EA Seeks Dismissal from Likeness Lawsuit

by
Posted July 29th, 2013 at 6:45 pm

ncaa140729

In a filing today Electronic Arts is seeking dismissal following the latest amended complaint in the player likeness lawsuit against the company, NCAA, and CLC. During the class action certification hearing EA and the CLC both threw the NCAA under the bus saying they shouldn’t be held liable given that they were just following the NCAA’s rules. That argument is appearing again now in the hopes, however slim despite happening once before, that they will be dismissed as defendants before the decision on class action certification comes down. 

EA’s lawyers argue that the plaintiffs consider them to be liable because they followed the NCAA’s rules and “lobbied for, and obtained, administrative interpretations of those rules that permitted greater exploitation of student-athletes’ names, images and likenesses.”  EA points out that the court has previously ruled that doing so is considered a commercial effort to obtain new rights and use their existing rights under the NCAA’s rules. The company now wants the legal sufficiency of the complaint tested before proceeding with the class action determination.

The plaintiffs’ complaint was amended when current athletes were added in order to qualify for consideration as a class should it be approved by the judge. A ruling on class action certification could come within the next few weeks if this filing by EA does not delay the timetable further.

[UPDATE] EA has been granted a hearing for September 5. That means a decision on whether the case will be certified as class action is unlikely to occur until later in September.

Earlier/Summary Below

The player likeness lawsuit against the NCAA, CLC, and Electronic Arts is the culmination of two high profile filings that were combined as led by Sam Keller and Ed O’Bannon (and O’Bannon now heads it up). It alleges improper use of player likeness through various forms of merchandise and media including video games in which the parties in question conspired to avoid paying players for their rights. Some interesting details and claims regarding the case at hand were revealed when EA was reentered as a defendant after initially being dismissed.

EA originally won a previous case regarding player likeness with the courts ruling video games are artistic works rather than commercial speech and therefore protected by the First Amendment. The Supreme Court in 2011 established forms of media, producing expressive works of art, are not subject to judgments based on incorporating someone’s name or likeness. That dismissed case however, involving Ryan Hart, has resurfaced after an appeals court reversed a decision based on that argument.

Recent uncovered emails have shown that NCAA representatives were well aware that players in games were based off real-life players. At one point the NCAA and EA had nearly reached an agreement to have actual player names included in the products. The EA Locker / Roster Share feature was a fallback option. With momentum clearly on the plantiffs’ side NCAA reps have begun to publicly express concern over the future of collegiate sports. A former EA Sports producer admitted players in NCAA games were based off real athletes.

The discovery of Tim Tebow’s name being in NCAA Football 10 could throw another wrench into EA’s series of arguments. Depositions from former Alabama wide receiver Tyrone Prothro and UConn basketball guard Tate George support the defendant’s reasoning for denying class action certification. The class action hearing resulted in the judge heavily questioning the legitimacy of a potential class and insisting a current athlete be involved. The judge required current athletes be added as plaintiffs for that party to have representation if the case is certified as class action. Six current college football players were added as plaintiffs in mid-July.

This consolidated case in California if certified as class action would go to trial – barring a settlement – and ultimately be the determining factor of how the NCAA proceeds in the future handling broadcasting rights, merchandising, and video games. Should a negative result come down, which one analyst has pegged as being a potential loss of $1 billion for EA, it would likely not just end the NCAA Football series but also with it any realistic possibility of college sports games being made in the future. The trial now is slated to begin June 2014. Appeals following a decision could extend the fight through 2020.

  • Tazdevil20

    I wonder how these guys will come up with the funds to fight EA for 10 years in court. One has to wonder if these constant headaches are karma for EA’s greed in gathering up every license under the sun a few years back.

    • Keith.

      The named plaintiffs aren’t footing the bill — their lawyers are. And it’s the same lawyers who beat down EA in the Pecover (Madden Monopoly) and the Antonick (original Madden designer) lawsuits, so no worries there.

      EA, on the other hand, has lost $2.5 billion since 2008, so the better question is how long can EA afford to fight. One CEO’s already out his job — is the next CEO (whenever he’s hired) gonna have the stomach to keep footing all these legal tabs, when EA keeps losing?

      • turkey86

        EA’s revenue last year was 4.1 billion.

        • Keith.

          You do realize that revenue does not equal profits, don’t you?

          “Riccitiello joined EA as CEO in April of 2007. The game company’s fortunes have run very much downhill since then. EA had a combined net loss of almost $2.5 billion over fiscal years 2008, 2009, 2010 and 2011. During the most recently reported quarter, revenue fell from $715 million to $711 million. EA’s net loss was $381 million compared to a loss of $340 million in the same quarter a year earlier. Wall St. was disappointed by the company’s financial outlook for the quarter going forward.”

          http://247wallst.com/special-report/2012/12/26/ceos-to-fire-in-2013/3/

          http://kotaku.com/5972012/how-long-will-eas-ceo-sit-on-the-hot-seat-in-2013

          • Casor_Greener

            A loss is not always what you think either….Magic with accounting my friend…

          • Keith.

            I hear ya, but $2.5 billion in losses takes more than magic accounting to overcome. Just ask Riccotello, who learned that the hard way.

          • johndoe1

            so disapointed that their stock went up (that’s some weird ass logic), shame shame, someone needs to look at a financial chart and not KOTAKU

          • Keith.

            LoL.

            If things really were so rosy with EA’s stock, then why has Andrew Wilson, EVP EA Sports, been unloading like crazy this week?

            http://www.sec.gov/Archives/edgar/data/712515/000154518713000135/xslF345X03/edgardoc.xml

            http://www.sec.gov/Archives/edgar/data/712515/000154518713000141/xslF345X03/edgardoc.xml

            I know if I had Apple on the way up, I certainly wouldn’t have been dumping it like AW has been doing dating back to May. Sound like somebody whose confident in the player likeness lawsuit outcome and the launch of next gen to you?

          • Johndoe1

            I think if you read a simple investment book you would understand trends and why it is a good time to sell. It really has nothing to do with confidence. If so why hasn’t his selling of stock translated into a sell of from every one else. It clearly has hit it’s upward resistance and it will fall from where its at or will break through an climb a lot higher very quickly.

            Sorry going over basic boring stock principles but please go educate your self and come back to me. Or live in your ignorant world of if I don’t like something then it must be horrible.

            Look at their last quarter revenue, when they really released nothing at all and it’s pretty clear EA is in store for a monster year, maybe the biggest year they have ever had as a gaming company.

          • turkey86

            I do and the profit from last year was 76 million. Most expenses are accounted for, though. Just pointing out that they aren’t in any dire situation.

        • johndoe1

          What about EA’s stock price up over 125% in one year something is going right for them

      • Tazdevil20

        Yeah, I’m interested to see how this all shakes out.

  • fantasyboi

    as long as we get 1 college football game i am good! what this will do for ppl like me is hurt madden a ton. If there ends up being an end to college football games that means no export/import. which means i could care less about madden and i know there are plenty of ppl with the same mindset

  • Casor_Greener

    First off – PROPS to Pasta for repping my Alma Mater TCU on the post!!!

    Secondly- TCU til the world blow!

    Third- I”m actually on EA’s side on this issue. The NCAA is the one who deserves to get stuck. They exploited these kids and now it’s time to pay the piper

  • smsixx

    LOL
    EA points finger at NCAA and says “but they did it!!!!”
    That, in a nutshell is their argument for dismissal.

  • badviruz

    I’m not clear on what will happen if EA keeps making the college football games without the NCAA license. So, will the teams all be fakes?

    • http://pastapadre.com/ pastapadre

      At this point nothing changes. But schools may be hesitant to be involved now. Looks likely at least one, maybe a few, schools just won’t be included next year.

      • badviruz

        Thank you, so its worth just waiting to see if all teams will be present, huh? I will be holding to my NCAA FB 14 til the end then.

        • rinodino

          I hear Stanford and Kansas are the only vocals ones as of today. Let’s hope it’s no more

          • Keith.

            Pretty sure most school board members haven’t even had a chance to meet, discuss and/or receive input from their own attorneys yet. The new playoffs system entity said they haven’t digested everything either and that they might not want to get involved (USA Today had the story last week). Does anybody really think schools and the playoffs entity are going to want to line up with EA on this?

          • Keith.

            Here’s the USA Today article, which Pasta linked to in his last Line Drive:

            http://m.usatoday.com/article/news/2573475

Sponsors
Categories
Featured Video