Fallout Follows Phelps into the Pool

(ATR) Swimmer Michael Phelps is back in the pool -- where he could do no wrong in Beijing -- but the repercussions of a photograph showing him holding a marijuana bong continue to follow him.

Not only has he lost a major sponsor in Kellogg, which decided not to renew his contract, but Phelps' three-month suspension by USA Swimming will delay his return to competition.

Phelps, 23, planned to swim his first meet since the Olympics at a Grand Prix event in Austin, Texas, from March 5-7. Because USA Swimming slapped him with the suspension effective Feb. 5, he won't be eligible until early May. The next major meet on the calendar is the Charlotte UltraSwim from May 14-17 in North Carolina. He is expected to compete in the FINA World Championships in Rome, which begin in July.

The national governing body said that it was reprimanding Phelps under its Code of Conduct and also stripping him of his financial support of $1,750 a month for the duration of the suspension.

"This is not a situation where any anti-doping rule was violated, but we decided to send a strong message to Michael because he disappointed so many people, particularly the hundreds of thousands of USA Swimming member kids who look up to him as a role model and a hero," USA Swimming said in a statement. "Michael has voluntarily accepted this reprimand and has committed to earn back our trust."

While the stipend from USA Swimming is pocket change to Phelps, who has already earned millions in endorsements - including a $1 million bonus from Speedo for winning eight gold medals in Beijing - the Kellogg contract is believed to be substantial.

Typical cereal fees top out at about $250,000, but Kellogg signed Phelps with great fanfare during the Olympics, beating out Wheaties for the chance to feature Phelps on boxes of Kellogg Corn Flakes and Frosted Flakes. Kellogg reportedly also pledged $250,000 to the Michael Phelps Foundation as part of the deal.

Although CNBC reported that Olympic cereal deals always end in February and there was no intention to renew, Kellogg issued a statement critical of Phelps.

"We originally built the relationship with Michael, as well as the other Olympic athletes, to support our association with the U.S. Olympic team," a Kellogg spokeswoman said in a statement first obtained by Ad Age.

"Michael's most recent behavior is not consistent with the image of Kellogg. His contract expires at the end of February and we have made a decision not to extend his contract."

However, Kellogg also did not renew its contract with the U.S. Olympic team. That contract ended in December.

Kellogg Company has also been dealing with a salmonella outbreak affecting foods with peanuts, peanut butter or peanut paste. The company has recalled products from its Austin, Keebler, Famous Amos and Special K lines and announced Thursday that it spent $34 million in 2008 on the recall and expects its final bill to hit $70 million.

Another major Phelps sponsor, AT&T, told Around the Rings that it had allowed its contract with the swimmer to expire in December.

In his first major interview since the photo appeared in the tabloid News of the World, Phelps told the Baltimore Sun that the scandal has made him consider whether or not he wants to continue in the sport.

"This is a decision of mine that I'm not going to make today and I'm not going to make tomorrow," Phelps said. "It's going to require a lot of time and energy and a lot of thinking for myself -- but also talking to Bob (Bowman, his coach) and talking to my family and just deciding what I want to do.

"Yeah, there are still goals that I have in the pool, 100 percent. But I'm not going to let anything stand in my way. If I decide to walk away, I'll decide to walk away on my own terms. If it's now, if it's four years, who knows. But it is something I need to think about and decide what I want to do."

Bowman said he doesn't believe Phelps will quit swimming.

"It makes me happy," Phelps said. "It's a part of me I've always had, and I've always been happy doing it. I like getting up in the morning and having something to do. On Monday we get back to two-a-day [practices], and I'm looking forward to that. I feel more comfortable here. This is my home."

This is the second time Phelps has publicly apologized for his behavior. He had a DUI when he was 19.

Phelps has admitted being in the photo and apologized for his actions, although he has not said he smoked marijuana. However, the sheriff in Richland County, S.C., where the University of South Carolina is located, said he will charge Phelps with a crime if he determines that he broke the law.

Both university police and Columbia, S.C police have said they would not pursue charges.

Under South Carolina law, possession of one ounce or less of marijuana is a misdemeanor that carries a fine up to $200 and 30 days in jail for the first offense. Possession of drug paraphernalia is a $500 fine.

Phelps is not subject to any sanctions by WADA or the U.S. Anti-Doping Agency, which does not test for marijuana out of competition.

In the most famous marijuana cases involving swimmers, Gary Hall Jr. and Jon Olsen tested positive for marijuana in the Olympic Village after their competition in the Atlanta Games.

FINA had added marijuana to the banned list before the 1996 Olympics, but the rule did not take effect until after the Games so the swimmers only received a warning.

Hall again tested positive for marijuana during an out-of-competition test in May 1998 and was provisionally suspended until the decision of a FINA Doping Panel. FINA lifted the suspension in August of that year.

Hall lost almost all of his sponsors, but regained some when he resumed his swimming career.

Canadian snowboarder Ross Rebagliati, who almost lost his Olympic snowboarding gold medal when he tested positive for marijuana in Nagano, defended Phelps in an interview with Reuters.

"I think Michael Phelps is an incredibly talented athlete and it's a shame the media is choosing to focus and scrutinize one photo taken months ago at a private college party. The guy has 14 Olympic medals," Rebagliati said.

Rebagliati was initially stripped of his medal, but it was later returned because the drug was not then a banned Olympic substance. He denied smoking marijuana and blamed secondhand smoke at a pre-Olympics party.

"I think marijuana is less taboo than it was back in 1998 when my incident occurred," Rebagliati said. "It definitely is not a performance-enhancing substance. I personally think it is safer than alcohol and cigarettes."

He added,"I guarantee, even with that one bong hit, Phelps is 100 percent healthier than the average human being."

The News of the World said that the Phelps story provided it's biggest-ever boost in web traffic.

In the 24 hours after the story went live Saturday, the site recorded more than 1.5 million unique users, with more than a million looking at the Phelps story.

According to the tabloid, the management firm representing Phelps offered lucrative incentives not to run the story and photo.

Octagon spokesman Clifford Bloxham promised that Phelps "would become our columnist for three years, host events and get his sponsors to advertise with us," according to the tabloid. "In return, he asked that we kill Phelps' bong picture. Bloxham said: 'It's seeing if something potentially very negative for Michael could turn into something very positive for the News of the World.'"Written by Karen Rosen.