Update from the interim chancellor on adidas

Here is an update on the adidas situation from Interim Chancellor David Ward, dated April 12:

To all members of the Labor Licensing Policy Committee,

I will be out of town on Friday and unable to attend the meeting of the Labor Licensing Policy Committee, but wanted to provide you with an update on the adidas discussions.

Throughout this process, I have attempted to maintain open lines of communication with all of our shared governance partners.  I have shared my thoughts and gathered feedback not only from you and the Labor Licensing Policy Committee, but also with representatives from the University Committee, ASEC and ASM, the UW Athletic Board, the Board of Regents and more.

We will continue our efforts to reach a solution to this important issue for our campus community.  We appreciate your patience as we move forward.

The university is contractually obligated to enter into mediation as part of our sponsorship agreement with adidas.  The decision to enter mediation instead of placing adidas on notice of breach does not impact the timing of a resolution.  Had we placed adidas on notice of breach, then chosen to enter mediation as required by our agreement with them, it is likely that we would have had to suspend the notice period while we engaged in mediation.

The potential risk of legal action should we place adidas on notice of a breach is problematic in two areas of importance.  First, we must be mindful of our fiduciary responsibilities when taking action, so as not to put the university at risk of financial harm.  Secondly, and perhaps most significantly, legal action could put the university’s code of conduct at risk, which would have a significant impact.

While the mediation process, by nature, seems to move slower than most of us would prefer, there has been progress.   LLPC chair Lydia Zepeda and LLPC board member Jane Collins joined our administrative staff in a recent meeting with the state Department of Justice, the entity that will represent UW–Madison in the mediation process.  At my behest, Vice Chancellor Darrell Bazzell, who along with our legal counsel will participate directly in the mediation process, will continue to be in communication with your committee chair throughout the mediation process.

Also, the DOJ has been working with adidas to choose a mediation service because the sponsorship agreement does not identify a specific mediation service to use.  I’m pleased to report that a service has been agreed upon, and that both the parties have agreed on a process for selecting a mediator from a panel of available retired judges.  Once the mediator has been selected, the parties and the mediator will schedule dates on which the mediation will occur and for the submission of position statements in advance of the mediation.  The mediator and the parties will also select a location for the mediation to take place.  The university has shared with DOJ our desire to move forward in a timely manner.

As I’ve said before, I believe that UW–Madison is in the best position to create meaningful progress if we work directly with adidas toward resolution.  I do not believe that termination of our relationship with adidas – or the threat of termination – is productive at this point, since it places the university and its code of conduct at risk and provides no relief to the displaced workers.

I remain confident that the required mediation is in fact a prudent step to take to achieve the goals that we all share of ensuring redress for the affected workers, while simultaneously mitigating financial harm to our institution and protecting the integrity of our code of conduct.

I appreciate your continued efforts on behalf of UW–Madison, and look forward to working with you toward resolution of this issue in the weeks and months ahead.