Lance Armstrong’s doping scandal cost him millions in future earnings. Luckily for him, most of his current fortune is likely safe and sound.
Most athlete endorsement deals include “morals clauses,” but it's rare that a company will go through the trouble of trying to claw money back from a major athlete after a scandal, Brian R. Socolow, an attorney at Loeb & Loeb who specializes in contract and sports law, has told Businessweek.
While clawbacks aren't common among athlete endorsements, they're relatively more common in other industries. In banking, for example, it's not unheard of for staffers to have some of their pay taken back for poor performance. Just this year, after JPMorgan Chase lost billions on a huge trading mistake, CEO Jamie Dimon said he would claw back the pay of some senior executives.
But just because clawbacks aren't typical in sports doesn’t mean that all of Armstrong’s money is safe. SCA Promotions, a Texas insurance company, is demanding Armstrong give back the $7.5 million bonus the company paid him after he won the Tour de France, according to ESPN. “He is no longer the official winner, so it would be improper for him to keep those funds,” the company’s lawyer told ESPN.
The International Cycling Union stripped Armstrong of his seven Tour de France titles Monday and banned him for life after the U.S. Anti-Doping Agency released evidence that he and members of his team were doping during his Tour wins. The announcement cost him millions in future endorsement deals from Nike to Anheuser-Busch and he also quit his post as chairman of Livestrong, the cancer fighting foundation.
Tiger Woods suffered a similar fate in 2010, after it was revealed that he had affairs with multiple women. The golf pro lost $22 million in endorsement deals in 2010, according to Business Insider. But if Woods’ story is any indication, Armstrong may be able to hop back on the endorsement horse; Woods inked a deal with Rolex in 2011, just two years after the sex scandal broke, according to ESPN.
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