Fantasy Leagues Can Use MLB Players, Stats Without License

CDM Sports Wins Lawsuit Against MLBAM

Judge Mary Ann Medler of the U.S. District Court for the Eastern District of Missouri ruled yesterday in favor of St. Louis-based CDM Sports, which last year sued MLBAM in an effort to gain legal protection from using MLB player names and statistics without a license, issuing a summary judgment in the case. MLBAM argued the commercial use of such data without a license was a breach of its rights, obtained last year from the MLBPA. But Medler ruled, “The undisputed facts establish that the players do not have a right of publicity in their names and playing records as used in [CDM’s] fantasy games and that [CDM] has not violated the players’ claimed right of publicity. The court further finds, alternatively, that even if the players have a claimed right of publicity, the First Amendment takes precedence over such a right. The court will order the MLBPA and MLBAM to refrain from interfering with CBC’s [CDM’s parent] fantasy games in the manner proscribed by this court’s decision.” CDM co-Founder and VP Charlie Wiegert: "We felt all along this wasn't a protected use, that we didn't need a license to run our game, and the court said that in just about every way, shape and form. And for them to also say explicitly for MLBAM and the players association not to interfere with our games, that's a bonus.” MLBAM can appeal the decision (Eric Fisher, SportsBusiness Journal). MLBAM Senior VP/Corporate Communications Jim Gallagher said of a possible appeal, “We’re in the process of reviewing the decision. We’ll be in contact with our partners, the [MLBPA], before commenting further” (USA TODAY, 8/9).

NO MORE CHERRY PICKING: In DC, Tim Lemke reports the ruling “shoots down MLBAM’s attempts to pick and choose which companies have the right to use player names and statistics for fantasy games.” CBC was one of the “world’s largest fantasy sports companies,” but it lost most of its market share after “losing contracts with USA Today, CBS Sportsline and other big media firms, who were wary of partnering with a company unlicensed by the league” (WASHINGTON TIMES, 8/9). USA TODAY’s Michael McCarthy notes MLB “slashed its roster of licensed [fantasy] operators to seven from 20, dropping many smaller companies in the process.” Wiegert said MLB licenses cost around $2.5M this season. Wiegert “hopes the ruling will help smaller operators among the 300 or so companies offering fantasy games stay in business -– and make the NFL, NBA, NHL and NASCAR think twice before charging big money for fantasy stats.” Wiegert: “This will be a defining moment in the fantasy sports industry. The other leagues are all watching this case. If MLB prevailed, it just would have been a matter of time before they followed up” (USA TODAY, 8/9). In L.A., Greg Johnson reports MLB had sold licenses for $2M each to companies like ESPN, Yahoo and CBS SportsLine. Former N.Y. Times Public Editor and founder of the first rotisserie league Dan Okrent said of yesterday’s ruling, “The only thing that saddens me about it is that there won’t be a public trial, during which MLB’s incredible greed would have been on public display” (L.A. TIMES, 8/9).

BROADER FANTASY IMPACT: Legal observers and fantasy league experts said that the ruling “could force a restructuring of the broader fantasy sports industry -– and might have implications for other information that can be repackaged to generate profits online” (L.A. TIMES, 8/9). CNBC’s Darren Rovell reported the ruling “puts all leagues that charge for the rights to use players’ names for fantasy games in jeopardy. Given the growth of fantasy sports, insiders say that could mean $100(M) in lost income over the next decade” (“On The Money,” CNBC, 8/8).