Aberdeen pension fund secures £334 million settlement with Under Armour

Court approves £334 million settlement for Aberdeen council workers against Under Armour

The North East Scotland Pension Fund (NESPF) has successfully reached a £334 million settlement with the American sportswear giant Under Armour, following a protracted legal battle. This landmark agreement, which has now received court approval, will provide financial relief to approximately 78,000 workers represented by the pension fund.

The settlement stems from allegations that Under Armour made misleading statements regarding its products, leading to significant financial losses for NESPF.

Background of the legal dispute

In June, NESPF accused Under Armour of providing false information about its product performance, which resulted in an estimated loss of around £6 million for the pension fund.

The legal team representing NESPF, Robbins Geller Rudman and Dowd LLP, was preparing for a federal jury trial that was set to commence on July 15. The class action lawsuit was initiated to represent a larger group of investors who suffered similar losses due to Under Armour’s alleged misstatements.

Details of the settlement agreement

Under the terms of the settlement, Under Armour will pay £334 million to resolve claims made by purchasers of its publicly traded shares between September 16, 2015, and November 1, 2019. The company has also agreed to implement two governance changes for a specified period, as outlined in its 8-K filing with the Securities and Exchange Commission (SEC). Despite the settlement, Under Armour maintains that it has not admitted to any wrongdoing, stating that the agreement was made to avoid the costs and distractions associated with ongoing litigation.

Implications for Under Armour and the pension fund

This settlement marks a significant turning point for Under Armour, which has faced scrutiny over its business practices in recent years. The company’s chief legal officer, Mehri Shadman, emphasized that Under Armour believes its sales and accounting practices were appropriate and denies any wrongdoing. However, the resolution of this case allows the firm to move forward and focus on its core business operations without the burden of a lengthy legal dispute.

For the NESPF, this settlement represents a crucial victory, providing much-needed funds to support the retirement benefits of its members. An NESPF spokesman expressed anticipation for further details regarding the court’s decision, highlighting the importance of this outcome for the workers represented by the fund.