Citing labor issues in Honduras, the University of Wisconsin at Madison announced Friday that it is ending its licensing agreement with Nike. Madison, like many universities with lucrative licensing deals, has insisted that companies pledge to meet certain standards, especially in production outside the United States, where workers lack the labor protections provided by U.S. law. The specific incident in Honduras involves a Nike subcontractor (for which, under the university's labor standards, Nike is responsible) that failed to pay more than $2 million in required severance payments. The incident has led to calls at Madison and elsewhere for universities to cut ties to Nike, but Madison's action is believed to be the first such move. Biddy Martin, the chancellor at Madison, issued a statement  indicating that the university acted only after trying to get Nike to deal with the problems.
"We do not take this action lightly," Martin said. "In general, it is preferable to remain engaged with our licensees, to be part of the conversation and to be involved in working toward solutions in what can be described historically as a troubled industry. In this case, however, we have reached an impasse and decided it was best, all things considered, to end this business relationship,"
Nike officials did not respond to the announcement.