Pattishall IP Blog

May 25, 2010

Supreme Court Makes the Call: NFL Not Exempt from Antitrust Law when Licensing Team Trademarks for Merchandise

Filed under: Antitrust, Licensing — Tags: , , — Pattishall, McAuliffe, Newbury, Hilliard & Geraldson LLP @ 7:27 pm

By Uli Widmaier, Esq.

Reversing the Seventh Circuit, the Supreme Court unanimously held that the National Football League’s trademark licensing activities are “not categorically beyond the coverage” of federal antitrust laws.  American Needle, Inc., v. NFL, No. 08-661, slip op. at 1 (S. Ct. May 24, 2010).  The Court concluded that the league’s actions constitute “concerted activity” under Section 1 of the Sherman Act, meaning that, on remand, the district court will evaluate American Needle’s claims under the Rule of Reason standard.  Id. at 18.  This does not mean that the NFL necessarily will be found liable under the Sherman Act, or that such an outcome is even likely.  Writing for the Court, Justice Stevens emphasized that the NFL may very well prevail under the Rule of Reason test, since NFL teams may have “a perfectly sensible justification for making a host of collective decisions.”  Id.  Nevertheless, American Needle’s antitrust claim will proceed for the time being. (more…)

July 17, 2009

Supreme Court To Review: Does a Multi-Team Sports League Act as a Single Entity & Avoid Antitrust Liability When Licensing Individual Team Trademarks?

Filed under: Antitrust — Tags: , , — Pattishall, McAuliffe, Newbury, Hilliard & Geraldson LLP @ 2:58 pm

by Sanjiv Sarwate, Trademark Attorney

On June 30, 2009, the Supreme Court agreed to review the Seventh Circuit’s decision in American Needle, Inc. v. National Football League, a case illustrating the intersection of trademark law and antitrust law.  American Needle manufactures headwear, and held a license from NFL Properties to manufacture, sell, and promote headwear bearing NFL team logos, names, and other indicia of origin.  NFL Properties initially licensed multiple parties to manufacture headwear bearing team logos.  However, in 2000, the NFL teams directed NFL Properties to solicit bids for an exclusive headwear license, which was eventually won by Reebok.  NFL Properties allowed licenses granted to other entities, including American Needle, to expire.  American Needle then brought suit, alleging that the exclusive license violated Section 1 of the Sherman Act, which forbids any “contract, combination, or conspiracy in restraint of trade.”

American Needle argued that because each NFL team owned its trademarks separately, the exclusive contract between NFL Properties and Reebok restrained other manufacturers’ abilities to obtain licenses from the teams.  Thus, the exclusive license between NFL Properties and Reebok restrained trade in violation of the Sherman Act.  The NFL argued that it is a “single entity” for purposes of licensing team trademarks, and therefore immune from liability under Section 1 of the Sherman Act.  The district court granted summary judgment to the NFL on the “single entity” defense and American Needle appealed. (more…)

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