US Supreme Court Hands Big Win to Free Speech Advocates in the IP World

Major League Baseball v. CBC Distribution

By: Allonn E. Levy, Esq.

June 2, 2008

By doing nothing today the U.S. Supreme Court handed a big victory to those concerned with the ever-tightening spigot of free-flowing commercial information.  After a change in MLB’s licensing scheme in 2005 and the subsequent denial of a license to use the names and statistics of major league baseball players in its for-profit “fantasy leagues,”  St. Louis based C.B.C. Distribution sued Major League Baseball in late 2005.  Presumably understanding the potential reach of the issues that would be decided in the case, the Major League Players association intervened in the case as well.  C.B.C. claimed that even though MLB would not grant a license for C.B.C. to use the information, C.B.C. nevertheless had a First Amendment right to utilize the names and data – even though it was exploiting the information for commercial gain.

M.L.B. argued that the information was protected by federal copyright laws, contract law, and the state law rights of publicity.  The trial Court disagreed and in 2006 found in favor of C.B.C. on summary judgment.  In October 2007, the Eight Circuit U.S. Court of Appeal issued an opinion upholding the trial court’s findings.  The Eight Circuit’s carefully reasoned opinion first corrected certain elements in the trial court’s opinion and expressly held that C.B.C.’s activities did violate Missouri’s state law Right of Publicity statutes.  However, the Court held that despite the statutory violation, the activity was protected by the right of Free Speech because the data was publicly available for all to see.  The Court also noted that there was no possibility of confusion by consumers or any suggestion that the players were endorsing a particular product or site.  In fact, the Court noted, the activities of C.B.C. were likely increasing interest in baseball – a pastime that itself allows players and owners to reap hansom pecuniary rewards.

Today, the U.S. Supreme Court simultaneously granted the requests of certain parties to file “friend of court” briefs (meaning the Court considered those briefs) but denied M.L.B.’s petition for Certiorari.  While not technically citable as “Supreme Court precedent” by taking no action, the U.S. Supreme Court will be seen by most as tacitly approving the intermediate court’s opinion.  By considering the petition and declining to take up the case practitioners and other Courts around the country who have been monitoring this case closely will likely take note.

In the past, some District and Circuit Courts have been hesitant to uphold First Amendment rights in the commercial context.  At least in this instance, however, both the trial and intermediate courts had little difficulty in doing so.  In its opinion, U.S. Circuit Judge Arnold writing for the majority addressed the issue concisely:  “It would be strange law that a person would not have a First Amendment right to use information that is available to everyone.” The idea however, has not been uniformly adopted.  Cases originating in California have been extremely protective of the Right of Publicity protecting such rights as the mimicked voices of actors, likenesses and such.  Some feel that the Ninth Circuit’s proximity to Hollywood has made it more sensitive to the pecuniary rights of celebrities than to the First Amendment rights of individuals and businesses.

Curiously, the Supreme Court has been silent on the clash between the First Amendment and rights of publicity for decades.  Its last case on the topic was Zacchini vs. Scripps-Howard Broadcasting – a 1977 case that held that the commercial exploitation of a performance was not protected Free Speech and thus was compensable under a Right of Publicity theory.  But that case was decided by the narrowest of margins – a 5-4 vote.  It also did not provide much direction to practitioners and courts as to where and upon what criterion the line between Free Speech and commercial publicity rights would be drawn.

How important is the High Court’s decision today to let stand the Eighth Circuit’s opinion?  In the brief time the opinion has been published – and despite a then-pending petition for certiorari, the opinion has already been cited 36 times by commentators, parties and at least one other Court.

Today’s refusal to review (and potentially reverse) the Eighth Circuit opinion secures greater rights to access available public information and utilize it for commercial gain.  The High Court’s decision means the Eighth Circuit’s carefully considered opinion will become the last word  on this issue – at least for the moment.  An obvious “win” for Free Speech advocates and “netizens” concerned with ensuring open access to information on the Internet, the case also helps the burgeoning field of Internet information consolidators who help consumers collect information and process it.  Expect to see the case cited frequently in the near future as more and more courts will be facing cases where Internet based information companies battle these issues out with content holders.

Research Notes:

District Court Decision – C.B.C. Distribution and Marketing Inc. v. Major League Baseball Advanced Media L.P. and Major League Baseball Players Assoc.  443 F.Supp. 2d 1077 (E. Dist. Mo 2006)