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A multi-million dollar lawsuit for copyright infringement against Take Two Software, the creators of NBA 2K16 has proved to be anything but a slam dunk.  The alleged infringement concerns player avatars displaying tattoos worn by several NBA stars including LeBron James and Kobe Bryant.  Last week, Take-Two filed a motion for judgment on the pleadings arguing its display of the tattoos is de minimis and qualifies as fair use.

The plaintiff, Solid Oak Sketches, purchased the tattoos from the original artists and first filed suit in February of 2016 seeking more than $1.1 million for a perpetual license to use the designs in Take Two’s NBA 2K series.  Although it is undisputed a tattoo can qualify for copyright protection, the parties passed the question whether Take Two’s display of the tattoos constitutes actionable infringement to Judge Laura Swain of the U.S. District Court for the Southern District of New York.  The issue whether tattoos must be licensed to appear in creative works surfaced once before when Mike Tyson’s tattoo artist sued the makers of The Hangover Part II in 2011, but that case ultimately settled.

In its motion, Take Two contends the display of the tattoos is de minimis because NBA 2K16 mainly uses a full-court camera during gameplay, rendering any tattoo on an avatar’s body virtually unrecognizable.  Additionally, Take Two contends its display of the tattoos is sufficiently transformative to constitute fair use.  The motion states the players use the tattoos for purposes of self-expression while Take Two incorporates them into NBA 2K16 to deliver a more authentic and realistic gameplay experience.

Overall, Take Two warned a denial of its motion would open the door to tattoo artists seeking fees every time a player commercializes his or her likeness or even appears in public and thereby publically displays the work under 17 U.S.C. § 106(5).  “Indeed, if Solid Oak were correct, it would mean that anyone appearing in public, on a television program, or in an advertisement would need to license the display of their tattoos,” argued Take Two in its answer to the original complaint.  “This is not the law and, if it were, it would be an encroachment on basic human rights.”

Solid Oak has not yet issued a public statement, but is expected to argue Take Two’s public policy concerns are overblown as this case deals with commercial use and not the mere display of a tattoo in public.  Plus, Solid Oak could assert Take Two’s use impacts the market for derivative merchandise bearing designs of the tattoos.

Because Solid Oak registered the tattoo copyrights at issue in 2015 and the first alleged instance of infringement came with Take Two’s 2014 publication of NBA 2K14, the court precluded Solid Oak from recovering statutory damages.  However, actual damages remain on the table and could reach seven figures.

Copyright: <a href='//www.123rf.com/profile_ericbvd'>ericbvd / 123RF Stock Photo</a>
Copyright: ericbvd / 123RF Stock Photo

A New York court of appeals last week declared the Orioles and Nationals will play extra innings in the teams’ longstanding dispute over fees the Orioles’ Mid-Atlantic Sports Network (MASN) owes the Nationals for broadcasting their games.

The teams have shared the network since the Nationals (formerly the Montreal Expos) arrived in Washington D.C. for the 2005 season.  The Orioles, incensed that the Nationals were consuming about a third of their market, broadcast Washington’s games at a substantial discount from 2005 to 2011 after which the MLB obligated Baltimore to pay fair market value.  After MLB’s Revenue Sharing Definitions Committee (RSDC) ruled MASN owed the Nationals $298 million for broadcast rights from 2012 to 2016, the Orioles cried foul and claimed the panel was biased.  MASN cited opposing counsel’s duel representation of Washington and the MLB in unrelated matters as a red flag, along with MLB’s $25 million advance to Nationals’ owner Ted Lerner to reportedly placate Lerner for having to sell MASN broadcast rights at a discount from 2005 to 2011.  MLB responded telling The Baltimore Sun the loans were “fully justified [and] done with the Orioles’ and MASN’s knowledge and encouragement.”

Associate Justice Richard Andrias, speaking for a 3-2 majority, found MASN’s claims unpersuasive because the panel will consist of new members and the Nationals will use new counsel.  Additionally, the Court found considerable significance in the teams’ decision to assign all disputes over telecast fees to the RSDC, an expert body with specialized knowledge on the apportionment of broadcast fees for sports teams, yet reserved other disputes for the MLB commissioner and/or American Arbitration Association (AAA).

The decision was not a complete loss for Baltimore, as the Court vacated an award MASN found to be unfair.  However, if performance has any impact on value, the Nationals appear to hold an edge.  After six consecutive losing seasons, the Nationals clinched playoff births in three of their last five campaigns, two of which came after the first RSDC panel rendered its decision.  Washington is also well-positioned for another post-season appearance with a comfortable 10.5 game lead over the rebuilding Braves in the National League East.

Counsel for the Orioles told The Hollywood Reporter that MASN will explore appealing the Court’s ruling before submitting to the RSDC for what would appear to be a final showdown for these crosstown rivals 12 years in the making.

Copyright: americanspirit / 123RF Stock Photo

The defamation lawsuit by retired three-time All-Star Philadelphia Phillies first-baseman Ryan Howard and All-Star Washington Nationals first-baseman Ryan Zimmerman against Al Jazeera over the controversial documentary The Dark Side: Secrets of the Sports Dopers survived a motion to dismiss Friday.  The 49-minute undercover exposé aired in late December 2015 and featured surreptitious recordings of Charles Sly, a former pharmacy intern at The Guyer Institute of Molecular Medicine in Indianapolis, who claimed he supplied Howard and Zimmerman with a performance-enhancing drug (PED) banned by Major League Baseball.  Approximately three weeks before the film aired, Sly publicly recanted his statements and declared on videotape “there is no truth to any statement of mine that Al Jazeera plans to air.”

Howard and Zimmerman filed suit in January 2016 alleging defamation and false light against Al Jazeera and reporters Deborah Davies and Liam Collins.  All three defendants moved to dismiss the action in April 2016 claiming the film lacked a direct accusation that Zimmerman and Howard used PEDs.  The defendants also attempted to shift the blame to Sly and cited the documentary’s disclaimer at the end alerting viewers to Sly’s retraction.

The U.S. District Court for the District of Columbia dismissed the case as to Collins, the undercover agent who was not involved with the documentary’s production, but kept the defamation claims against Al Jazeera and Davies in play.  Judge Ketanji Brown Jackson found Sly’s statements clearly referenced the athletes and a reasonable viewer could have interpreted the documentary to be an endorsement of Sly’s claims.

Although Howard and Zimmerman are public figures who will be required to show Al Jazeera and Davies acted with actual malice in broadcasting the report (i.e., acting with knowledge of falsity or in reckless disregard for the truth), the Court concluded the players could make this showing using evidence that Sly publicly recanted his statements weeks before the documentary aired.  Plus, plaintiffs’ counsel informed Al Jazeera before the broadcast that the documentary’s PED allegations had no merit.  Nonetheless, Al Jazeera published the film and could face millions of dollars in damages if it elected not to reasonably investigate the veracity of Sly’s scandalous assertions.

Also featured in the film is NFL icon and two-time Super Bowl Champion Peyton Manning, Green Bay Packers linebackers Mike Neal, Julius Peppers, and Clay Mathews, and Pittsburgh Steelers linebacker James Harrison.  None has filed a lawsuit against Al Jazeera to date, but Manning told ABC News the film is a “freaking joke.”

Ken Burns’ 4 hour salute of Jackie Robinson premiered on Monday. A few notes:

  1. He was a UCLA Bruin. The Dodgers wanted a college man for its first African-American player.
  2. There was no law against having Black players. There was not anything in the baseball rules. It was a “Gentleman’s Agreement” that was ruining our national game.
  3. There were no anti-discrimination laws in those days. If you were born Black or Jewish, you lived with this as an everyday reality. The NAACP fought on a daily basis to get rid of discrimination. It was so awful that when there was a lynching, they would hang a banner outside their New York headquarters proclaiming “A man was lynched yesterday.”
  4. Beware blogs, tweets, Facebook posts or any other social media entries that talk about the “good old days.” The courts existed to help some but not all.

For more sports-related legal takes, please follow our Sports Law Scoreboard blog.

For many years, only major corporate entertainment companies like studios, networks and record companies had the capacity to build entertainment brands. These companies essentially had a monopoly on all mass-market distribution channels and the research on audience spending habits which allowed them to build and sustain brand loyalty. We have all watched billion-dollar empires like The Walt Disney Company develop, market and promote branded products and characters to record profits around tentpole blockbuster movie franchises or hit television shows that are exploited around the world. Today, however, consumers of content have so many options on so many platforms that strong brand identity is a necessity for individual artists and for companies large and small to cut through the clutter.

Being a successful artist requires more than just being talented. It also requires an artist to have some basic strategic business skills and savvy to navigate the shifting industry in order to stay successful. This new reality for artists has fueled a lot of creative deal-making in recent years and an increase in the number of strategic partnerships that align artists with some of the highest profile traditional brands around the world.

In an attempt to gain market share over competitors, many corporate brands are taking on more celebrity endorsers or creating joint ventures with celebrities. While not a new concept, the volume and breadth of this practice in the industry is soaring. Celebrities and their representatives have become a lot more savvy about their how to leverage their celebrity into big dollars and in many cases asking for ownership or stock is not uncommon. Luxury brands that have never used a spokesperson before are now working with celebrities. For example, Max Mara, a global apparel and accessory line, recently began working with Jennifer Garner. Previously this retailer was known for relying solely on its product performance, traditional advertising and word of mouth to reach clientele. However, in a new world where Brad Pitt is a front-man for Channel and Halle Barry and Queen Latifah are promoting L’Oreal, it appears that Max Mara was compelled to join the party and align itself with its own celebrity partner.

Celebrities and other artists are sometimes called “multi-hyphenates” because they demonstrate the ability to have multiple talents and become branded across different mediums. A good example of a multi-hyphenate is Ryan Seacrest who is a radio personality, host of “America Idol, front-man of ABC’s New Year’s Rockin’ Eve franchise, producer of “Keeping Up with the Kardashians”, among several other television shows, and also a philanthropist through his Ryan Seacrest Foundation, a non-profit organization dedicated to enhancing to the quality of life for seriously ill and injured children.

For virtually all artists, the days of having just one revenue stream or working only one job to maintain your costs of living are over. Entering into strategic partnerships with major brands or creating their own line of products or services to be private labeled within an existing brand are just two avenues for today’s multi-hyphenate celebrity to grow their own brand and revenues.

All of the new entertainment choices for consumers have diluted the monopolies of the old entertainment business and spread the entertainment dollars across a wide variety of distribution platforms. To reach general market consumers and the most loyal fans, celebrities and businesses most think creatively and understand the new technology driven world in which we are now living. Cross-genre marketing is the new branding – and revenue generating – norm for those who understand the new world. A steady line of stars are crossing over from one market to many new areas or industries in order to create greater access to opportunities and to build multiple streams of income. This type of business strategy has become very rewarding for those who have figured out how to build the right team of representatives and manage multiple projects.

Brand partnerships, endorsements with joint ownership when possible and leveraging an individual or corporate brand across various platforms of distribution are essential components to building sustainable success in the entertainment marketplace. However, understanding the new landscape and how to maneuver within it are the new challenges for those who choose to pursue this path. Celebrity and corporate brands must evaluate each opportunity carefully and strategically to ensure that the messaging is on point, the targeted audiences benefit everyone and the collaboration makes business sense for all parties. In success, most artists and businesses find these kinds of joint ventures to be highly profitable and well worth the effort.