Mercedes and Diageo Join Long List of Sponsors Bailing on L.A. Clippers

State Farm, Virgin, Red Bull, Kia and Others Suspend Marketing Activities

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State Farm is taking a break from the Clippers, but not from its deal with Clippers star Chris Paul
State Farm is taking a break from the Clippers, but not from its deal with Clippers star Chris Paul

Updated: 7:40 p.m.

Corporate sponsors dropped the Los Angeles Clippers left and right Monday to protest the allegedly racist comments by billionaire owner Donald Sterling. The worst blow: Mercedes-Benz USA told Advertising Age it's ending its sponsorship of the NBA club.

Declaring Mr. Sterling's comments "deplorable," the luxury marketer's Southern California dealer group "has moved to cease its sponsorship of the Clippers effective immediately," said Mercedes representative Diedra Wylie.

With dealerships across Beverly Hills and other swanky Southern California locales, Mercedes is one of the Clippers' biggest, most high-profile sponsors. Given Mr. Sterling's alleged disdain for lower and middle-class fans, Mercedes is probably the kind of sponsor the billionaire owner covets.

Outside of banner ads, Mercedes is one of the few sponsors that gets its own digital link on the Clippers web site. The section promotes the "Preferred Valet Experience," including court-side club passes, valet parking and free goodies, offered to Mercedes owners at Clippers home games at the Staples Center.

Diageo, the liquor company whose brands include Johnny Walker and Smirnoff, also said Monday evening that it was putting its deal with the team on hold until events play out further. "In light of the recent comments by LA Clippers owner, Donald Sterling, we have requested that the Clippers organization suspend our sponsorship pending further mitigation efforts by the league," the company said in a statement. "Our decision in no way reflects our continued support of the players, the team, the NBA, or its fans."

The Commerce Hotel and Casino in Los Angeles made a similar call Monday evening.

That brought the number of sponsors dumping the Clippers, or at least suspending support, to 11.

One of the NBA team's biggest sponsors -- State Farm Insurance -- said it's "taking a pause" in its relationship with the Clippers due to the "offensive" remarks attributed to Mr. Sterling.

"While those involved sort out the facts, we will be taking a pause in our relationship with the organization," said State Farm representative Holly Anderson in a statement. "We are monitoring the situation and we'll continually assess our options."

However, State Farm is not pulling its "Born to Assist" ad campaign featuring the Clippers superstar point guard Chris Paul. "We have a great relationship with Chris," Ms. Anderson said. Translation created the campaign.

CarMax was the first Clippers sponsor to jump ship on Monday. The company told ESPN it finds the alleged statements about black players and celebrities attributed to Mr. Sterling to be "completely unacceptable." The company had been one of the club's longest-serving and most loyal corporate partners, sponsoring the Clippers for nine seasons.

Virgin America also dropped its sponsorship of the team. "While we continue to support the fans and the players, Virgin America has made the decision to end its sponsorship of the L.A. Clippers," the company said in a statement.

Red Bull is taking a limited time out from the Clippers as well. "We trust and respect the NBA's process to formally investigate the matter, and in the interim, are suspending all team-related marketing activities," said a spokesman in a statement. "We will continue to support our Red Bull athlete, Blake Griffin, his teammates and coaching staff in their pursuit of an NBA title."

Another big blow to the Clippers Monday came when Kia Motors America announced it was suspending its sponsorship of the club over the "offensive and reprehensible" comments allegedly made by Mr. Sterling.

Kia is not just some local SoCal sponsor. Kia serves as the official automotive partner of the NBA. It also sponsors TNT's "Inside the NBA with Charles Barkley."

"As fans of the game of basketball, our support of the players and the sport is unwavering," said Kia spokesman Scott McKee in a statement.

Other sponsors suspending marketing activity around the team include Sprint, Corona and AquaHydrate.

Seth Burton, a spokesman for the Clippers, said he wasn't aware of any changes with the club's marketing partners. He declined to comment further.

Racist remarks or attitudes are the one thing that's sure to make corporate sponsors on Madison Avenue head for the hills, said Mike "The Reputation Doctor" Paul.

That's why it's not surprising why sponsors reacted so quickly Monday morning to a story that only broke this weekend. Said Mr. Paul: "There's a zero tolerance for it. You cannot be associated with anything racist in this country."

The NBA and the Clippers are both investigating Mr. Sterling. The league plans to hold a press conference Tuesday, according to spokesman Mike Bass.

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