Lawyer Article

Published in the May 21 edition of Southeast Tech Wire.

Who owns the facts? Can anyone own history? What value lies is in a name, or a number?

These questions lie at the heart of an important case currently fought over the use of baseball statistics and fantasy sports leagues. The case may arise from a child’s game, but in the information economy, the legal answers will affect many industries.

While politicians spin the facts and journalists report the facts, seldom have businesses claimed to own the commercial rights to the facts. By facts, I mean descriptions of events that actually happened after they occurred – in other words, “who did what, and when did they do it?”.

Economically, facts are distinguished from performance. For example, the knowledge that the Rolling Stones played a concert in Atlanta and performed several of their hits would not generally be considered a piece of intellectual property that is owned by the Rolling Stones or their tour promoter, but the actual performance of those songs and recording of that performance may be privately owned and commercially controlled.

The question has been important in the business of sports for decades. More than seventy years ago the Brooklyn Dodger’s baseball club established in court that the Dodgers owned the immediate news value of the facts in a baseball game that they sponsored, hosted and promoted, so that an outside person could not set up his own real-time radio broadcast of the game without permission of the Dodgers. This immediate value of sports news has been repeatedly confirmed, including the decision in a 1997 case involving the National Basketball Association’s right to license real-time scores for text-messaging service.

That text-messaging case clearly stated that once the immediate news value of sports statistics is extinguished, then the league does not have a copyright in those facts and cannot stop other businesses from using them. Major League Baseball (MLB)is taking another angle in its attempt to control the economic value of its games long after those games are in the history books. MLB is claiming that use of game statistics violates the player’s rights to control their images – know as the right of publicity. MLB is claiming this right even where pictures of the players are not used, only the player names and statistics.

Saint Louis based fantasy sports company CBC Distribution and Marketing, Inc. filed a federal lawsuit against MLB to establish CBC’s right to use major league baseball statistics without paying for a license from MLB. According the New York Times, MLB has previous argued against a right of publicity in player names and statistics when sued by its players. Now, presumably based on its 2005 contract with the Major League Player’s Association, MLB holds the legal ability to exploit its players’ publicity rights related to games, and is pushing to exclude others from using these names.

In many cases, courts have allowed celebrities to protect their names and images from commercial use by others where those uses implied a celebrity endorsement. For example, an actor may be able to restrict reference to himself in a video game where game players were likely to assume the actor cooperated with the game’s producers. But courts have also established a freedom under the First Amendment to the U.S. Constitution to use historical facts for commercial purposes.

How is the use of baseball statistics by a fantasy league different from the reporting of those statistics by a newspaper sports page? Both businesses are receiving payment – directly from readers and from advertisers – for display of those names and statistics. MLB argues that there is an important difference between merely reporting the facts, and pretending to own a team comprising celebrity players.

If MLB is successful, then the American public’s rights are further diminished in favor of large holders of intellectual property. How far could the courts go to restrict people’s ability to report on events? It may limit our ability to reference people and their actions in nearly any commercial context.

We live in an information age, where digital technology and interconnectivity encourage viewing data in new ways. But the rules surrounding commercial use of this data are still being formed. The future of creative businesses based on the abstraction of data from events – sporting events, political events, or natural occurrences – will hinge on these rules.