SBD/March 21, 2011/Marketing and Sponsorship

NFL Lockout Watch, Day 10: League Warns Sponsors About Deals With Players Group

The NFL disclosed that it is "advising sponsors to be wary about signing group licensing deals with the players' newly established trade association, strongly suggesting that the group might not have the legal right to market the players," according to Daniel Kaplan of SPORTSBUSINESS JOURNAL. The decertified NFLPA has said that it "continues to represent players for group licensing, but the league is questioning that assertion." NFL Senior VP/Business Affairs & General Counsel Gary Gertzog said, "We don't understand the source of their rights. In the (now expired) CBA, it states group licensing rights are designed to support the objective of the union. If the union no longer exists, there is certainly a question whether those rights are valid, and people who do business (with the new players association) should be looking into those questions." Gertzog added, "We have communicated to our sponsors who were relying on these rights (that) if they are still interested in group players they will have to find out how to access those benefits, whether through some other entity the former union has or going directly to the agents or players." Kaplan notes his "point is that group licensing is tied directly to the union's bylaws, which no longer exist." Octagon Exec VP Woody Thompson, whose agency works with NFL team sponsors Sprint and MasterCard, said, "The waters are very murky. There are statements being made by a number of parties about what will and will not fly for (NFL) sponsors and non-sponsors. I think it's a little bit of a wild West show right now." He added, "The PA is telling us that their marketing agreements are unaffected ... but if the PA doesn't exist, I don't know how they can have any rights over what we do with individual players" (SPORTSBUSINESS JOURNAL, 3/21 issue).

NFLPA TALKING WITH SPONSORS: The NFLPA's marketing and licensing arm is currently in discussions with some NFL sponsors as well as a number of non-NFL sponsors in many categories which are now open to deals with the players about new sponsorship deals with the decertified union, which is now operating as a trade association. "We have had several discussions with league sponsors and for contingency sponsorship agreements that would essentially continue their ability to utilize group player licensing rights, but the majority of sponsorship categories remain open," said Keith Gordon, President of NFL Players, the NFLPA's marketing and licensing arm. "And NFL Players has engaged in discussion with a variety of potential sponsors across those categories," he said. The categories which are open for new, non-NFL sponsors include QSR, automotive, beer, travel, and various technology products, he said. Meanwhile, the expiration of the commercial agreement will not affect EA Sports' "Madden" videogame franchise, as the NFLPA has a separate licensing agreement with EA Sports, Gordon said. "Madden will be released this year," Gordon said. "What you may see is some delayed rosters” (Liz Mullen, SportsBusiness Journal).

PARTNERS WARY OF LABOR UNCERTAINTY: Packers President & CEO Mark Murphy revealed yesterday that "some corporate sponsors are expressing concern about renewing their deals with the uncertainty of the 2011 regular season." Murphy: "For a lot of sponsorships, there is a lead time. They're worried (whether) this will be resolved in time for (them) to be able to start programs in time for the season." He also suggested that "some teams are having trouble getting commitments for premium seating in their stadiums, although the Packers are not likely to be one of those" (ESPN.com, 3/20). Murphy added, "Sponsorships require lead time, and a lot of the sponsors you're talking to are worried about this being resolved in time to do something (for the 2011 season)" (N.Y. POST, 3/21). Bank of America Senior VP/Global Sponsorship Charles Greenstein said that BofA has "been in close contact with the teams it sponsors" about the lockout. Industry sources said that BofA and other sponsors are "holding off, for now, on planning specific in-season promotions and advertising" (CHARLOTTE BUSINESS JOURNAL, 3/18 issue). Meanwhile, Panthers President Danny Morrison said that team officials have "reached out to their corporate partners to address alternatives should the lockout drag into the summer and threaten the league's training camp or regular season." Morrison: "We're just having continuing dialogue. And that way, we're able to shift gears if needed." He noted that the Panthers "have sponsorship deals connected to the draft that will not be affected" (CHARLOTTE OBSERVER, 3/21).
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