LITTLETON, Colo. (CN) - Adobe Systems wriggled out of a $325,000 sponsorship deal with the Denver Broncos by adding a secret escape clause to a contract, the NFL team claims.
PDB Sports - which owns the Broncos - and Stadium Management Co., which leases Mile High stadium, sued Adobe Systems in Arapahoe County Court, alleging fraud, breach of contract and bad faith. The plaintiff will be referred to in this article as the Broncos.
The Broncos claim Adobe signed a 2-year contract in 2012, promising to pay $20,000 for the first year for access to an executive suite and an event with Broncos legend and executive vice president John Elway.
The payment was to rise to $325,000 in 2013, when Adobe would serve as a "game day sponsor," according to the lawsuit.
For the money, Adobe would get advertising on the stadium scoreboard, public address announcements touting their sponsorship, and continued access to the executive suite.
But the Broncos claim Adobe never planned to follow through on its commitment, and doctored a binding letter of agreement to create an escape route from the balloon payment.
"Adobe altered the contract by adding a new and never-discussed term to the contract," the complaint states. "This new and never-discussed term purported to give Adobe sole discretion over the 2013 provisions of the contract. Adobe added this language in a smaller font and in such a manner that it did not alter the pagination or spacing of the agreement. Adobe then signed the contract and sent it back to PDB Sports to sign without mentioning the material change."
The Broncos claim Adobe added these two sentences to the contract: "Adobe is committing to Year 1 of the agreement. Year 2 is optional and not committed to at this time."
Unaware that the changes had been made, the Broncos say, the team signed the agreement and fulfilled its end of the bargain.
"Although Adobe knew 'from the very beginning' that it would not serve as a 2013 game day sponsor, Adobe nevertheless accepted all the 2012 assets listed in the contract, as well as numerous assets not mentioned in the contract," the complaint states. "During this time, Adobe had numerous opportunities to inform PDB Sports 1) of the provision it had inserted and 2) that it had decided not to be a 2013 game day sponsor. Adobe never did so. Even when PDB sent Adobe a contract further formalizing the sponsorship agreement, Adobe did not mention that the contract failed to contain the provision it had inserted into the prior agreement nor did Adobe state that it did not intend to perform the 2013 provisions of the agreement."
When it came time to pony up the $325,000, an Adobe sales manager said the company had never planned to sign on for another year, the Broncos claim.
The lawsuit cites a March 4 email from Adobe, stating: "'Brendon said Adobe will not be picking up the option for the next season partnership. Brendon told me that Eric [Mitchell] was aware of this from the very beginning and should have relayed that information to you. Apologies again if Eric misled you about next season.'"
Three days later, the Broncos say, the Adobe manager sent another email, stating: "'Again, apologies for the unprofessionalism on our end. That's not how we conduct business.'"
But that is how Adobe conducted business, the Broncos say. The team claims it could not find another game-day sponsor to replace Adobe.
The Broncos seek damages for fraudulent concealment, breach of contract, breach of faith, and reformation of contract, back to its original language.
The plaintiffs are represented by Daniel Reilly with Reilly Pozner.
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