The next month, in April, ABG sued TAG for $49 million over the non-payment. That June, TAG countersued ABG for $200 million, alleging that ABG had conspired to steal proprietary code and commercial information.
Less than a year later, the two announced in April that the lawsuit had been settled out of court. ABG has been involved in legal battles on at least five previous occasions. Of those concluded, this is the only one that ended in a settlement.
The resolution, while atypical for ABG, allows both parties to move forward without the distraction and financial drain of a protracted trial, according to Kibel. Indeed, just three weeks after settling the case, ABG announced its $311 million acquisition of the footwear brand Dockers.
TAG, meanwhile, which has been unprofitable since joining the New York Stock Exchange in February 2022, recently posted its third consecutive profitable quarter.
While a heritage brand, Sports Illustrated weighed on TAG’s balance sheet for years, as ADWEEK previously reported. With it spun off, its licensing payment eliminated, and no material financial damage incurred in the process, TAG now has healthier financial footing than it has in years.
