Longtime CVS Health executive David Joyner has replaced Karen Lynch as CEO, as the company struggles to drive higher profits and stock performance, CVS announced Friday.

The move, effective Thursday, the day before the announcement, comes as CVS shares have fallen nearly 20% this year. Shares plunged about 11% in premarket trading Friday.

CVS has faced challenges as higher medical costs weigh on its insurance unit, Aetna, and consumer spending drops at its retail pharmacies. In August, the company slashed its full-year profit guidance and said it would cut $2 billion in costs over the next several years.

In its release Friday, CVS also said it expects adjusted earnings of between $1.05 and $1.10 per share in its third quarter. It anticipates higher medical costs than previously expected, with a so-called medical benefit ratio of 95.2% in the quarter.

“In light of continued elevated medical cost pressures in the Health Care Benefits segment, investors should no longer rely on the Company’s previous guidance provided on its second quarter 2024 earnings call on August 7, 2024,” CVS said in the release.

The company is set to report third-quarter earnings on Nov. 6.

Last month, major CVS shareholder Glenview Capital began a significant push for changes at the company, CNBC previously reported.

CNBC reported last month that CVS’ board had engaged strategic advisors to weigh its options, including the potential of a breakup of its insurance and retail businesses.

Joyner most recently oversaw the company’s pharmacy services business as president of CVS Caremark, a similar position to the one Lynch held before she assumed the top job in February 2021. He began his career at Aetna in pharmacy benefit services and previously held the role of executive vice president of sales and marketing at CVS Health.

“We believe David and his deep understanding of our integrated business can help us more directly address the challenges our industry faces, more rapidly advance the operational improvements our company requires, and fully realize the value we can uniquely create,” Chairman Roger Farah said in a statement.

Lynch also stepped down from the company’s board of directors this week, the company said Friday. Joyner will take a seat on the board, and Farah will assume the role of executive chairman.

This is breaking news. Please refresh for updates.

CVS Health on Friday named company veteran David Joyner as new CEO, succeeding Karen Lynch who stepped down from the helm of the struggling healthcare giant after an agreement with the board.

Shares of the company tumbled 11% to $57 in premarket trading.

Joyner, president of the company’s pharmacy benefit manager CVS Caremark, takes over as president and CEO from Friday, the company said.

The change comes on the back of repeated profit forecast cuts this year as the company’s insurance segment has struggled with rising medical costs.

“The board believes this is the right time to make a change, and we are confident that David is the right person to lead our company,” said Chairman Roger Farah.

The healthcare giant is also exiting its core infusion services business and plans to either close or sell 29 related regional pharmacies in the coming months, Reuters reported earlier this week.

The Wall Street Journal had first reported the news of Joyner’s appointment on Friday.

Hurricane Milton’s damage to Tropicana Field in Tampa, Florida, was so devastating it likely means the Tampa Bay Rays will be looking for another place to play ball for opening day next spring.

Like many baseball stadiums around the country, Tropicana Field’s geographic location makes it vulnerable to hurricane winds or tornado-force winds, hail, storm surge and flooding.

The Baltimore Orioles, Los Angeles Dodgers, New York Mets, Miami Marlins, Pittsburgh Pirates, San Diego Padres and others play on or near the water and could see insurance premiums rise and repair costs soar as weather-related losses hit.

But it’s not just baseball stadiums at risk. NFL stadiums could experience $11 billion in climate-related losses by 2050, according to a new report released by the climate risk analysis company, Climate X.

As football stadiums are increasingly being used for concert venues, storm shelters and community events, the impact could be severe for the economy.

Climate X said it’s a wake-up call for state and local governments.

“The problem with climate change is non-linear and non-stationary. If you had a problem there yesterday, that doesn’t mean that it’s going to be there tomorrow,” said Kamil Kluza, co-founder of Climate X. “Places that have been unimpacted will become impacted, because the climate will change and move around.”

The risks from changing weather patterns go far beyond hurricane winds and flooding.

Dangerous heat is a problem for the Arizona Diamondbacks playing in Phoenix. The team has a lease until 2027 at Chase Field and is responsible for upkeep and repairs. But the facility is struggling to keep fans cool, much less players, in a city where the temperatures this summer broke even Phoenix’s own scorching records.

Up north, a massive snowstorm in 2010 collapsed the roof of the Minnesota Vikings’ Metrodome.

Some of the most harrowing images of stadium damage are still from 2005, of a SuperDome surrounded by floodwaters in New Orleans, housing Katrina victims trying to take cover from the storm.

The Climate X report ranks the vulnerability of the 30 NFL stadiums when it comes to climate hazards such as flooding, wildfires and storm surge. It’s calculated by comparing the projected damage costs to the stadium’s current replacement value.

MetLife Stadium in East Rutherford, New Jersey, home of the New York Giants and the New York Jets, is projected to incur the biggest losses. Climate X projects a total percentage loss of 184%, with cumulative damages exceeding $5.6 billion by 2050 due to the stadium’s low elevation in the marshy Meadowlands and exposure to flooding and storm surge.

The new state-of-the-art $5 billion Sofi Stadium, home to the Los Angeles Chargers and Los Angeles Rams, and State Farm Stadium in Arizona, where the Arizona Cardinals play, are the next-most vulnerable stadiums to climate risk.

Climate X said Lumen Field in Seattle, home to the Seattle Seahawks, and Lambeau Field in Green Bay, Wisconsin, home to the Green Bay Packers, are projected to have a much lower relative loss rates. Their non-coastal locations and limited exposure to extreme heat events could benefit them.

Some teams are trying to tackle the climate change problem head on. For example, Allegiant Stadium in Las Vegas ran the Super Bowl completely off renewable energy.

Mercedes Benz stadium in Atlanta, home to the Atlanta Falcons, said its energy-efficient design reduces electricity usage by 29%.

“The bottom line is that climate change is happening, whether we like it or not, and I think the instead of fighting climate change with just sustainability and reducing CO2, we need to start acting to put adaptation measures in place,” Kluza said.

As for Tropicana Field, there are questions about whether it should be repaired at all, as it’s slated for demolition anyway to make way for a new $1.3 billion ballpark for the Rays to play in time for the 2028 season.

Ulta Beauty shares slumped on Wednesday morning, as the company said it sees “headwinds” and tougher competition in the beauty industry.

As it hosted its investor day near its Chicago headquarters on Wednesday, the specialty retailer stuck by its forecast for this fiscal year. Ulta said it anticipates net sales will range from $11 billion to $11.2 billion and comparable sales will range from a decline of 2% to roughly flat. It said earnings per share will range from $22.60 to $23.50.

For 2026 and beyond, Ulta said its financial targets will be 4% to 6% net sales growth and low double-digit diluted earnings per share growth. It said it expects mid single-digit operating profit growth and operating margins around 12% of net sales.

Yet it did not provide specific outlook for the 2025 fiscal year. The updates come after the company missed Wall Street’s earnings expectations and cut its full-year 2024 forecast in August.

In his opening remarks at the investor day, CEO Dave Kimbell said this year “has been more challenging than planned.” Kimbell said the beauty category has normalized to more modest historic growth levels, the consumer backdrop is more volatile and more competition has emerged, especially in the prestige category.

He said the company is taking action to boost its sales by striking partnerships with new brands, expanding its loyalty program and personalizing promotions to engage customers.

“While we anticipate that some of these headwinds will persist in the near term, we are confident in our ability to on our plans and set ourselves up for long term growth,” he said.

The investor day will include presentations on Ulta’s strategy and a question-and-answer session with investors.

This story is developing. Please check back for updates.

New Lebanon, Ohio, population 3,756, has three dollar stores, a Groceryland grocery store, a few fast-food restaurants, a public library branch, and a spirit-filled school system. What it doesn’t have is a pharmacy.

As part of Rite Aid’s bankruptcy filing in October 2023, the chain announced it was closing 800 stores, with Ohio especially hard hit, at 180 closings slated largely in struggling small towns or Rust Belt cities. According to Rite Aid’s website, the chain currently has 1,700 locations, down from the 2,111 reported at the time of bankruptcy. The company has stated it will emerge from bankruptcy with about 1,300 stores.

New Lebanon’s Rite Aid closed in September.

“My community needs a pharmacist. It is concerning to me that the residents don’t have one here,” said New Lebanon Mayor David Nickerson.

Some smaller towns near New Lebanon have their own pharmacies, but even those are a 15-minute drive away. New Lebanon’s Rite Aid prescriptions were transferred to a Walgreens 30 minutes away in Dayton.

Nickerson, who was just elected last year and has a military background, recently found himself walking the Walgreens parking lot in Dayton. He even strolled around the back of the building at night, doing a thorough inspection to tell his constituents he had done his due diligence and made sure it was a safe place to go. But even coming away convinced that Walgreens was safe and clean won’t be enough for some of New Lebanon’s residents.

“We have many elderly residents who are uncomfortable going that far with the traffic and unknown area,” Nickerson said.

Getting a prescription filled in New Lebanon, which sits on a busy thoroughfare leading to Dayton, wasn’t always so difficult.

“Before we moved to New Lebanon two years ago, there were three pharmacies,” said Joyce Dingman. “Last year New Lebanon’s CVS closed, and now Rite Aid is closing, leaving us with none.” 

She and her husband will head to a town 30 minutes away to get prescriptions filled at a Kroger pharmacy.

 A spokesman for Rite Aid confirmed the outsized impact the closings are having on Ohio.

“Nearly all our stores in Ohio will be closing by the end of September as part of our recent Chapter 11 process to create a stronger, healthier company,” the spokesman said, adding that there would only be four Rite Aids remaining in Ohio. There were over 140 before the latest round of closures.

New Lebanon, though, is hardly alone in its struggle to hold on to a pharmacy.  Experts say the retail pharmacy model has been squeezed by complicated and sometimes lower reimbursement rates for medication while competition for sales of candy and paper towels, items that used to pad profits, has grown more fierce.   

The pharmacy squeeze

At a time when the federal government is suing the primary drug market’s middlemen, the pharmacy benefit managers — with the Federal Trade Commission alleging inflated prices on drugs like insulin — some are pointing the finger at the PBMs for the pharmacy deserts.

Miranda Rochol, senior vice president of provider solutions at healthcare technology company Prescryptive Health — who worked her way up in the business, starting as a pharmacy technician before moving to Walgreens health technology team — says the PBMs are largely to blame for the current problems in the industry. “PBMs can steer patients into their own pharmacies, drive profit to their pharmacies, and under-pay community pharmacies,” she said.

In June, the FTC issued a scathing report about PBMs and the “squeezing” of Main Street pharmacies caused by decades of mergers and acquisitions. According to the FTC, the three largest PBMs control nearly 80% of all prescriptions filled in the United States, negotiating the terms and conditions for access to prescription drugs for hundreds of millions of Americans. The report blames falling reimbursement rates from PBMs for many of the financial troubles of smaller pharmacies.

“As long as the big three PBMs go unchecked, more pharmacy deserts will appear,” Rochol said.

The three largest PBMs are CVS‘s Caremark, OptumRX (part of UnitedHealth), and Express Scripts, owned by Cigna.

A spokesperson for Express Scripts pointed to its lawsuit filed against the FTC in response to the report, calling it unfair, biased, erroneous, and defamatory, and claims the report ” wrongly concluded that PBMs inflate drug costs and harm independent pharmacies.”

Tim Wentworth, Walgreens Boots Alliance CEO — who was CEO of Express Scripts from 2016–2021 — addressed PBMs in Walgreens’ third quarter earnings call, saying the company was “in active discussions with our PBM and payer partners to align incentives and ensure we are paid fairly.”

Walgreens has announced that it may close as many as 25 percent of its 8,200 stores, which will further squeeze communities that lack pharmacies. A spokesman for Walgreens pointed out that while they may be large in size, they are still “independent” — unaffiliated with a PBM — so they face many of the same price pressures as smaller stores.

CVS has also closed stores, and for its part, a CVS Caremark spokesman disputes claims that it is economically squeezing smaller pharmacies, citing Georgia as an example. Between 2023 and 2024, independent pharmacies in the CVS Caremark pharmacy network were reimbursed 67.5% higher on average than CVS Pharmacy locations, and 51.9% higher than other chain pharmacies in the state. 

“Local, independently owned pharmacies serve as vital partners in CVS Caremark pharmacy networks, representing more than 40% percent of our in-network pharmacies,” the spokesman said. “CVS Caremark reimburses independent pharmacies substantially more, in aggregate, than chain pharmacies.”

The CVS spokesman also said that CVS pharmacies are not all serviced by Caremark, working with over 70 different PBMs. None of CVS’s closings, the spokesman said, were related to PBM issues, but due to changes in consumer buying patterns and population shifts.

“Claiming that PBMs are under-reimbursing independent pharmacies is not based on the fact. Research in fact shows that PBMs are reimbursing independent pharmacies at higher amounts than chain pharmacies,” said Greg Lopes, spokesman for the Pharmaceutical Care Management Association, the national trade group representing PBMs. “There are unfortunately many factors for pharmacy closures in rural areas, including population declines and the growing use of online pharmacies.”

Data from the National Community Pharmacists Association illustrates the concern over PBM pricing.

Almost all pharmacies (99%) have experienced a reduction in the reimbursed dollar amount of prescribed medications at the point of sale. More than half say that insurance plans and their PBMs are reimbursing pharmacies less than the cost to purchase the drug for at least three of every 10 prescriptions they fill.

The National Association of Chain Drug Stores is pressing for PBM reform legislation. “The U.S. Congress has done the hard work to get bipartisan pharmacy benefit manager (PBM) reform ready to go, and that is ‘must-pass legislation’ before the 118th Congress adjourns,” said Steven C. Anderson, president and CEO of NACDS.

CVS pulled out of NACDS in 2022 amid the trade association’s support of PBM reform.

The vital role of the local pharmacist in Amazon era

According to experts, PBMs, are just one of many reasons retail pharmacies are struggling.

With the neighborhood pharmacy’s demise, patients have to get more creative in getting their medicines. Dr. Colin Banas, chief medical officer of health-care solutions company DrFirst, says there are various other ways for patients to get medicine if their neighborhood pharmacy closes.

“For urgent medications, if patients cannot drive to an available pharmacy, they may explore prescription pickup and delivery services offered by ride-share services such as Uber and Lyft,” Banas said.

He added that it’s also worth checking with local hospitals to see if they have in-house pharmacies that can dispense prescriptions. “Even some doctors’ offices and urgent care centers stock certain medications, so it’s worth making a few calls,” Banas said. 

But Banas believes the pharmacy deserts will only grow, and lead to an increase the number of apps and digitization.

“As pharmacy deserts become more common, patients should keep an eye on new apps and digital tools that will increasingly begin to fill some of the gaps,” Banas said.

This week, Amazon announced that its same-day prescription delivery would expand to roughly half the U.S. next year.

Patient advocates say that technology can’t replace humanity.

All the focus on PBMs, reimbursements, and profits misses the human aspects of the profession, says Dr. Tamera Hughes, an assistant professor at High Point University’s School of Pharmacy who spent several years working at a community pharmacy in Georgia during the last decade before entering academia.

Hughes says PBM business models do prefer to shuttle people more towards medication by mail, but what may be gained in short-term savings is lost in the value of the pharmacist-patient relationship.

“Medication delivery takes away the engagement and rapport that pharmacists build within the communities they serve,” Hughes said.

During her time working at a pharmacy, she got to know her regulars, their needs, and their ailments. “I knew all my customers by name; I asked about their holidays and grandchildren. By removing that one-on-one upfront engagement with the communities they serve, you strip away what it means to holistically look at someone else’s health,” Hughes said. “Pharmacists are not just dispensing the medication, but some of the other lifestyle things that produce a healthy individual, and pharmacies have been great historically doing it.”

In fact, Hughes says that a pharmacist often serves as a de facto doctor for someone who can’t afford a visit.

“People would come to the pharmacy counter to pick up a prescription, while another two to three people would come to pharmacy because their child is sick and say to the pharmacist ‘What can you recommend for a sore throat or a cough?’ … At least five times an hour, I walked from behind the counter to assist someone in picking out medication for their children, and we are able to ask questions to get them the best over-the-counter medicine,” Hughes said.

Pharmacies are being squeezed from all directions — by rising PBMS costs, competition from online pharmacies like Amazon, and retail competitors like dollar stores — but Hughes says by serving as a first defense against illness, neighborhood pharmacists can save greater strain on the larger health system. With the drug store chains like Rite-Aid closing hundreds of retail locations, that line of defense is being lost.

A spokesman for Rite Aid said the closings were the result of trying to create a more “efficient company.”   

In New Lebanon, city officials and the mayor just want their pharmacy back. Acting village manager Rob Anderson says it is a real inconvenience for some residents, and the Rite Aid closing served as a blow to the town.

“Having Rite Aid leave makes it seem like your town is on a negative path when, in reality, New Lebanon’s doing is just fine,” Anderson said.  “But it makes you think the big corporations don’t value your town like they once did.”

             

The biggest names in sports are joining forces in a new campaign to combat antisemitism.

New England Patriots owner Robert Kraft and his foundation unveiled a star-studded ad titled “Time Out Against Hate” on Thursday in collaboration with Major League Baseball, Major League Soccer, the National Basketball Association, the Women’s National Basketball Association, the National Football League, the National Women’s Soccer League and NASCAR.

The campaign follows a new report out Sunday by the Anti-Defamation League that revealed there have been more than 10,000 antisemitic incidents in the U.S. in the year since the Oct. 7, 2023, Hamas terrorist attack in Israel. The Foundation to Combat Antisemitism, founded by Kraft, says 10% of U.S. adult males are blatantly prejudiced against Jewish people and tend to be outspoken about it.

“What’s going on now in the country — I’ve never seen anything like it,” Kraft told CNBC’s “Squawk Box” on Thursday. “And I’m concerned what will happen after the election.”

The ad spot, which includes names such as Billie Jean King, Shaquille O’Neal, Jim Harbaugh, Doc Rivers, Joe Torre, Ryan Blaney and Candace Parker, will premiere Thursday as part of Amazon’s Thursday Night Football programming featuring the NFL’s San Francisco 49ers and Seattle Seahawks. The campaign will also be seen on digital platforms and on billboards across the country.

“By uniting under a common cause, we amplify our message and demonstrate that the power of sports extends beyond stadiums, arenas and fields, and into our communities,” Kraft said in a statement announcing the campaign. “This initiative is a call to action for everyone to join us in creating a world where hate is met with a unified stand for empathy, understanding, and respect.”

Last year, Kraft organized a meeting of sports commissioners from nearly ever league to try and address the hateful dialogue taking place. The leaders discussed ideas and opportunities to work together.

The campaign has since expanded to include all hate, whether it is gender, religion or race.

“We wanted to make sure it included anti-Black, anti-LGBTQ, anti-Muslim,” said NBA Commissioner Adam Silver in the CNBC interview, alongside Kraft and NWSL Commissioner Jessica Berman. “Because hate is corrosive to our society and the underpinnings of our democracy,” Silver said.

Berman said Kraft asked the commissioners to lean in and change the narrative when it comes to hate.

“I think we have a responsibility as professional sports league leaders in that we have an outsized impact,” said Berman. “We know throughout history that sport has the power to change the world.”

Kraft founded the Foundation to Combat Antisemitism in 2019 to help address the rising hate against Jews in the U.S. His organization has been working with companies such as Bank of America and shoemaker Adidas as well as with colleges to raise awareness of on-campus incidents of antisemitism.

“We’re able to tell college campuses what’s going on in their campuses before their security people see it,” Kraft said.

In April, Kraft said he was no longer comfortable financially supporting his alma mater, Columbia University, over the administration’s handling of anti-Israel protesters on campus. In June, he announced a $1 million donation to Yeshiva University to cover tuition for Jewish students who wish to transfer.

Walmart shut its doctor offices for people. But the nation’s largest retailer is expanding its pet care business.

On Tuesday, the company announced it will open five more pet services centers in October and early November. The new locations in Arizona and Georgia will include veterinary care and grooming. Walmart opened its first pet services center last year in the Atlanta area.

Walmart’s pet category is an attractive growth opportunity because it drives frequent purchases, resonates with customers across age groups and tends to hold up even when customers’ budgets are stretched, said Kaitlyn Shadiow, vice president of merchandising for pets for Walmart U.S.

Walmart’s pet services centers will have their own dedicated entrance next to a store. They will be under the Walmart name, but staffed by employees of vet care and pet product company PetIQ. The centers will offer routine vet care, such as wellness exams, vaccines and minor medical services, and grooming for cats and dogs.

Shadiow said Walmart decided to expand after seeing strong visits and repeat rates at its first pet services location. About 25% of customers had never shopped at Walmart for pet items before, she said. And when shoppers went to the store for vet or grooming services, Shadiow said it created a “halo effect” that lifted sales for pet food and other supplies, too.

“If you think about pet services, the business case is there,” she said. “We are already serving the needs of so many pet parents today, and it’s a great opportunity for us to help do that in one convenient location or trip.”

Other factors could be motivating Walmart. Chewy and Petco have expanded into pet services as well, with specialty retailer Petco using its stores to become a major vet provider. The services are higher margin than pet food, but are needed more often than other supplies like leashes, pet beds and crates.

Pet ownership spiked during the Covid pandemic, which led to more household spending on dogs, cats and other animals, and a bigger need for vets. Annual household spending on pets is expected to reach $1,445 per animal by 2026 and $1,733 by 2030, according to a recent survey by Morgan Stanley Research. That would represent a 113% jump in total industry spending from $122 billion in 2019 to $261 billion by 2030, the firm found.

Walmart has seen other signs of high demand. A subscription to veterinary telehealth provider Pawp was used more than any other limited-time offer for Walmart+, the retailer’s membership program and answer to Amazon Prime, according to Venessa Yates, senior vice president and general manager of Walmart+. Starting next week, it will turn that limited-time offer into a permanent benefit.

The pet category has also been a way to reach younger and more affluent shoppers, Shadiow said. Gen Z is the fastest-growing segment for Walmart’s pet category, as the group ages into pet ownership, she said. The number of customers shopping the pet category with a household income of over $100,000 grew by 36% year over year, as of the end of July, she said.

Walmart announced earlier this year that it would close all of its 51 health-care clinics for people — a sharp turnabout for the company, which it pinned on “the challenging reimbursement environment and escalating operating costs.” The clinics offered lower-priced doctor visits, dentist appointments and therapy sessions.

Walmart also closed its human telehealth provider, which it had acquired for an undisclosed amount in 2021. It has tested the pet services concept in Dallas, Georgia, where it opened its first health clinic for people in 2019.

Yet Shadiow said pet care is a simpler and more profitable business. Fewer people pay for pet care through insurance and the centers themselves can be smaller, she said. People want transparent pricing since they often pay out of pocket. Plus, she said, Walmart is a one-stop shop for customers who need related products, such as pet prescriptions or food.

“We feel a lot more confident in the ability for this to be successful over the long term,” she said.

— CNBC’s Gabrielle Fonrouge contributed to this report.

Florida’s sports betting market may be about to get a lot more interesting, with Hard Rock’s chairman opening the door to partnerships with commercial sportsbooks.

Hard Rock has the monopoly on sports betting in the state, winning the exclusive tribal gaming compact following a hard-fought battle against Flutter-owned FanDuel, DraftKings and Penn Entertainment. The sportsbooks mounted a massive effort in 2021 to get sports betting legalized in the state, but failed.

When asked about comments made by FanDuel CEO Amy Howe on trying again to get into the Florida market, Hard Rock International Chairman and Seminole Gaming CEO Jim Allen said he’s open to it.

“I would say whether it’s FanDuel or whether it’s DraftKings, we’ve actually developed a great relationship with them,” he said in an interview with CNBC at the Global Gaming Expo in Las Vegas.

Allen says he’s met with both companies over the past two days.

“We do recognize that long term, some type of strategic relationship with some of the brands that really have marquee value could be helpful to both of us, and we are receptive to those conversations,” he said.

At Flutter’s investor day two weeks ago, Howe said she’s focused on three key super states: California, Florida and New York.

FanDuel and DraftKings declined to comment on the possibility of entering into a deal with Hard Rock.

Operators have been eyeing the Sunshine State for years. Florida has a bigger population than New York state, which brings in the most sports betting revenue, according to the American Gaming Association. And it has more than 20 professional and Division 1 college sports teams in the state.

Last December at Seminole Hard Rock, the company marked what it called “a new chapter in Florida gaming,” when it launched sports betting and expanded the casino table games across six Seminole Casinos in Florida.

Allen declined to give specifics on sports gaming revenue in Florida on the basis that the tribe is a sovereign nation.

A logo dispute between Tiger Woods’ apparel company Sun Day Red and Tigeraire, a company that makes cooling products for athletes, is now in the hands of the federal court system.

Last week, Tigeraire filed a notice of opposition with the U.S. Patent and Trademark Office against Sun Day Red’s Tiger logo, saying the golf legend’s company “unlawfully hijacked” Tigeraire’s design into its own branding.

In a subsequent court filing, Woods’ legal team sued Tigeraire, accusing the company of trying to capitalize off Sun Day Red’s status as a bigger brand. Sun Day Red has filed a motion to dismiss the patent claim.

“This case, unfortunately, presents the time-worn circumstance of an opportunistic, misguided business attempting to extract an unwarranted financial windfall from a larger and more successful brand, based on threats of legal action and demands for exorbitant sums,” the suit says.

According to the lawsuit, which was filed last week in U.S. District Court for the Central District of California, Sun Day Red says it has attempted in good faith to resolve the infringement claims though negotiation and that Tigeraire has sent “outrageous monetary demands” to Sun Day Red, which is owned by TaylorMade.

The suit also says Tigeraire recently started attending golf tournaments and changed its website’s homepage to prominently feature golfers in an attempt to demonstrate market overlap.

Tigeraire did not immediately respond to request for comment on the lawsuit. A representative for Woods and TaylorMade declined to comment on the matter.

Trademark attorney Josh Gerben called the lawsuit an “aggressive response” to the trademark dispute.

He noted bringing a case to federal court makes the matter much for expensive for a smaller company like Tigeraire.

“A lot of time these cases favor the party with the resources to litigate, and that can make it a challenge,” Gerben said.

Sun Day Red was launched in May after Woods ended his 27-year partnership with Nike.

The brand’s name pays homage to the fact that Woods always wears red on Sundays, and the logo is a tribute to the 15 majors he’s won over the course of his career, Woods said previously.