DAYTONA BEACH, Fla. - Nature's Bakery claims that Stewart-Haas Racing took advantage of a young company with no NASCAR sponsorship experience, and that SHR "did nothing other than collect Nature's Bakery's money" in not living up to its promises to support the sponsorship nor provide significant value as part of the deal that was worth $15 million annually.
The fig bar company filed its response and counterclaims to the lawsuit Friday filed earlier this month by Stewart-Haas Racing in North Carolina Superior Court. SHR seeks $31 million for the final two years of the three-year deal, which Nature's Bakery terminated in January after one season, in part citing that Danica Patrick's endorsement of a protein bar violated the deal.
"SHR could not control Patrick's performance, particularly as to her social media, which Patrick often refused to use to promote Nature's Bakery," the company states in its filing, which it released Saturday morning. "Nor could SHR guarantee exclusivity for Nature's Bakery's brand in category of on-the-go foods because Patrick was already endorsing a protein bar made by one of Nature's Bakery's competitors, Six Star Pro Nutrition. It was as if Michael Jordan decided to wear Adidas while being paid by Nike.
"Other promises also fell by the wayside ... and the brand failed to realize any of the promised return on its investment."
In its original complaint, SHR stated that the protein bar was not a competitor of Nature's Bakery. Nature's Bakery claims that Patrick spent more time and energy promoting other sponsors and side projects, especially on her personal Instagram and Twitter accounts. When it questioned SHR about it, SHR said it had difficulty controlling Patrick's conduct.
"I think that it was a shock to all of us that one year into a three-year deal that there was a problem, but everything that was ever asked of me I did to the very best of my ability," Patrick said Wednesday.
The company is asking for SHR to collect nothing and to be assessed an unspecified amount in damages. It said SHR took advantage of Nature's Bakery leadership, which was new to NASCAR sponsorship and never delivered on its promise to generate "at least four times return" on the company's investment as a primary sponsor for 28 races a year. Patrick is not a party to the lawsuit nor the counterclaim.
"Nature's Bakery has tried for almost half a year to resolve the failed relationship in a productive business-like manner, but it now faces a public lawsuit that never should have been filed," the company said in its filing. "Forced to engage, Nature's Bakery will not be bullied and is intent on prevailing in this case-even as it continues to support NASCAR and wish Ms. Patrick much success on the track in 2017 and beyond."
In a statement, SHR denied the allegations of Nature's Bakery filing.
"It's an unfortunate situation, but we know we've delivered on all aspects of our agreement and more," SHR President Brett Frood said in a statement. "We took great pride in elevating the brand awareness and relevance of its products and were prepared to continue activating pursuant to the agreement in 2017 and beyond. Nature's Bakery chose to breach and terminate the contract. We're confident with our position."
To show Patrick didn't violate the clause, SHR cited Nature's Bakery social media account "liking" those posts. In its response, Nature's Bakery said its company management was unaware of those "likes" and that is not a corporate acknowledgement of content.
Nature's Bakery also challenged SHR's assessment that financial difficulties resulted in adjustments to the timing of payments under the deal.
"SHR is aware that Nature's Bakery's business was healthy throughout 2016 and that the amendments to the agreement were not due to any alleged 'cash crunch,'" the response states.
It also alleges that SHR misrepresented the health of NASCAR.
"SHR also heavily promoted NASCAR's alleged growth in both sponsorship and viewership, particularly in key demographics where Nature's Bakery hoped to expand. ... Nature's Bakery would later learn that these statements about NASCAR's health were untrue, as NASCAR was undergoing retraction - something that SHR well understood," the filing states.
SHR also promised to help with access to major retailers and distribution channels in the Southeast and other areas where NASCAR was popular.
"SHR's promises were illusory and misleading," the filing states. "There was no massive increase in sales. NASCAR viewership was retreating. The team had other significant operational problems."
Nature's Bakery also states that SHR rejected a settlement offer of $3.8 million for 2017 and $1.5 million for 2018, contingent that Nature's Bakery would get the money back if SHR sold sponsorship that would match the original contract. Aspen Dental has increased by at least six races its sponsorship as a result of Nature's Bakery termination, an increase that Nature's Bakery alleges was "at below-market prices."
SHR co-owner Tony Stewart said he had not read the response.
"I'm focused on 100 percent of what we're doing down here this weekend," Stewart said prior to Daytona 500 practice Saturday. "We have a business group that will take care of that side of it."