Top Managers of Nike Unit Resign, Sue for $2 Million : Lawsuit: Robert and James Warsaw, whose father founded Irvine-based Sports Specialties, have filed a fraud and breach of contract suit.

In a bitter split with Nike Inc., brothers Robert and James Warsaw have resigned as top managers of the giant company’s Sports Specialties Corp. unit and have sued Nike for $2 million.

The Warsaws, whose father founded Sports Specialties, filed their fraud and breach of contract suit in Orange County Superior Court on Friday. They claim Nike broke its promise to use them to organize and run a companywide marketing effort and made it impossible for them to remain employed at Irvine-based Sports Specialties.

In a brief announcement Monday, Nike said the brothers had quit because of “a difference in opinion with Nike about the strategic direction of Sports Specialties.” No mention was made of the suit.

Robert Warsaw was chief executive officer of the company and James Warsaw was president.

Nike paid more than $50 million in January to acquire Sports Specialties from the New York investment firm Oppenheimer-Palmieri.

Sports Specialties in the 1950s pioneered the sale of sports merchandise produced under exclusive license with a team or player. Since the early 1970s, it has specialized in manufacturing and distributing caps with the official logos of professional and college teams.

Jess Meyers, chief financial officer of Sports Specialties, has been appointed interim general manager of the company.

Nike officials could not be reached for comment on the Warsaws’ suit.

The suit claims that Sports Specialties had grown to $62 million in sales when Nike began negotiating to buy it last year and that the Beaverton, Ore., company represented at the time that it did not want the company unless the Warsaws came with it.

Nike promised, according to the suit, to make the Warsaws co-directors of a new Licensed Sports Specialty Products unit and said that celebrities such as basketball superstars Michael Jordan and Charles Barkley and tennis player John McEnroe would be made available to promote the unit.

But after acquiring Sports Specialties, the Warsaws claim in their suit, Nike ignored those promises and launched a campaign to force the brothers to resign by making their working conditions “intolerable” and by starting a new unit, Organized Team Sports, designed “to directly compete with Sports Specialties in the licensing of caps.”