Helmet Makers Suffer from Head Injury Crisis

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The New York Post


The NFL concussion crisis has hit the league's helmet makers where it hurts: in the wallet.

Riddell, a leading manufacturer of football helmets for the past 85 years, has been struggling without success to sell itself in recent months despite its market dominance, sources told The Post. Ditto for No. 2 Schutt Sports, which recently canceled an auction of the company that makes helmets for NFL stars like Cam Newton and Julio Jones.

One big obstacle is Leonard Marshall, the former New York Giants great who is leading a class-action suit on behalf of 4,500 former NFL players against Riddell, alleging the company until 2002 had not properly informed players about the risks of concussions despite knowing better.

The legendary lineman says he got a call in July from possible suitors, who offered him cash and an equity stake in the company in exchange for dropping his suit.

"I've spoken to people interested in purchasing Riddell and they have asked me to set aside my claim," Marshall told The Post.

"I am not going to drop my lawsuit because I am part of a much bigger picture," said Marshall, most famous for his hit that knocked Joe Montana out of the 1991 NFC championship game.

"I feel like there are too many bodies in this for me to withdraw and relieve them of liability," he said.

Marshall's lawyer Jason Luckasevic, also the originator of the bigger concussion lawsuit against the NFL, declined to name the prospective bidder for Riddell, although he revealed it was a firm that mainly makes gear for other sports.

Luckasevic said he isn't worried that BRG Sports, the privately owned parent company of Riddell, will go bankrupt if his clients win their suit.

"Riddell has insurance that should cover litigation," even if it ends up being $500 million, he said.

Still, insiders say the legal battle is a major cloud hanging over the helmet makers' future, even as the NFL's own liabilities are expected to cross the $1 billion mark. The federal case against Riddell in Philadelphia is ongoing, and plaintiffs are angling to move it to California in search of a bigger judgement. Discovery in the suit is slated to begin next year.

"Take away concussions and these helmet makers would be much more valuable," a source who considered buying one of the businesses said.

Private equity firm Fenway Partners, whose previous investments have included diamond seller Harry Winston, bought Riddell in 2004. It now owns Riddell through BRG, which in recent years has sold off most of its other assets, including Easton-Bell helmets.

Meanwhile, Platinum Equity-owned Schutt has been for sale through the Park Lane investment bank, seeking about $40 million, two sources said.

But Schutt cancelled the auction a few months ago after Riddell counter-sued it in a patent infringement dispute.

Riddell is the biggest football equipment maker, with about $200 million in sales. Schutt is second with $55 million.

Suitors also have bigger-picture concerns about the popularity of football, sources said.

The market for helmets for varsity high school football on up is stable, but the number of players from 8 to 12 years old has dropped as kids move more to flag or protected flag football, a source said.

Riddell, Fenway and Park Lane declined to comment. Platinum did not return calls.

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December 11, 2017


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