Sports & Entertainment Beat

Happy Spring! After an especially long winter throughout several parts of the country, it is a welcome sight to see many of the familiar hallmarks of this time of year (even as our daily lives remain markedly different from this time two years ago): MLB Spring Training, Awards season and busted brackets (thank you, Oral Roberts).Without further ado, below is a sampling of the latest for you to tuck away in your bonnet:

Welcome back and to those of you who celebrated a belated Happy St. Patrick’s Day. While I can’t promise that this installment of the Spotlight will be the “hair of the dog,” it should still make for a great accompaniment with your coffee(s). Without further ado, here is a sampling of what I found at the other end of the rainbow:

• • Former NFL greats (and momentary draft day teammates) Eli Manning and LaDainian Tomlinson are the latest big name athletes to get into the SPAC game, backing a $200 million blank check company in its pursuit of a consumer-oriented company that can leverage “influence driven purchases” and “talent as brands.”
  • Music streaming service SoundCloud appears to be experimenting with a new per-stream royalty structure, marking a deviation from the model favored by streaming giants Apple Music and Spotify. Pay-per-stream certainly seems like it could go a long way to provide transparency and allow more artists to garner meaningful streaming income.
  • The Non-fungible Token (NFT) market remains hot, with more influencers and institutional players adapting to take advantage of the new crypto opportunities in the sports, arts and entertainment world, while others sound the alarm on the viability of NFTs as an asset. Only time will tell whether we are witnessing a passing fad or a sign of things to come.
  • After a two-year hiatus because of the COVID-19 pandemic, the National Collegiate Athletic Association (NCAA) Men’s and Women’s Basketball Tournaments will be (fingers crossed) set in motion, and due to recent legislative developments in New Mexico and Maryland, it appears that at least some of the players and their fellow collegiate athletes will soon be able to be compensated for the use of their name, image and likeness (NIL). Until the ever-elusive federal legislation is passed, collegiate athletes (and the NCAA) will have to deal with a patchwork of laws and regulations in the near term.
    
    

Welcome back to another week in the Spotlight. It is truly remarkable to think that it has (already? only?) been one year since the World Health Organization’s declaration of the COVID-19 pandemic, shuttering sports arenas, film sets, theatres, concert venues and disrupting people’s way of life – that of course is nothing in comparison to the human toll of the disease. Still, the beat goes on…

At any rate, below is a sampling of some developments that caught my attention this week:

Greetings, and welcome to the inaugural edition of the Sports & Entertainment Spotlight series! The product of my unrequited desire for human interaction nearly one year into the COVID-19 pandemic, this weekly feature will endeavor to bring readers up to speed on new, noteworthy and/or cutting-edge business and legal developments in the sports and entertainment industries. I hope you find it informative and fascinating, as I certainly do. If there are any topics you’d like to read more about, please feel free to let me know.

This week’s installment spotlights some noteworthy trends and developments, including:

With the Super Bowl coming up, it is important for brands looking to capitalize on football-themed promotions to remember that the terms “Super Bowl” and “Super Sunday” are registered trademarks guarded by the National Football League (NFL) more closely than a shutdown corner on a wide receiver. Because there is a fine line between permissible fair uses of Super Bowl and Super Sunday (e.g., in on-air banter and news and sports reports) and impermissible promotional uses that may infringe the NFL’s trademark, here are some guidelines to keep you from going “offsides:”

California Adopts Bill Allowing Athletes to Earn Money from Marketing Promotions or Endorsement Deals

On Monday, September 30, 2019, California Governor Gavin Newsom signed into law SB 206, the "Fair Pay to Play Act," which is a bill that could fundamentally transform collegiate athletics amateurism rules. The bill allows college athletes to earn money from the use of their name, image or likeness through sponsorships and/or endorsements, which is in direct conflict with the National Collegiate Athletic Association (the "NCAA") amateurism rules.[1] The Fair Pay to Play Act will go into effect in 2023 and will apply to all 58 California NCAA-affiliated schools.[2]

The Fair Pay to Play Act does not require colleges to pay their athletes, but rather will prohibit schools from upholding rules preventing student athletes from participating in intercollegiate athletics because the athlete is being compensated for the use of their name, image or likeness.[3] This prohibition will apply to institutions and organizations affecting California student athletes, including the athlete’s academic institution, the NCAA and collegiate athletic conferences such as the Pac-12.[4] However, colleges will be able to control the types of sponsorships or endorsements students may enter into, so that student deals will not directly conflict with preexisting school sponsorship deals.[5]

The Largest College Admissions Bribery Scandal Erupted in the United States With a Number of Celebrities as Targets

In the early weeks of March, news broke of the largest college admissions scandal in the country's history, nicknamed "Operation Varsity Blues".  At least 40 people were charged with conspiracy to commit mail fraud and honest services mail fraud for their alleged participation in the scheme. Among those charged was actress, Lori Loughlin, who is most famous for her role as Aunt Becky on ABC's hit sitcom series Full House. Charges against her allege that, in order to get her children into the University of Southern California ("USC"), Loughlin paid $500,000 to have her daughters designated as crew recruits, although it is reported that they did not participate in that sport. One day after 14 parties involved in the scheme agreed to plead guilty, 16 parents, including Loughlin and her husband, were charged in a second indictment for conspiring to commit fraud and money laundering. Loughlin has refused to plead guilty and plans to fight these charges.

This post was originally published on GSB's website as a GSB client update on April 2, 2019.

On March 4^th, the Supreme Court ruled that copyright owners must wait to file an infringement suit until the Copyright Office has registered the work. The unanimous opinion, authored by Justice Ruth Bader Ginsburg in Fourth Estate Public Benefit Corp. v. Wall-Street.Com, LLC, affirmed the Eleventh Circuit and resolved a split among the circuit courts of appeal. The decision has significant implications for copyright holders and contract or legislation drafters, and comes at a time of change.

Social media platforms provide a powerful, and efficient means for brands to partner with celebrity “influencers” and reach millions with something as simple as a photograph and a few lines of text. However, as demonstrated by the recent actions initiated by the leading consumer protection agency in the United States, the Federal Trade Commission (FTC) stressing to influencers and marketers the importance of clear and conspicuous disclosure of brand relationships when promoting products on social media, these strategies are rife with pitfalls for brands and influencers, alike.[1] So, how do individuals and brands comply? There are no hard and fast rules, but the FTC's Guides Concerning the Use of Endorsements and Testimonials in Advertising[2] (the “Guides”), provide a general roadmap within which to operate.

This post was originally published on GSB's website as a GSB Client Update on August 13, 2018.

Is Sports Betting Legal?

Until a recent Supreme Court decision addressed the question, the answer was fairly straightforward: sports betting was allowed in only four states. All other states were prohibited from legalizing sports betting.

On May 14, 2018, in Murphy v. NCAA, the Supreme Court struck down the Professional and Amateur Sports Protection Act (“PASPA”) on grounds that the Constitution prevents Congress from “commandeering” the legislative decision of states.