Nike, Reebok Settle Tim Tebow Jersey Lawsuit

Two weeks after Nike filed suit against Reebok for illegally producing Tim Tebow Jets jerseys, the companies came to terms on a settlement agreement. The settlement requires Reebok to eliminate any Tebow Jets clothing from the sales chain. Reebok will also buy back any remaining apparel from stores.

Shortly after Tebow was traded to the New York Jets, Reebok began producing Tebow Jets jerseys. This was illegal because Reebok's NFL player license had expired on March 1, two weeks before the trade. Player jersey production requires licensed permission from both the league and the NFL Players Association. Reebok retained their league mark license until April 1, but without the player license, the jerseys could not legally be manufactured.

A judge recently extended a temporary restraining order into a permanent injunction, having decided Nike had a likelihood of success on the merits of their lawsuit. Reebok had to recognize they had no chance of winning. Nike likely settled this lawsuit ahead of trial to avoid any headaches that can come with a jury trial.

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