Editor's note: Major League Baseball Advanced Media and the players' association released a statement on Aug. 9 that they would appeal U.S. District Judge Mary Ann Medler's Aug. 8 ruling.
ST. LOUIS — Fantasy baseball leagues are allowed to use player names and
statistics without licensing agreements because they are not the intellectual
property of Major League Baseball, a federal judge ruled yesterday.
Baseball and its players have no right to prevent the use of names and
playing records, U.S. District Court Judge Mary Ann Medler in St. Louis ruled in
a 49-page summary judgment.
St. Louis-based CBC Distribution and Marketing Inc. filed a lawsuit against
Major League Baseball Advanced Media, MLB's Internet wing, after CBC was denied
a new licensing agreement with the baseball players' association giving it the
rights to player profiles and statistics.
Major League Baseball claimed that intellectual property laws and so-called
"right of publicity" make it illegal for fantasy leagues to make money off the
identities and stats of professional players.
But even if the players could claim the right of publicity against commercial
ventures by others, Medler wrote, the First Amendment takes precedent because
CBC, which runs CDM Fantasy Sports, is disseminating the same statistical
information found in newspapers every day.
"The names and playing records of major league baseball players as used in
CBC's fantasy games are not copyrightable," Medler wrote in CBC Distribution and Marketing
v. Major League Baseball Advanced Media. "Therefore, federal copyright
law does not pre-empt the players' claimed right of publicity."
The ruling brings some relief to more than 300 businesses that run online
fantasy leagues and have awaited the outcome of the lawsuit. In fantasy sports
leagues, fans draft major leaguers and teams win or lose based on the
statistical success of the actual players in major league games.
It wasn't immediately clear what impact the ruling would have on existing
agreements, such as the ones MLB has with CBS Sportsline.com, Yahoo Inc.,
ESPN.com and others. MLB also may appeal.
"My thought today is this ruling is pretty strong but if MLB wants to fight
it they have the funds to do it," said Jeff Thomas, founder and CEO of the
fantasy site SportsBuff.com and president of the Fantasy Sports Trade
Thomas said SportsBuff.com's online fantasy baseball leagues have tried for
years to reach agreements with MLB, but have been unsuccessful and have carried
on without them.
Major League Baseball Advanced Media had just received the ruling yesterday
afternoon and was in the process of reviewing it, spokesman Jim Gallagher said
in response to a request for comment.
"We need to talk to our partners, the Major League Baseball Players
Associations, before we have anything more to say," he said.
Baseball's refusal to give CBC a contract for the 2005 season came as the
league was making exclusive statistics licensing agreements in the fantasy
sports marketplace that has grown to more than 15 million players.
Like many other fantasy baseball leagues, CBC had a licensing agreement with
the MLBPA from 1995 through the 2004 season and paid 9% of gross royalties to
the association. The company now believes it shouldn't have to pay for the right
to use statistics.
Rudy Telscher, who represents CBC, said both sides had asked for a summary
judgment before the case was scheduled to go to trial next month.
"Once you've won this here the odds are really good for us when MLB appeals,"
Telscher said. "I think once this issue is decided by an appellate court it's
unlikely that other sports will try to take this to the court again."
Fantasy sports has grown at a rate of up to 10% each year, according to the
Fantasy Sports Trade Association.
MLB had 19 license agreements in 2004, according to MLB Advanced Media, and
just seven last season after a $50 million agreement with the players
association giving baseball exclusive rights to license statistics.
Many of the smaller fantasy businesses, such as CBC, say they were cut out of
Glenn Colton, a New York lawyer who wrote a friend of the court brief for the
Fantasy Sports Trade Association, says the statistics licensing issue is
critical to the industry.
"The idea on MLB's part is if you can scare all of the little companies out
of the market," Colton said, "you can collect more money."