Lance Armstrong Loses $10 Million Lawsuit

Ordered to pay sports insurance company SCA Promotions

Feb 16, 2015
Outside Magazine

Armstrong racing in the 2002 Tour de France.    Hase/Wikimedia

Lance Armstrong and Tailwind Sports Corporation, his team’s former management company, must pay $10 million to prize-insurer company SCA Promotions for lying under oath, an arbitration panel ruled Monday

The dispute with SCA Promotions began over a decade ago when the company refused to pay Armstrong a $5 million bonus for his 2004 Tour de France win, The Wall Street Journal reports. Tailwind Sports had taken out an insurance policy with the company to provide Armstrong a payout for the 2004 Tour. (SCA Promotions had awarded a total of $4.5 million for his 2001, 2002, and 2003 wins.) But in 2005, SCA Promotions sued Armstrong and Tailwind Sports arguing that his wins were not clean. Armstrong fought the lawsuit, claiming he raced without the aid of performance-enhancing drugs, and was awarded an additional $2.5 million on top of the $5 million bonus, raising his total payout from the company to $12 million.

SCA Promotions launched another suit in 2013 following Armstrong’s come-clean Oprah performance. In a statement to Outside, Armstrong wrote that he "offered to pay SCA the entire $10 million in order to resolve the matter, but SCA refused."

On Monday, a Texas arbitration panel ruled against Armstrong and former U.S. Postal Service team owners Tailwind Sports in a 2-1 decision. 

"Perjury must never be profitable," the majority wrote. "Tailwind Sports Corp. and Lance Armstrong have justly earned wide public condemnation. That is an inadequate deterrent. Deception demands real, meaningful sanctions."

In a court filing, Armstrong said he will refuse to pay the $10 million, according to USA Today. For SCA Promotions to collect the payment, it needs a court to turn the panel’s decision into a final judgment.

In a statement to Outside, Armstrong wrote that he "offered to pay SCA the entire $10 million in order to resolve the matter, but SCA refused." He also called the judgment "unprecedented," noting that "no Court or arbitrator has ever reopened a matter which was fully and finally settled voluntarily.*

Armstrong is facing other legal troubles. In April 2013, the government joined a whistleblower suit initiated by his former teammate Floyd Landis and is seeking to recover triple damages on the $40 million that the Postal Service spent on Armstrong’s team as a sponsor between 1998 and 2004.

*This post was updated to include portions of a statement from Lance Armstrong.

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