Should video game producers pay licensing fees to football players?

Cam Newton EA Sports

Intellectual property will be the death of college football. As previously discussed, universities have become more aggressive in attacking every perceived “exploitation” of their football identities, and now some former players want to get in on the act. The end result will be a market less hospitable to fans and more accessible for lawyers.

Cam Newton EA Sports

Cam Newton on the NCAA Football ’12 Cover

The former players are class action plaintiffs, led by former Arizona State and Nebraska quarterback Sam Keller, who have sued the NCAA and Electronic Arts, producers of the officially licensed NCAA video games, on a variety of charges related to the alleged misappropriation of player images. The problem stems from the NCAA’s amateurism policies, which prevents the direct licensing of an athlete’s “name, picture or likeness.” This policy extends to the Collegiate Licensing Company, the third co-defendant in this case, which is a Georgia-based company that manages the trademark licensing for the NCAA and several of its members.

The Keller lawsuit maintains that EA gets around the NCAA rule, with the implied consent of the NCAA and CLC, by replicating player likenesses in its games—matching the “skin tone, hair color, and often a player’s hair style”—while omitting his actual name. The lawsuit argues this “misappropriation” of player images deprives players of their “rights of publicity,” which is a form of intellectual property created under the laws of some states.

EA is caught in a bind. The company has indicated it would have no problem paying players to license their images, except then the players would be declared ineligible under NCAA rules. That said, the company has rejected the legal argument that it must “license” images at all. EA contends its video games are artistic expression, a form of speech protected under the First Amendment, and that such rights trump any state-law publicity rights claim.

The trial judge overseeing the class action disagreed and denied EA’s motion to dismiss on First Amendment grounds. EA appealed this decision to the San Francisco-based Ninth Circuit Court of Appeals. A three-judge panel of that court was supposed to decide this question last year, but one of the judges died before a decision was published, and so the case was re-argued before a new panel last month. (There are actually two appeals; the other involves a similar publicity rights lawsuit brought by Hall of Famer Jim Brown against EA.)

The appellate judges have to decide to what extent publicity rights—in this case, under California law—trump EA’s artistic expression. During oral arguments, the lawyers and judges discussed the applicability of the “famous human cannonball case,” a reference to a 1977 U.S. Supreme Court decision involving Hugo Zacchini, a county fair performer who sued an Ohio television station after it aired a tape of his act without permission. The Supreme Court, in a decision authored by former Colorado All-American halfback Byron “Whizzer” White, ruled for Zacchini, holding that the station’s broadcast effectively denied the performer of his right to control the marketing of his act:

The broadcast of a film of [Zacchini’s] entire act poses a substantial threat to the economic value of that performance. As the Ohio court recognized, this act is the product of petitioner’s own talents and energy, the end result of much time, effort, and expense. Much of its economic value lies in the “right of exclusive control over the publicity given to his performance”; if the public can see the act free on television, it will be less willing to pay to see it at the fair.

The difference here, EA argued, is that it didn’t simply film games and resell them without consent. Rather, EA created avatars based on publicly available information—statistics and player descriptions—for use in an interactive video game. That “transformative use” makes the video game protected expression under the First Amendment.

Keller’s attorneys pointed to other court decisions limiting the “transformative use” defense. In February 2011, a California appeals court ruled against Activision Publishing, the makers of Band Hero, for using avatars of the band No Doubt without the group’s consent. The California court said the video game did not contain enough unique elements to “transform” the band’s depiction into protected speech:

[N]o matter what else occurs in the game during the depiction of the No Doubt avatars, the avatars perform rock songs, the same activity by which the band achieved and maintains its fame. Moreover, the avatars perform those songs as literal recreations of the band members. That the avatars can be manipulated to perform at fanciful venues including outer space or to sing songs the real band would object to singing, or that the avatars appear in the context of a video game that contains many other creative elements, does not transform the avatars into anything other than exact depictions of No Doubt’s members doing exactly what they do as celebrities.

Similarly, Keller’s attorneys maintained, merely depicting real-world college football players in a “realistic” simulation of college football does not involve any genuine artistic expression.

Lost in all this hair-splitting are the interests of the fans. “Publicity rights” law is fundamentally flawed because it ignores the paramount role of the consumer in creating value. The Keller plaintiffs would have you believe there is an objective, independent “publicity” value derived solely from the players’ work ethic and on-field performance. But that’s not how markets work. It’s the subjective valuation by individual consumers that create value—their decisions on what jerseys to purchase, for example.

This should be particularly obvious in the case of college football. Unlike No Doubt, which is a band that exists independent of other musical acts, individual football players function within a team and established program. Cam Newton is a phenomenal athlete. But would his “persona” command the same value if he had played at a Division III school instead of Auburn? The school makes the player more than anything—and the fans make the school.

If the Ninth Circuit rules against EA and allows the Keller lawsuit to proceed, we’re looking at a potential inversion of the fan-athlete relationship. The “publicity rights” laws are nothing more than special privileges for celebrities to censor speech they don’t like (or don’t profit from). Extending this privilege to college athletes means anyone who talks about a player—even a website like Saturday Down South—could face a lawyer shakedown.

That’s not to say there isn’t a legitimate gripe buried underneath the facade of “publicity rights.” This entire litigation could end today if the NCAA would simply agree to share some of its licensing revenues with current and former players. EA’s counsel noted during Ninth Circuit arguments that even if the company doesn’t have a legal obligation to license games, it’s still in the firm’s interest to do so, not only to avoid costly litigation but because there’s marketing value in such relationships. The only thing keeping EA from building such relationships with players is the NCAA, which effectively claims its own “intellectual property” rights over all current and former college athletes.

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