An elite law firm is helping one of track and field’s most outspoken athletes challenge the U.S. Olympic movement on antitrust grounds, and leading legal minds say the lawsuit should be taken seriously.
Partners at Washington, D.C.-based Hausfeld LLP, fresh off their victory in O’Bannon v. NCAA, say the U.S. Olympic Committee and USA Track & Field violate the Sherman Act by limiting in-competition advertising at the Olympic Trials to clothing and equipment makers.
They’re representing Run Gum, a caffeinated gum brand owned by two-time Olympic 800-meter runner and frequent USATF critic Nick Symmonds that wants to place logos on athletes. The lawsuit was filed in U.S. District Court in Oregon.
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Nick Symmonds owns Run Gum, which wants to advertise on uniforms in the Olympic Trials.
Photo by: GETTY IMAGES
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Winston & Strawn partner Jeffrey Kessler said he thinks they have a case.
“In general, the issue of the ability of the Olympics to pass rules that limit the endorsement opportunities of athletes is a serious legal issue,” said Kessler, who has successfully represented Tom Brady, Latrell Sprewell and other athletes in high-profile fights with leagues. “In other words, it’s not at all clear to me that the Olympics has such authority.”
The U.S. Olympic Committee and USATF declined to comment.
Other experts said the governing bodies’ defense likely will center on the Amateur Sports Act of 1978, which grants the USOC broad, exclusive authority to administer Olympic sports. By extension, experts said, the bodies will argue that they maximize the sport’s overall resources by limiting commercial activity and protecting its brand with so-called “clean venues.”
Run Gum is demanding an injunction that would allow the company to advertise on uniforms at the Olympic Trials. The lawsuit does not challenge the bodies’ right to award governing-body-level marketing rights exclusively in a given business category.
“I think the Amateur Sports Act is the pro-competitive justification that USATF or the USOC would come back with,” said John Grady, a lawyer and professor of sport management at the University of South Carolina. “In other words, they’re given this authority in good faith, and they’re exercising their role to deliver the marketing rights for Olympic sports.”
Historically, the USOC has had great success in using the Amateur Sports Act to force entities that use Olympic intellectual property without approval to change their names. Courts also have granted the USOC and its governing bodies wide latitude in deciding who participates in the Olympics. Disqualification from the Olympic Trials is a possible punishment for athletes wearing banned advertisements.
But Hausfeld partner Sathya Gosselin says this particular rule, which allows only clothing or equipment brands to gain any exposure at the Trials, takes a step beyond the law’s purview. In the complaint, the plaintiffs note that USA Wrestling does not ban athlete advertising at its Olympic Trials.
“[That] puts USATF on the defensive to explain the rationale behind its rule in antitrust terms,” said Robert Boland, a sports law professor at Ohio University.
Whether or not the Amateur Sports Act grants the USOC a complete antitrust exemption, like Major League Baseball enjoys, figures to be a key issue. “This is an interesting case, and in light of precedent, one with a fair chance of success,” Boland said.
The USOC and USATF may argue that an injunction would lead to a cluttered, overly commercialized scene at the Trials, which potentially could harm the value of its contracts with exclusive sponsors, said John Wolohan, a professor of sports law in the Falk College of Sport and Human Dynamics at Syracuse University. Protecting those revenue streams is a bona fide exercise of their rights granted by Congress, he said.
“If I allow you to basically plaster yourself with non-exclusive deals, that’s going to pollute the market and it’s going to dilute what official sponsors get,” Wolohan said.
The problem for Symmonds, Wolohan said, is that prior legal decisions have generally ruled that Congress gave the USOC and its governing bodies “the right to run the Olympic sports any way they see fit.”
So is the lawsuit a lost cause? “If you want to talk about tilting at windmills, talk about the O’Bannon case. What, they dropped $50 million before it even got into the courts?” Wolohan said.
