or one of its affiliates, and was acting for the purpose of benefitting and did
4 benefit adidas by the unfair and illegal activities described herein. Plaintiff is
5 informed and believes, and on that basis alleges, that adidas accepted the benefits of
6 Gatto’s actions. Plaintiff is further informed and believes, and on that basis alleges,
7 that Gatto’s actions were foreseeable in connection with his duties, incidental to
8 adidas’s business, and an outgrowth of his employment.
9 10. Plaintiff is informed and believes and on that basis alleges that Merl
10 Code is an individual who, at all relevant times, was affiliated with various high-
11 school and college basketball programs sponsored by adidas, was an agent and/or
12 employee of adidas or one of its affiliates, and was acting for the purpose of
13 benefitting and did benefit adidas by the unfair and illegal activities described
14 herein. Plaintiff is informed and believes, and on that basis alleges, that adidas
15 accepted the benefits of Code’s actions. Plaintiff is further informed and believes,
16 and on that basis alleges, that Code’s actions were foreseeable in connection with
17 his duties, incidental to adidas’s business, and an outgrowth of his employment by
18 or work for adidas.
19 11. Plaintiff is informed and believes and on that basis alleges that
20 Jonathan “Brad” Augustine is an individual who, at all relevant times, was the
21 Program Director for 1 Family Hoops (a high-school-aged basketball team
22 sponsored by adidas), was an agent and/or employee of adidas or one of its
23 affiliates, and was acting for the purpose of benefitting and did benefit adidas by the
24 unfair and illegal activities described herein. Plaintiff is informed and believes, and
25 on that basis alleges, that adidas accepted the benefits of Augustine’s actions.
26 Plaintiff is further informed and believes, and on that basis alleges, that Augustine’s
27 actions were foreseeable in connection with his duties, incidental to adidas’s
28 business, and an outgrowth of his employment by or work for adidas.
5
COMPLAINT
1 12. Plaintiff is informed and believes and on that basis alleges that Thomas
2 “T.J.” Gassnola is an individual who, at all relevant times, was the Director of the
3 New England Playaz (an amateur basketball team sponsored by adidas), was an
4 agent and/or employee of adidas or one of its affiliates, and was acting for the
5 purpose of benefitting and did benefit adidas by the unfair and illegal activities
6 described herein. Plaintiff is informed and believes, and on that basis alleges, that
7 adidas accepted the benefits of Gassnola’s actions. Plaintiff is further informed and
8 believes, and on that basis alleges, that Gassnola’s actions were foreseeable from
9 his duties, incidental to adidas’s business, and an outgrowth of his employment by
10 or work for adidas.
11 13. Plaintiff is presently unaware of the true names and capacities of the
12 defendants sued herein as Does 1 through 10, inclusive, and therefore sues said
13 defendants by such fictitious names. Plaintiff will amend this complaint to allege
14 the true names and capacities of the fictitiously named defendants when the same
15 have been ascertained. Plaintiff is informed and believes and based thereon alleges
16 that each of the fictitiously named defendants was an agent and/or employee of
17 adidas or one of its affiliates, and was acting for the purpose of benefitting and did
18 benefit adidas by engaging in unfair and illegal activities, or is responsible in some
19 other manner for the occurrences, acts, and omissions alleged herein, and that
20 Plaintiff’s damages were proximately caused by their conduct.
21 JURISDICTION AND VENUE
22 14. This action is brought pursuant to the provisions of the Lanham Act,
23 15 U.S.C. § 1051 et seq. Jurisdiction is conferred on this Court by 28 U.S.C. §§
24 1331, 1332 and 1337.
25 15. This Court has general personal jurisdiction over Defendant adidas
26 because adidas has conducted continuous, systematic, and routine business within
27 the State of California.
28 16. Upon information and belief, at all times relevant to this complaint,
6
COMPLAINT
1 Defendant adidas sold its products through hundreds of retail outlets in California,
2 as well as through more than twenty adidas-owned retail outlets in California.
3 Defendant adidas also maintains corporate offices in Carlsbad, California and Santa
4 Fe Springs, California under the brands Taylor Made-adidas Golf and Elegant
5 Sports, respectively.
6 17. Upon information and belief, during the time period relevant to this
7 complaint, Defendant adidas has sponsored basketball teams for at least the
8 following public universities in California: California State University (“CSU”)
9 Bakersfield, CSU Sacramento, CSU San Jose, University of California (“UC”)
10 Davis, UC Irvine, and UC Riverside.
11 18. Upon information and belief, during the time period relevant to this
12 complaint, Defendant adidas has sponsored numerous high-school-aged basketball
13 tournaments and programs, including the Elite Basketball Organization, in
14 California.
15 19. This Court also has specific personal jurisdiction because Defendant
16 adidas caused harm in Los Angeles County within the State of California. As set
17 forth in paragraphs 15–18 above, adidas also has purposefully availed itself of
18 California’s laws through its widespread retail presence, corporate offices, and
19 sponsorship of basketball programs at multiple public universities in California.
20 20. Furthermore, upon information and belief, Defendant adidas and its
21 agents knew or should have known that their illegal activities, as detailed in this
22 Complaint, would harm Plaintiff Skechers, a competitor located in Manhattan
23 Beach, California. Plaintiff Skechers in fact incurred increased advertising costs,
24 lost sales, and other damages in excess of $75,000 as a result of activities carried
25 out by Defendant adidas and/or its agents, and these harms were suffered in Los
26 Angeles County in the State of California. California is a relevant market for
27 purpose of Skechers’ harm since Skechers’ principal place of business is located
28 within this state. CollegeSource, Inc. v. Academy One, Inc., 653 F.3d 1066 (9th
7
COMPLAINT
1 Cir. 2011).
2 21. Defendant adidas’s actions were part of a nationwide marketing and
3 sponsorship campaign, and were intentionally targeted at California based on,
4 among other things, sales of Defendant adidas’s products at hundreds of adidas-
5 affiliated stores in California and its affiliation with athletic programs at multiple
6 California universities.
7 22. Venue is proper in this District pursuant to 28 U.S.C. § 1391(b)(2)
8 because a substantial part of the events and omissions alleged herein occurred and
9 are occurring within this District.
10 FACTUAL BACKGROUND
11 23. Plaintiff Skechers designs, develops, and markets a diverse range of
12 lifestyle footwear for men, women, and children, as well as performance footwear
13 for men and women. Skechers’ products are available in the United States and
14 more than 160 countries and territories worldwide through department and specialty
15 stores, more than 2,400 Skechers-branded retail stores, and on Skechers’ e-
16 commerce websites.
17 24. Skechers designs, markets, and sells many categories of footwear that
18 compete with adidas, including basketball footwear and other athletic performance
19 shoes. Skechers and its subsidiaries also compete with adidas on the regional and
20 national level for endorsements by professional athletes, including NBA-level
21 endorsers. For example, several years ago Skechers signed an endorsement deal
22 with Jamal Crawford—at the time, a guard for the Los Angeles Clippers—relating
23 to basketball products. After Mr. Crawford was subsequently lured away by a
24 richer endorsement deal from adidas, a new endorsement deal was struck with
25 Clippers forward Josh Smith (who, at the time, had recently parted ways with
26 adidas). Skechers’ products also have been endorsed by NBA owner Mark Cuban,
27 NBA stars Karl Malone, Kareem Abdul-Jabbar, and Larry Bird, boxing champion
28 Sugar Ray Leonard, National Football League Hall of Famers Joe Montana and Joe
8
COMPLAINT
1 Namath, Major League Baseball star David Ortiz, National Hockey League legend
2 Wayne Gretzky, marathoners Meb Keflezighi and Kara Goucher, and professional
3 golfers Matt Kuchar, Colin Montgomerie, Brooke Henderson, Russell Knox,
4 Wesley Bryan, Belén Mozo and Billy Andrade.
5 25. Skechers also works with young, up-and-coming basketball players
6 and their personal brands, consulting through its subsidiaries with companies like
7 Big Baller Brand—which was founded by the three Ball brothers, Lonzo (who is
8 currently playing for the L.A. Lakers in the NBA), LiAngelo (who previously
9 played for UCLA in the NCAA and has declared for the 2018 NBA draft), and
10 high-school basketball phenomenon LaMelo Ball—on products such as the Melo
11 Ball 1, a shoe named after the youngest Ball brother that was just released in Fall
12 2017.
13 26. Skechers and its products have won numerous awards and accolades
14 over the years and, in 2015, Skechers overtook adidas to become the second largest
15 sneaker brand behind only industry powerhouse Nike. In the years that followed,
16 Skechers and adidas have continued to battle for that number-two spot.
17 27. Federal authorities, including the FBI and the U.S. Attorney for the
18 Southern District of New York, recently discovered and disclosed in criminal
19 complaints that, just as Skechers was passing adidas in sneaker brand popularity,
20 adidas and its employees and/or agents Gatto, Code, and Augustine, among others,
21 engaged in a pattern of wide-ranging misconduct that included funneling illicit and
22 improper payments to amateur players in violation of NCAA rules. Plaintiff is
23 informed and believes that the publicly disclosed revelations from the federal
24 investigation have only scratched the surface of adidas’s misconduct, and therefore
25 seeks discovery to ascertain the full nature and extent of the illegal scheme
26 perpetrated on adidas’s behalf.
27 28. Upon information and belief, shortly after the media reported that
28 Skechers had overtaken adidas in market share for the U.S. sports footwear market
9
COMPLAINT
1 in May 2015, adidas apparently became concerned that key basketball prospects
2 might not join certain adidas-sponsored university basketball programs based solely
3 on the merits of those programs.
4 29. For example, although Dennis Smith Jr.—then a top high-school
5 basketball recruit and now an NBA point guard playing for the Dallas Mavericks—
6 had publicly committed in September 2015 to attend and play for North Carolina
7 State University (a NCAA Division I university basketball team sponsored by
8 adidas), by approximately October 2015 adidas was concerned that Smith might
9 retract his commitment and play for a different, non-adidas-sponsored school. As a
10 result, adidas conspired to funnel approximately $40,000 to Smith’s father in
11 exchange for Smith maintaining his commitment to play for North Carolina State
12 University and promising to sign a sponsorship agreement with adidas when Smith
13 entered the NBA.
14 30. Specifically, upon information and belief, in or around October 2015,
15 Gassnola, the director of an adidas-sponsored amateur basketball team, paid
16 $40,000 to a coach for North Carolina State University with the understanding that
17 the money would be delivered to Smith’s father. Gatto, adidas’s Director of Global
18 Sports Marketing, then reimbursed Gassnola for this payment with $40,000 in
19 transfers from adidas to Gassnola. Gatto and Gassnola used sham invoices to cover
20 up the true purpose of the payments, which were intended for Smith’s father.
22 between November 11, 2016 and March 7, 2017, Smith played basketball for North
23 Carolina State University in 32 games, consistently wearing footwear and clothing
24 with prominent adidas logos both on and off the court. On information and belief,
25 most, if not all, of the games in which Smith played while wearing adidas-branded
26 gear were televised locally, regionally, and/or nationally.
27 32. On June 22, 2017, the Dallas Mavericks selected Smith as the ninth
28 pick in the 2017 NBA Draft. As part of the draft, the NBA aired, to the benefit of
10
COMPLAINT
1 adidas, a two-minute highlight reel showing Smith’s stellar basketball performance

2 while at North Carolina State University in adidas-branded footwear and clothing.
3 A video of this highlight reel is available at the following link:
4 https://www.youtube.com/watch?v=qSx1ArLwy9E.
5 33. Maintaining the relationship with Smith was extremely important to
6 adidas, which the company had vigorously promoted. An article from SB Nation
7 noted that “Smith and Adidas have been synonymous for years now,” beginning
8 with Smith’s status as a featured player in the Adidas Uprising tournament in
9 California and his play at North Carolina State University, “an Adidas-branded
10 team.” See https://www.sbnation.com/2017/8/8/16112342/dennis-smith-jr-under-
11 armour-shoe-deal. To further associate itself and its products with Smith, adidas
12 has posted and still makes available to the public on its website
13 https://news.adidas.com at least 75 promotional photos of Smith wearing adidas-
14 branded products. Below is an example of the photos of Smith available on
15 adidas’s publicly available website:
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COMPLAINT
1 34. Upon information and belief, between 2015 and 2017, adidas
2 continued funneling improper payments to student-athletes and/or their families in
3 exchange for the student-athletes’ attendance at adidas-sponsored universities and
4 promises to sign future endorsement deals with adidas. Indeed, adidas’s practice
5 spread to multiple schools in different states, all using the same pattern of obscured
6 payments.
7 35. Upon information and belief, in or around October 2016 and
8 continuing into at least November 2017, Gatto conspired on behalf of adidas to
9 illicitly transfer approximately $90,000 from adidas to the mother of top-10 recruit
10 and All-American Billy Preston in order to secure her son’s commitment to attend
11 the University of Kansas, another NCAA Division I university whose basketball
12 program is sponsored by adidas, with the expectation that Preston would sign an
13 endorsement deal with adidas upon entering the NBA.
14 36. In particular, upon information and belief, on or about October 21,
15 2016, Gatto again authorized a $50,000 payment from adidas to the adidas-
16 sponsored New England Playaz, a team managed by Gassnola. Gatto and Gassnola
17 again sought to cover up this payment with a sham invoice for a “Basketball Team
18 Tournaments Fee.” Gassnola then delivered approximately $30,000 of the $50,000
19 payment to Preston’s mother in a hotel room in New York, New York.
20 37. Upon information and belief, on or about January 18, 2017, adidas, by
21 and through Gatto, made another $90,000 payment to the adidas-sponsored New
22 England Playaz pursuant to a further sham invoice for “2017 1st Quarter Consultant
23 Fee and T & E for 1st Quarter 2017.” Gassnola then delivered approximately
24 $20,000 in cash to Preston’s mother in another hotel room in Las Vegas, Nevada.
25 38. Upon information and belief, on or about May 31, 2017, adidas, by
26 and through Gatto, made another $70,000 payment to the adidas-sponsored New
27 England Playaz pursuant to yet a third sham invoice, this one purportedly for
28 “Tournament Activation/Fee.” From those funds, Gassnola then wired another
12
COMPLAINT
1 $15,000 to Preston’s mother.

2 39. As was the case with Smith, adidas has vigorously promoted its
3 relationship with Preston. To associate itself and its products with Preston, adidas
4 posted and still makes available to the public on its website https://news.adidas.com
5 at least eight promotional photos of Preston wearing adidas-branded products.
6 Below is an example of the photos of Preston posted on adidas’s website:
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20 40. Upon information and belief, in or around August 2017, Gatto
21 conspired to pay the guardian of yet another student-athlete, Silvio De Sousa,
22 approximately $20,000 in order to secure his commitment to attend the University
23 of Kanas rather than another school sponsored by a rival athletic apparel company.
24 41. Specifically, upon information and belief, in or around August 2017,
25 De Sousa’s guardian informed Gassnola that the guardian had previously received
26 payments from a rival company to steer De Sousa to attend a different university.
27 The guardian informed Gassnola that those payments would need to be repaid if De
28 Sousa were to attend the University of Kansas. Gassnola, in coordination with
13
COMPLAINT
1 Gatto, assured De Sousa’s guardian that adidas would make payments to the
2 guardian in order to secure De Sousa’s attendance at the University of Kansas.
3 42. Shortly thereafter, on August 30, 2017, De Sousa made what the media
4 reported as a “surprise” announcement that he would attend the University of
5 Kansas. Upon information and belief, on or about September 11, 2017, Gatto and
6 Gassnola spoke by phone and Gassnola informed Gatto that he would need to make
7 “another $20,000” payment to the guardian to get De Sousa “out from under” the
8 deal to attend the other university. Shortly thereafter, on September 23, 2017,
9 adidas issued a press release announcing that the University of Kansas had
10 extended its partnership with adidas through 2031.
12 between January 13, 2018 and March 31, 2018, De Sousa played basketball for the
13 University of Kansas in 20 games, consistently wearing footwear and clothing with
14 prominent adidas logos both on and off the court. On information and belief, most,
15 if not all, of the games in which De Sousa played while wearing adidas-branded
16 gear were televised locally, regionally, and/or nationally.
17 44. Upon information and belief, adidas’s scheme continued to expand to
18 additional schools and to escalate to larger dollar amounts throughout 2017. In or
19 about May 2017, federal authorities intercepted through a lawful wiretap several
20 cellular telephone conversations during which Gatto and Code, acting on behalf of
21 Defendant adidas, discussed with a sports manager named Christian Dawkins and
22 an investment advisor named Munish Sood, a request from a coach at the
23 University of Louisville for a $100,000 payment in four installments from adidas to
24 the family of college prospect Brian Bowen. University of Louisville is an NCAA
25 Division I university whose athletic programs are sponsored by adidas, and the
26 purpose of the payment from adidas was to secure Bowen’s attendance at the
27 University of Louisville, as opposed to other schools, and to ensure that Bowen
28 would sign an endorsement deal with adidas upon entering the NBA.
14
COMPLAINT
1 45. Upon information and belief, adidas had originally agreed to pay a
2 lesser amount to Bowen’s family, but a higher offer from an unidentified rival
3 athletic apparel company prompted Dawkins to go back to “get more” money from
4 adidas to secure Bowen’s commitment to attend the University of Louisville.
5 Dawkins told Rick Pitino, the coach of University of Louisville’s basketball team at
6 the time, that Pitino would need to call Gatto, whom he described as “the head of
7 everything” at adidas’s basketball program. Upon information and belief, Gatto
8 ultimately had two telephone conversations with Pitino on May 27, 2017, and a
9 third on June 1, 2017, one or more of which related to Bowen.
10 46. Just days later, on June 3, 2017, Bowen announced his commitment to
11 attend the University of Louisville, after previously indicating a desire to attend a
12 number of rival schools, including schools not sponsored by adidas. At the time,
13 Bowen’s decision to attend the University of Louisville was described by the press
14 as a “surprise commitment” that “came out of nowhere” and a “late recruiting
15 coup” for the coaches at the University of Louisville. In a press release issued by
16 the University of Louisville, then-coach Rick Pitino stated that the University of
17 Louisville was “extremely excited to have Brian [Bowen] with us” and that the
18 addition of Bowen gave Louisville “a deep, talented team.” On August 25, 2017,
19 adidas issued a press release announcing the extension of its partnership with the
20 University of Louisville. The press release falsely represents, through a purported
21 quote attributed to University of Louisville Vice President and Director of Athletics
22 Tom Jurich, that “[t]he biggest winners in our cooperative partnership have clearly
23 been our student-athletes.”
24 47. Upon information and belief, adidas, through Gatto, was expected to
25 handle the $100,000 payment to Bowen and/or his family “off the books,” as that
26 was the manner in which prior dealings with Code had been handled by adidas. In
27 an effort to create a scenario in which false documentation could be created for the
28 transaction, Code asked Sood, Dawkins, and an unknown FBI undercover agent
15
COMPLAINT
1 (“FBI Agent #1”), who was posing as a financial backer for a new sports
2 management business that Dawkins and Sood were forming, to make an initial
3 $25,000 payment to Bowen’s family that would later be reimbursed by a payment
4 from adidas to a third party.
5 48. Upon information and belief, Code was recorded on or about July 10,
6 2017 explaining to Sood and FBI Agent #1 that sham arrangements like this are
7 how athletic apparel companies like adidas mask payments to high-school athletes
8 in order to get around NCAA rules. Code further admitted that the rationale behind
9 Defendant adidas making such payments was to ensure not only that a targeted
10 high-school athlete would attend an adidas-sponsored university, but also that the
11 athlete would sign an endorsement deal with adidas when he entered the NBA.
12 49. Upon information and belief, on or about July 11, 2017, FBI Agent #1
13 delivered $25,000 in cash to Sood in order to make payments to Bowen’s father.
14 On or about July 13 or 14, 2017, Sood delivered at least $19,500 of that sum to
15 Bowen’s father. During a phone call on July 14, 2017, Sood expressed his belief
16 that he had secured Bowen’s commitment to attend the adidas-sponsored University
17 of Louisville.
18 50. Upon information and belief, the money paid to Bowen’s father was
19 ultimately reimbursed by adidas. On or about July 24, 2017, federal authorities
20 recorded Code discussing how Gatto and others at adidas intended to account for
21 payments by adidas to Bowen’s family, which would be to record them as
22 payments to an organization affiliated with Code, who would in turn funnel the
23 payments on to Bowen’s family through other intermediaries. Confirming the
24 unlawful and secret nature of these payments, upon information and belief Code
25 stated that Gatto would characterize the funds as “a payment to [Code’s] team, to
26 [Code’s] organization, so it’s on [adidas’s] books, [but] it’s not on the books for
27 what it’s actually for.”
28 51. Upon information and belief, on or about August 1, 2017, an adidas
16
COMPLAINT
1 affiliate did in fact transfer $30,000 to a bank account held by an unidentified

2 individual and an unidentified amateur basketball team sponsored by adidas. That
3 same day, a $25,000 check was deposited from the same bank account into another
4 account owned by Loyd, Inc., a company that is ultimately owned by Dawkins. In
5 an apparent effort to obscure its illicit purpose, the $25,000 check was identified as
6 being for “consulting fees.” Upon information and belief, in a subsequent phone
7 call on or about August 16, 2017, Dawkins confirmed to a second unknown FBI
8 undercover agent (“FBI Agent #2”) that Code had reimbursed Dawkins on behalf of
9 adidas through a payment to his “Loyd Inc. account.”
10 52. Upon information and belief, on or about September 13, 2017, federal
11 authorities again recorded Gatto and Code discussing plans for additional payments
12 to be made by adidas to Bowen’s family. Specifically, in that call, Gatto told Code
13 that, in order to prepare for a second payment in November 2017, they should “get
14 the invoice in now” to “get that out of the way now.” Gatto further stated that they
15 would “figure out the other fifty in ’18.”
16 53. Upon information and belief, Bowen was not the only player whom
17 adidas improperly paid to attend the adidas-sponsored University of Louisville with
18 the further expectation that he would sign an endorsement deal with adidas when he
19 entered the NBA. On or about July 27, 2017, federal authorities recorded a meeting
20 between FBI Agent #1, Dawkins, Augustine, a coach for the University of
21 Louisville, and an unidentified fifth individual during which the five men discussed
22 their plans to improperly pay money to the family of a second player in order to
23 “get this kid to attend [the University of Louisville].” Upon information and belief,
24 in that meeting, Augustine noted that adidas, which sponsored both the University
25 of Louisville and the player’s amateur team, would be supportive of the plan.
26 Dawkins concluded that their plan to funnel money to this unidentified player
27 and/or his family in exchange for the player’s commitment to attend the University
28 of Louisville and to sign with Dawkins and adidas “works on every angle. We have
17
COMPLAINT
1 Merl [Code] at [adidas], we have Brad [Augustine] out with the kid, and we have
2 [the University of Louisville].” Augustine then stated that he expected adidas to
3 fund at least a portion of the money paid to this unidentified player and/or his
4 family because Mr. Pitino, the coach for the University of Louisville basketball
5 team who had previously participated in the efforts to secure payment to Mr.
6 Bowen’s family, had substantial influence at adidas.
7 54. As was the case with Smith, Preston, and others, adidas has vigorously
8 promoted its relationship with Bowen. To associate itself and its products with
9 Bowen, adidas posted and still makes available to the public on its website
10 https://news.adidas.com at least 11 promotional photos of Bowen wearing adidas-
11 branded products. Below is an example of the photos of Bowen posted on adidas’s
12 website:
13
14
15
16
17
18
19
20
21
22
23
24 55. Upon information and belief, adidas also unlawfully sought to direct at
25 least one amateur basketball player to the University of Miami, another NCAA
26 Division I university sponsored by adidas, through the payment of bribes. On or
27 about August 9, 2017, Dawkins and Code discussed by telephone a plan to funnel
28 payments from adidas to high-school player Nassir Little in order to secure Little’s
18
COMPLAINT
1 commitment to go to the University of Miami, and to sign an endorsement deal

2 with adidas once he joined the NBA. Upon information and belief, Code informed
3 Dawkins during the call that Code had already left a message for Gatto regarding
4 the payment that would need to be made to Little.
5 56. Upon information and belief, on or about August 11, 2017, Gatto and
6 Code spoke by phone about an alleged request from personnel at the University of
7 Miami that adidas pay $150,000 to Little in order to prevent him from committing
8 to attend a different university sponsored by a rival athletic apparel company that
9 supposedly had offered to pay him $150,000. Upon information and belief, during
10 this call, Gatto discussed extensively the details of this potential payment, including
11 whether Little would take less than $150,000 and still attend the University of
12 Miami, whether the payment could be deferred until 2018, and whether it could be
13 made in multiple payments.
14 57. Upon information and belief, on or about August 19, 2017, federal
15 authorities recorded a call between Code and Augustine in which Code further
16 confirmed his commitment on behalf of adidas to make the required payments,
17 stating that he would do what was necessary “to make sure that we secure[]
18 [Little],” but that “budget-wise, everything was kind of strapped for ’17 . . . So ’18
19 puts us in a better place to have that conversation.”
20 58. Upon information and belief, adidas’s scheme was far more wide-
21 ranging than reported in the federal criminal complaint against Gatto and Code. In
22 particular, the original criminal complaint notes that “in or around 2017, GATTO,
23 CODE, [and others] agreed to pay bribes to at least three high school basketball
24 players and/or their families” (emphasis added). Subsequent filings in the criminal
25 proceedings confirm that the scheme implicates no fewer than six players and began
26 long before 2017. From all appearances, adidas’s scheme was part of a long-
27 established practice, and discovery is likely to reveal additional payments to
28 additional amateur players that go back for many years, including potentially
19
COMPLAINT
1 players who attended one or more of the six college basketball teams in California
2 that are sponsored by adidas.
3 59. Upon information and belief, in order to conceal these illegal payments
4 from the NCAA, consumers, investors, and the public, Gatto and Code employed
5 sham purchase orders and invoices to conceal the fact that illegal payments from
6 Defendant adidas’s accounts were made to the student-athletes and/or their families.
7 60. The NCAA Division I Manual (the “Manual”), which contains the
8 NCAA’s Constitution and its operating bylaws, sets forth as a core principle of
9 intercollegiate athletics that “[s]tudent athletes shall be amateurs in an
10 intercollegiate sport” and that “student-athletes should be protected from
11 exploitation by professional and commercial enterprises.”
12 61. Financial assistance to student-athletes or their legal guardians is
13 prohibited without express authorization from the NCAA. Neither student-athletes,
14 prospective student-athletes, nor their relatives can accept benefits, including
15 money, travel, clothing, or other merchandise directly or indirectly from outside
16 sources. By virtue of accepting bribes from adidas and its agents, the student-
17 athletes mentioned herein were ineligible to participate in the NCAA, and therefore
18 ineligible to endorse adidas by wearing adidas’s products on the basketball court as
19 they did.
20 62. Plaintiff Skechers is informed and believes, and on that basis alleges,
21 that Defendant adidas and its senior executives knew or should have known about
22 payments that adidas was making and facilitating to the student-athletes and/or their
23 families.
25 that Gatto, Code, Augustine, and Gassnola made the above-described payments to
26 the student-athletes and/or their families in order to benefit their employer and
27 principal, Defendant adidas, and that Defendant adidas did in fact benefit as a
28 result. Plaintiff is further informed and believes, and on that basis alleges, that
20
COMPLAINT
1 Gatto, Code, Augustine, and Gassnola’s actions were foreseeable in connection

2 with their duties, incidental to adidas’s business, and an outgrowth of their
3 employment by or work for adidas.
5 that Defendant adidas never disclosed to prospective customers, investors, and the
6 public either that the student-athletes matriculated to adidas-sponsored universities
7 and agreed to sign with Defendant adidas due to illicit payments made to the
8 student-athletes and/or their families or that those student-athletes were in fact
9 ineligible to participate in the NCAA as a result of those illicit payments.
11 that Defendant adidas unlawfully sought to—and did—increase the value of its
12 brand and deceive consumers into believing that athletes are selecting adidas-brand
13 collegiate sports programs and signing endorsement deals with adidas on the basis
14 of superior quality or brand identity.
15 66. Academic studies have demonstrated that celebrity and athlete
16 endorsements generally positively influence consumer perceptions of a brand and
17 likewise have positive, spillover effects on a brand owner’s reputation, sales, and
18 stock price. Endorsement deals with athletes are particularly valuable in terms of
19 increasing brand recognition, creating positive brand associations, differentiating
20 brands from those of competitors, and enhancing sales of branded products. These
21 influences generate a greater likelihood of customers’ choosing the endorsed brand
22 over competitors’ brands.
23 67. With respect to athlete endorsements in particular, academic experts
24 generally agree that the competitive benefits of such endorsements increase over
25 time as the athletes advance in their careers. Researchers, for example, have found
26 that a company’s sales and stock returns tend to jump noticeably each time an
27 athlete-endorser wins a major event or championship. Upon information and belief,
28 adidas, through its employees and/or agents, was seeking to reap precisely such
21
COMPLAINT
1 tangible economic benefits by making the illegal payments described herein,

2 principally to ensure that college teams sponsored by adidas acquired the top
3 players necessary to win more games (and, hopefully, championships), but also
4 secondarily to illegally block out competition and lock up valuable, highly talented
5 athlete-endorsers early in their careers. Indeed, two of the adidas-sponsored
6 schools for which the bribed student-athletes played—the Universities of Kansas
7 and Louisville—are perennial contenders in the NCAA national championship
8 tournament. Each has won the tournament within the past 10 years, and both teams
9 made it to the “Final Four” in 2012, in or about the timeframe that adidas
10 commenced its bribery scheme.
11 68. The Federal Trade Commission’s Guidelines Concerning Use of
12 Endorsements and Testimonials in Advertising, 16 U.S.C. § 255.5, state that
13 “[w]hen there exists a connection between the endorser and the seller of the
14 advertised product that might materially affect the weight or credibility of the
15 endorsement (i.e., the connection is not reasonably expected by the audience), such
16 connection must be fully disclosed.”
18 that reasonable consumers would not and did not expect that athletes are selecting
19 adidas-branded collegiate sports programs and wearing and endorsing adidas’s
20 products because of secret, illegal payments between $40,000 and $150,000 made
21 to the athletes while they were in high school.
22 70. On or about September 25, 2017, Defendant adidas’s scheme
23 unraveled when federal authorities filed a criminal complaint in United States v.
24 James Gatto et al., Case No. 1:17-cr-00686-LAK (S.D.N.Y.), charging Gatto,
25 Code, Augustine, and others with conspiracy to commit wire fraud, two counts of
26 wire fraud, and money laundering, in violation of Sections 2, 1343, 1349, and 1956
27 of Title 18 of the United States Code based on the acts described herein. Those
28 criminal proceedings are ongoing. On April 10, 2018, the grand jury returned a
22
COMPLAINT
1 superseding indictment which added allegations regarding misconduct involving

2 North Carolina State University and the University of Kansas.
3 71. On or about March 30, 2018, federal authorities separately commenced
4 criminal proceedings against Gassnola relating to his involvement in the scheme to
5 benefit adidas. The case is United States v. Thomas Gassnola, Case No. 1:18-cr-
6 00252-VM (S.D.N.Y.). Gassnola has since pleaded guilty to one count of wire
7 fraud and has agreed to cooperate with prosecutors, confirming that he had
8 participated in the unfair and illegal activities described herein.
9 72. The allegations in the criminal proceedings are credible and reliable,
10 and have been heavily reported on in the press. The credibility and reliability of the
11 criminal allegations are evidenced by the fact that, on February 15, 2018, the court
12 overseeing those proceedings denied Gatto’s and Code’s motion to dismiss the
13 complaint against them, concluding that the facts alleged therein could support a
14 jury verdict finding Gatto and Code guilty of the crimes charged. Further, the
15 publicly available evidence in the record corroborating those allegations includes at
16 least one affidavit from an FBI agent experienced in fraud and public corruption
17 offenses, as well as a guilty plea from a co-conspirator.
18 73. Defendant adidas has misled the public by failing to disclose the fact
19 that it was secretly paying amateur players and/or their families for the players to be
20 seen in and endorse its products, and not because of the strength of adidas’s brand
21 or the quality of its products. Consumers and the public do not reasonably expect
22 that Defendant adidas secures its endorsement deals through illegal conduct that
23 violates NCAA rules regarding recruitment, amateurism, and athletics eligibility.
24 74. As a result of Defendant adidas’s actions, Plaintiff Skechers has been
25 harmed due to increased advertising and marketing costs and lost sales, market
26 share, and goodwill.
27
28
23
COMPLAINT
1 FIRST CAUSE OF ACTION

2 (False Advertising & Unfair Competition under the Lanham Act,
3 15 U.S.C. 1051 et seq.)
4 75. Plaintiff Skechers incorporates and restates paragraphs 1–74 hereof as
5 if fully set forth herein.
6 76. Through its actions as described above, Defendant adidas has violated
7 the Lanham Act, 15 U.S.C. § 1125(a), by using false and misleading
8 representations of fact in commercial advertising or promotion in interstate
9 commerce in connection with Defendant’s products and services, which
10 representations misrepresent the nature and qualities of Defendant adidas’s goods
11 or commercial activities, all to the damage of Plaintiff Skechers. In particular,
12 Defendant adidas has caused collegiate and professional basketball players to
13 endorse adidas’s products—including by wearing those products during televised
14 games—in a manner that has actually deceived and has the tendency to deceive a
15 substantial segment of adidas’s audience into believing that athletes are selecting
16 adidas-branded collegiate sports programs and products on the basis of superior
17 quality or brand identity. Plaintiff Skechers is informed and believes, and on that
18 basis alleges, that those athletes in fact affiliate themselves with adidas because of
19 improper payments made by adidas.
21 that the performance and brand identity of a particular shoe is important to
22 consumers and potential consumers of adidas’s shoes, and therefore that the
23 misrepresentations described herein were likely to influence the purchasing
24 decisions of those consumers and potential consumers.
25 78. By the acts described above, Defendant adidas has unlawfully
26 burnished its reputation in a manner that Plaintiff Skechers cannot, thereby unfairly
27 competing against Plaintiff Skechers.
28 79. At all relevant times, through its employees, agents and
24
COMPLAINT
1 representatives, Defendant adidas knew or should have known that its advertising
2 and promotional activities, as described above, were false, misleading, and
3 deceptive. Upon information and belief, Defendant adidas also acted willfully,
4 deliberately, and in bad faith in connection with some or all of the events described
5 herein.
6 80. Defendant adidas’s acts described above are likely to cause, and have
7 caused, confusion, mistake, or deception among the public.
8 81. By reason of Defendant adidas’s acts, Plaintiff Skechers has suffered
9 and will continue to suffer damage to its business and goodwill, the loss of sales
10 and profits it would have made but for Defendant adidas’s acts, and increased
11 advertising and marketing costs, all in an amount to be proven at trial. Skechers
12 seeks monetary relief of up to three times the amount of all such damages that it has
13 suffered.
15 that, by reason of Defendant adidas’s acts, adidas has obtained profits that it would
16 not have obtained absent its unlawful and improper actions. Skechers seeks an
17 award of adidas’s improperly obtained profits.
18 83. Defendant adidas’s acts described above have caused injury to Plaintiff
19 Skechers and the general public and, unless enjoined, will continue to cause
20 irreparable harm to Plaintiff Skechers and the general public. The balance of
21 equities and public interest both favor enjoining Defendant adidas’s wrongful
22 conduct. Accordingly, Plaintiff Skechers is entitled to temporary, preliminary,
23 and/or permanent injunctive relief as set forth below.
24 SECOND CAUSE OF ACTION
25 (False Advertising under Cal. Bus. & Prof. Code § 17500 et seq.)
26 84. Plaintiff Skechers incorporates and restates paragraphs 1–74 as if fully
27 set forth herein.
28 85. By the acts described above, Defendant adidas has made, and
25
COMPLAINT
1 continues to make, untrue and misleading representations to the public in California

2 concerning its products and the supposed endorsement of those products by
3 collegiate and professional basketball players in violation of California Business
4 and Professions Code Sections 17500 et seq., thereby causing injury to Plaintiff
5 Skechers and its business and property. In particular, Defendant adidas has caused
6 collegiate and professional basketball players to endorse adidas’s products—
7 including by wearing those products during televised games—in a manner that is
8 likely to deceive members of the public into believing that athletes are selecting
9 adidas-brand collegiate sports programs and signing endorsement deals with adidas
10 on the basis of superior quality or brand identity. Plaintiff Skechers is informed
11 and believes, and on that basis alleges, that those athletes in fact affiliate themselves
12 with adidas because of the improper payments made by adidas.
13 86. By the acts described above, Defendant adidas has unlawfully
14 burnished its reputation in a manner that Plaintiff Skechers cannot, thereby unfairly
15 competing against Plaintiff Skechers.
16 87. At all relevant times, Defendant adidas knew or should have known
17 that its advertising and sponsorship activities, as described above, were untrue and
18 misleading. Upon information and belief, Defendant adidas also acted willfully,
19 deliberately, and in bad faith in connection with some or all of the events described
20 herein.
21 88. Upon information and belief, Defendant adidas’s untrue and
22 misleading representations were made and disseminated with the intent directly and
23 indirectly to sell their products and to induce the public to purchase those products.
25 Skechers and the general public and, unless enjoined, will continue to cause
26 irreparable harm to Plaintiff Skechers and the general public. The balance of
27 equities and public interest both favor enjoining Defendant adidas’s wrongful
28 conduct. Accordingly, Plaintiff Skechers is entitled to temporary, preliminary,
26
COMPLAINT
1 and/or permanent injunctive relief as set forth below.

2 THIRD CAUSE OF ACTION
3 (Unfair Competition under Cal. Bus. & Prof. Code § 17200 et seq.)
4 90. Plaintiff Skechers incorporates and restates paragraphs 1–74, 76–83
5 and 85–89 as if fully set forth herein.
6 91. By the acts described above, Defendant adidas has violated California
7 Business and Professions Code Sections 17200 et seq. by engaging in unlawful
8 business acts and practices, including:
9 a. Failing to disclose the payments being funneled to certain of adidas’s
10 endorsers and/or their families, in violation of the Federal Trade Commission’s
11 Guidelines Concerning Use of Endorsements and Testimonials in Advertising, 16
12 U.S.C. § 255.5.
13 b. Engaging in wire fraud and a conspiracy to commit wire fraud in
14 violation of 18 U.S.C. §§ 2, 1343, 1349.
15 c. Engaging in money laundering and a conspiracy to commit money
16 laundering in violation of 18 U.S.C. §§ 2, 1956(h).
17 d. Using false and misleading representations of fact in commercial
18 advertising or promotion in interstate commerce in connection with adidas’s
19 products and services, which representations misrepresent the nature and qualities
20 of Defendant adidas’s goods or commercial activities, in violation of the Lanham
21 Act, 15 U.S.C. 1051 et seq., as described further in paragraphs 76–83 above.
23 Business and Professions Code Sections 17200 et seq. by engaging in unfair,
24 deceptive, untrue, and misleading advertising. In particular, Defendant adidas has
25 caused collegiate and professional basketball players to endorse adidas’s
26 products—including by wearing those products during televised games—in a
27 manner that is likely to deceive members of the public into believing that athletes
28 are selecting adidas-brand collegiate sports programs and signing endorsement
27
COMPLAINT
1 deals with adidas on the basis of superior quality or brand identity. Plaintiff
2 Skechers is informed and believes, and based upon such information and belief
3 alleges, that those athletes in fact affiliate themselves with adidas because of the
4 improper payments made by adidas.
6 Business and Professions Code Sections 17200 et seq. by engaging in acts
7 prohibited by California Business and Professions Code Sections 17500 et seq., as
8 described further in paragraphs 85–89 above.
9 94. At all relevant times, Defendant adidas knew or should have known
10 that its advertising and sponsorship activities, as described above, were unlawful,
11 literally false, misleading, and deceptive. Upon information and belief, Defendant
12 adidas also acted willfully, deliberately, and in bad faith in connection with some or
13 all of the events described herein.
15 Skechers and its business and property and, unless enjoined, will continue to cause
16 irreparable harm to Plaintiff Skechers. The balance of equities and public interest
17 both favor enjoining Defendant adidas’s wrongful conduct. Accordingly, Plaintiff
18 Skechers is entitled to temporary, preliminary, and/or permanent injunctive relief as
19 set forth below.
20 WHEREFORE, Plaintiff Skechers prays for judgment to be entered in its
21 favor and against Defendant adidas, as follows on all causes of action:
22 1. For an injunction prohibiting Defendant adidas from (a) making any
23 payments to high-school students, NCAA student-athletes, or their
24 families that are not fully disclosed to the public, and (b) otherwise
25 unfairly competing against Plaintiff Skechers and/or its subsidiaries or
26 falsely advertising or promoting adidas’s products;
27 2. For a declaration that (a) Defendant adidas’s payments to high-school
28 students, NCAA student-athletes, and/or their families constitute unfair
28
COMPLAINT
1 competition; and (b) adidas’s failure to disclose those payments

2 constitutes false advertising and unfair competition;
3 3. For an award of the profits that Defendant adidas unlawfully derived
4 as a result of its wrongful conduct;
5 4. For compensatory damages to Plaintiff Skechers in an amount to be
6 determined at trial, and to be trebled under 15 U.S.C. § 1117(a), which
7 are attributable to the false, deceptive, and misleading advertising and
8 related actions described herein;
9 5. For the costs of bringing this action, including reasonable attorneys’
10 fees and expenses associated with bringing and prosecuting this action;
11 and
12 6. For such other and further relief as the Court may deem just and
13 proper.
14
15 DATED: May 9, 2018 DANIEL M. PETROCELLI
MARK A. SAMUELS
16 JEFFREY A. BARKER
CHRISTOPHER S. WHITTAKER
18
19 By: /s/ Daniel M. Petrocelli
Daniel M. Petrocelli
20 Attorneys for Plaintiff
Skechers USA, Inc.
21
22
23
24
25
26
27
28
29
COMPLAINT
1 DEMAND FOR JURY TRIAL

2 Pursuant to Federal Rule of Civil Procedure 38(b), Plaintiff Skechers hereby
3 demands a trial by jury of all of the causes of action that are so triable.
4
5 DATED: May 9, 2018 DANIEL M. PETROCELLI
MARK A. SAMUELS
6 JEFFREY A. BARKER
CHRISTOPHER S. WHITTAKER
8
9 By: /s/ Daniel M. Petrocelli
Daniel M. Petrocelli
10 Attorneys for Plaintiff
Skechers USA, Inc.
11
12
13
14
15
16
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20
21
22
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26
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28
30
COMPLAINT
Skechers USA, Inc. v. adidas America, Inc. et al, Docket No. 2:18-cv-03882 (C.D. Cal. May 09, 2018), Court Docket
General Information
Court United States District Court for the Central District of California;
United States District Court for the Central District of California
Federal Nature of Suit Other Statutory Actions[890]
Docket Number 2:18-cv-03882
© 2018 The Bureau of National Affairs, Inc. All Rights Reserved. Terms of Service
// PAGE 31

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Case 2:18-cv-03882 Document 1 Filed 05/09/18 Page 1 of 30 Page ID #:1

1 DANIEL M. PETROCELLI (SBN # 97802)

1 has created expectations that law-abiding competitors cannot meet. In the

1 adidas, a two-minute highlight reel showing Smith’s stellar basketball performance

1 $15,000 to Preston’s mother.

1 affiliate did in fact transfer $30,000 to a bank account held by an unidentified

1 commitment to go to the University of Miami, and to sign an endorsement deal

1 Gatto, Code, Augustine, and Gassnola’s actions were foreseeable in connection

1 tangible economic benefits by making the illegal payments described herein,

1 superseding indictment which added allegations regarding misconduct involving

1 FIRST CAUSE OF ACTION

1 continues to make, untrue and misleading representations to the public in California

1 and/or permanent injunctive relief as set forth below.

1 competition; and (b) adidas’s failure to disclose those payments

1 DEMAND FOR JURY TRIAL

Federal Nature of Suit Other Statutory Actions[890]

Docket Number 2:18-cv-03882

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