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Suing Over Statistics

Fantasy leagues challenge Major League Baseball's right to demand licenses

January 02, 2006|Greg Johnson | Times Staff Writer

Who owns the back of a baseball card?

For decades, it didn't seem to matter. The courts made it clear that cereal makers and sneaker companies needed permission to use an athlete's name or likeness, but baseball's ocean of numbers -- found in newspaper box scores and on trading cards -- generated little controversy.

Then came sports fantasy leagues, which grew from a grass-roots hobby a quarter-century ago to a multimillion-dollar industry with the rise of the Internet and digital technology.

After long ignoring the fantasy movement, Major League Baseball entered the business in 2001. Last year, baseball ordered game operators to obtain a license before plugging player statistics into software that runs their games. Now, a Missouri company, CBC Distribution & Marketing, has responded by suing baseball in U.S. District Court in St. Louis, alleging that it had no right to demand that operators be licensed.

For The Record
Los Angeles Times Wednesday January 04, 2006 Home Edition Main News Part A Page 2 National Desk 1 inches; 40 words Type of Material: Correction
Fantasy leagues -- An article in Monday's Sports section about fantasy sports leagues' access to baseball statistics said Kim Beason was a professor at the University of Arkansas at Fayetteville. He is on the faculty at the University of Mississippi.

The case highlights the new types of disputes arising as sports, like Hollywood, tries to wring more revenue from intellectual property in a digital world where information flows ever more freely.

"The question of whether performance statistics are some form of protected intellectual property becomes vital," said Jack Williams, a Georgia State University law professor and longtime fantasy league player. "Moreover, who owns the property becomes vital."

Fantasy fans act as team owner, general manager and coach, poring over real-world athletes' performance statistics before assembling rosters. The fate of their dream teams is dictated by how well "draftees" perform in real-world games.

Sixteen million Americans played these games during 2004, spending about $200 million on league registration fees, according to the Fantasy Sports Trade Assn. Some leagues now offer a $100,000 grand prize.

CBC argues that it has a right to use statistics without obtaining a license.

"What we're dealing with is historical data," said attorney Rudy Telscher, who represents CBC. "The minute a game is over, these are historical facts. And, to my way of thinking, the public ought to be able to use historical facts without having to compensate players or the league."

The 1st Amendment protects the right of media companies and others to use game statistics to tell the story of a game from the first pitch to the last out, or from tipoff to final buzzer.

Baseball, in court filings, maintains that intellectual property law makes it illegal for the fantasy league operator to "commercially exploit the identities and statistical profiles" of big league players.

Baseball executives declined comment on the lawsuit.

For years, CBC paid the Major League Baseball Players Assn. for a license. Last year, the players sold the right to use their names and likenesses to MLB, which then denied CBC a license renewal. The company continues to operate leagues and the two sides are in mediation.

Williams, the law professor, suspects CBC's suit will be settled out of court because baseball doesn't want to risk losing the case and the potential revenue from licenses.

"Ambiguity and uncertainty favors baseball," Williams said. "I don't think it's to Major League Baseball's benefit to get an answer, because I don't think they're going to like the answer that they'd get."

Baseball has gone to court before to protect its logos, marks and other intellectual property.

During the 1990s, it demanded that an Orange County company obtain a license to stitch major league logos onto youth league uniforms. Sports leagues also have complained that media companies have profited illegally at their expense by transferring game photos to coffee mugs, T-shirts and books.

Last year, the Chicago Cubs (owned by Tribune Co., which also owns the Los Angeles Times) settled a lawsuit against businesses that sell seats to fans who watch games from rooftops overlooking Wrigley Field, alleging copyright infringement.

But until recently, the major sports paid scant attention to stat-driven games.

"Fantasy leagues clearly were giving more to the leagues than they were getting in return," said Kim Beason, a professor at the University of Arkansas at Fayetteville who conducts market research for the Fantasy Sports Trade Assn.

Now, all the major sports operate fantasy games, recognizing that players are incredibly loyal fans -- the type increasingly coveted by advertisers.

The NFL, which has placed a renewed emphasis on courting fantasy players, "found that people who play fantasy football end up watching two to three hours more NFL action on television," said Brian Rolapp, the league's vice president of media strategy.

Fred Villaruel, 26, of Valparaiso, Ind., is that type of fan. The computer consultant spends much of his free time playing fantasy football. He catches games at a sports bar and uses his laptop to communicate via instant message with league competitors around the country.

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