CommLawBlog : Broadcast & Communications Lawyers & Attorneys : Fletcher Heald & Hildreth Law Firm : Telecommunications, FCC Regulation, Communications Act

The two cases – O’Bannon/Newsome on the one hand, Keller on the other – adopted different legal strategies. Keller claimed that the NCAA and EA violated his “right of publicity”, i.e., the right to profit from the use of his name and/or likeness. O’Bannon/Newsome, on the other hand, claimed that the NCAA is engaging in “anti-competitive” practices by unduly restricting the rights of college athletes. From the court’s initial rulings – the Keller decision is here, the O’Bannon/Newsome decision here – both arguments appear to have gotten traction.

While Keller’s claims were dismissed with respect to the NCAA, they stuck with respect to EA. Because of the particular statutory language of the “right of publicity” laws in Indiana (one of the two jurisdictions at issue in Keller’s suit, mainly because the NCAA happens to be headquartered in Indiana), the court held that the NCAA itself did not “use” Keller’s name/likeness in a way which would make the NCAA directly liable under those laws. But as to EA, well, that’s another story entirely.

Conceding, at least for the sake of its motion to dismiss, that Keller could establish all he needed to in order to establish that EA had violated his right of publicity, EA argued that it had engaged merely in “transformative fair use”. In other words, the image of the football player that was included in EA’s video game was really EA’s own expression, and not Keller’s true likeness. 

To be successful, the transformative fair use defense requires a demonstration that the defendant has contributed “significantly distinctive and expressive content” which might be protected by the First Amendment. Cases where the defense is successful often involve taking an individual’s recognizable likeness and adding to it distinct new elements, or placing it in a completely novel setting. For instance, albino rocker brothers Johnny and Edgar Winter were portrayed in comic book form as brothers Johnny and Edgar Autumn, with pale faces and long white hair reminiscent of albinism. Transformative? If the changes had been limited to the name change alone, probably not. But in that case the Autumn brothers were also depicted as half-human, half-worm characters with green tentacles sprouting from their chests. Now that’s transformative. In another case, a musician and dancer known for uttering the phrase “ooh-la-la” was depicted with similar physical features and named “ulala” – but, instead of singing and dancing, she was shown as a “news reporter in the 25th century, ‘dispatched to investigate an invasion of earth by dance-loving aliens’.” That, too, is what they’re talking about what they talk about “transformative fair use”.

In Keller’s case, the court concluded that EA’s depiction of Keller contained no such “distinctive content”. Rather, EA simply presented Sam Keller as the college football quarterback for Arizona State.

Result: EA’s motion to dismiss Keller’s suit was denied, and the case proceeds to trial. Along the way, the judge also agreed that Keller’s additional claim – that EA conspired with the NCAA to violate his image rights – could also proceed to trial. So while the NCAA dodged one bullet (i.e., the claim that it had directly violated the right to publicity), it will still remain under the gun because of its involvement with EA in the development of EA’s videogames.

As to O’Bannon/Newsome, the same judge gave a similar thumbs up to the “anti-competition” theory. O’Bannon/Newsome’s claim was based primarily on a provision that the NCAA apparently requires all of its student-athletes to sign:

You authorize the NCAA [or a third party acting on behalf of the NCAA (e.g., host institution, conference, local organizing committee)] to use your name or picture to generally promote NCAA championships or other NCAA events, activities or programs

The plaintiffs claimed that this provision allows the NCAA to enter into licensing agreements which financially benefit the NCAA without conveying a benefit to the athletes.

To prevail in an anti-competition claim along these lines, O’Bannon/Newsome had to establish (a) the existence of a contract, combination or conspiracy that (b) unreasonably restrains trade in a way which (c) affects interstate commerce. The judge concluded that O’Bannon’s claim was sufficient to go to trial. After all, the NCAA’s own constitution which requires member schools to agree to abide by the organization's constitution, bylaws and rules (Factor (a)); the NCAA and its affiliates control the collegiate licensing market to such an extent that the average individual athlete is precluded from having any chance to enter the market for himself (Factor (b)); and the NCAA and its affiliates control the collegiate licensing market to such an extent that the average individual athlete is precluded from having any chance to enter the market for himself (Factor (c)). 

(Interestingly, Newsome’s claim was dismissed because he failed to make a sufficiently strong allegation of unreasonable restraint of trade (i.e., Factor (b)). No worries, though – the judge granted him to leave to amend his complaint to patch up that hole.)

The judge also ruled on a number of other ancillary arguments, but the bottom line here is that both the Keller and the O’Bannon/Newsome cases will proceed. While that does not necessarily mean that any of the athlete-plaintiffs will ultimately prevail, it’s at least a strong indication that their respective theories of liability are valid. It just remains for them to prove that the underlying facts support those theories.

Perhaps more importantly, though, the fact that the cases are proceeding – with the NCAA, in particular, as a defendant – means that discovery will go forward. And that in turn means that considerable light may now be shed on the various contractual arrangements which NCAA has made, and the wads of cash the NCAA has pocketed, in connection with the marketing of athlete-related merchandise. It is entirely possible that the revelation of the details of that enterprise could lead to substantial changes in the relationship between the NCAA, its members, and the student-athletes whose performance is the real key to the profit-generating machine that is college athletics. Attention should be paid.

In his suit Brown alleged that EA Sports had engaged in the unauthorized use of his likeness in two “historic” teams featured in EA’s Madden NFL games.  Those games feature the1965 Cleveland Browns team and an “All Browns” team with an unnamed running back wearing number 37 and boasting statistics “nearly identical” to Brown’s actual playing statistics.  In real life, however, Brown wore number 32.

Brown brought the following causes of action: 

• A federal unfair competition claim under the Lanham Act alleging that the apparent use of Brown’s likeness falsely implied that he had endorsed the game; and
• California state law claims for (a) invasion of privacy and (b) unfair business practices.

EA Sports moved to dismiss the Lanham Act claim, arguing that the First Amendment precludes the imposition of liability in this case. The judge agreed.

The judge re-affirmed that the First Amendment does generally apply to these types of video games.  It disagreed with the arguments made by Brown – and by others suing video game makers or seeking to regulate their often sexual or violent content – that these games (and other similar commercial enterprises) should be entitled to less than full First Amendment protection. Au contraire, said the judge, the implicitly creative nature of EA’s games merits full First Amendment protection.

Because they enjoy that protection, video game manufacturers can be held liable for violations of commercial statutes such as the Lanham Act only if the public interest in avoiding consumer confusion outweighs the public interest in free expression. That is judged through a two-pronged test: (1) the defendant’s use of the plaintiff’s proprietary right must be relevant to the defendant’s underlying work; and (2) the defendant’s use of the plaintiff’s proprietary right must be found to explicitly mislead consumers about the source or content of the work.

In Brown’s case, the first prong was clearly met.  As the judge observed, “The Madden games are about NFL football. Brown is a legendary NFL player: the best ever, according to some journalists. Use of a legendary NFL player’s likeness in a game about NFL football is clearly relevant.”

As to the second prong, the judge found that users of EA’s Madden games would not be “misled into thinking that Brown is somehow behind the game or sponsors the product.”  The player depicted in the game is anonymous, identified only by a jersey number and a roster position; his name is never seen on the packaging or advertising.   As the judge saw it, it would require a “leap of logic” to conclude that the depiction of a player like Jim Brown equates to endorsement by the Jim Brown.

With that the District Court stopped the great Jim Brown dead at the line of scrimmage. 

The decision doesn’t bode well for those college athletes, mentioned in earlier blogs, who are also suing EA sports for unauthorized use of their likenesses.  However, the clock hasn’t totally run out on those other cases.  In dismissing the lone federal claim advanced by Brown, the judge declined to exercise supplemental jurisdiction over the state claims – including the non-federal right of publicity claim that is the heart of so many of these lawsuits – and simply left them unanswered.

So stay tuned to see whether the judge’s punt on these state law claims may be returned for a touchdown by one of our fearless former gridiron greats (or, slam dunked, as the case may be, by a former collegiate cager).

1996:  The NBA sues to prevent Motorola and “Stats, Inc.” from distributing information from basketball arenas in real time, alleging violations of, among other things, copyright, trademark and right of publicity (commercial misappropriation). Verdict: Motorola/Stats, Inc. win, as the United States Court of Appeals for the Second Circuit rules that the NBA does not “own” the factual information about its games.

2008:  Major League Baseball falls to C.B.C. Distribution and Marketing, a fantasy sports purveyor, when the U.S. Court of Appeals for the Eighth Circuit rules that players’ names, biographies and statistics can be freely used because they’re akin to news that’s generally available. The Court rejects the notion that names, bios and stats are subject to overall “image right” that can be claimed, and commercially marketed, by the player, team or league alone.  This opens the door for all fantasy sports providers to drop their existing marketing contracts with major sports leagues, costing those leagues millions in licensing revenues.

2008: CBS Interactive grabs a page out of C.B.C. Distribution and Marketing’s playbook and sues the NFL, seeking a declaratory judgment allowing it to use these same types of player information (names/backgrounds/ stats) in its NFL fantasy football game.   CBS files its suit in Minnesota. Why Minnesota?  Because that’s in the same 8th Circuit that was so kind to C.B.C. Distribution and Marketing.  Guess what?  It works.  The District Court rules in favor of C.B.S Interactive in April 2009. 

Meanwhile, we also have a number of games still in progress, as big-name players – presumably prevented from recouping image rights (either directly or through the leagues or player associations supposed to represent them) for the use of the names, etc., in fantasy sports – began to find new ways to try to monetize their commercial images . . .

May, 2009:  Several former college football players file a class action  lawsuit in federal court in California, alleging that EA Sports, the maker of several popular sports video games, is using their images without permission (even though the players’ real names appear nowhere in the game). This case is pending trial.

June, 2009: Several more former college players file another lawsuit against EA Sports.  They “get in the game” in a state court in New Jersey.   This case is also pending trial. 

July, 2009:  Former UCLA basketballer Ed O’Bannon (last seen selling cars outside Las Vegas) files a lawsuit against EA Sports.  Yep, still pending. 

So, let’s see, we've got: 

• Lawsuits between the leagues and the fantasy sports companies, with a clean sweep by the fantasy sports companies to date;
• Lawsuits by former college athletes against video game makers, with no resolution thus far;
• Leagues continuing to represent their current players with regard to use of those players image rights in all manner of commercial formats.

What’s missing?   As we see, about the only permutations or combinations we haven’t seen yet involve (a) former pro players getting getting back into the action and (b) lawsuits by athlete(s) against his/her/their league. 

That's why we're so happy to report that former NFL’ers John Dryer, Jim Marshall, Joe Senser,  Elvin Bethea, Dan Pastorini, and Ed White have filed a class action lawsuit against their former league, alleging that their images are being used in NFL films and other products  without their permission or any compensation.  Former pro players suing their former league! Two for the price of one!

The lawsuit alleges that the NFL “trades on the ‘glory days’ of the NFL as a marketing and advertising technique”, netting the NFL big bucks while the players get nothing.  The NFL, through its NFL Films website, offers hundreds of productions for $50 each, using the names and likeness of over 450 former players in the films and for promotion purposes. According to the players, such uses constitute: “false endorsement” (a violation of the Lanham Act); appropriation of the “right of publicity” under Minnesota, California and Texas law; and violations of the common law “right of publicity” under just about every other state’s laws. The players also allege that the league has engaged in unjust enrichment at their expense. 

The players seek all damages allowed under law and equity (and, for good measure, reimbursement of attorneys’ fees and court costs). 

What’s really interesting about this one – other than the fact that the players are now biting the very hand that once fed them (even if you believe the meals were of less than adequate size and, ultimately, extremely unhealthy) – is that the players’ complaint was filed in the United States District Court for the District of Minnesota.

But wait! Isn’t that the same court that has already declined to protect the names and likenesses of NFL players from use in fantasy sports? (Sure, that suit pitted the league’s marketing arm, not the players themselves, against the fantasy sportsters, but the same basic likenesses, images, etc., were at issue.) And isn't that in the same 8th Circuit that ruled against MLB player seeking compensation (again, through their league's marketing arm) for use of their names and likenesses in fantasy sports as well? Yes and Yes.

So what’s the deal? Have these players simply taken one too many blows to the head?  Surely they must know that the Court will bat this one down at the line of scrimmage once again!  Perhaps, but there’s plenty of reason to think they’ll emerge victorious as well. 

First, they know that the Court will not move the case for lack of jurisdiction, having ruled in the earlier NFL case that jurisdiction in Minnesota is proper due to sufficient minimum contacts there. So that’s one major procedural matter they don’t have to worry about.

Substantively, we think that the players’ lawyers have read between the lines of the earlier NFL and MLB cases and believe that the judges in each of those earlier cases ruled for the fantasy sports companies because the information used was so factual in nature that it could be obtained anywhere.  The court essentially viewed the player names, backgrounds and statistics as “news” to which the leagues could not claim any exclusive right. That would be distinct from using commercial images in which somebody – perhaps the players, perhaps the teams, perhaps the league – could properly assert a proprietary claim.  

If the earlier courts did rest their verdicts on that side of a “commercial/noncommercial” line, it would make sense for them to do the same here. But in this latest case, the courts could easily conclude that the material in question – featuring overtly commercial use of particular players’ readily-identifiable images – is entitled to precisely the kind of protection that the broader, noncommercial, informational name/background/stats stuff did not merit.  

One thing is for sure: the younger generation of college players who have sued EA Sports will be watching these elder statesmen closely, as we’ll likely see similar results for young and old.

The fact that the CBS Interactive, Inc. v. National Football League Players Association, Inc. and National Football League Players Incorporated case is entering overtime after the NFLPA, NFL and Players, inc. filed an appeal to the Eighth Circuit actually kicked off this latest pigskin classic.  

Yahoo! has been offering its fantasy football game for several years.  Until March 1, 2009, Yahoo! had licensing agreements with Players, inc. which allowed Yahoo! to use the likenesses of NFL players.  Yahoo! decided not to renew these agreements after that date (presumably for the same reason that CBS Interactive did not renew its agreements with Players, Inc.: because of the earlier ruling by the United States Court of Appeals that permission was not required to use Major League Baseball player likeness and information). 

Players, Inc. had threatened to sue Yahoo! when the licensing agreement was not renewed.  Emboldened by the CBS Interactive decision, Yahoo! went on the offensive in late May, asking Players, Inc. whether it had changed its tactics in light of Minnesota decision. Yahoo! received no response to a May 21 request for information.  Players, Inc. refused to reveal its playbook then, or when asked again on May 26.

Instead, Players, Inc. and the NFL Players Association filed a notice of appeal in the CBS Interactive case on May 28, 2009.  Yahoo! took this as a sign that Players Inc. and the NFLPA intended to protect their house.  It requested a conversation by June1 and, receiving no response, again filed its complaint in District Court. Specifically, Yahoo! makes seeks three declarations:

1. Declaratory Judgment that Yahoo! does not violate any right of publicity owned or controlled by NFL players.
    
2. Declaratory Judgment that a Right of Publicity interpreted broadly enough to encompass Yahoo!'s actions is superseded by the First Amendment to the United States Constitution.
    
3. Declaratory Judgment that a Right of Publicity Interpreted Broadly Enough to Encompass Yahoo!'s actions are preempted by federal copyright law.

Given the earlier decisions in this District Court and the United States Court of Appeals, you really have to bet (not that we advocate betting on sports or law) on Yahoo! and on CBS Interactive in their respective cases. But one wonders whether the 2009-2010 Supreme Court schedule will feature a Publicity Rights Bowl in an attempt to settle this simmering rivalry.

Sam Keller played quarterback for three years at Arizona State before transferring and playing his final season at Nebraska.  Despite a moderately successful college career, he wasn't drafted by an NFL team. 

Keller is the named plaintiff in a class action lawsuit filed against Electronic Arts, a/k/a "EA Sports" ("It's in the Game"), the maker of the popular college football video game series "NCAA Football [insert year here]".  Other defendants include the NCAA  and the Collegiate Licensing Company, which administers the contracts regarding college athlete likenesses.  According to his complaint, Not-So-Slingin' Sammy represents "all NCAA football and basketball players listed on the official opening-day roster of  a school whose team was included in any interactive software produced by Electronic Arts, and whose assigned jersey number appears on a virtual player in the software." 

Now I really don't follow college football all that closely (the dual result of attending a college without a truly big-time football program  and  the NCAA's refusal to dump the bogus BCS system in favor of a college football playoff leading to a true national champion).  I'm also not all that into video games; even though EA's line of "NCAA Football [insert year here]" is insanely popular, I can't say that I've ever played one. 

So it's a good thing that the folks at the Above The Law blog (I do follow them) do a good recitation of the NCAA policies and video game characteristics, which I'll further boil down to about four key points:

1. College athletes are basically indentured servants, with major football and basketball programs generating substantial revenue for their schools in exchange for the athlete receiving a free education (that he/she largely can't take advantage of because of team practice, conditioning and related activities requiring a time commitment similar to that of a pro athlete). 
    
2. Similar pro football and basketball video games (think about the highly successful "Madden" and "NBA Live" games here), use the real names, uniforms, numbers, likenesses (which get increasingly more real -- and scary -- with every new version), statistics and backgrounds.   The game makers had previously used fake names and players until an agreement was reached with each league's players association for the image rights. 
    
3. No similar agreement exists between the NCAA (through the Collegiate Licensing Company) and Electronic Arts, so fake names continue to be used in the college-based video games. The uniforms look real (so the JMU Dukes, if the Football Championship Subdivision powerhouse is represented, will be identified by its ever-intimidating Purple-and-Gold), and the  virtual players' statistical characteristics correspond to their real life counterparts.  In Keller's case, that meant the NCAA Football '08 version of the Nebraska Cornhuskers wore red and white and featured a quarterback wearing # 9 who threw for 2,422 years and 14 touchdowns, while completing 63.1 percent of his passes, strikingly similar -- indeed, identical, to his own personal stats.
    
4. Die-hard fans have created programs that allow users of this game to upload the true names of each player to replace the fake ones. EA Sports knows about this, but does not promote it.  Both EA and the NCAA have maintained that EA sports does not and cannot use the players' names or actual pictures.

The post in Above the Law suggests that Keller should win, but does it unduly discount an interesting decision from federal district court in Minnesota that was issued on April 28, 2009, involving the use of NFL player names, likeness and information in conjunction with CBS Interactive's fantasy football games? 

Granted, there are some major differences between the recently-decided Minnesota case and the case which Keller brought in California: aside from the fact that we're now talking pro sports rather than college, the recent Minnesota decision affected the use of player information and licenses in the fantasy sports, not video game, context.  And pro sports leagues have a bad history in this area:

• It's been more than ten years since United States Court of Appeals held that the National Basketball Association could not prevent a company called Stats, Inc. from distributing statistics and other in-game information in real time via Motorola pagers.
   
• A little over two years ago, in a case we blogged about, the United States Court of Appeals for the Eighth Circuit ruled against the Major League Baseball Players Association and declared that pro baseball players' names and likenesses could be freely used in a fantasy baseball game. 

The NFL decision is a direct descendant of the more recent MLB case.  CBS Interactive runs one of the more popular fantasy football games, which makes extensive use of NFL player names, likenesses, pictures, photographs, voices, and biographical information.  Through the 2007 NFL season, the player information was obtained via a licensing agreement with the NFL Player's Association that controls the image rights of the players and distributes any revenues obtained through such games to them. 

After the 2007 season, CBS Interactive took note of the decision against the MLB in the 8th Circuit.  It did not renew its licensing agreement with the NFL and instead sprinted to the District Court of Minnesota.  You see, the District of Minnesota is located in...the 8th Circuit.  CBS Interactive sought a declaratory judgment from the court that would apply the MLB ruling to NFL player information as well.  This kicked off the case of CBS Interactive, Inc. v. National Football League Players Association, Inc. and National Football League Players Incorporated. 

After a brief -- but very informative -- recitation of how image rights of NFL players were previously licensed and how fantasy football is played, District Court Judge Ann Montgomery spent the majority of the first half of her opinion knocking down, one by one, motions by the NFL/NFLPA to either dismiss the case for lack of personal jurisdiction in MInnesota or transfer the case to Florida (where the only other case involving a similar sports image rights issue was decided the other way). 

Compressing all of this Civil Procedure 101 stuff into an ESPN "Two Minute Drill" highlight reel cuts to the chase:  the Court ruled that there is personal jurisdiction over the NFL/NFLPA in Minnesota  and the transfer was not proper because there was no proof that hearing the case in Minnesota would be inconvenient for the parties, to witnesses or contrary to the interests of justice.  At least no more so than Florida.

As is often the case, all that procedural posturing proved dispositive.  The NFL/NFLPA made a brief goal line stand, getting one of CBS Interactive's causes of action dismissed  when the judge ruled that the NFL/NFLPA's control over player image rights do not constitute an antitrust violation.  The next play was the winning touchdown, as the court granted summary judgment in favor of CBS Interactive, finding little to no difference between this case and the MLB case. 

So is that it?  Game over for the NFL/NFLPA?  Well, the NFL/NFLPA still has two levels of court to which to appeal, though their prospects seem unlikely given the 8th Circuit's ruling in the MLB case and the Supreme Court's later refusal to hear that case.

As for Keller, he's still got a chance.  It's pretty clear by now  that the use of statistics and other game-related facts are protected by the First Amendment, at least with regard to professional sports (though we see no reason why there would be any difference here just because the statistics come from college games).  For Keller to win, the Court will have to find that: (a) video games are inherently more commercial than the now multi-million dollar fantasy sports industry and (b) that EA Sports has made its games "too real" to the point where using this First Amendment protected background information in conjunction with wink-wink, nudge-nudge virtual players makes it all but impossible to separate those virtual players from the real ones.

And if he doesn't win?  Well, there's always the NHL, MLS (yes, fantasy soccer does exist) and NASCAR (perhaps the biggest one of them all), waiting in the wings.   But, more importantly, it opens up another avenue for broadcasters, print media, bloggers, etc. to more freely (and accurately) use player information and even photos in conjunction with sports reporting and perhaps even some overtly promotional contest-type events.

Actually, I can write freely about the fact that the Arizona Cardinals will be playing the Pittsburgh Steelers in Super Bowl XLIII in Tampa, FL on Sunday, February 1 (and I'll actually be watching, if only for the halftime show featuring Bruce Springsteen).  Your publications and stations can broadcast or write too, provided you take care to limit use of the terms to situations that fall within the concept of "nominative fair use".   That generally requires three things: 

1. You must use the actual  trademarked term (i.e., "Super Bowl", "Super Sunday", "NFL" or team names) to identify what your'e talking or writing about
    
2. You only use the trademarked term as necessary for identification purposes and do not engage in gratutious use
    
3. You do not use the trademarked term to suggest any sort of sponsorship or endorsement connection.

So, clearly, you can mention the Super Bowl and team names without Goodell's goons blitzing you.  The most obvious permitted use is in the context of a legitimate news story.  But other discussion within the confines of (1), (2), and (3) above is OK as well.  Morning show DJs can discuss who they think will win the game -- but they can't create a station contest or viewing party around the game that uses any of the NFL's trademarked terms. You should also take care to review advertising bought in your papers or on your station to make sure that the advertisers aren't running afoul of these rules either. 

The NFL takes this very seriously and does not hesitate to protect their trademark rights, as many stations find out each year (it is, after all, referred to by many as the "No Fun League").   So don't get a flag thrown on you for stepping out of bounds on this one.  Trademark infringement will cost you a lot more than just 15 yards...

(By the way, what you've just read is true for pretty much every major sporting event -- such as "March Madness" and the World Series -- so, rather than coming back here in March or October, just substitute a new, equally corny sports analogy of your own and keep the legal lessons in mind. Try it: 

"So don't get a technical foul called on you for stepping on the baseline.  Trademark infringement will cost you a lot more than just 2 free throws and possession..."

"So don't balk on this one.  Trademark infringement will cost you a lot more than just a free base.")