From stealing to kneeling, what do NFL player contracts say about “bad” behavior?

From stealing to kneeling, what do NFL player contracts say about “bad” behavior?

Three times each year, two professional American football teams journey across the pond to play against each other in the NFL London Games. This weekend however, four players from the Jacksonville Jaguars made headlines for something they did off the field. They were arrested under suspicion of fraud by false representation for attempting to leave a nightclub without paying the £50,000 ($64,000) bar tab.

According to ProFootball Talk, expensive bottles of champagne and vodka were sent to the players’ table. They thought someone else was paying, and were surprised to learn that they were expected to pay. The bill was settled hours after the arrest, and the players were released with no further action taken by police. “There was definitely a misunderstanding,” said Barry Church, one of the players arrested. “We handled it as a private matter within the team, and we’ll just go from there.”

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Despite their fame and talent, at the end of the day, professional athletes are capable of making mistakes just like the rest of us. But unlike the rest of us, sports stars are often contractually obligated to maintain a positive reputation.

The NFL has had a formal policy addressing off-field conduct since 1997. The current 2014 Personal Conduct Policy prohibits physical violence, illegal possession of a gun or drugs, and cruelty to animals – remember Michael Vick and his dogfightingBut the policy also prohibits anything “that undermines or puts at risk the integrity of and public confidence in the NFL.” Even if a player’s conduct does not result in a criminal conviction, the NFL can impose fines, suspension, or even banishment from the league.

In addition to the NFL Policy, individual player contracts also contain “morality clauses.” Also known as a “moral turpitude clause” or “bad boy clause”, this permits an employer to end the contractual relationship if the employee’s conduct breaches the moral expectations laid out in the employment or endorsement agreement. For my overview of the history and use of morality clauses more generally, see Morality Clauses in Talent Contracts.

The 2012 contract between Arian Foster (“Player”) and the Houston Texans (“Club”) is available online thanks to a (fascinating) IPO filing with the Securities and Exchange Commission. Clauses regarding Foster’s behaviour and conduct included:

  • Player agrees to give his best efforts and loyalty to the Club, and to conduct himself on and off the field with appropriate recognition of the fact that the success of professional football depends largely on public respect for and approval of those associated with the game. 
  • If at any time, in the sole judgement of Club, Player has engaged in personal conduct reasonably judged by Club to adversely affect or reflect on Club, then Club may terminate this contract.
  • Player recognizes the detriment to the League and professional football that would result from impairment of public confidence in the integrity and good character of NFL players.

“Meaning Transference” and marketing magic

You might be wondering why a football team should care about the off-field behaviour of its players. As long as the guy can run the ball or block a tackle, who cares if he’s arrested for trying to skip out on a bar tab. Right? Wrong.

Consider for a moment the amount of money teams and companies invest in employment contracts and endorsement agreements. By way of example, Russell Wilson earned $2 million during his first three seasons with the Seattle Seahawks. In 2015, the Hawks rewarded their quarterback with a renewed contract worth nearly $90 million. Wilson also gets $10 million a year from his deals with Bose, Nike, and Alaska Airlines. On the other side of the country, the New York Giants’ wide receiver Odell Beckham Jr is earning about $10 million over four years. But the real kicker is that Nike recently signed him for the biggest shoe endorsement ever, worth $25 million over five years.

CFO
“Seattle’s hometown airline” Alaska Airlines “couldn’t be more proud of Seattle’s football hero, Russell Wilson.” Thanks to Wilson’s impressive skill and wholesome image, they even made him their CFO! Chief Football Officer, that is.

Meaning Transference is a social theory which posits consumers “transfer” the perceived ideals, credibility and reputation of celebrities to the associated product or service being sold (Grant McCracken). Because negative perceptions can also transfer, a company will want to distance themselves if a celebrity behaves badly. Essentially, morality clauses protect the team or company’s public image from the athlete’s potential scandals. In practice, this could mean suspending or terminating the contract, which could cost the athlete thousands – or potentially millions – of dollars.

The crux of any morality clause is how the “bad behaviour” is defined. Does a player kneeling during the American national anthem adversely affect the image of the NFL?

Given today’s heated political climate, it’s no surprise that professional athletes are increasingly voicing – or otherwise demonstrating – their opinions on social issues. In 2016, Colin Kaepernick of the San Fransisco 49’s started the trend of protesting police brutality and racial inequality, by kneeling during the national anthem at the start of games. Other players soon joined in, much to the ire of many football fans and prominent figures, including President Trump. That same year, Kaepernick was deemed the most hated player in the NFL.

Speaking to The Washington Postconstitutional law Professor Fred Smith Jr. described the anthem debate as a “clash of values which has become a very fraught issue in the American political imagination.” The NFL reacted to the situation by announcing a new policy in May of this year: players must either stand for the national anthem on the field or wait in the locker room. The policy was then shut down by the NFL’s labour union (NFLPA) only two months later.

As the NFL and the NFLPA continue to negotiate, “no new rules relating to the anthem will be issued or enforced”. However, introduction of the new rules in the first place demonstrates that the NFL is at least attempting to mitigate the perception that it is an unpatriotic organisation. It could be argued that from the NFL’s perspective, it is the result of the public’s perception that matters, and not the conduct itself. 

In spite of the furor and uproar, Nike made a risky decision in September to feature Colin Kaepernick in an advertising campaign. Despite some backlash and boycotts, the move paid off handsomely overall: Nike received valuable free publicity, and online sales and stock price skyrocketed. In this way, Kaepernick’s kneeling is both detrimental to one organisation (the NFL), as well as highly profitable for another (Nike).

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Nike released a controversial commercial featuring Colin Kaepernick, which hints at the embroilment over NFL players kneeling during the American national anthem.

Ultimately, it is critical to understand that morality clauses attempt to regulate something that is continually in flux. Opponents of morality clauses worry that the definition of what constitutes “immoral” or damaging activity could be too broad and subject to abuse by the employer. Smart sports stars and their lawyers will therefore do well to ensure that morality clauses are carefully negotiated and written precisely in order to protect their position – and their paycheques.

A Step Too Far? Fifa takes down celebratory World Cup dance video

A Step Too Far? Fifa takes down celebratory World Cup dance video

This story was first published for the 1709 Blog, where I regularly write about copyright law in entertainment, technology and media. 

The World Cup is the largest single sporting event on Earth, with nearly half the world’s population tuning in. With England’s (somewhat surprisingly!) good run up to the Semi-Finals, fans of the Three Lions were especially eager to show their support.

When England’s captain Harry Kane scored a goal against Tunisia, a mother filmed her 7-year old boy celebrating the moment. She subsequently posted the short 5-second clip of him dancing in the living room on Twitter. However, FIFA – Football’s ruling body – ordered the clip removed from Twitter. FIFA claimed the clip infringed their copyright, as viewers could see blurred football action from the family’s TV in the background.

Speaking to the Mirror, Kathryn Conn explained that her son “is a massive Spurs fan and he absolutely worships Harry Kane so he started dancing around in the living room. All you can see on the TV in the background is a really blurry replay of the goal. It’s hardly visible.”

According to Conn’s tweet on the subject, the copyright notice from Twitter was brought under the US Digital Millennium Copyright Act. Several sources including iNews report that Fifa issued a letter stating: “On behalf of Fifa, we hereby assert that your making available and/or promoting of the protected content on your platform is not authorised by Fifa, its agent nor the law and that your activities in this regard serve as a serious infringement of Fifa’s exclusive rights.”

By way of background, Fifa reports on its finances page that around 95% of its revenues come from the sale of television broadcasting, marketing, and licensing rights related to the FIFA World Cup. From the 2014 World Cup in Brazil, Fifa hauled in $4.8 billion in revenue, which turned a $2.6 billion profit for the association (which is then re-invested into development projects). Compared to ticket sales earned $527 million, Fifa’s broadcast revenue topped $2.43 billion, while sponsorship fees brought in $1.6 billion.

To date, Fifa’s intellectual property portfolio contains 14,000 trade mark registrations, about 300 registered designs, and 150 copyright registrations covering 157 jurisdictions overall. As is made clear in its 30-plus pages of official guidance on brand protection, Fifa has millions of reasons to be protective of its intellectual property.

Fifa engages in active surveillance and brand protection, which includes court proceedings to halt an infringing situation and seek financial compensation for any damages suffered. However, sharing official content belonging to FIFA by fans without any commercial benefit is expressly permitted, as per the branding guidance. Curious by nature, this CopyKat’s therefore wonders why an account with barely 200 followers was singled out in this instance.

Fair Play to use FIFA trade marks on social media?

Fair Play to use FIFA trade marks on social media?

This weekend, together with millions of others around the world, I watched Iceland make its World Cup debut against Argentina. Iceland, the smallest nation to ever qualify for the World Cup, is a special country for me, not least because my husband and were married there! Especially as my home country failed to qualify for this year’s tournament (sigh) it comes as no surprise that I’m supporting the Iceland’s national football team, or Íslenska karlalandsliðið í knattspyrnu.

I recently came across an article which said fans should beware of using World Cup logos in social media profile pictures. The article explained that although “many fans will be using social media to show their support by uploading images of their country’s flags and the World Cup logo as their profile pictures, by uploading the World Cup logo in your pictures you could be infringing intellectual property rights owned by the Fédération Internationale de Football Association (FIFA).”

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So, what’s the deal? Does my newly updated Facebook photo, which features FIFA’s official emblem, unlawfully infringe upon FIFA’s trade mark? The answer is below…

Intellectual Property is football’s star player.
The World Cup is the largest single sporting event on Earth, with nearly half the world’s population tuning in. The tournament, which runs from June 14 to July 15 is being hosted in Russia for the first time, at an official cost of 683 billion rubles or £8.4 billion (Reuters).

As reported on its finances page, around 95% of FIFA’s revenues come from the sale of television broadcasting, marketing, and licensing rights related to the FIFA World Cup. In exchange for funding, FIFA grants exclusive rights to use its official marks to certain companies, which this year include addidas, Coca Cola, Gazprom, Budweiser, and Visa (rights holders).

In its 30-plus pages of official guidance on brand protection, FIFA claims that if anyone could use the official marks for free, the power of the marks would dilute and there would be no reason for companies to pay for sponsorship. Without lucrative corporate partnerships FIFA would lack the revenue required to organise the World Cup.

From the 2014 World Cup in Brazil, FIFA hauled in $4.8 billion in revenue, which turned a $2.6 billion profit for the association (which is then re-invested into development projects). Broadcast revenue topped $2.43 billion, while sponsorship fees brought in $1.6 billion and ticket sales earned $527 million. In other words, it’s not ticket sales that pay the bills: it’s intellectual property.

To date, FIFA’s intellectual property portfolio contains 14,000 trade mark registrations, about 300 registered designs, and 150 copyright registrations covering 157 jurisdictions overall (Official marks). Official marks include the flag, logo, hymn, and motto of FIFA, mascots, emblems, posters, and identification symbols.

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the official emblem and the official mascot, which is a Eurasian wolf named Zabivaka. According to the FIFA website, Zabivaka – which means “goal scorer” in Russian – “radiates fun, charm and confidence.”

The words “FIFA”, “2018 FIFA World Cup”, “World Cup Russia”, “FIFA World Cup”, “Football World Cup”, and “Soccer World Cup” are also protected, as are “Russia 2018” and “Moscow 2018.” Simply writing “Russia 2018” on a t-shirt could land you in trouble, as doing so may lead consumers to establish an unlawful association with FIFA’s tournament.

Trade marks as broad as these are generally not enforceable. One wonders if these trade marks would have been approved in the first place, were it not for the massive size and power of FIFA. However, it’s also important to note that, without the co-operation of local officials, FIFA lacks both adequate legitimacy and capability to effectively police and protect their official marks.

Russian law.
Domestic law provides FIFA with the additional teeth needed to enforce its intellectual property rights. In March of 2013, Russia passed the Federal Law No 108-FZ On preparation for and the staging of the 2018 FIFA World Cup (“World Cup Law”). There are provisions aimed at protecting FIFA’s commercial rights, including a specific procedure for the registration of FIFA’s trademarks. Under Article 19, pre-existing Russian trademarks that are identical or similar to FIFA’s are prohibited for use until 2019.

Compliance is supervised by the Russian Federal Service for Surveillance of Consumer Rights Protection and Human Wellbeing (Rospotrebnadzor) and the Federal Service for Supervision of Communications, Information Technology and Mass Media (Roskomnadzor).

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FIFA poster in front of the Kremlin, Moscow

On November 2017, Rospotrebnadzor adopted an agenda to prepare for the World Cup, including the key priority of supervising the use of FIFA’s official marks. In March, the Roskomnadzor announced that it had placed 858 websites selling counterfeit products on the so-called “Russian Internet Blacklist“, the Unified Register of Prohibited Information.

Additionally, the Federal Antimonopoly Service (FAS) can also hold parties accountable for illegal use of official marks. By way of example, Bavaria Brewing House Group Ltd and Agrofirma FAT Ltd raffled tickets for the World Cup final on their website and on social media. They also used FIFA trade marks in their promotional campaign and to mark their “Bavaria” beer. As neither Bavaria Brewing House nor Agrofirma FAT were licensed rights holders, the FAS issued an injunction against the companies to stop the violations.

What this means for fans.
FIFA engages in active surveillance and brand protection, which includes court proceedings to halt an infringing situation and seek financial compensation for any damages suffered.

It’s important to note that sports bars, restaurants, clothing brands and other companies are welcome to use generic football or country related images, provided they do not include any of FIFA’s official marks. The key here is avoiding reference to the World Cup that could suggest your company has an official relationship with FIFA.

But should individuals be worried about changing their profile pics on Facebook, if those photos include official marks? Not really. This is because sharing official content belonging to FIFA by fans without any commercial benefit is expressly permitted. This includes sharing on Facebook, Twitter, or even here on KelseyFarish.com, as blogs without commercial content are likewise exempted. Provided that you don’t attempt to make money by unlawfully using FIFA’s official marks, go on and enjoy the beautiful game!

Ricciardo’s ritual returns at Monaco Grand Prix

Ricciardo’s ritual returns at Monaco Grand Prix

Australian Formula One driver Daniel Ricciardo has an interesting celebratory ritual: he drinks champagne from his sweaty racing shoe. Keen to capitalise on the popularity of the stunt, Formula One has recently trademarked the name of this quirky act, known as a “shoey.”

Drinking champagne from a lady’s slipper was once a symbol of decadence in the early 1900s. According to drinks and culture website VinePair, sipping booze from shoes is said to be of Russian origin, dating back to the late 19th century. At the Bolshoi Ballet in Moscow, fans may have drunk vodka from their favourite ballerinas’ satin slippers!

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The shoey celebration has found itself popular once again, at least in Australia. Dean and Shaun Harrington of the The Mad Hueys surfing brand are said to have reintroduced this strange practice – and the name “shoey” – back in 2002. As The Mad Hueys gained in popularity, more celebs in the shoey.

However, the shoey only really hit the global stage after Red Bull racing champ Daniel Ricciardo adopted the tradition to celebrate his racing victories. During a press conference in 2016, Ricciardo admitted that it “basically comes from a few Aussies called the Mad Hueys. I just thought I’d keep the Australian tradition going!” Cognizant as ever of the branding and merchandising potential behind their biggest stars, Formula One Licensing B.V. has now trademarked shoey.

When asked at the Spanish Grand Prix about F1 trademarking his so-called trademark, Ricciardo said, “I don’t know what that means. Can I still do it or are they going to fine me every time?”

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Daniel Ricciardo (Australia, racing for Red Bull) does a “shoey” on the podium, while Lewis Hamilton (UK, racing for Mercedes) who came in third, looks on.

Hopefully by now, his team will have explained that the trademark protection only extends to the use of the word on certain products. F1 won’t be able to stop Daniel, or anyone else for that matter, from celebrating in this way.

Now registered in 25 countries, the shoey trademark is protected in the United States, Germany, Italy, France and the United Kingdom (you can see the UK’s Intellectual Property Office record here).

It’s important to note that trademarks are categorised according to the products or services to which they relate. When making an application for trademark protection, the applicant must choose from one of the classifications under the Nice Agreement (1957). Registering a trademark in one particular class cannot prevent someone from registering the same trademark in a different class.

F1’s shoey registration is for use on items in Class 21, which covers household goods such as glasses, bottles, mugs, sculptures and figurines. Accordingly, we might see shoe-shaped beer steins with shoey written on them for sale at the F1 shop. In addition – or perhaps alternatively – trademarking shoey could be a defensive move by F1, to keep someone else out of the market.

F1 previously attempted to register shoey in Class 25, which would have protected the use of shoey on clothing, hats, and some types of shoes. However, this was cancelled due to an earlier registration by the Harringtons. This is why the Mad Hueys are able to use shoey on their line of clothing, but wouldn’t be able to use it on glasses or mugs without stepping on F1’s toes (or tyres, I suppose).

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Trademark battle: The Mad Hueys website explains: “Passed down from our ancestors, the Shoey ritual runs deep within The Hueys family. The Shoey is ours and its here to stay! This limited edition collection asserts our position as the true kings of the Shoey!”

UEFA scores goal against internet giants to prevent copyright infringement

UEFA scores goal against internet giants to prevent copyright infringement

Union Des Associations Européennes De Football (UEFA), whose members include 55 national football associations, organises some of the most famous and prestigious football competitions in Europe. Recently, UEFA obtained an injunction against the UK’s main retail internet service providers.

As a substitute for paid subscriptions to sport packages through Sky, BT and others, some football fans are instead using set-top box devices such as Kodi to connect directly to streaming servers via their IP addresses. A survey for the BBC found that 47% of adults have watched a football match through an illegal provider at least once, with 36% streaming matches at least once per month.

Infringement in this way is on the rise for two key reasons. Firstly, an increasing proportion of UK consumers mistakenly believe using devices to access unauthorised streams is lawful. Secondly, most people know they personally won’t face charges for pirating illegal streams.

UEFA therefore applied for an injunction against the internet companies themselves, relying on the principle of “online intermediary liability.” Online intermediaries are companies which provide the infrastructure and data storage to facilitate transactions over the internet. Examples of intermediaries are search engines, web hosts, and internet access and service providers (“ISPs”).

Rather than go after private users, copyright holders – such as UEFA, movie stuidos and record labels – consider corporate intermediaries to be more viable targets for lawsuits. Accordingly, if online intermediaries have actual knowledge of the copyright infringement, they may be liable for the illegal behaviour of their customers and viewers.

Services of intermediaries may increasingly be used by third parties for infringing activities. In many cases such intermediaries are best placed to bring such infringing activities to an end. — Recital 59, Information Society Directive (2001/29/EC)

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