Legal Geek No. 133: NCAA Bends the Rules for All-Athlete DWTS Season

Hi, and welcome back to Legal Geek. This week, we review an interesting recent decision of the NCAA to allow a current player to make and keep prize money from appearing on the TV show Dancing With The Stars, without exhausting her eligibility.

https://archive.org/details/LegalGeekEp133 

The latest season of Dancing With The Stars premiered this week, and this all athlete-season is the biggest opening since Avengers Infinity War came out last weekend.  Jokes aside, this season of the dancing competition show features several human interest stories in the competitors, including a current college athlete in Notre Dame women's basketball player Arike Ogunbowale. 

Ogunbowale hit last second shots in the national semifinal against Connecticut and again in the national championship against Mississippi State to lock up the NCAA title for the Fighting Irish last month.  Needless to say, she's at the peak of fame in college athletics, and she plans to return for one more season in which she will be the face of women's college basketball.  However, as we've covered before on this segment, the NCAA strictly prohibits athletes from profiting on their likenesses while playing college sports.  These rules are under siege in court cases ongoing around the country, but they do stand currently.

What happened here was a narrow reading or interpretation of those rules.  NCAA Bylaw 12.4.1.1 prohibits college athletes from being paid "for value or utility that the student-athlete may have for the employer because of the publicity, reputation, fame or personal following that he or she has obtained because of athletics ability."  The NCAA is allowing Ogunbowale to accept prizes from Dancing With The Stars because such prizes will not be awarded based on her athletics ability, meaning basketball ability.  The NCAA is not allowing her to participate in any promotional materials for the show, however.

The NCAA may be backing down a bit because the writing is on the wall for this rule and modern college athletics.  By showing some flexibility, albeit with a flimsy interpretation of rules since Ogunbowale is only on the show because she's an athlete with specific abilities and achievements that make her an interesting story, the NCAA may be trying to forge a new path forward in defining what it means to be an amateur athlete.  But we really won't know for sure until other athletes are in similar positions and asking for NCAA permission.

The Bottom Line is, the NCAA has had to bend the rules in certain circumstances like for Olympic games athletes, but this television appearance based on recent fame generated from playing college basketball is new ground that the NCAA used to be much more wary of allowing.  We will continue to monitor whether the NCAA becomes more flexible or stands its ground as the court cases continue against it to try and allow payment of college athletes in some manner.

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Legal Geek No. 132: A Kickstarter Scam for the Ages in Tabletop Games

Hi, and welcome back to Legal Geek. This week, we cover a scam in the Tabletop game space that has recently come to light, as a lesson in why we all still need to be careful with Kickstarter and other funding websites.

https://archive.org/details/LegalGeekEp132 

Kickstarter has been a force in the tabletop board game development space for years, as many developers and publishers use the service as a pre-order system to fund first print runs of new games.  When dealing with funding concepts like Kickstarter, there's always a chance for fraud however.

Boarders Tabletop Game Studio served as a primary distributor for the southeastern Asia market when it came to several popular Tabletop game Kickstarter projects, including Anachrony and Gloomhaven.  The company also came up with a service where backers from this region would group together to save on shipping, which can otherwise be very cost prohibitive for individual backers far away from most tabletop game companies based in Europe and the U.S.

But these customers started to see warning signs a few months ago when shipping information began to be inconsistent with Boarder's deliveries, and the company became unresponsive to e-mails and chat requests.  The suspect activity came to a head when one game designer who worked with Boarders to distribute in southeast Asia announced on their Kickstarter page that Boarders had received the shipment of the backer's games but had stopped all contact and had absconded with the product and the down payment for fulfillment.  That was allegedly a $20,000 heist of sorts.

This led to further investigation by some companies and project backers, and it was discovered that Boarders had collected backer funds for many other projects without actually pledging to purchase the product.  That's the definition of fraud, taking money under a pretense that is completely false.  

Project backers in these countries have started to band together to make police reports and help local reporters investigate this situation.  Outside one Facebook update in late March indicating the board game café the company runs was closing permanently, there has been no communication from Boarders.  There appears to be at least 10 companies where Boarders did not pay them for games sent to Boarders as a distributor, and over $35,000 of product not delivered to consumers. 

While several isolated incidents have occurred over the years on single Kickstarter projects where the creators did not deliver product and absconded with the funds, this collection of activities is quickly becoming the biggest case of fraud ever reported in the tabletop game industry.  Unless facts begin to change in a hurry, these project backers and companies appear to be out of luck.  That's just sad, in an industry made for the purposes of having fun and making people happy.

The Bottom Line is, there's always some risk when crowdfunding or investing in a potential game or product.  When adding a third party intermediary like Boarders to the mix, that's simply another risk factor that has to be considered.   It will be interesting to see if game companies and Kickstarter itself puts in some more protections to try and avoid such fraudulent activity from occurring in the future.  But for now, keep safe with your investments, friends.

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Legal Geek No. 131: The Accelerated Federal Judicial Nominee Process under Trump

Hi, and welcome back to Legal Geek.  This week, we update you on the tribal sovereign immunity strategy used in some pharma patent cases, and then review the reasons behind a surprising set of trends in how quickly open seats in the federal judicial system have been getting filled so far under President Trump.

https://archive.org/details/LegalGeekEp131

A few months back we covered a case where a pharmaceutical company assigned its patents to a Native American tribe and then argued tribal sovereign immunity of that tribe stopped the patents from being challenged for invalidity in government proceedings.  Recently, Congress has introduced a bill that would exclude patent proceedings from what tribal sovereign immunity applies to, which would eliminate this potential loophole.  While it remains to be seen if this becomes law, do not be surprised if other similar loopholes are located and leveraged even if this one is addressed.  In other words, never doubt the genius ideas of some litigators with big budgets and a lot of time.

Turning to this week's main topic, the Trump presidency has certainly been marked with a lot of memorable news moments.  However, other than the tax bill passed a few months ago, it's hard to point to many things that will be long-lasting legacies of this presidency.  One notable exception to this is our subject today: the federal judiciary.

While it may be easy to overlook with sexier news stories always popping into your attention each week, the Trump administration has established unprecedented success in quickly nominating and gaining approval of new federal judges.  Federal judges at all levels from local courts to the Supreme Court are appointed by the executive branch and then reviewed by the Senate for approval before joining the federal bench, and these are lifetime appointments for the judges.  Thanks to the presidency and the Senate being held by the same party for this two-year period, any opposition to Trump's generally-conservative nominees has been mitigated.

Here's some numbers to explain Trump's quick filling of the federal bench compared to prior presidents.  He has nominated 69 potential judges to the bench in his first year in office, compared to 34 in Obama's first year, and Obama is more in line with the average.  The Senate has already confirmed 29 of these judges, 15 of them at the Court of Appeals level or at the Supreme Court.  That number of 15 high-level judge confirmations in one year is nearly more than the first years of the last three presidents combined, as Obama had 6, Bush 7, and Clinton 3.  So the Trump Administration is filling up a lot of the federal judiciary with judges who may hold more with his views than the judges they may be replacing, and such a trend is somewhat troubling.

Why is this happening?  In addition to the White House and the Senate being held by the same party, the obstructionist recent past of judicial nominations has been the primary driver to where we are today.  During Obama's presidency, judicial nominations languished in front of the Senate as nobody could drive these nominations through, including most notably the year-long delay on Supreme Court nominee Merrick Garland before Obama left office.  The obstructionism continued when Neil Gorsuch replaced Garland on the Supreme Court nominee agenda, and all the while more and more open judicial seats were left unfilled thanks to retirements not being replaced.

So it's clear why a critical mass of seats are there to fill, but the obstructionism of past Senates came to a head when the GOP removed the filibuster rule that used to apply to judicial nominees, making it possible to push for votes with only 50 members on board instead of 60 out of 100 under the filibuster rules.  Without the filibuster rules, a simple majority can push through a lot of nominees in a short period of time, and that's precisely what happened.  So while the overloaded dockets of federal courts caused by so many open seats is being addressed, the process for vetting and approving judicial nominees has changed significantly.

Not surprisingly, one party had to be the first to take advantage of that situation.  If a blue wave occurs in future elections, we may see similar results with Democrats in charge, but with different ideological judges.  However, the big crush of openings available in the judiciary won't likely repeat itself like this, meaning the long-lasting effect of the Trump presidency may be first and foremost, a reshaping of the federal bench to be far more conservative.

The Bottom Line is, when there's obstructionism in government processes, sometimes that forces only the cream of the crop to move forward.  Unfortunately, it can also lead to opportunities like this one, and it may indeed be the biggest effect of that landmark 2016 election.  We will keep an eye on the courts moving forward to see where they go.

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Legal Geek No. 130: Does a Hacky Sack World Record create a Right of Publicity?

Welcome back to Legal Geek, coming to you from a new home studio, so apologies for any sound quality quirks while we get used to the new space.  This week, we review an ongoing case from Illinois in which a hacky sack world record holder is claiming he has a right of publicity that comes from his world record holding status, in a conflict with Wendy's and Guinness World Records.

https://archive.org/details/LegalGeekEp130

Children of the 90's will remember the hacky sack craze, a game in which you kick a small footbag or beanbag repeatedly with your feet and knees to keep the footbag off the ground for as long as you can.  In 1997, a man named Ted Martin set the record for consecutive kicks of a hacky sack, as he achieved 63,326 kicks in a little less than 9 consecutive hours of play.  That record still stands today, per the record keepers at Guinness World Records.

Ted Martin leveraged this world record into a commercial business, as he sells footbags to those still interested in the hacky sack game.  Thus, it should come as no surprise that Martin objected to the unauthorized use of his name when Guinness and Wendy's combined on a 2013 kids meal promotion that gave out footbags with marketing asking kids if they could beat Ted Martin's longstanding record.  The interesting legal question is whether Martin's world record entitles him to sufficient fame to make a right of publicity claim against such a marketing practice.

Under the Illinois law being applied, the federal courts thus far have denied Martin's requests to hear this case in detail.  Their reasoning has included the fact that Martin does not challenge Guinness's rights to publish his name and record in their book, and that it would be a farce to allow them to sell a book with Martin's name in it while prohibiting the same recitation of a fact in promotional materials.  Martin argues this is a distinction between free speech and commercial speech that the courts do not comprehend.

As you might guess, when a person like Martin represents themselves in court and makes such broad sweeping arguments, it's probably not a great sign.  He does cite an interesting prior case in Illinois where retailer Jewel-Osco was found liable under the Illinois right of publicity law for including Michael Jordan in a full page ad in a magazine congratulating him on his Hall of Fame induction while also connecting him with their store slogan.  However, Jordan is on another level of celebrity fame, and the apparent association between Jordan and Jewel-Osco was much stronger in that case than the association that could be implied by the Wendy's advertisements here.

The Bottom Line is, a hacky sack world champion likely has some ability to commercialize his small claim to fame and protect that fame with trademark and branding type protections.  When it comes to proving higher burdens of proof associated with most right of publicity laws as applied to private citizens instead of celebrities, cases like this one often fall short.  So while Martin will continue to hold the world record, a payday does not appear to be in his future for this case.

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Legal Geek No. 129: Do Age Limits on Gun Sales Create Age Discrimination?

Welcome back to Legal Geek. This week, we cover a listener question from Russell, who asks whether the recent trend of several retailers prohibiting gun sales to those under age 21 is age discrimination that could be challenged in court.

https://archive.org/details/LegalGeekEp129

The recent string of high-profile school shootings in Florida and other states have ramped up pressure for stronger gun control in America.  While the government has not yet weighed in as of the time of this recording, several retailers like Wal-Mart have decided to take action themselves and ban sales of firearms to persons under the age of 21.  While this may be seen by some as a positive P.R. move for these companies, does it open them to an age discrimination lawsuit?

The topic of age discrimination is most often associated with workplace harassment and discrimination, and the only federal law on point is the Age Discrimination in Employment Act, which prohibits discrimination against those age 40 or older.  To this end, there is not a specific law protecting younger workers from discrimination, at least on the federal level, but regardless, this type of law does not apply in this gun sales context.

That leaves several more amorphous Constitutional grounds to make a discrimination claim, including under the Second Amendment, under due process, or under the Equal Protection clause.  The Second Amendment is likely not infringed because these retailers are not government entities, and there remain other sources of firearms if a young person wants to own one and exercise their rights under this Constitutional Amendment.

Due process and equal protection both stem from the 14th Amendment to the Constitution.  For due process, states are generally free to restrict your rights under their broad police powers unless the law infringes upon a fundamental right, which have typically been interpreted to include all those rights enumerated in the Constitution and the Bill of Rights.  Thus, the right to keep and bear arms would likely be a fundamental right that would require states to comply with the strict scrutiny standard to enact limits upon that right, which means the state law must be narrowly tailored to serve a compelling interest of the state.

However, again we run into the problem that these retailers are not states or government entities.  Even if we ignore that problem with the potential challenge and posit that a state writes a law prohibiting sales of guns to those under age 21, there is a possibility that such a law could still be deemed to meet the strict scrutiny standard.  Public safety, particularly of young adults and children, is almost certainly a compelling state interest, and as long as it could be proven that the law would be narrowly tailored to fit those interests, it would stand as constitutional.  A challenge could certainly be made in court, but it's a close call on whether it would be successful, and that's only if we have actual government action or laws on this point beyond the retailer context.

Equal protection stops laws from discriminating against so-called suspect classes, which is basically people that have been getting a raw deal for years like minorities and religions.  Age ranges are not a suspect class, which is also why prohibitions against sales of alcohol to the same age group have not been successfully challenged.  Indeed, the alcohol age limit is perhaps the best analogue to this question about gun sales, with the only notable difference being that gun ownership may be a fundamental right under the Constitution, while drinking alcohol is not.  While that difference could change the legal standard applied in court, it may not change the outcome.

The Bottom Line is, although I am no Constitutional civil rights expert, it appears that challenges to retailers not selling guns to those under age 21 would face an uphill battle in court for a number of reasons.  Age discrimination is not really recognized for younger people in several contexts, including the sale of alcohol, and that would make it exceedingly difficult to stop these practices and decisions of private party retailers.  That being said, this would be a great intersection of gun control and Constitutional rights to watch in court if a challenge is ever made, but that seems more likely if states or the federal government writes a law like this.  We will have to wait and see if that develops.

Thanks Russell for the great topic suggestion.

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Legal Geek No. 128: Google Sued for AdWords Practices

Welcome back to Legal Geek. This week, we review a recent federal lawsuit filed against Google in federal court claiming trademark infringement and dilution based on practices Google has established in its AdWords program.

https://archive.org/details/LegalGeekEp128 

Edible International is the owner and operator of the Edible Arrangements brand, well known for sending bouquets of candy and fruit as a competitor for flowers.  If you conduct a Google search for Edible Arrangements, the company's primary competitors including Shari's Berries and 1-800-Flowers come up as links as well as Edible Arrangements itself.  This is because those competitors have purchased the rights to appear in search results when the keyword term Edible Arrangements is searched by a user. 

This is common practice for companies under the Google Adwords program, as it can be helpful to appear both when users search for you as well as your competition.  However, Edible International argues that allowing competitors to buy such search rights based on its trademarked name has caused over $200 million dollars in damages thanks to customer confusion and damage or dilution to their trademark.

Thus, Google once again finds itself on the cutting edge of IP litigation that will help define the boundaries of such rights moving forward.  Google has successfully pushed against copyright claims in the various Google Books cases, and this will be one of what may become a number of case studies on trademark law and how it interacts with online search engine practices. 

The gray area comes in that Google is profiting off selling advertisements using the actual trademarks and slogans of companies not related to Google.  That appears to be contrary to the goals of trademark law, as it can potentially lead to consumer confusion when competitors buy up the right to advertise using competition names and slogans as keywords.  However, there is also a countervailing public interest to allow helpful information to be presented to users of software like search engines.

The case from Edible International makes out a number of different theories for liability, and as such, Google will have its work cut out to overcome and contest all of these theories.  Of course, some of the claims may be removed by the court or simplified as the case continues through the early stages, but as currently written, this will be a landmark decision on the cutting edge or potential limits of brand protection. 

The Bottom Line is, one of the aspects that makes Google a success as a company is the innovation and boundary-pushing it does, but such practices often lead to litigation as well.  In the case of AdWords, Google appears to be profiting more than acting purely in the public interest, so if this case comes down to a close call of the equities, Google may lose this time.  We will keep a pulse on this case and update it as decisions occur, as this is likely a case that could shoot up through appeal courts and possibly to the Supreme Court.

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Legal Geek No. 127: How an Embedded Tweet may lead to Supreme Court Litigation

Welcome back to Legal Geek. This week, we cover a recent case from New York about embedding tweets into news articles that may lead to a circuit split of opinion and Supreme Court litigation on what constitutes copyright infringement.  Who knew embedding a tweet could have such dire consequences?

https://archive.org/details/LegalGeekEp127 

The case is entitled Goldman v. Breitbart News Network, and it was decided in late February at a New York federal district court.  Justin Goldman is a photographer who captured an image of Tom Brady speaking with Boston Celtics GM Danny Ainge in July 2016, and then posted it on Snapchat.  This phot went viral and was shared by many others on other platforms like Twitter.  That also led to a slew of news articles with speculation of how Brady and Ainge might be working together.

These news articles came from sources such as Yahoo, Time, Gannett, and the Boston Globe, with many of the articles embedding tweets of other Twitter users containing Goldman's photo.  Goldman filed suit and claimed such a practice was copyright infringement of his photograph.

Embedding tweets works by displaying the content of another server or site, in this case Twitter, in the middle of a news article when published online.  Thus, the news publishers never stored a copy of the picture on their servers, and this was argued by the news companies as decisive proof of no copyright infringement.

This theory is based on a 9th Circuit Court of Appeals case called Perfect 10 v. Amazon, which occurred in California.  In that case, Google was being sued for copyright infringement for showing nude or suggestive images originally from the Perfect 10 magazine when google image searches led to sites having this content.  That case drew an interesting distinction between the showing of thumbnails in the initial search, and the full size images shown when a user would click on a corresponding thumbnail image.  The full size images were shown by in-site linking to the other sources, while the thumbnails were stored on Google's server, and this storage was deemed to make the thumbnails copyright infringement.  In other words, linking or embedding an image from another source is not a prohibited display of a copyrighted work because it was never stored on the server of the infringer.

The New York court explicitly questioned whether the Perfect 10 decision was correct in concluding the opposite in this case, that copyright infringement exists when embedding tweets with images even though there is no local storage of the image by the news sites.  Thus, the photographer wins at this level, although you can likely expect this to be appealed by the big publishers to the Second Circuit Court of Appeals, and then to the Supreme Court if they don't win at the intermediate level.  If this occurs, this is precisely the type of split in law or interpretation between circuit courts that usually leads to the Supreme Court taking a case and rendering a decision.  So embedding a tweet could lead all the way to the Supreme Court.

Most social network terms of service force you to sign away such IP rights claims against them, but this waiver interestingly does not stretch to those who repeat content from those social networks, at least in the judgment of this court.  Just another fascinating quirk of this case.

The Bottom Line is, the lines of what constitutes copyright infringement can be ever-changing in the field of online publishing, and that's even when there's no fair use claim, as in this case.  Sometimes the most seemingly innocuous action can lead to the highest courts, and we will keep our eyes on this possibility in this case.  

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