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| January 29, 2013

SCA’s Statement on Lance Armstrong

CONTACT:
Tanya Mathis, SCA Promotions
tanya.mathis@scapromo.com
888-860-3700

2/16/2015 Update: Lance Armstrong was hit with a record breaking $10 million sanctions award by the arbitration panel hearing his dispute with Dallas-based SCA Promotions, Inc. According to the arbitrators’ written ruling, the sanctions award punishes Armstrong for engaging in “an unparalleled pageant of international perjury, fraud and conspiracy.” The $10 million award, which must be paid directly to SCA Promotions, is believed to be the largest award of sanctions assessed against an individual in American judicial history. The award was made public today when SCA Promotions filed a motion with a Dallas state district court to have the award confirmed into a judgment against Armstrong.

The arbitration panel issued the award after holding a multi-day evidentiary hearing during which Armstrong himself testified. During the hearing, the arbitrators considered whether Armstrong should be punished for his wrongful conduct in connection with his original dispute with SCA Promotions. That dispute, which took place in 2005, involved whether SCA Promotions owed Armstrong bonus payments after he had won a series of Tour de France races. Armstrong swore under oath on numerous occasions in that proceeding that he had never used performance-enhancing drugs during his career. Given that sworn testimony, SCA Promotions settled the matter for $7.5 million in 2006.

Armstrong later confessed in 2013 that he had cheated during every Tour de France race that he had won. He also acknowledged that he had committed perjury during his dispute with SCA Promotions. As a result, SCA re-convened the arbitration proceeding and sought to sanction Armstrong based on his prior wrongful conduct. After an evidentiary hearing, the arbitrators found that Armstrong had “used perjury and other wrongful conduct to secure millions of dollars of benefits” from SCA Promotions.

According to the arbitrators, Armstrong’s wrongful conduct was not limited to perjury. In addition to committing “perjury on every issue” in the case, the arbitrators also found that Armstrong “intimidated and pressured other witnesses to lie” and even “used a false personal and emotional appeal to perpetuate” his lies. While Armstrong acknowledged during the hearing that he was untruthful about his prior cheating, the arbitrators found that he “expressed no remorse to the Panel for his wrongful conduct.”

“We are very pleased with this result,” said SCA’s president and founder, Bob Hamman. “It is hard to describe how much harm Lance Armstrong’s web of lies caused SCA but this is a good first start towards repairing that damage.” The sanctions award is the latest chapter in SCA’s long-running dispute with Armstrong. SCA’s lawyer Jeff Tillotson, said “This record breaking award was justified given Armstrong’s outrageous conduct.” Perhaps most disturbing, noted Tillotson, is that “the panel of arbitrators determined that Armstrong ‘continued to lie to the Panel throughout the final hearing even while admitting to prior falsehoods and other wrongful conduct.'”

SCA is asking the Texas court to turn the award into a final judgment against Armstrong so that it can collect the amount owed. SCA’s dispute with Armstrong is not over. It has a currently pending lawsuit in Dallas state district court where it is pursuing additional claims against Lance Armstrong and Bill Stapleton.

For further enquiries, please contact Tanya Mathis at tanya.mathis@scapromo.com or call 214-860-3700.


2/7/2013 Update: Robert Hamman statement re SCA vs Tailwind Sports, Inc., Lance Armstrong and William Stapleton.

"I am the CEO of SCA Promotions, Inc. and am speaking on behalf of SCA Promotions, Inc.

Lance Armstrong cheated to win all of his Tour De France victories. He has admitted as much on national TV.

As a result of Lance Armstrong’s unjustly achieved victories and related activities, SCA paid $12,120,000 to Tailwind Sports, Inc. SCA also suffered reputational damage and substantial loss of business.

At this time SCA seeks to recover the damages it suffered.

Accordingly, suit has been filed in the District Court of Judicial District 116, Dallas County, Texas."

The Petition can be found here.


“A lie with a purpose is one of the worst kind and the most profitable.”
     
– Finley Peter Dunne

Lance Armstrong captured the attention of the world with his unprecedented seven Tour De France titles. SCA Promotions became financially invested in Mr. Armstrong’s career when Tailwind Sports, owner of Armstrong’s U.S. Postal Cycling Team, came to SCA for its services covering prize amounts if Armstrong won the 2001 through 2004 Tour de France races. Armstrong became eligible for the largest of these prize amounts with his alleged win in 2004, although it came amidst allegations of doping – allegations that we took very seriously. SCA sought to investigate these credible doping allegations prior to further payment of prize awards.

Armstrong vigilantly denied these allegations, going as far as denying he ever used performance enhancing drugs to attorney Jeffrey Tillotson under oath. Unfortunately during this time, Capital Sports and Entertainment, the management arm of Tailwind Sports, did quantifiable damage to SCA Promotions’ business by taking out an inflammatory full page advertisement in a leading industry publication, Sports Business Journal, which derided SCA Promotions. Among other brand-damaging quotes, the advertisement read, “SCA’s failure to pay the final installment of its policy is a shameful and baseless breach of contract.”

Ultimately, despite the ongoing allegations, SCA paid Mr. Armstrong $12 million, which included the prizes, interest, and legal fees. While we are in the business of awarding winners, Lance Armstrong is no longer in that category, as he was stripped of those Tour De France wins in 2012 because of a federal investigation that found him to have been using performance enhancing drugs during his victories. On January 17, 2013, he admitted his guilt to Oprah Winfrey:

     Winfrey: “Did you ever take banned substances to enhance your cycling performances?”

     Armstrong: “Yes … I view this situation as one big lie that I told several times.”

While we are pleased that Mr. Armstrong has come clean about his use of performance enhancing drugs, he lost his Tour De France titles and was ordered to repay those prizes paid to him for races won while doping, thus making it inappropriate for Mr. Armstrong to retain the money paid to him by SCA under fraudulent circumstances. Additionally, he lied under oath to Tillotson about his use of the drugs. SCA believes it is unfair for Mr. Armstrong to keep the money and to profit from his lies…at our expense.

“We want our money back, because we never should have paid it in the first place.”
      – Jeffrey Tillotson

About SCA Promotions

Dallas-based SCA Promotions delivers promotional solutions that connect with consumers, without risk to the sponsor. For over 26 years, SCA has offered an entire suite of advanced, interactive promotions, imaginative contests, record-breaking sweepstakes, and inventive games designed to engage and motivate. SCA has covered billions of dollars and paid out over $193 million in cash and prizes for sales and consumer product promotions, lottery and casino jackpots, radio contests, direct mail, Internet, and sports promotions. SCA has offices in Dallas, London, Las Vegas, and Calgary, with affiliate partners across the globe.


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