Kentucky loses as much as $1.5M in royalties due to defeat

ByDARREN ROVELL
April 5, 2015, 4:02 PM

— -- Kentucky's loss at the hands of Wisconsin on Saturday night not only shattered the undefeated dream of the school's players and fans, but also had financial ramifications for those who had prepared to merchandise the feat being accomplished for the first time in 39 years.

Industry insiders estimate that losing out on a title, and an undefeated season, will cost the University of Kentucky as much as $1.5 million in royalty fees and retailers as much as $15 million Wildcats championship gear they now won't sell.

Matt Hoetker, whose Lexington-based Wildcat Wearhouse has been in business since 1995, had so much on the line that he -- as he is accustom to do -- went on a walk to avoid having to sweat through every moment of the game. When he walked in his house through the garage, his wife Kirby met him inside the door. He knew right away.

"I was just stunned," said Hoetker, who would have given the University Kentucky more than $1 million in royalties for sales this season had the Wildcats had won. "Every time I get upset, I have to think about what this great season did for us."

Hoetker said he sold more Wildcats product at his 18 stores in March and the first week of April than he sold for the entire 2011-12 season, when the team last won it all.

"We would have produced 115,000 T-shirts over the next month," said Hoetker, who is now going on a vacation with his family, something he couldn't have done if Kentucky won it all.

Glenn Campbell checked out of his Indianapolis hotel at 6 a.m. on Sunday morning. He had two nights left on his stay, which he paid for, but he couldn't stand to stay for the title game, so he drove 5 hours back to his home in Missouri.

"When you don't have a dog in the fight, you root for business," said Campbell, the founder of LIDS, which has 1,400 stores and sells more college hats than any company in the country. "The other three teams' title gear combined wouldn't hold a candle to what Kentucky would have generated. This would have had legs for the next 12 months. Actually, judging from Indiana, it might have lasted 50 years."

Also in the crowd on Saturday night was Joe Bozich, whose company Knights Apparel produces the most college gear at retail than any other company, including Nike.

"This would have been our single biggest basketball title in terms of amount of product we would have made and sold," Bozich said. "Including college football titles, it likely would have made it into the top seven highest-grossing title runs."

Bozich said that Kentucky sales are usually regional but that the idea of going undefeated had key accounts taking more product than they normally do.

Derek Eiler, managing partner of Fermata Partners, the University of Kentucky's consumer products licensing agency, said that more than 60 licensees had already committed to making title gear.

"The potential Kentucky National Champions licensing program was certainly shaping up to be the largest licensing programs in college basketball history," Eiler said. "It was a historic run that still had many positive benefits for the UK licensing program."

Losing might have solved one problem. The school isn't going to have to battle Louisville lawyer David Son, who trademarked 40-0 and was selling shirts in Kentucky colors. Last week, the school sent Son a cease-and-desist letter. Son's lawyer said the school had no legal claim to the mark, which now has essentially been rendered useless.

Hoetker of Wildcat Wearhouse eventually will go back to his office to the bulletin boards that show the shirt designs with "D9nasty," "Won & Done" and "40-0" and it will be hard for him to forget what could have been. But he has one thing going for him.

Joked Hoetker: "I hear they'll be pretty good next year too."