The biggest company in cheerleading says it built the sport. Cheer parents say it built a monopoly. – Grid News


The biggest company in cheerleading says it built the sport. Cheer parents say it built a monopoly.

FORT WORTH, TEXAS — Backstage at the Fort Worth Convention Center, Jeni Hartman’s daughter practiced hoisting her teammates up — shoulder-height — into elaborate pyramids. At 11 years old, the girls spend four days a week practicing at their Texas cheer gym. They worked hard to get here — and their parents spent a lot of money.

Cheer parents joke that their kids participate in “a five-figure” sport, as the cost of uniforms, travel, gym tuition, cheer camps and competitions adds up quickly. About 4 million kids, mostly girls, cheer competitively in the United States each year. And their parents’ spending on cheerleading overwhelmingly flows to a single company, Varsity Brands, a cheer behemoth bought in 2018 by Bain Capital for a reported $2.5 billion.

“Uniforms alone are $1,200 to $1,500. Then there are jackets,” Hartman said. “And that’s not including the shoes, or the scrunchies.”

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Varsity looms over every aspect of cheerleading. It owns 90 percent of competitions and 80 percent of the apparel business in competitive cheer, according to one complaint filed in court. If families need to travel to a competition run by Varsity, they are often expected to stay at a Varsity-approved hotel, an arrangement that people in the cheerleading world have deemed “stay-to-play.” If parents want a video of their kids competing at a Varsity competition, they can buy access to footage from Varsity. (Parents told Grid they can’t shoot and post their own video — a policy that got national attention in the Netflix documentary “Cheer,” when the series’ film crew was similarly denied entry to a Varsity competition.)

Varsity has gone so far as to testify in court that cheerleading is not, technically, a sport. It’s an argument that has kept cheerleading outside the purview of other governing groups like the NCAA, allowing Varsity to make even more money on programs like summer camps that it otherwise wouldn’t.

Parents are starting to revolt. In three lawsuits filed in federal court, parents and competing cheer business owners allege Varsity is running an illegal monopoly. If courts agree Varsity overcharged parents and squashed competition, the company could lose millions of dollars. It could even be broken up by a judge.

Parents and competitors allege in the lawsuits that Varsity bought up all of its competition, then enticed gym owners into contracts and rebate programs that keep them from buying from the businesses that remain. Varsity controls cheerleading’s regulatory body, the U.S. All Star Federation (USASF), and the two organizations set rules that encourage cheerleaders to buy Varsity goods.

Varsity denies the allegations. The company and its founder, Jeff Webb, have long maintained Varsity has benefited only from having sharp business acumen and a deep understanding of cheer.


“As we have grown, so too has the entire cheer industry’s ability to engage, inspire and fulfill millions of young athletes,” Varsity spokesperson Jackie Kennedy said in a statement. “Varsity Spirit welcomes the kind of competition that enhances the entire cheer marketplace and believes that claims alleging otherwise are baseless and unfounded.” Varsity declined to answer specific questions about the lawsuits and its business practices.

In Washington, D.C., a heated debate is raging over antitrust and big technology companies like Google and Amazon. Advocates argue antitrust is an issue that extends much further: They say a decadeslong resistance to enforcing antitrust laws has led to consolidation across the economy, from chicken farms to hospitals to prison suppliers, or in this case, a teen sport sought out by young athletes who want a moment in the spotlight.

Monopolies often lead to higher prices and worse products. Parents who’ve filed suit say that’s what has happened in cheerleading. Participation costs more over time, as Varsity has shown a willingness to impose more restrictions, like the stay-to-play rules. Parents fear buying from other companies out of concern their children’s teams may be punished.

“Varsity has created a culture where cheer is something that gives young women a goal and prestige,” said Joseph Saveri, an antitrust lawyer representing cheer parents against Varsity.

“But it’s a lot different from signing up for a swim team or a soccer team. Because the soccer and the swimming isn’t owned by a company which charges you money every time you turn around,” he added.

From hair bows to hotels: How Varsity charges for cheer

Stephanie DeRosa, whose daughter graduated from high school last year, started a small business in 2013 making hair bows for her daughter’s cheer team, which included the name of a major Varsity cheer competition held at Disney World, “The Summit,” printed on them. For a bow that Varsity would sell for $40, DeRosa charged between $10 and $30, she said.

Soon, DeRosa racked up 80 cheer teams as clients. But her success was short-lived: Varsity sent her a cease-and-desist letter, telling her the phrase “The Summit” was trademarked and needed to be removed from all of her hair bows, she said.

“I was a dumb little bow company in Washington state,” DeRosa said. “I had to call all my customers and clients and tell them I couldn’t do their bows.”

She tried to accommodate the letter, removing the words “The Summit” and other Varsity-trademarked words, but Varsity continued to contact her, telling her to remove old posts from social media that the company said infringed on their intellectual property.

Exhausted, she eventually shut her company down.


Parents pay for every part of the cheerleading experience — and Varsity profits, directly or indirectly, from their spending. Families with one child in cheer can spend $10,000 to $15,000 a year, parents told Grid. Those with less disposable income fundraise, turn to grandparents or hoard tax return money to help keep their kids in the sport.

Uniforms alone often cost more than $350, even up to $1,200, depending on the embellishments, according to parents. Cheerleaders often take private lessons ($100 and up), attend cheerleading camps ($350 to $1,000 for three nights) and attend 10 or more competitions each year ($800 to $2,500 each including hotels, food and sometimes flights, parents estimated). For Varsity competitions, parents are expected to book at hotels that are Varsity-approved and often not cheap. At the Cheerleading Worlds, a major Varsity competition held at Disney World, the least expensive two-night hotel package available to parents for a two-person room is $765.

Uniforms are just one part of a cheerleader’s outfit: Parents purchase cheer shoes and stiff, shiny, customized hair bows like those DeRosa made. Teams buy practice uniforms, backpacks and makeup palettes — so even 4-year-olds can perform in matching eye shadow and lipstick.

Cheer routines are custom, and costly. Many teams hire professional choreographers from companies like V!ROC, a Varsity brand that charges $4,500 to fly out a professional for a two-day session, according to its website. Songs are also commissioned new for each team and each season in order to avoid copyright concerns from using popular music. According to a complaint filed against Varsity, the company sells licenses to cheer songs, too.

At cheer competitions, parents usually pay $20 a piece for their own admission to the event on top of registration fees for their kids — a practice that elicits eyerolls from parents.


“I’ll never forget my first event. They only took cash,” recalled Lisa D. Welsh, creator of CheerMAD, a popular cheerleading blog. “Here I had paid for, you know, choreography and [my daughter’s] uniform and her practice uniform, her bow, her shoes, her music. And now they want me to pay $20 at the door to view all that stuff I had paid for. That was my first education.”

Welsh estimated that when her daughter first started to cheer in 2002, she spent roughly $3,000 a year. Ten years later, she said, it was standard for cheerleading at her child’s gym to cost $10,000 a year, at least.

During a recent Skype hearing for one of the lawsuits, a lawyer representing Varsity said the company “invented an ecosystem.”

“They set up rules of the game that allowed everyone a fair chance to compete. They set up an infrastructure that created opportunities for new entrepreneurs, for gyms, for people who wanted to put on events,” said the lawyer, George Cary. “As a result of that, the sport took off, and now there are millions of participants every year, whereas before there was nothing.”

The start of a cheerleading giant

Lawrence Herkimer — the godfather of modern cheerleading — patented the pom-pom in 1971, which he sold through his cheer company, the National Cheerleaders Association (NCA). That same year, he hired Webb, an aspiring lawyer and former cheerleader at the University of Oklahoma.


Fresh out of college, Webb saw cheerleaders starting to gravitate toward flashier, more athletic moves. He believed the trend represented the future of cheerleading and tried to convince Herkimer to pivot his approach — but Herkimer didn’t share Webb’s vision. (“Our people are teachers, not show-offs,” Herkimer later told Sports Illustrated. “He hired hot dogs.”)

Within three years, Webb had decided to forgo a career in law and, with $85,000 in capital — and several cheerleading camp instructors who joined him from Herkimer’s NCA — he launched the company that would grow to be Varsity Brands.

“I was a young man who had a vision for transforming a traditional student activity,” Webb said in a statement sent to Grid. “I left a solid, well-paying job and took a risk to pursue my dream.”

Webb’s company started out running camps where instructors taught jumps, pyramids and lifts to cheerleaders during the summer. But as cheerleading became increasingly elaborate, there was another opportunity. Webb started selling uniforms made out of technical fabric, fit to sweat in and durable enough to withstand a demanding cheer routine. In 1980, he took things another step further and launched cheerleading’s first national high school competition in Orlando, Florida.

Cheerleading is a sport dominated by young women. Webb emits traditional masculinity. Stocky and athletic, he loves the movie “Rocky” and has claimed to know every word to “Take it Easy” by the Eagles. He owns a 700-acre duck- and goose-hunting ranch in Brinkley, Arkansas, which he showed off on a video made by Turning Point USA, riding a camouflage ATV around the property.


Webb is also an adept communicator — and during the 1980s and 1990s, he succeeded in selling his new kind of cheerleading to millions of people, namely young girls. Today, there are several forms of cheer, including high school, collegiate and “All Star,” or club, cheerleading. The sport boomed, and Varsity increased its sales and profit 44 of the 45 years Webb founded it, he told Turning Point USA. By the mid-1980s, Varsity cheerleading competitions were being broadcast on ESPN.

Webb’s company had become the biggest brand in cheerleading, alongside Herkimer’s NCA. But for a time, there were also other, smaller competing cheer companies. Eventually, that would all change.

“That’s our Olympics … and Varsity used it as a weapon”

The Gold Rush Fort Worth cheer competition started recently to provide an alternative to Varsity events.

Heidi Weber and David Owens launched Gold Rush last year as part of a new series of competitions — like a league — with the goal of spinning up events that are both cheaper and flashier than Varsity competitions.

Both upbeat former cheerleaders, Weber and Owens have become de facto leaders of a movement to unseat Varsity Brands. Owens previously ran a cheerleading gym in Oklahoma and did regular business with Varsity, including getting discounts on Varsity apparel and rebates when his gym attended a large number of Varsity events, he said.


While unknown to many parents, it’s not uncommon for gyms to receive rebates or discounts from Varsity. In some cases, gym operators sign agreements with Varsity stating they will attend virtually all Varsity events and buy Varsity clothing in exchange for cash back from Varsity at the end of the year, according to one of the complaints filed against the company. For other gyms, Varsity offers discounts to those who promise to attend at least six Varsity cheer competitions a year, with escalating discounts of up to 20 percent when gyms spend more than $150,000 and attend nine or more Varsity competitions.

When Owens shut down his gym in nine years ago, he started to see Varsity differently. He ran cheer competitions as a part-time job and found himself competing directly with the company instead of buying from it. Being Varsity’s competition, it turned out, was tough.

“I was able to step back and say, ‘Hey, no matter how hard I work with my company, no matter how many events I try to produce, I will still be behind,’” Owens said.

Varsity’s agreements with gyms were one challenge facing Owens. Its influence over club cheerleading’s governing body, the USASF, was another. Varsity lent USASF startup funding and, in the past, its address was the same as Varsity’s Tennessee headquarters. After buying the biggest competitors in cheer, Varsity and USASF employees hold the majority of USASF board seats. (USASF declined to comment for this story, saying the company does not comment on “matters under pending or ongoing litigation.”)

USASF runs the biggest end-of-year cheerleading competition at Disney World, the Cheerleading Worlds. But only certain cheer tournament operators were allowed to give out invitations, called “bids,” to the Cheerleading Worlds during their competitions — and overwhelmingly, they were those owned by Varsity. Without the ability to send teams to the Cheerleading Worlds, event producers like Owens would never be able to draw big crowds and elite cheerleading gyms, Owens said.

“That’s our Olympics. These kids all want their opportunity to go and have that shot on that stage to be called a world champion. And Varsity used it as a weapon,” said Owens.

Weber, too, has struggled with Varsity, first while working as a high school cheer coach in Oklahoma and running a cheerleading apparel company. Weber wanted to show wares from her apparel company at the state’s annual coaches conference — but soon found out Varsity had an exclusive relationship with the state cheer association. No outside companies like Weber’s were allowed to display their goods, Weber later said in a sworn affidavit explaining her experiences.

Soon after, in 2014, Weber was on the verge of landing a major deal. Lids Inc. — a major athletic retail company — suggested she sell her clothes through Lids under a private label, which would have brought millions of dollars to Weber’s company in revenue. Test sales were promising, and Weber spent more than a year developing a plan and new designs for the launch — until BSN Sports, a subsidiary of Varsity, purchased Lids.

“All the things we’d done were dead in the water. They were owned by Varsity Spirit, so they were not going to do any kind of private labeling,” Weber said. “It was devastating when we lost that contract. It was devastating.”

In the spring of 2020, a lawyer approached both Owens and Weber, explaining he was putting together an antitrust lawsuit against Varsity. Suing was a “no-brainer” for Owens, he said. Weber — who hadn’t considered if what happened to her could be considered a monopolistic practice — thought it through.

“Was the greater good going to be worth the initial cost, and the pain, and — you know — the fear? There’s a lot of fear in this industry,” Weber said. Eventually, a desire to bring cheerleading back into balance won out. “It took me a good two weeks, and then I knew that I didn’t really have a choice.”

Owens and Weber may be embroiled in a legal battle against Varsity, but at their competition in Fort Worth, signs of Varsity’s dominance in the industry were still everywhere.

Some cheerleaders wore Varsity shoes. Others had jackets, warm-up uniforms and backpacks purchased from Varsity. The competition’s rules were by USASF, the governing body that’s effectively controlled by Varsity. And judges used Varsity’s scoring system to assess the cheer routines, lest the cheer teams have to recalibrate their routines, which are choreographed to maximize scores at Varsity tournaments.

Backstage, even the warm-up clocks were purchased from a Varsity subsidiary. There was nowhere else to get them from, Owens said.

How Varsity consolidated cheerleading

Over the last 20 years, Varsity has acquired dozens of competing businesses, including more than 50 cheer competition circuits and uniform-makers large and small. Sometimes Varsity bought competitors like Just Briefs, an apparel company, then shut the brand down. In 2004, Webb made a notable purchase: Varsity bought NCA, Herkimer’s original company and Webb’s former workplace.

The antitrust lawsuits against Varsity allege the acquisitions effectively squashed competition in the cheerleading market. In his statement, Webb disagreed, saying, “I strongly disagree that Varsity has any type of monopoly power in the Cheer market,” and the company’s purchases “were always strategic in nature.”

“If there was a company that offered a chance to expand our product offering, fill in regions where we had a void, or offered a way for us to provide an enhanced experience to our customers, we of course would consider it,” Webb said. “And by the way, a significant percentage of those companies that were acquired actually initiated contact with us.”

Over time, Varsity became more sophisticated in protecting its business.

Varsity filed suit in 2010 against a rival uniform-maker, Star Athletica, saying the brand had infringed on copyrighted Varsity uniform designs that had specific stripes and chevron patterns on them. According to Varsity, Star Athletica had been founded earlier that year as a sort of revenge: Former Varsity employees had teamed up with embroidery-maker R. J. Liebe to launch the new company after Varsity had canceled business with R. J. Liebe. The case made its way to the Supreme Court in 2017, where the court ruled in favor of Varsity.

There was also a high-profile lawsuit that tackled the question of whether cheerleading was a sport — and in which Varsity, to the surprise of those not in the know, testified that it wasn’t. Quinnipiac University had decided to count its cheer program as a sport for the purposes of Title IX, which regulates gender equity in sports. Members of the university’s recently cut volleyball program sued.

Webb, the new dean of cheerleading, appeared in court as a witness. Asked if he thought past cheerleading events he’d run were “a sports competition,” he replied, simply, “No.” Ultimately, the judge agreed with Webb.

His viewpoint aligned with Varsity’s business interests. In a 2002 SEC filing, the company disclosed that making cheerleading a collegiate sport would likely lead to regulations that hurt Varsity’s summer cheer camps, a main profit center for the company.

If cheerleading were regulated like other NCAA sports, “it is likely that Varsity would be unable to offer a significant number of its camps either because participants would be prohibited from participating during the summer or because suitable sites would not be available,” the filing said.

Asked about the Quinnipiac case, Webb said he felt it had been “widely misinterpreted.” He noted the case focused on Title IX and said that “making traditional cheerleading a Title IX sport would have meant the participants would in all likelihood have had to give up all other game day activities and student leadership roles.”

Competing is “only a small part of what college cheerleaders do and how they spend their time,” Webb said. “Alumni functions, pep rallies, game day appearances and physically leading the crowd at athletic events constitute the majority of their focus.”

Varsity had become a cheerleading juggernaut. Eventually, Wall Street took notice. The company was purchased for an estimated $1.5 billion in 2014 by Boston-based Charlesbank Capital Partners, a private equity firm. In 2018, it was acquired again by Bain Capital — for a reported $2.5 billion.

But cheerleading — now a multibillion-dollar sport with millions of adherents — showed signs of trouble. In September 2020, news broke that “Cheer” star Jerry Harris was being investigated by the federal government for soliciting sex acts from minors. (Later that year, Harris pled not guilty to the charges, and his case is ongoing.) Harris’ indictment set off a wave of similar abuse accusations, many of them chronicled by USA Today.

Even more troubling, the regulators who oversaw cheer gyms — including USASF, the governing body with ties to Varsity — failed to keep track of and ban nearly 180 people who have been involved with cheerleading who have faced past charges of sexual misconduct involving minors, USA Today found. In one case, a person on the sex offender registry started a USASF-member gym in Ohio. Varsity and USASF did not respond to questions on the allegations.

At the end of 2020, Webb stepped down from his longtime position as chairman of Varsity, the company he founded more than 40 years ago.

Publicly, Webb left his role so he could focus his ambitions on making cheerleading an Olympic sport — a move that would help increase cheer’s visibility at a time when Varsity is expanding in foreign countries.

But Webb also has one eye on politics. He released a book, “American Restoration: How to Unshackle the Great Middle Class.” He began pouring money into politics, giving more than $300,000 to campaigns in recent years, $175,000 of which went into a super PAC supporting Tennessee Republican Sen. Marsha Blackburn. He was overwhelmingly the PAC’s largest donor.

Webb also started spending time with Charlie Kirk, the conservative commentator who hosted Webb at his annual Turning Point USA conference and featured Webb in a YouTube video. Webb has appeared on not one but two episodes of Kirk’s podcast.

“The first time we sat down, it’s almost as if we knew each other for a long time,” Kirk said of Webb on his podcast. “We were on the same cadence.”

The complicated road ahead

The lawsuits against Varsity allege that over the last 15 years, one company was able to overwhelmingly consolidate a market. This happened without the government stepping in — a surprising notion, but one that experts on antitrust policy say happens all the time.

“Cheerleading shows we have a pro-monopoly legal framework. We don’t enforce antitrust law,” said Matt Stoller, research director at the American Economic Liberties Project, who has written about cheerleading. “[Varsity’s] ability to monopolize illustrates that the way that we look at the law is the problem.”

It’s difficult to prove a company violated antitrust law. To win the lawsuits against Varsity, lawyers will have to show the company acquired other cheerleading companies in a way that stomped out competition and that parents were harmed by those mergers, for example. These private lawsuits are hard to win, and they often settle out of court for money — leaving the monopoly intact.

“Antitrust suits are very hard to prove,” said Herbert Hovenkamp, a law professor at the University of Pennsylvania. “You have to show not only that the merger is unlawful, but that the injury is a result of the merger. For example, if an injury resulted in higher prices, and you’re suing four years after the merger occurred, frequently a million other things could have also explained why those prices went up. It’s a difficult thing to sort out.”

The Federal Trade Commission or the Department of Justice could take Varsity to court, alleging it violated antitrust law. But government regulators have filed fewer and fewer cases against alleged monopolists over the last four decades.

During the 1980s, many antitrust lawyers and economists adopted a free-market belief that unfair markets will eventually correct themselves. The Department of Justice brought fewer and fewer lawsuits over time, a trend that has just started to reverse in the last few years. Even so, antitrust lawsuits are expensive and hard to win, so the federal government’s capacity to pursue cases is severely limited.

As concerns about Big Tech’s power have mounted, politicians from both parties started to ask if we need a new approach. Several lawmakers are pushing bills that would give more money to regulators or limit “predatory pricing,” where a company sells items for less than what they’re worth in order to drive competitors out of business.

In the cases against Varsity, there have been small signs that the presiding judge, Obama appointee Sheryl H. Lipman, is at least open to the plaintiff’s case. She denied motions to dismiss one of the lawsuits and has allowed the cases to enter a discovery phase together where they will take depositions from dozens, if not hundreds, of people in the cheer industry.

Owens and Weber are now battling Varsity on three fronts. Just a couple weeks after they drew big crowds to their Fort Worth cheer competition, they got word that they were being sued by USASF.

The complaint says their new cheer league — whose largest tournament, held at a convention center in Orlando, is called the “Allstar World Championship” — infringes on a USASF trademark for “The Cheerleading Worlds,” the major invitation-only cheer competition at Disney World. (It was Varsity who originally trademarked the phrase “The Cheerleading Worlds” in 2005, an exhibit filed in court shows, but it transferred the trademark to USASF in July of last year, five months before USASF filed suit.)

In the lawsuit, USASF asks that Owens and Weber’s company stop using the phrase “The Cheerleading Worlds” or the word “Worlds” at all.

For Owens, who heard about the lawsuit just days before Christmas, the news was unexpected but not shocking. In a text message, he said, “Monopolists are always going to try and stop competition.”

Jason Paladino contributed to this report.


This story has been corrected to accurately reflect the year DeRosa started her business.

  • Maggie Severns
    Maggie Severns

    Domestic Policy Reporter

    Maggie Severns is a policy reporter for Grid covering complex policy stories and major headlines.