Varsity Spirit is trying to prevent a former vice president from turning over a trove of company documents to two groups of plaintiffs suing the multi-billion-dollar cheerleading company for alleged antitrust violations.
The twist is that Marlene Cota, who served as Varsity’s vice president of corporate alliances, claims that the materials she has—which she asserts are pertinent to the case—were physically handed to her by the company upon her 2018 termination. Varsity, which is owned by Bain Capital, disputes Cota’s account and insists she should return any custodial files to her former employer.
“This material should never have been in Ms. Cota’s possession,” Varsity’s lawyers wrote in a motion filed late last month.
A few weeks before, Cota’s attorney, Bryan Meredith, informed Varsity that his client had been subpoenaed by its antitrust accusers, who sought both her testimony and “numerous categories of documents.” Meredith wrote that Cota planned to comply with the subpoena unless the judge overseeing the class-action lawsuits directed her otherwise.
The litigation, filed in the District Court for the Western District of Tennessee, accuses Varsity of operating for years as an illegal monopoly through its acquisition of rivals, use of exclusionary contracts and by leveraging control of cheerleading’s governing bodies, such as the U.S. All Star Federation (USASF). The plaintiffs include all-star cheerleading gyms that were direct purchasers of Varsity.
Cota is one of the rare Varsity insiders who has been publicly critical of her former company, appearing last August in an episode of HBO’s Real Sports that raised questions about Varsity’s role in a growing sexual abuse scandal in the sport.
Despite having signed a separation agreement with Varsity that included non-disparagement and nondisclosure terms, Cota nevertheless told reporter Mary Carillo that Varsity prioritized “protect[ing] the brand” over the safety of underage cheerleaders. Cota further alluded to monopolistic concerns, saying that “90% to 95% of the business of cheerleading is controlled by Varsity.”
In a subsequent interview with Sportico, Cota weighed in on the departure of Varsity Brands founder Jeff Webb, who announced his resignation as chairman of Varsity Spirit in late 2020.
“I would think that for the sake of preserving whatever integrity is left in the sport, when the courts get done with it, it was probably best that they all parted ways,” Cota said.
Cota’s attorney Bryan Meredith wrote a letter to Varsity’s outside counsel on Dec. 16, informing the company that she likely had a number of documents that related to the plaintiffs’ antitrust claims. Meredith explained that on the date Cota was terminated, she was immediately denied access to her Varsity work space and told to return to the company’s offices the next day to “receive her personal things.”
Meredith wrote that when Cota showed up the next day, two Varsity officials, including the company’s head of human resources, placed boxes of materials in her car.
“Cota did not know specifically what the boxes provided by Varsity contained, and she did not examine their contents,” Meredith wrote. It was only after Cota was subpoenaed, her lawyer wrote, that she discovered she was in possession of a number of relevant materials to the case, including “business development documents disseminated by Varsity to its employees” and personal notes contained in “volumes of notebooks.”
Responding to Cota, Varsity disputed that its employees had provided her any business materials in connection with her termination, and insisted that the boxes that had been placed in her car “included only personal items.” Varsity contends that Cota is obligated to return any of the company’s documents, so that she is not in breach of her separation agreement.
In its motion with the court, Varsity decried the subpoena as an attempt at an “end-run” around the discovery process, noting that the plaintiffs did not specifically name her as a potential record custodian during negotiations. The plaintiffs, however, argue that Varsity does not have standing to challenge Cota’s subpoena, as she is an ex-employee and a non-party to the case.
Cota’s “documents are indisputably relevant,” the plaintiffs’ lawyers wrote in a motion filed Monday, citing Cota’s on-the-record comments to HBO and Sportico. “Defendants omit important facts about how they came into Ms. Cota’s possession in the first place. Ms. Cota did not abscond with the documents, nor were they in her possession by virtue of her employment.”
Cota and her attorney declined requests for comment and a Varsity spokesperson did not respond to an email inquiry.
Varsity’s legal battle carries forward at an increasingly acrimonious time within the world of competitive cheer. Last month, USASF filed a trademark infringement lawsuit against the Open Cheer & Dance Championship Series for using the term “ALLSTAR WORLDS” in connection with their event. As Sportico previously reported, Varsity has sued its former Oklahoma state director, Josh Quintero, who left to become communications director of the Open series, claiming that he violated the noncompete terms of his contract.