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Former USC and Heisman Trophy-winning running back Reggie Bush and his family are being sued by the co-founder of a failed sports marketing agency, according to a filing Tuesday in San Diego County Court.
The lawsuit, filed by attorneys for New Era Sports & Entertainment co-founder Lloyd Lake, alleges Bush and his family failed to repay a wide array of benefits they received from New Era while Bush played for the Trojans. One of Lake's attorney's, Paul Wong, said that in addition to filing the suit, Lake has agreed to meet with NCAA investigators to discuss Bush's involvement with New Era Sports. That meeting is now expected Monday or Tuesday.
"I believe the complaint speaks for itself," Wong said. "… We're looking forward to meeting with the NCAA. Beyond that, I'm not at liberty to discuss any details."
Bush's attorney, David Cornwell, did not return a phone message seeking comment.
Tuesday's filing purports that from November 2004 through January 2006, Bush and his family received cash, a vehicle and shelter as well as labor, material and services tied to New Era Sports – the agency that expected to represent the USC star when he declared for the NFL draft. The suit places the total value of the benefits extended to Bush, now in his second season with the New Orleans Saints, and his family at just over $291,000.
The suit also claims to have written communication from Bush that promises to repay some of the benefits, stating "On January 14, 2006, Defendant Reginald Bush – reaffirmed his commitment to repay (Lake) in a written communication."
If it is determined by the NCAA and Pac-10 Conference that Bush or his family received extra benefits, he would be in violation of NCAA rules. In accordance to NCAA bylaws, Bush's amateur status could be retroactively voided, prompting USC to forfeit games from the 2004 and 2005 seasons, including its latest national championship. Bush's 2005 Heisman Trophy could also be in jeopardy. Per the language on the Heisman ballot, any winner of the award "must be in compliance with the bylaws defining an NCAA student-athlete."
USC director of sports information Tim Tessalone declined to comment and referred questions to university general counsel Todd Dickey.
Among the other significant points in Tuesday's filing:
• The suit seeks to recoup benefits doled out "between November, 2004, through January, 2006, for work, labor, services, materials, goods, a vehicle, and shelter rendered at the special instance and request of Bush and his family." It also seeks to recover an unspecified amount of cash given to Bush and his family during that same period.
• The suit also alleges that Bush's family "expressly stated, in a meeting with (Lake) and NEW ERA SPORTS in October, 2004, and again in November, 2004, that they had fallen on hard times financially and required immediate and significant financial assistance to support their respective lifestyles, including, but not limited to, payment of living and travel expenses of Defendants LaMar Griffin and Denise Griffin (Bush's parents) as well as living and lifestyle expenses of Defendant Reginald Bush. At said meetings, Defendants expressly and unequivocally, stated and promised that they were borrowing from (Lake) and NEW ERA SPORTS only and that they would not borrow money or accept monies from any other person or entity without expressly notifying (Lake) in advance."
• The suit charges a breach of agreement due to Bush's family receiving benefits from a third party, stating that Bush's family "secretly received payments, in direct violation of Defendants' promises to (Lake) and New Era Sports, from at least one person sometime around late October, 2005. In particular, said person paid for the airfare sometime around October 26, 2005, and hotel expenses of Defendants LaMar Griffin and Denise Griffin along with (Bush's younger brother) when they traveled to Oakland from San Diego between November 11 to November 13. Defendants suppressed and concealed all knowledge and information of said payments from (Lake) and New Era Sports as such information and knowledge would immediately end any further cash advances."
Yahoo! Sports first reported in September 2006 that the airfare and limousine service for Bush's parents and younger brother for USC's game against Cal on Nov. 12, 2005 were paid for on the credit card of Jamie Fritz, an employee of Bush's current marketing agent, Mike Ornstein. Ornstein initially told Yahoo! Sports that he did not pay for the plane tickets. Ornstein then said Fritz might have paid for the tickets but was repaid by the Bush family. Fritz declined to comment when contacted by Yahoo! Sports.
In Friday's scheduled meeting with the NCAA, Lake could reveal a variety of information, from receipts, bank and phone records, as well as taped conversations between himself, Bush and Bush's stepfather LaMar. Sources say the recordings were made as Bush's agreement to sign with New Era Sports began to fall apart in December 2005.
Lake co-founded New Era Sports along with San Diego businessman Michael Michaels in late 2004. Bush was expected to sign with New Era Sports and become an eventual partner in the entity when he left USC, according to Lake and Michaels. But the deal fell apart and New Era Sports failed, leading both Lake and Michaels to seek a return of the benefits they say they had provided to Bush and his family. Sources have told Yahoo! Sports that Michaels has already received a settlement from Bush for between $200,000 and $300,000 for his part of the failed deal. Sources also informed Yahoo! Sports that a similar settlement attempt with Lake failed over the summer.
Although Lake's suit does not break down specific dollar amounts paid to Bush and his family, an eight-month investigation by Yahoo! Sports published in September 2006 showed Bush's family lived in a house purchased by Michaels. The family lived in the new $757,000 home rent free for a year, starting in April 2005. One of Lake's attorneys, Brian Watkins, eventually stated that the rent on the home came to more than $50,000. The family was eventually evicted from the residence.
The 2006 Yahoo! Sports report disclosed that Bush received more than $12,000 in cash from Lake for the purchase of a 1996 Impala SS. Bush received approximately another $4,000 from Lake to equip the car with high-performance rims, a stereo system and alarm.
In addition, Yahoo! Sports reported that Bush and his family also received multiple cash payments for travel and other expenses, including furniture for the home Michaels purchased.
Sources close to the failed New Era Sports & Entertainment venture said Bush and his family demanded payments be made in cash, to keep the transactions hidden from NCAA scrutiny. Payments were said to have been made in person to Bush's parents in San Diego, while Lake would personally drive to Los Angeles to deliver monthly payments to Bush at his apartment near the USC campus.
Jason Cole and Charles Robinson are national NFL writers for Yahoo! Sports.