SBJ/October 22-28, 2012/Opinion

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  • Cartoon: Frozen out

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  • Could sports adopt the polarizing political talk-show model?

    I was a political junkie.

    My parents exposed me to the process and various candidates at an early age. At age 8, I met Gerald Ford’s son, John, during a campaign stop for his father in Vermont. I met GOP presidential candidate George H.W. Bush during a small rally in 1979, when I was 11. I worked for Gary Hart while in high school and, yes, even during his scandal-tarred run in 1988. My first job out of college was as an unpaid intern for U.S. Sen. Patrick J. Leahy (D-Vt.) in Washington, D.C.

    I was so hooked. I loved the look, feel, vibe and pulse of our nation’s capital. Walking to work past the Supreme Court and the Capitol rotunda and walking the halls of Senate offices for “work” was a high I’ll never forget. I worked in politics until I was 26, when I decided to go after my first love of working in sports. I never regretted the decision. I am still interested in the issues, the personalities and the strategies of the political process, but like many, I have become blindingly numb to the polarizing noise — the failure of our political system and its “leaders.” Night after night, I try to watch the news shows for some insight into the issues of the day, but they are so politically skewed and biased that they prevent me from getting any measured, clear-minded and balanced information.

    One could argue that Rupert Murdoch’s Fox News was the instigator of this format by identifying and exploiting a “niche” of people on the right who felt their views were not represented in how news was presented. So, by saying that the rest of the media was left, they became the alternative. But then came MSNBC after liberals got so angry about Fox News. They joined in on the game and gave their own one-sided view of the news.

    One night recently when flipping through this sanctimonious madness, I wondered how this could equate to sports.

    ESPN is the one-network mainstream media. Who are they underserving? Hockey, soccer or UFC fans, perhaps? Certainly not NFL fans. This could lead to a network defining a niche, and then positioning itself against the powers that be that are not satisfying that group of viewers — and then exploiting the hell out of that niche. So, could we ever see sports follow the political talk-show model? Could, or would, a more developed NBC Sports Network hit ESPN the way Fox News and MSNBC go after each other? Is Fox Sports 1 prepared to become Deadspin on air? Most viewers have been OK with the polarization of news programming. Would they be OK with it in sports? Wouldn’t leagues and properties be resistant to such muckraking, fearful of dividing loyalties? Networks search for the largest audiences, and if this format draws for our news programming, it may be a blueprint for sports. I’m not advocating for it in the least, but as the election nears, it’s a topic that has crossed my mind. Thoughts or comments?

    > SPORTS AND POLITICS: We’ve always tried to do a package of stories on the nexus between sports and politics around an election year. This year, when we sat around the edit table going over ideas, we had more than a few interesting thoughts — including taking a look at Mitt Romney by talking to the people in sports business who worked with him throughout his career. Instead, we decided to look more closely at what role sports played in a candidate’s evolving and vital media strategy. So this week, we’re rolling out extensive data from nine battleground states. This project couldn’t have been done without the smart work and long hours of senior writer Bill King and research director David Broughton, who pored over more than 5,000 filings and spent many a late night and early morning completing the analysis.

    What stood out for them? “The degree of detail with which these campaigns are managing their ad spends,” King said. “Not only are we talking about decisions on what market to buy in, and which programming to buy, but then the money moves around as the rates move and as the budgets shift. I was struck by how fluid it is. You’ll see 10 or 11 changes off a single order. When you think about that going on intensely across six or seven states, and a couple of dozen TV markets, wow.” What was it like to get a look at so many actual ad contracts? “Hooray for transparency,” King said. “We live in a world of ‘high six figures’ and ‘mid-seven figures’ and ‘multiyear deals’ and some very squishy interpretations of who spends how much on what. It was nice to be able to dig through orders and invoices and get at some real figures.”

    > WHAT CAUGHT MY EYE: MLS Commissioner Don Garber and members of his staff visited with our editorial team last week in Charlotte. It’s always good to get Don’s perspective, and it’s clear to me what he is focused on: landing a 20th team, and making it the second one in the New York City market. Garber deserves credit for much of MLS’s steady growth over the years, but this could prove to be his greatest achievement if it’s accomplished. Why? Because of the complexities and logistical challenges of building a privately-financed 25,000-seat stadium in Flushing Meadows-Corona Park. A quick list: There are community concerns, questions over the use of public park land, the interests of the U.S. Tennis Association to expand its footprint, and the Wilpon family’s proposal to develop its Willets Point project — seemingly all competing for the same, small parcels of land. In other words, a lot of plans by some heavy hitters for a little piece of land. Keep an eye on this story. … For years, NBA Commissioner David Stern has been vocal in saying the impediment to global growth of the game has been the lack of viable arenas around the world. Despite some progress, it was interesting to hear him say that it’s still an issue. He told Gary Washburn of The Boston Globe that any NBA team presence in Europe is still years away. “There aren’t enough buildings, there aren’t adequate TV arrangements, we don’t have owners, and I’m not sure we could charge the prices that would be necessary,” he said. Stern said that “part of the problem is that European cities, where soccer rules day and night, are not financially prepared to build arenas to house anything more than an exhibition game.” Meanwhile, the league completed what should be considered a successful NBA China series, with games between the Heat and Clippers in Shanghai and Beijing. In talking about NBA China, Stern said the league is looking to do $150 million in business in the country this year, with a growth rate of 10 percent annually.

    Abraham D. Madkour can be reached at amadkour@sportsbusinessjournal.com.

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  • How to build ethical decision-making into compliance programs

    When the NCAA Executive Committee directed NCAA President Mark Emmert to examine the circumstances surrounding the recent scandal at Penn State, the result was an unprecedented $60 million fine and other dramatic punitive and corrective measures. The severity of the penalties stemmed from Penn State’s alleged failure to meet what President Emmert identified as the first responsibility of all association members: to adhere to the fundamental values of respect, fairness, civility, honesty and responsibility. According to the president, “if you find yourself in a position where the athletic culture is taking precedence over the academic culture … bad things can occur.”

    The effect of failed compliance

    For the past several years, whistleblowers have alleged that bad things are happening in athletic departments, giving rise to a number of whistleblowing and retaliation claims brought by high-level employees. In 2007, for example, a women’s basketball coach alleged retaliation after she complained about funding-related gender inequity. She received a $19 million jury verdict. That same year, a former assistant athletic director who claimed she was retaliated against after participating in a Title IX compliance review received a $3.4 million jury verdict. Similarly, former coaches in Florida received a $3.4 million settlement after alleging their university retaliated against them for their involvement in gender-equity complaints.

    Mike McQueary’s lawsuit against Penn State alleges he was terminated because of his cooperation with authorities in the case against Jerry Sandusky.
    Photo by: GETTY IMAGES
    Other cases are ongoing. In New Jersey, a former director of athletics has filed a claim under the state’s Conscientious Employee Protection Act alleging he was fired after reporting academic fraud and other violations to the NCAA. In Arizona, a former member of a university athletic department sued the NCAA, his former university and several athletic administrators personally, claiming he was wrongfully terminated after participating in an NCAA investigation concerning rules violations by the baseball program. Earlier this month, former Penn State assistant football coach Mike McQueary filed a whistleblower complaint alleging that he was terminated after participating in a criminal investigation and providing grand jury testimony in 2010 concerning the Jerry Sandusky sexual abuse case.

    While the theories asserted in these cases vary, the allegations underscore the importance of value-based decision-making. To be sure, these cases reflect one certainty: Bad decisions result in bad facts, which make for bad lawsuits, resulting in bad settlements or bad jury verdicts.

    In an atmosphere of heightened awareness regarding issues of ethics and campus safety, reports by whistleblowers are only likely to increase. In 2008, the Clery Act, a law that governs campus safety, was amended to specifically protect whistleblowers from retaliation. Since that time, enforcement of the Clery Act is on the rise. Last year alone, the U.S. Department of Education imposed fines for Clery Act violations against six major institutions. That is the same number of institutions that were fined in the first 18 years following the law’s enactment.

    A culture of ethical compliance

    In light of these developments, athletic departments are asking how to assist their personnel in making better decisions and ensuring a culture of compliance. For athletic departments that lack policies and practices designed to promote a workplace of mutual respect and ethical standards, the first step is to conduct a risk assessment so that an effective compliance program can be designed and implemented. Many entities are turning to outside counsel experienced in conducting internal investigations and implementing ethics and compliance programs. Experienced counsel will review policies and procedures, ascertain problem areas, and recommend practical solutions to remedy those deficiencies.

    Regardless of whether an athletic department has existing policies or is starting from scratch, all departments must adopt an ethics policy or code of conduct for all employees. These policies should be drafted in a manner that complements the athletic department’s values, principles and strategies. Effective policies will govern the value-based decision-making mandated by the department as a term and condition of employment.

    Next, athletic departments are encouraged to adopt their own internal whistleblower policies designed to discover and rectify potential problems before they fester and escalate into litigation. Effective whistleblower policies clearly identify reportable misconduct and set out a confidential procedure for reporting it. Equally important is an express prohibition against unlawful retaliation or discrimination against the whistleblower.

    However, simply providing employees with an ethics policy or code of conduct is not enough. A successful compliance program must provide training to employees. Most ethical violations occur when an employee is faced with a difficult choice that requires balancing competing interests — where the right thing to do is not entirely clear. Athletic departments must provide effective training to address those gray areas and teach employees practical skills for identifying and resolving ethical dilemmas. There also should be specialized training for managers to ensure that whistleblowers are neither discouraged nor ignored, and are protected from retaliation.

    Finally, athletic departments must respond to whistleblower complaints promptly and thoroughly. An effective complaint procedure includes methodologies for protecting and preserving evidence and electronic records, and measures that protect the whistleblower and any witnesses from intimidation or any form of retaliation. To encourage good-faith, internal reports of misconduct, these departments must demonstrate to faculty, staff and students that they welcome such reports and will respond to them fully and fairly.

    Along with the risks of liability exposure and legal costs posed to a college or university, ethical violations carry the potential for career derailment, loss of professional reputation, individual liability and brand attrition. The key to sustainability is going beyond compliance: taking steps to prevent unethical and illegal conduct from arising in the first place, while simultaneously strengthening organizational values and accountability.
     
    Scott James Preston (spreston@littler.com) is a shareholder in the Indianapolis office of Littler Mendelson, P.C., the world’s largest employment and labor law firm representing management.


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  • Ambush marketing lessons from the London Olympic Games

    Despite all the muscle-flexing of the London Summer Olympic Games brand police, the jury remains out on the topic of ambush marketing simply because … the jury was never called in. What promised to be a full-scale siege in the battle against ambush marketing ended with a fizzle.

    Across each of the most recent Olympic Games, event organizers have implemented stricter (and arguably overprotective) measures to ensure that official sponsors are protected from ambush marketing, a controversial practice whereby businesses that are not official sponsors conduct advertising and promotional activities that seek to capitalize on the event’s good will, reputation and popularity. From a strictly legal standpoint, ambush marketers rarely infringe on the trademarks of the sport organization or event that they are allegedly ambushing, making “brand protection” efforts difficult.

    As a bid requirement to hosting the London Games, special legislation was enacted by the British government to provide the Olympic Movement with additional ambush marketing protection for the period of time surrounding London’s hosting of the Games. This legislation created the London Olympics Association Right, an unprecedented approach to protecting Olympic intellectual property that future host countries are likely to emulate. This “right of association” specified that implying a commercial or contractual association with the Olympics would violate the LOAR (albeit the legislation did provide a safe harbor for “honest” business practices).

    Before the Games, the aggressive ways in which the International Olympic Committee and the London Organizing Committee for the Olympic Games enforced the legislation left many crying foul. For example, in May, the Olympics’ brand police were successful in halting a window display simulating the Olympic rings made from plastic gym ropes and Olympic torches crafted from old “For Sale” signs at a real estate agency. The display was witnessed by LOCOG officials during the Olympic torch relay. LOCOG demanded that the trademark-infringing display be removed or else face formal legal action: “Whilst we appreciate your enthusiasm and support, use of the Olympic rings in the window of a commercial office inevitably creates an association between [the real estate chain] and the Games and allows the [real estate] brand to benefit from the goodwill and excitement of the Olympic Torch Relay.” Remarked a branch manager of the real estate agency: “We thought this is a once-in-a-lifetime thing. This is not about the Olympics for people. This is about the Olympics for [official sponsors] Lloyds Bank, Samsung and Coca-Cola.” It was later acknowledged that two LOCOG lawyers accompanied the entire torch relay to address any other potential incidents of ambush marketing.

    Other small businesses, such as a butcher who displayed sausages in the shape of the Olympic rings, were also ensnared in LOCOG’s ambush marketing crackdown. With this type of aggressive enforcement called “lunacy” by those affected, industry observers and critics questioned why LOCOG was choosing to go after small businesses seeking to share in the celebration of their country’s hosting the Games. Moreover, from a strategic perspective, these local businesses posed no real commercial threat to global Olympic sponsors like Coca-Cola, Samsung and Adidas.

    Nike’s campaign was timed to coincide with London’s opening ceremony.
    Once the Games began and the incidents of true ambush marketing revved up, enforcement efforts seemingly kept a much lower profile. For example, Nike, no stranger to the Olympic ambush game, used its high-profile campaign “Find your greatness” to showcase ordinary athletes finding greatness in cities around the world named London (talk about clever!). With the start of the campaign timed to coincide just a few days before the opening ceremony, Nike’s actions initially raised the ire of LOCOG’s brand enforcement team. However, it relented, promising to “monitor the situation” and ultimately determined that a lawsuit was unwarranted. Nike’s performance achieved a high level of global consumer awareness among Olympic visitors, television and online audiences.

    Another high-profile ambush incident was launched by Irish online betting site Paddy Power, whose billboard ad featured a fictitious egg and spoon race in London, France. The billboards claimed Paddy Power was the “Official sponsor of the largest athletics event in London this year! There you go, we said it (ahem, London France that is).” LOCOG directed the outdoor advertising space provider to remove the billboards as a violation of the Olympic special legislation but was forced to retreat when Paddy Power sought a court order blocking removal of the billboards. Paddy Power argued the content did not contravene the special legislation. Media outlets suggested that LOCOG’s reversal was strategic in order to avoid negative publicity during the height of the Games. In hindsight, Paddy Power’s cheeky billboards may be notorious for their typically irreverent creativity but also noteworthy for the response it provoked by LOCOG.

    A third well-publicized example of alleged ambush marketing was Beats Electronics’ recognizable headphones, Beats by Dre, worn prominently by American and British Olympic athletes on the pool deck and before athletic events at Olympic Stadium, thus providing international TV exposure. Others implementing well-publicized marketing campaigns conducted without legal recourse included, but were not limited to, Tetley Tea, Red Bull, Virgin Media, Puma and Mizuno.

    Undoubtedly, the legislation deterred many smaller and risk-averse companies from engaging in ambush marketing or simply showing their local pride and excitement about hosting the Games. However, it proved ineffective in thwarting companies who were both clever and intent on associating with the Games. It’s indeed ironic that the legislation and the threats of legal action stopped so many companies that were not intent on ambush marketing, but were unable to stop all those companies that were blatantly seeking to ambush. Furthermore, the overzealous approach to its brand protection efforts arguably served to tarnish the Olympic brand, given the amount of negative publicity that surrounded these efforts.

    It will be interesting to see, when the United States next hosts an Olympic Games, whether our Congress and local legislators would be willing to enact special legislation that provides the IOC and the local organizing committee with ambush marketing protection as broad as that afforded the IOC and LOCOG for the London Games.

    John Grady (jgrady@mailbox.sc.edu) is an associate professor in the Department of Sport and Entertainment Management at the University of South Carolina. Steve McKelvey (mckelvey@isenberg.umass.edu) is an associate professor in the Mark H. McCormack Department of Sport Management at the University of Massachusetts Amherst.

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