FC Cincinnati had hoped by now that it would have a lucrative naming rights sponsorship deal for its new West End stadium.
But it hasn’t happened. And a lawsuit filed Monday morning in Hamilton County Common Pleas Court alleges that’s the fault of the leading Major League Soccer sponsorship company.
Futbol Club Cincinnati is suing that company, Los Angeles-based Premier Partnerships, in Hamilton County Common Pleas Court for breach of contract, alleging that company’s negligence cost them tens of millions of dollars in revenue.
The team seeks an unnamed amount in compensatory damages and a declaratory judgement that the team was right to terminate its contract with Premier. The Enquirer reached out to Premier Partnerships Monday morning, but has not heard back.
Troubles date to May 2017 when FC Cincinnati was a USL team with dreams of making it to the big leagues.
The team contracted with Premier to begin working on national sponsorship deals in the moment and in the future, when it would be a Major League Soccer team.
On its website, Premier Partnerships bills itself as the “leading naming rights, sponsorship sales, and consulting firm” with 15-years of experience.
The company, the website says, assesses a team’s value and then secures “profitable, enduring partnerships.”
Listed among the companies Premier works: Mercedes Benz, Coca-Cola, McDonald’s, Nike and many more.
As president of a USL team, Jeff Berding didn’t know the rules of MLS – and like all sports leagues, there are a lot of them – but Premier touted itself as having significant experience with Major League Soccer deals, so it was a deal worth doing, the lawsuit alleges.
The promise: a national cornerstone sponsorship for the stadium. And there was one, but the lawsuit doesn’t say who. When contacted for this story, an attorney for FC Cincinnati wouldn’t name the company.
Berding in recent months has declined to discuss the issue. He could not be reached for comment for this story.
“The Club will not comment on pending litigation,” said Brock Denton, a Keating Muething and Klekamp attorney who represents the team. “We believe the complaint speaks for itself and look forward to pursuing the merits of its claims with the court.”
What happened once the deal was signed with Premier is that Premier offered the prospective stadium sponsor various terms and items that either violated MLS rules or were financially unworkable for FC Cincinnati, the lawsuit says. It goes on to say that even after FC Cincinnati raised concerns Premier continued to pressure the team to revise stadium blueprints and the seating bowl to cater to the company, despite the fact it would violate MLS stadium rules.
“Premier had no other prospective stadium sponsors in the pipeline, and forcing FC Cincinnati to close the deal – regardless of whether the terms violated MLS rules or were financially unreasonable for FC Cincinnati – was the only way Premier would collect its sizable commission,” the lawsuit says.
Naming rights deals tend to be secretive, but the lawsuit sheds some light on such deals, alleging the failure to secure naming rights cost the team “tens of millions of dollars in stadium sponsorship revenue over the next several years.”
It specifically says Premier was to secure naming rights and find new national partnerships, worth roughly $200,000 a year, in addition to naming rights revenue. The team is mostly locally owned by some of Cincinnati’s wealthiest residents and business owners.
The team made it clear, the lawsuit says, it did not hire Premier to work on local partnerships.
FC Cincinnati is a building a $250 million, privately-funded, stadium in the West End. The design is being hailed as one of the nicest in the MLS, featuring 513 glowing fins. Advertising can be incorporated in the those lights.
In the first 17 months of the contract, FC Cincinnati paid Premier more than $160,000 and reimbursed $25,000 in expenses. In return, Premier, the lawsuit says, secured one signed letter on intent related to sponsorships.
That partnership is not named in the lawsuit. But a letter attached to the lawsuit, from Denton to Premier Partnerships, says the company is Mercy Health, a local company which sponsors FC Cincinnati’s jerseys. Mercy Health is listed on Premier’s website as a partner with whom it works. The lawsuit says Premier promised items to the unnamed company forbidden under MLS rules, including allowing the unnamed company to be the team’s exclusive healthcare provider and sponsorship rights to things outside of FC Cincinnati’s control.
“Because FC Cincinnati was still a USL team during deal negotiations, FC Cincinnati had no access to MLS rules at that time,” the lawsuit says. “Premier, however, did have access to MLS rules at that time and also knew by virtue of the Collective Bargaining Agreement that a MLS-level sponsorship was the ultimate goal.
That cost the team money, the lawsuit says. Instead of the things Premier promised the sponsor, FC Cincinnati had to give the sponsor “hundreds of thousands of dollars” in merchandise.
As time went on – with the team still paying the monthly retainer – the agreement was revised.
The lawsuit says Premier was given a revenue target of $8.1 million for 2019, which it made. And a target of almost $10.9 million this year, which is failed to do, the suit goes on to say.
The lawsuit notes Premier “has made a number of statements” that it did meet that target.
FC Cincinnati terminated its contract with Premier May 1.
In the meantime, the team was still hopeful a naming rights sponsor for the stadium could be secured. The lawsuit says Premier offered things to that sponsor that were impossible to do under MLS rules.
• Exclusive exposure during play, even during nationally televised games.
• For it to be integrated into FC Cincinnati’s social media platforms.
• The ability to buy merchandise at cost
• A 50% discount on tickets for anyone who worked for the company.
“FC Cincinnati spent countless hours and incurred significant costs trying to salvage the naming rights deal,” the lawsuit says. “Under the deal. FC Cincinnati would have received tens of millions of dollars in stadium sponsorship revenue over the next several years.
“.. FC Cincinnati is currently without a stadium sponsor – even though the stadium is scheduled to open next year.”