June 30, 2008 3:58 PM

Speedo Convinces Judge to Delay Suit Until After Olympics

Posted by Zach Lowe

World records continued to fall Sunday night at the U.S. Olympic swimming trials. And swimmers continued to convert to Speedo's $500, NASA-engineered LZR racer--some even ditched prior sponsorship deals with rival companies in favor of the high-performance suit.

As The Am Law Daily reported in May, the LZR racer is now the subject of a lawsuit filed against Speedo by its main rival, TYR Sport Inc., and sparked by USA Swimming head coach Mark Schubert's comments that swimmers wearing the LZR have an advantage. In fact, 38 of the last 42 world records, including one set by Michael Phelps Sunday night, have been set by swimmers wearing the Speedo suit. TYR claims Schurbert's comments restrain fair competition.

On June 20 Speedo, represented by Katten Muchin Rosenman partners Karen Artz Ash, James Calder, Stuart Richter and Zia Modabber, successfully convinced a judge to delay the case until after the Olympics over the strong objections of TYR's team at Hewitt & O'Neill.

The company and USA Swimming argued that the matter would prove too distracting to the competitors and potentially harm Speedo's business interests. Schubert and USA Swimming are represented by Denver-based Holme, Robert & Owens.

In response, Hewitt partner Lawrence Hilton, TYR's lead lawyer, said the distractions during the games would be minimal. "TYR is not talking about pulling swimmers out of the pool to attend depositions," Hilton wrote. He argued that witnesses' memories will not be as sharp and that e-mails may get lost over the three-month delay.

Hilton points to what he considers a major concession from the June 20 hearing. In his declaration, Stuart Isaac, a senior vice president of marketing for Speedo, detailed duties that include managing "sponsored athletes and paid spokespersons, such as coach Mark Schubert." The declaration, Hilton says, is an admission that Speedo pays Schubert to push their products.

The matter is set to resume in mid-September. The Olympic trials continue through July 6.

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