Armstrong's Brand, Charity Ties Run Deep

Months after disgraced cycling champion Lance Armstrong severed ties with the Livestrong Foundation, the cancer charity he created in 1997, to protect it from the ongoing controversy surrounding United States Anti-Doping Agency allegations against him, questions are being raised about the degree to which the charity and Armstrong's business interests were intertwined, the New York Times reports.

According to the Times, Armstrong's global celebrity status enhanced both Livestrong's brand recognition and his own marketability, but not without sometimes blurring the line between the two. In 2008, for example, Demand Media hired Armstrong as a spokesperson and reached an agreement with the foundation to launch a commercial Web site backed by advertisers under the Livestrong brand. As a result of a deal, the foundation ended up with 184,000 shares of Demand Media, while Armstrong received 156,000 shares valued at some $2 million, which he donated to the foundation when the company went public.

Indeed, while lawyers reviewed the foundation's business deals to make sure they were aligned with the foundation's mission and complied with federal tax regulations, a number of former Livestrong employees said they were uncomfortable with some of the partnerships. "There was a conflict. I felt there was," former Livestrong development officer Doug Kingsriter told the Times. "And of course we run into this with nonprofits. Personal interests, personal agendas, should not be greater than the interest of the mission of the organization."

The scrutiny of Armstrong's business interests comes just days before an interview is scheduled to air on the Oprah Winfrey Network in which the the seven-time Tour de France winner is expected to admit that he used performance-enhancing drugs during his reign as the dominant cyclist in the world. The Winfrey interview is seen by many as an attempt by Armstrong to salvage his career and the reputation of his charity, which has cut its budget some 11 percent for 2013 but expects many of its donors to stick with it despite the controversy.

In a statement posted online, the Livestrong Foundation said it is "in a very strong position" to continue its work in the years ahead. "Our plans for 2013 are robust, focused on strengthening current programs, expanding support services where survivors report to us that gaps remain, and reaching more people, particularly in low-income and minority communities. We are continuing to bring in donors to make these expansions possible."

In the statement, the charity also took issue with the Times article and what it described as insinuations based on one person's feelings about its business ties to Armstrong and others. With respect to its partnerships, the charity argued that its "purpose with all agreements...is singular and simple: help ensure the long-term financial health of our organization so we can continue fighting to improve the lives of people affected by cancer. We recognize that all successful partnerships benefit both sides, but our duty and focus in entering into them is only to our own mission and to those we serve, no one else."

Stephanie Saul. "Armstrong's Business Brand, Bound Tight With His Charity." New York Times 01/13/2013. "Statement From the LIVESTRONG Foundation." Livestrong Press Release 01/14/2013.