By TUALE CHARLES AJUYAH and NNADI, EZINNE TOCHUKWU
The world of sport has fast become a billion-dollar entity, morphing from a mere recreational activity to a financial and economic haven. In its own right, sporting activities account for over 3.7% of the aggregate GNP of the twenty-eight EU states. It is also responsible for over 3% of world trade. It employs fifteen million people in the EU, which is about 5.4% of the entire European labor force. In December 2020, NBA superstar Giannis Antetokounmpo agreed to sign a five-year contract extension with the Milwaukee Bucks worth $228.2 million, in what is the largest deal in NBA history today[1]. Barcelona FC conceded in January 2021 that Lionel Messi indeed earned $167 million a year on a 4-year contract he signed in 2017[2].
Evidently, sport is now bigger than it has ever been, in terms of its lucrativeness and the human resource it employs. It is only natural that in an industry with so much money and people, there would exist a barrage of laws. Although there is no defined and distinct ‘sports law’, it is governed by the basic principles found in our civil and criminal laws.
Arbitration is the primary dispute resolution mechanism employed in sport, with the Court of Arbitration for Sports (CAS) the apex Court for this purpose. The CAS recently overturned the UEFA’s club financial control body (CFCB) decision banning Manchester City FC based on allegations that the club is involved in serious breaches of financial fair play regulations. Recent trends in sports have shown that intellectually property is increasingly regarded as a major source of value and revenue and is thereby heavily guarded. This article focuses on these intellectual property considerations in sports law.
IMPORTANCE
Intellectual Property Rights herein referred to as ‘IPRs” play a massive role in the world of sports, especially in terms of copyright and trademarks. This is because they enable the protection of rights and in this regard, sports branding and marketing, which in turn boosts the successful commercialization of Sports events; major sport events like the Olympic games, the FIFA World Cup, WrestleMania among others are built around IPRs.
One could argue that without the IPRs, these events would not hold. Simply because, nobody wants to pay a ton of money to sponsor sports teams, athletes or events, and not have rights to safeguard such investments. IPRs is the recognized law which breeds confidence in investors or sponsors to part with money and invest in sports because they know such rights, will be legally exploitable and also enforceable in cases of breach. IPRs are not only of importance to sponsors but also to athletes, organizations and personalities.
In marketing sports events, IPRs are important for the aforementioned reasons. The issues with marketing sports events in most common law jurisdictions is the fact that a sporting event as a whole cannot be protected, “A spectacle cannot be owned in any ordinary sense of that word.”[3] This means that a sporting event is legally not a property that can be protected on its own rights. What happens therefore in practice is, potential marketers and investors in sporting events would have to focus on properties within the event which can be legally protected.
This element further raises the level of importance attached to trademarks and copyright. Special note should be taken on the importance of registered ‘domain names’ for sports bodies who use this domain names to promote, market and commercialize sporting events, organizations and personalities. In practice, these domain names serve as quasi trademarks and most times, it gives corporate identity with commercial and cultural goodwill[4].
LEGAL PERSONALITY AND GOODWILL
Goodwill generally is an intangible asset in relation to the acquisition of a company or business by another. Goodwill is an essential asset of any enterprise because the core essence of its existence is embedded into it. The spectators and supporters of a sports organization or federation are to a great extent its customers, as their passion for their favorite sports team/event makes them follow with unquestionable enthusiasm. Asides the proprietary interest in goodwill, there are also personality interests. Personality rights are not limited to natural persons, as juristic persons like companies also have personality rights like reputation and identity.
Goodwill as well as reputation is intricately related to identity. Identity entails a wide range of things including specific products of an enterprise and the pattern in which it is packaged. In relation to sports federation as an enterprise, the “product” is the sports events and its identity is echoed in the tournaments, events or matches which uniquely differentiates it from other sports federations or bodies.
For instance, when one thinks of the International Federation of Association Football (FIFA)World Cup, it automatically gives you an image of the FIFA world cup trophy (18carat gold with bands of malachite on its base)[5], the blue FIFA flag with the organization logo in the middle, the FIFA anthem, the grand opening of the ceremony, the idea of it being a football game amongst the member countries, the recognitions and awards, and so on. These are essential characteristics of the identity of FIFA, and same can be said for other sports federations and tournaments they represent. It is these identifications that make it easy for a football fan to differentiate a premier league game from the German Bundes liga.
The identity right of FIFA in the above is breached where another person uses these distinct features which are primarily attributable to the Association for commercial gains without authorization. The core element of this breach is that the use was for a commercial purpose which is solely aimed at promoting a product or service to attract customers. The unlawfulness in this case is mainly vested in the violation of the right to freedom of association and the commercial exploitation of the individual or company.[6]
PROTECTION
Sporting International organizations in most cases explore various avenues to protect their IPRs. For example, the Olympic Charter in Article 7[7] contains provisions which provide strict safeguard for these IPRs. It provides among others that, “The International Organizing Committee (IOC) is the owner of all rights in the Olympic Games and Olympic properties described in this Rule, which rights have the potential to generate revenues for such purposes.
It is in the best interests of the Olympic Movement and its constituents which benefit from such revenues that all such rights and Olympic properties be afforded the greatest possible protection by all concerned and that the use thereof be approved by the IOC”. This point is further buttressed by paragraph 2 of Article 7 of the same Olympic Charter, which provided that “The Olympic Games are the exclusive property of the IOC which owns all rights and data relating thereto, in particular, and without limitation, all rights relating to their organization, exploitation, broadcasting, recording, representation, reproduction, access and dissemination in any form and by any means or mechanism whatsoever, whether now existing or developed in the future”[8]
This provisions show that the IOC have taken necessary steps to protect their brand. This protection goes beyond protecting the basic ‘properties’, but also the cultural goodwill and the commercial viability of the organization. In practice, along with the Olympic Charter, the IOC would need to have legislations passed by host cities to prevent ambush marketing. Host cities are also obligated to implement ‘brand protection programs’[9].
An instructive case study for this is the series of Intellectual Property cases that both FIFA and the Local Organizing Committee (LOC) of the 2010 FIFA World Cup had to battle against in South Africa, a decade ago. About 450 cases where filed against said offenders of these IPRs[10]. FIFA and the LOC’s campaign for protection of IPRs is probably one of the biggest in Sports history, as an extensive list of trademark registrations was released which demonstrated the paramount importance Sports organizations place on protecting their brands in terms of organization, staging and commercialization.
On the issue of FIFA and World Cups, in preparation for the 2014 World Cup, FIFA had 13,000 trademarks registered worldwide, 1160 of them registered for the World Cup and 400 occurred after the passage of the World Cup Law in Brazil, which was a law passed to prevent this ambush marketing[11]. This protection goes beyond, sports organizations or committee, and includes franchises who can file trademark applications for team names, logos and mascots.
Individual athletes also feel the need to create their own brands, gain endorsements and gain financially from trademarking names, initials, catch phrases or celebrations. In football and basketball, these are known as ‘image rights’, which allows a player employed with an organization to also gain value from the use of their images that is unconnected to their employer’s brand.
LANDMARK CASES OF TRADEMARK IN SPORTS
BARCELONA FC TRADEMARK CASE
In April 2013, Barcelona Football club (Barcelona) applied for the registration as a community (EU) Trade Mark of the silhouette of its crest in relation to a range of goods such as paper goods, stationery, clothing, footwear, headgear and even some sports activities. The Office for Harmonization in International Markets (OHIM) now known as the European Union Intellectual Property Office (EUIPO), which is the body responsible for the registration of community trademarks, rejected the application on the grounds that the mark lacked distinctiveness, and therefore did not meet the basic requirement for registration. Barcelona appealed until it got to the EU General Court, where they also dismissed the appeal and ruled that:
- The crest silhouette is not capable of attracting the attention of consumers as a sign indicating the origin of the goods/services carrying that mark.
- The silhouette of a crest does not differentiate itself much from the basic shapes generally used in various commercial sectors as a decorative element.
- Therefore, the crest silhouette does not possess the inherent distinctive character[12]
WASHINGTON REDSKINS TRADEMARK CASE
There has been a legal fight which has persisted for about twenty years over the use of the Redskins team name by the Washington Redskins American Football club. The court in a ruling ordered the United States Federal Trademark and Patent Office to cancel several trademark registrations held by the club in respect of this name, on the ground that the name ‘Redskins’ may be reproachful to Native Americans, who have objected to the name for decades, while also citing dictionary entries stating that the name is considered to be offensive.
However, the present ruling does not prevent the club from using the name although the legal implication is that the name would no longer enjoy the full legal protection attributable to a federally registered trademark.
INTELLECTUAL PROPERTY RIGHTS IN THE NIGERIA SPORTS SECTOR
Speaking particularly about the branches of Intellectual Property in Nigeria, we shall begin the discussion with Patents. Patents can be defined as the legal rights vested on inventors of new and useful products and processes, the right to exclude all others from commercially exploiting the invention. It is a right that rewards, ingenuity of thought. It ensures the author of the invention is afforded legal recognition and protection.
Once a patent has been registered in Nigeria and indeed around the world, it prevents those not afforded the rights from exploiting the use of that invention for commercial purposes. Patent protects the authors time, effort and resources used in producing a new invention. The author or patentee then holds the patent to such invention for the next twenty years (Section 7(2) of the Patents and Designs Act)[13]
In Nigeria today, the Sports industry, is still lacking behind the rest of the world in terms of industrialization and technological development. Instead we continue to reap the reward of the invention of others. One can confidently speak on and say that patent is the least utilized IPR in Nigeria. It is also key to state that, Sports people and inventors should not be deterred from being creative. The resources or platform may not be there, but one can never truly know, when his invention is the next best thing.
Copyright is another branch of IPR that seems to not exist in the Nigeria Sports industry. This branch of IPR is not only infringed on, but one might argue it is abused in Nigeria. This is because local markets are field with all sorts of fake jersey’s, scarfs, cups, slippers, boots etc. Essentially copyright is a right which protects the expression of an idea in a definite form and gives rights to the creator or owner the right to sell, produce, reproduce that expression of idea for their commercial benefits. This could be by themselves or another via through a testamentary deposition or grant of license.
The areas of sports where copyright abounds are the merchandise, Television and media rights literature contained in match day programs sold to fans, ticket sales, the software of computer and online games. In Nigeria most of the aforementioned being copied without permission. This also seems to discourage creativity as inventors do not see the means to commercialize their ideas, the protection afforded to them or the penalties for infringement are not stiff enough to encourage inventors.
Another branch of IPRs are Trademark. This along with copyrights are the most popular IPRS. Trademarks has its rights embedded in the very things we see everywhere when it comes to Sports. From logos, team names, league names, sporting goods, broadcasting and apparel. It is essentially anything that gives a brand an identity, such as symbols, crests, logos, catch phrases or anything that distinguishes the products (goods/services) of one business to another.
Trademarks are important as they allow supporters recognize easily the brand they are associated with. Naturally, trademarking would lead to good commercial output. For example, seeing the Nike tick or Puma jaguar would tell one that such product is that of Nike or Puma and they guarantee quality. Various forms of trademarking exist which include registering of nicknames by sports celebrities, catch-phrases, mascots.
It is clear that in Nigeria we are behind most of the world in Intellectual Property rights. The need to develop commercially potent brands that would compete transnationally, is at an all-time high. A major issue with the lack of protection or platform for inventors to develop in Nigeria is the fact that, Nigerian Sport is generally managed and controlled by the government. With that, it is difficult to allow businesses in the industry genuinely grow. At the end of the day, no one wants his/her efforts to be wasted without gains, and this extends to possible investors and stakeholders in the sport industry
The U.S Chamber International IP Index 2021[14], Nigeria ranks 47 of 50 countries in the assessment of economies whose intellectual property systems provide a reliable basis for investment in the innovation and creativity lifecycle[15]. This is a damning report, because it proves most of the aforementioned faults of the legal framework for IPRs in Nigeria. It is a challenging environment for the prosperity of goods and involves a high right of physical counterfeiting and online piracy remains high and public awareness of the value of IP remains low.
Just like in most Common Law jurisdictions, in Nigeria there are statutory protection for regular trademark, and the doctrine of passing off is also applicable. Laws and regulations established for the protection and administration of intellectual property rights include: the Copyright Act[16] , the Patents and Designs Act[17], the Trademarks Act[18], and so on.
The courts have not interpreted the provisions of the Nigerian Trademark Act to include marks from the sporting industry, and this may be likened to the fact that the sports jurisprudence in Nigeria is not as developed as it is in other jurisdictions like Europe and the United States of America. Nevertheless, it merely provides enough general covers that sport brands can explore in order to fully relish the benefits attached to IPRs for stakeholders. In the Nigerian sporting sector, the provisions of the Trademark Act and the Common Law doctrine of passing off must be fully utilized, as they are still vastly underutilized.
It is highly recommended that organizers of sports events should always protect their event marks by adopting the provisions of the Trademark Act which is similar to the provisions of the UK Trademark Act.[19]It is also suggested that every state with a sporting presence should enact a Law that would provide a mirrored protection available in the Federal Act enacted by the National Assembly.
For instance, the Nigerian Premier Football League (NPFL) can have an Act titled ‘The Nigerian Premier League Event Mark and Related Rights Act’ to be adopted by the various state governments. This would serve as the principal protection for all the marks associated with the NPFL throughout the Federation while the Trademark Act serves as secondary or ancillary protection for the football league.[20]
The importance of a proper shield of sports events marks in Nigeria cannot be overemphasized, as it would allow owners to exclusively exploit their marks for economic and financial gains. This can serve as a booster to the confidence of prospective sponsors and business partners, as it gives a sense of security for their investments.
CONCLUSION
With the rising enthusiasm and passion of individuals in the sporting sector, it will be highly disappointing if the full potentials of intellectual property rights in sports activities are not utilized to the maximum. In a bid to achieve this and protect the rights of stakeholders in this sector, it becomes pertinent that professional sport clubs and sport event organizers within Nigeria maintain the global standard.
In addition, the Legislative and Judicial bodies in Nigeria, are advised to amend and adjust our laws to toe the line of international sporting communities while considering our local circumstances, as the legislature governing intellectual property and by extension sports, are somewhat anachronistic.
The judiciary also, do not provide a hasty and less adversarial means of dispute resolution mechanism, hence, more people involved in sports should seek resources in arbitration, and make more use of avenues like the Lagos Court of Arbitration. All these measures would be to the national benefit as the economic and cultural benefits of hosting sporting events in a city or a country are always astronomical.
BIBLIOGRAPHY
STATUTES
Cap C28, Laws of the Federation, 2004
Cap P2, Laws of the Federation, 2004
Cap T13, Laws of the Federation, 2004
- 1 (1) of the UK Trademark Act, 1994
Article 7 of the Olympic Charter
Article 7, Paragraph 2 Olympic Charter
CASES
General Court of the European Union Press Release No 144/15, Luxembourg, 10 December 2015, Judgment in Fútbol Club Barcelona v OHIM, Case T-615/14.
Victoria Park Racing and Recreation Grounds Co Ltd v Taylor [1937] 58 CLR 479
Wells v Atoll Media (Pty) Ltd [2010] 4 All SA 548 (WCC).
ONLINE SOUCRES
Allen Kim (2020) Giannis Antetokounmpo signs largest deal in NBA history with Milwaukee Bucks https://edition.cnn.com/2020/12/15/us/giannis-antetokounmpo-contract-spt-trnd/index.html
Blackshaw I.S. (2017) IP and Sport. In: International Sports Law: An Introductory Guide. Short Studies in International Law. T.M.C. Asser Press, The Hague. https://doi-org.gcu.idm.oclc.org/10.1007/978-94-6265-198-2_5
FIFA.com https://www.fifa.com/who-we-are/news/the-fifa-world-cuptm-trophy-517161 Accessed 4th Jan 2021
George Ramsey (2021) Barcelona denies responsibility for leak after report reveals Lionel Messi’s record $672 million contract https://edition.cnn.com/2021/02/01/football/lionel-messi-barcelona-contract-spt-intl/index.html
BOOKS
Owen Dean “Sport as a Brand and its Legal Protection in South Africa”, ‘Global Sports Law and Taxation Reports’, March 2012 pp 41
Ugochukwu Johnson Amadi (2017); Intellectual Property Rights in Sports: African Sports Law and Business Bulletin
Written by: TUALE CHARLES AJUYAH and NNADI, EZINNE TOCHUKWU
Tuale and Ezinne are Associate at Omaplex Law Firm.
Tuale, is a sports and entertainment lawyer who represents a wide variety of Nigerian and international clients including television broadcasters, Sport and Entertainment personalities, media companies, sports governing bodies, global brands and buddings musicians.
While
Ezinne is a member of the Firm’s Dispute Resolution Team with a focus on intricate Civil Litigation. She has an outstanding experience in contract and business disputes. She has represented major debtors and creditors in high-profile Debt Recovery proceedings.
[1] George Ramsey (2021) Barcelona denies responsibility for leak after report reveals Lionel Messi’s record $672 million contract https://edition.cnn.com/2021/02/01/football/lionel-messi-barcelona-contract-spt-intl/index.html
[2] Blackshaw I.S. (2017) IP and Sport. In: International Sports Law: An Introductory Guide. Short Studies in International Law. T.M.C. Asser Press, The Hague. https://doi-org.gcu.idm.oclc.org/10.1007/978-94-6265-198-2_5
[3] Victoria Park Racing and Recreation Grounds Co Ltd v Taylor [1937] 58 CLR 479
[4] Blackshaw I.S. (2017) IP and Sport. In: International Sports Law: An Introductory Guide. Short Studies in International Law. T.M.C. Asser Press, The Hague. https://doi-org.gcu.idm.oclc.org/10.1007/978-94-6265-198-2_5
[5] FIFA.com https://www.fifa.com/who-we-are/news/the-fifa-world-cuptm-trophy-517161 Accessed 4th Jan 2021
[6] Wells v Atoll Media (Pty) Ltd [2010] 4 All SA 548 (WCC).
[7] Article 7 of the Olympic Charter
[8] Paragraph 2, Article 7 Olympic Charter
[9] Blackshaw I.S. (2017) IP and Sport. In: International Sports Law: An Introductory Guide. Short Studies in International Law. T.M.C. Asser Press, The Hague. https://doi-org.gcu.idm.oclc.org/10.1007/978-94-6265-198-2_5
[10] Owen Dean “Sport as a Brand and its Legal Protection in South Africa”, ‘Global Sports Law
and Taxation Reports’, March 2012
[11] Ibid 11
[12] See General Court of the European Union Press Release No 144/15, Luxembourg, 10 December
2015, Judgment in Fútbol Club Barcelona v OHIM, Case T-615/14.
[14] Global Investment Journal: U.S Chamber International IP Index https://www.theglobalipcenter.com/report/ipindex2021/
[15] Supra n14
[16] Cap C28, Laws of the Federation, 2004
[17] Cap P2, Laws of the Federation, 2004
[18] Cap T13, Laws of the Federation, 2004
[19] See S. 1 (1) of the UK Trademark Act, 1994
[20] Ugochukwu Johnson Amadi (2017); Intellectual Property Rights in Sports: African Sports Law and Business Bulletin
