FanDuel Wins Again as Uses of Athletes in Fantasy Sports Held Newsworthy

Friday, October 26, 2018 - 3:15 pm PT
daniels fanduel right of publicity indiana newsworthy first amendment

This week the Indiana Supreme Court held in Daniels v. FanDuel that uses of players’ names, pictures, and statistics in online fantasy sports games and related advertisements are of “newsworthy value.” Accordingly, the uses are not actionable under Indiana’s right of publicity statute which expressly exempts such matter from liability.

Daniels involves a lawsuit brought by several former collegiate athletes, including Akeem Daniels, against fantasy website operators, FanDuel & DraftKing. The athletes objected to the nonconsensual use of their names and likenesses on the websites and in promotions for the profit-making ventures.

The outcome of this case has been hotly watched because of its implications for the entire online fantasy sports business model. A venture that the Indiana Supreme Court has now shored up.

The case came to the Indiana Supreme Court after the 7th Circuit Court of Appeals certified to it the question of whether fantasy-sports operators need consent from athletes to include them in their for-profit fantasy sports games. As I mentioned in an earlier post, such certifications in right of publicity cases are rare, but are a useful and appropriate mechanism for federal courts to get advice on what state laws cover.

This was particularly important here since few Indiana cases had been decided under the governing statute (first passed in 1994, and amended in 2012). As the Indiana Supreme Court noted, this was the first opportunity it had to consider the boundaries of the explicit statutory exemption for uses of “material that has newsworthy value.”

The court’s holding that uses of players’ names, likenesses, and their playing statistics are newsworthy uses that fall outside of the Indiana statute puts Indiana in line with the 8th Circuit’s decision in another fantasy sports case, C.B.C. Distribution & Marketing v. Major League Baseball. In C.B.C., the 8th Circuit held that the First Amendment allowed uses of players’ names and statistics in baseball-themed fantasy sports games, and barred right of publicity claims in that context.

The Indiana court saw the issue before them as virtually identical to that in C.B.C. It noted that the inclusion of the same information about players (their names, images & statistics) in “newspapers and websites across the nation” suggested that the online games should get similar protection. “We agree that, ‘it would be strange law that a person would not have a first amendment right to use information that is available to everyone.’” (quoting C.B.C.)

The court held that the newsworthy exemption applied without regard to the speaker―what matters is whether the material is newsworthy, not whether the user is part of a new agency. The court also concluded that the exemption applied to advertisements for the underlying uses, if those are newsworthy.

Nevertheless, the court distinguished this case from one in which a player’s identity is used in traditional advertising for a product. The court pointed to a 9th Circuit decision allowing Kareem Abdul-Jabbar’s right of publicity claim in the context of an advertisement for a car as an example of a use that “likely lies outside the scope of what is considered newsworthy.”

Beyond the primary holding―that uses of players’ identities in fantasy sports falls outside of the Indiana right of publicity statute because they are uses with newsworthy value―there are several other interesting take-aways from this case:

First, the court expressly noted that it was not making factual determinations or deciding the specific case so there may still be room once back in federal court to take-up other issues. In particular, the court highlighted that if the uses of players’ identities gave a false impression of endorsement or sponsorship that would likely create an actionable claim. The court observed, however, that simply including information about the players, such as their names, likenesses, and statistics, would not be enough in its book to establish a showing of endorsement.

Second, the court declined to consider the scope of the “public interest” exception under the statute. This means that it remains unclear whether that exemption will be interpreted as synonymous with the newsworthiness exception or as something distinct under Indiana law.

Third, the court narrowly (and appropriately) interpreted the U.S. Supreme Court’s decision in Zacchini v. Scripps-Howard Broadcasting―the only right of publicity case that Court has decided. The Indiana court emphasized that Zacchini only applies when an "entire act" is used. The Indiana court noted that the Supreme Court expressly left room for news reporting of the underlying facts of Zacchini’s human cannonball performance. The Indiana Supreme Court therefore concluded that the player’s names, likenesses, and statistics in the context of the fantasy sports games were akin to these facts about Zacchini’s performance.

It will be interesting to see if a certiorari petition is eventually filed with the U.S. Supreme Court in this case, and if so, if the Court will grant review of such a petition. Although the decision rests on Indiana law, and an express statutory exemption, this has not stopped the Supreme Court from weighing in on state right of publicity laws.

Notably, though often forgotten, the Supreme Court in Zacchini reversed the Ohio Supreme Court’s determination that the news broadcast of Zacchini’s act at the local fair was “newsworthy”―a common law, state-based exemption to Ohio’s right of publicity and privacy laws. As I discuss in my book, the Court concluded that the state newsworthiness defense was really a First Amendment defense about which the U.S. Supreme Court had the final word.

It is hard to square the decision in Daniels and C.B.C. with the decisions in the video game cases, Keller, Davis, and Hart, in which courts rejected First Amendment defenses when other athletes’ statistics and allegedly also their likenesses were used in sports-themed games that recreated historical team rosters. This sets up two competing lines of precedents that will continue to plague creators until the Supreme Court steps in to clarify the scope of the First Amendment defense in right of publicity cases.

Of course, if the U.S. Supreme Court justices agree with the Indiana Supreme Court on the outcome of this case, they may be disinclined to grant review.

(As a side note, the legal historian in me would have preferred that the Indiana Supreme Court not repeat in the opinion the common misreading of O’Brien v. Pabst Sales, as being about privacy law denying recovery to public figures (not true), and of Haelan Labs. v Topps Chewing Gum, as creating a right of publicity (also not true). Neither decision did either of those things. But the Indiana Supreme Court is not alone in these misunderstandings, which in this instance does not affect the outcome of the decision. If you’re interested in learning more about the true stories behind O’Brien and Haelan—I tell both in my recent book on the right of publicity, which traces the right’s origins, and also considers the challenges it presents today.)

The Book

Privacy Reimagined For A Public World

THE RIGHT OF PUBLICITY: Privacy Reimagined for a Public World

This book from Harvard University Press by Professor Jennifer Rothman traces the history and development of the right of publicity and its current collision course with individual liberty, free speech and copyright law.

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