Commercial Issues in Sport

Question 1

As a result of the commercialisation of sport, what are the main examples of contract types in sport?

Answer 1

. Broadcasting contracts
. Sponsorship contracts
. Merchandising and licensing contracts
. Transfer contracts

Question 2

Not every business arrangement will be enforceable as a contract, such as?

Answer 2

Importance of the notion of a contract. Not every business arrangement will be enforceable as a contract, e.g. :

. Difficult to establish binding agreement without the contract; Sports
Network Ltd v Calzaghe [2009]

. On oral agreements, see White v Bristol Rugby [2002]

. Will all terms of a signed contract be enforced? See Proactive v Rooney [2011]

. Written, signed, contract, clearly formed with the intent to create a legally binding relationship. E.g. s.P(7) EPL Handbook

Question 3

What is sponsorship?

Answer 3

The term sponsorship describes an investment in cash or kind in an activity in return for access to the exploitable commercial/marketing potential associated with that activity
.Well established brands have long used sports sponsorship to maintain public awareness, e.g. Coca-Cola with the Olympics and FIFA

Question 4

Explain the parties components of sponsorship contracts?

Answer 4

. The sponsor should ensure it is contracting with the right party, i.e. the owner of the rights
. Both parties must have capacity and authority to enter in to the contract
. For unincorporated associations, persons must be verified by checking the rules to confirm their power to contract and bind the association
. Where a sponsorship package is being bought from an agent, it must be absolutely clear that s/he has all rights purporting to sell

Question 5

Explain the ‘Terms’ component of sponsorship contracts

Answer 5

. The duration of a grant of rights can be agreed in a number of ways
. Sponsorship should provide for number of events and specified term
. Any renewal option should be specified as absolute or conditional

Question 6

Explain the territory component of sponsorship contracts

Answer 6

. Generally a sponsor will require world-wide rights
.Ideally the sponsor will not want the event owner to split the sponsorship rights territorially e.g. Man Utd has different telecommunications partners in different terrritories

Question 7

What are some examples of sponsors rights in a contract?

Answer 7

Most event sponsorship arrangements include the following rights:
. Naming: to incorporate the sponsor’s name in the event title
. Official supplier
. Advertising and branding rights
. Hospitality, merchandising, presentation, association marketing, filming, approval

Question 8

What are examples of recent issues with sponsorship contracts?

Answer 8

. Zoopla and WBA FC-Anelka gesture put sponshorship contract into disrepute
. Ched Evans and Oldham Athletic-sponsors threatened to terminate contract if he was bought
. FIFA and sponsors-main sposnors called for Blatter to resign
. West Ham and Alpari- financial losses meant sponsor had to terminate contract-no issue as out of part control

Question 9

What is merchandising?

Answer 9

. Generic names given to agreements which provide for the use of the name, logo, trade marks, livery colours and other properties of and relating to a sports person, club or organisation.
. potential licensors of rights in this context include NGBs, tournaments, clubs and sports organisations, individual players, teams and others.

Question 10

What is Intellectual Property (IP)?

Answer 10

IP provides rights of protection for: innovators, inventors, authors and
holders of goodwill and reputation

IP in sports is relevant in, for example: event organising,merchandising
and broadcasting

Question 11

What have issues of IP increased in sport?

Answer 11

. The sale of increasing amounts of merchandise offers potential for sport clubs to increase their income

. Secondary markets have sprung up as alternatives for consumers of these products and in many instances in opposition to primary rights holders
. attempts to protect rights have increased

Question 12

What are the key components of Copyright in the UK

Answer 12

. Regulated by the Copyright, Design and Patents Act 1988
. Copyright does not subsist in a literary, dramatic or musical work unless and until it is recorded in writing or otherwise

. Owner has exclusive rights to copy, issue copies, rent or lend it, broadcast it and others

. Automatic protection, no registration required

. Protection for 70 years after the author’s death (or 50 years from creation of a computer program, broadcast and musical work)

Question 13

What does copyright include from the CDPA Act 1988?

Answer 13

Original literary, dramatic, musical and artistic works;
Sound recordings, films, broadcasts and cable programmes;
Typographical arrangements of published editions

Question 14

Outline components of the CDPA Act 1988 that could be applied to sport and give examples

Answer 14

. Musical works: The music itself and sound recording. E,g. official
theme tunes and anthems
- Premier League anthem in unauthorised broadcasting: FAPL Ltd & Others v QC Leisure & Others [2008]

. Photographs and graphic works: E.G. photographs of venues, teams
logos, mascots, etc
- FA’s copyright of 1966 World Cup mascot ‘World Cup Willie’

.Sound recordings: E.g. interviews, digital files of broadcasts, audio files
-Films: Recordings of a match or any part of it. Importance of licence to the events organiser

Question 15

What determines an infringement of copyright and remedies?

Answer 15

. Infringement of copyright if (wholly or partly): copying the work, issuing copies to the public, adapting the work

. No infringement if:
	fair dealing (news reporting, incidental, private or educational use)

. Remedies for infringement: Damages, Injunction (in court) to prevent further infringement, Seizure and detention of infringing copies, Can be a criminal offence

Question 16

What act provided the protection of trademarks?

Answer 16

The Trade Marks Act 1994 created a new framework of protection for
signs designating the trade origin of a product

Question 17

What are the components of the 1994 Trade Marks Act?

Answer 17

. S.1(1) … any sign capable of being represented graphically which is capable of distinguishing goods or services of one undertaking from those of other undertakings

. A trade mark may, in particular, consist of words (including personal names), designs, letters, numerals or shape of goods/packaging

. Must be registered under particular class of good and services and on a territorial basis, eg. Community Trade Mark

. Provides protection for 10 years and needs to be renewed upon expiry.

Question 18

What are the causes of infringement of a trademark and remedies?

Answer 18

. Infringement by:
use of sign identical to a TM for identical goods/services
use of sign identical to a TM for similar goods/services if likelihood of confusion
use of sign similar to a TM for identical goods/services if likelihood of confusion
use of similar or identical goods/services if TM has reputation in UK

Remedies for infringement:
   Damages
   Injunction to prevent further infringement
   Delivery up infringing goods
   Can be a criminal offence

Question 19

What is the purpose of a trademark for sports organisations?

Answer 19

. designate the origin of a product, without any possibility of confusion and with a guarantee of its quality, provenance and originality
. Where clubs, governing bodies and event organisers have registered as a trade mark a crest, badge, logo, they can prevent anyone from using it to market similar products

Question 20

What is passing off?

Answer 20

. Provides common law (case law) protection for unregistered trade marks

I.e. prevents a trader from exploiting goodwill built by another; by passing off his goods or services as the other’s

Question 21

What does the claimant need to show to prove passing off?

Answer 21

. Claimant’s goods have acquired goodwill or reputation in the market and are known by some distinguishing feature; likely to lead the public to believe the goods/services offered by the defendant are those of the claimant; and
- the claimant has suffered or is likely to suffer Damage as a result.

. The tort has developed through a series of sports-based cases

Question 22

What is the Act to protect patents and describe

Answer 22

. Patents Act 1977 allows the owner of a patent to register it in a particular territory and thereby secure the exclusive right to make, use and exploit the product or process in that territory

Question 23

What are the components of the Patents Act 1977? and sport application

Answer 23

. 20 year monopoly once registered

. Requires full publication of the details, so makes public the intellectual
breakthrough in return for ability to exploit for limited period

. Relevant for sporting equipment manufacturers. E.g. patents in many golf balls; ski equipment.

Question 24

What is the background of the fanatix case?

Answer 24

Fanatix was a social video app allowing fans to record and upload 8 secs of sport material which can be shared and watched by other users

Question 25

Who brought forward a case against Fanatix?

Answer 25

Case by England and Welsh Cricket Board & Sky UK Limited v Tixdaq Ltd & Fanatix Ltd

Question 26

What was the legal argument against Fanatix?

Answer 26

Legal Argument (Article 16 of CDPA 1988): Users of app infringing copyright through sharing broadcasting of materials & the defendants jointly liable

Question 27

What was the defence in the Fanatix case?

Answer 27

. Fair dealing defence of reporting current events under Article 30 of CDPA 1988

    Article 30(2) of CDPA 1988
	"Fair dealing with a work (other than a photograph) for the purpose of reporting current events does not infringe any copyright in the work provided that (subject to subsection (3)) it is accompanied by a sufficient acknowledgement”

Question 28

What was the legal analysis of the courts in the Fanatix case?

Answer 28

. 8-second video was seen as substantial part of the copyrighted work (i.e. Broadcasting)?
. seen as current event as most were live recordings
.not seen as reporting of the matches

. company then had to close as the business model lost

Question 29

What examples of protecting intellectual property can be seen in the Olympics?

Answer 29

The Olympic Symbols Protection Act 1995. Generated for the BOA to generate sufficient profits with the trade-mark like properties of trade-mark qualities.