USA Law and Practice Contributed by: Irwin A. Kishner, Daniel A. Etna, Joel Wagman and Barry Werbin, Herrick, Feinstein LLP
for a first violation, between five and 17 regular and/or postseason games for a second viola - tion, and with a multiple-season suspension for a third violation. With respect to gambling and integrity violations, MLB has – in effect – clear guidance, through MLB Rule 21, which can provide, depending on the offence, for up to permanent ineligibil - ity based on a single offence. The MLB’s clear guidance on the penalties’ specific offences contrasts with other leagues’ guidelines, such as the NFL’s, where the league or the Commis - sioner may analyse violations on a case-by-case basis, with the resulting disciplinary actions including severe penalties, up to and including a fine, termination of employment and/or banish - ment from the NFL for life. 2. Commercial Rights 2.1 Available Sports-Related Rights Aside from sponsorship and broadcasting rights (discussed elsewhere in 2.2 Sponsorship and 2.3 Broadcasting ), key sports-related rights include merchandising, hospitality, events and ticketing. While these rights all involve sports teams’ licensing, they primarily relate to the use of a team’s stadium or third-party facilities. Commercial rights to merchandising most com - monly relate to retail sales of a wide variety of products, including team logos and player ref - erences. To make use of these rights, teams or leagues will typically enter into agreements with retail goods companies for design and produc - tion of gear. Those contracts often include intel - lectual property licences of team trade marks and copyrights, in exchange for a fee or per - centage of sales. Teams and players may also engage in more specialised merchandising,
including sales of memorabilia used in-game at pivotal or record-setting moments, often by way of auction or private sales to collectors. Use of stadiums and sports facilities can be a significant commercial right that sports organi - sations monetise, which includes provision of hospitality services and concessions. To provide concessions at their facilities, sports organisa - tions contract with suppliers. Alternatively, some teams form their own hospitality organisations to control both the quality of the concessions available at their events, and the profits to be made therefrom. Teams also monetise unique offerings in their stadiums and facilities, including specialty seat - ing for games or higher-end restaurants. Sports organisations may even use their facilities for special events such as concerts, either charg - ing a fee for use of the space or including some split of ticketing profits in agreements with event organisers. Increasingly, sports organisations are facilitating secondary ticket sales and combatting illegal sales through e-ticketing and apps dedicated to purchasing, storing and producing tickets for safer access to games. 2.2 Sponsorship Sponsors use sport to enhance and promote their brand primarily through advertising and title rights. Sports organisations attract spon - sors through the creation of advertising space and marketing title rights. The primary contract terms typically revolve around payments and intellectual property rights. Sports organisations provide sponsors with a wide variety of opportunities for advertising, including on billboards, on the field or court,
256 CHAMBERS.COM
Powered by FlippingBook