Protecting the business of professional sports leagues

By DPS Parmar and Aniruddh Singh, LexOrbis
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Sports events are among the most popular forms of entertainment available via the media. There is a craze for live events such as Indian Premier League cricket, Indian Super League football and even kabaddi matches.

Promotional products flood the market months before the start of major events, with a mad race to sponsor these events or get a prime space for advertisements in the stadium or on the jerseys of the players, the organizers or the team managers.

DPS Parmar Heads the IPAB practice group LexOrbis
DPS Parmar
Heads the IPAB practice group
LexOrbis

In India, where a sport like cricket is considered as a religion and players are seen as gods, sports must be viewed as an integral part of a true Indian’s life, and recently the introduction of professional sports leagues has made the sports industry a business worth millions.

The considerable revenue generated by a T20 cricket game, a football match or even kabaddi results from exploitation of intangible rights in the form of brand recognition of teams participating or the event itself or through sponsorship from a multinational organization that can impalpably benefit from such association and also profit from selling broadcasting rights, etc.

Almost everyone wants to promote their business by associating their brand with such a sports event but the unauthorized use of intellectual property or an unauthorized association by an organization for commercial benefit may result in the infringement of the rights of the stakeholders and may cause irreparable losses.

Activities linked with sports events involve diverse stakeholders – government and public bodies; enforcement officials and the judiciary; legal practitioners; agents, athletes, clubs, sports federations; event organizers, donors, sponsors; sporting goods manufacturers; television and media companies, etc.

These stakeholders in the normal course of business deal with a variety of laws including intellectual property laws relating to trademarks, copyright and designs, commercial laws relating to competition, trade practices, telecommunications and broadcasting, etc.

The business of sports leagues is also governed by the terms and conditions of the contracts between the stakeholders providing exclusive rights over different aspects such as selling of tickets, live streaming of matches over the internet, live telecasting, and transmitting live scores of matches through SMS or other means.

Aniruddh Singh Associate LexOrbis
Aniruddh Singh
Associate
LexOrbis

Intellectual property rights (IPR) play a significant role in the commercialization of professional sports leagues. On one hand, trademarks and brands associated with such sports leagues have become huge commercial assets and are used as a marketing tool to gain commercial benefits. On the other, copyright and related rights are adding huge amounts to the earnings of various stakeholders, especially the broadcasting organizations that are telecasting such sports events live on TV or websites. Design rights or patent rights for new sporting gear add immensely to the revenue in certain cases The scope of IPR has become so wide particularly in the sports league business that every stakeholder has to be extremely vigilant to protect its rights.

The enormous developments in technology not only widen the scope of revenue generation for the stakeholders but also increase the risk of piracy in the form of signal theft as well as counterfeiting of products. Piracy is hurting the business of sports as whole by reducing the value of rights granted by sports leagues.

In India, there are cases where the courts have looked into the matter and passed John Doe orders restricting unauthorized broadcasting. Such an order was first passed by Delhi High Court in Taj Television Limited v Rajan Mandal and then in ESPN Software v Tudu Enterprises, where the court dealt with the particular issue and passed an order restraining both unidentified and identified infringers of the plaintiff’s broadcasting rights. Such orders are also passed in cases of counterfeit products, where unidentified infringers use trademarks without authorization.

It was reported that the Indian Premier League collected gross revenue of US$378 million for the 2016 season. The Indian Super League reportedly collected revenue of US$70 million in its first season back in 2014. Other professional sports leagues are also earning huge revenue, which will increase with time and the popularity of the sports.

The growing revenue from sports leagues will not only create millions of job opportunities in the sports industry but will also help in the development of public infrastructure. Securing the rights of the stakeholders of sports leagues would likely attract foreign investment, which would be reflected in India’s economic growth. So it is the duty of Indian law firms to help secure the national interest by protecting the business of professional sports leagues in India.

DPS Parmar heads the IPAB practice group at LexOrbis and Aniruddh Singh is an associate.

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