Headline | Heitner Legal

How Much Should Jimmy Graham Cash-in?

Compare the following stats:

Player A: 84 receptions, 1,492 yards, 17.8 avg. yards/catch, 12 TDs

Player B: 86 receptions, 1,215 yards, 14.1 avg. yards/catch, 16 TDs

Player C: 52 receptions, 850 yards, 16.3 avg. yards/catch 13 TDs

If you guessed that Player A and Player B were two of the top receivers for the 2013 NFL season for their respective teams, you would be correct; however, if you assumed that both players played the same position, you would be wrong. Player A is Calvin Johnson, widely regarded as the top wide receiver in the NFL, a notion the Detroit Lions seemed to agree with when the team made him the highest wide receiver in NFL history, signing him to an eight-year contract worth up to $132 million dollars, with $60 million guaranteed. Player C is Vernon Davis, recent mini-camp holdout for NFC runner up, the San Francisco 49ers. Davis recently expressed his reasoning for holding out on Sports’ Illustrated MMQB. Therein he states “In 2010 I signed a five-year, $37 million contract extension with $23 million guaranteed [which at the time] was the biggest contract for a tight end in league history.” Four years later, Davis is holding out because he believes he is currently worth more based upon his production showing that he has been playing at a higher level since signing that record-setting deal.

Here’s the problem: Player B is Jimmy Graham, high-flying receiver for the New Orleans Saints. Looking at the statistical discrepancy between Vernon Davis and Jimmy Graham from this past NFL season, one would assume that whatever contract Jimmy Graham receives from the Saints in this off-season would greatly eclipse Davis’ record setting contract from 2010. Furthermore, based upon his recent string of injuries that has hampered his production over the past two seasons, it follows that Jimmy Graham should be set to receive much more than Rob Gronkowski, the New England Patriots tight-end who agreed in 2012 to what is now known as the richest contract for a tight end in NFL history: 6 years, $53 million, with $16.5 million guaranteed. However, that is not what Graham is seeking. He does not want to be paid based upon being known as the top tight end; he wants to be compensated for being one of the top receivers in the league.

Arbitrator Stephen Burbank is hearing arguments from the NFL Players Association (NFLPA) and the NFL Management Council regarding whether Graham should be officially labeled as a tight end or wide receiver for purposes of the franchise tag placed upon him by the Saints. Pursuant to the language of the NFL Collective Bargaining Agreement (CBA), the contract for a player whose teams has used the franchise tag is determined as such:

(ii) Exclusive Franchise Tender. The Exclusive Franchise Tender shall be a one year NFL Player Contract for (A) the average of the five largest Salaries in Player Contracts for that League Year as of the end of the Restricted Free Agent Signing Period that League Year…for players at the position…at which he participated in the most plays during the prior League Year, or (B) the amount of the Required Tender under Subsection (a)(1) above, whichever is greater.

The NFL CBA is a legally enforceable contract signed between the players and owners. Therefore, when interpreting its language, the words should be given their plain and ordinary meaning, unless it is determined that the language is ambiguous. When ambiguous, interpreters must look outside the language of a contract in order to determine the true intent of the parties when they agreed upon its language. However, it is apparent that, under the NFL CBA, compensation for a player placed under the franchise is determinative of where the player spent most of his time on the field.

Using the language of the CBA, Graham’s main argument is that he should considered a wide receiver based upon the fact that he lined up either in the slot or out wide 67 percent of the time during the 2013 NFL season. Stated differently, because Graham spent more than two-thirds of 2013 NFL season playing various wide receiver positions, and not lining up as a tight end, he should be compensated as such. While the Saints counter is that the team drafted Graham as a tight end, his Twitter biography lists himself as a tight end, and tight end is the position that he made the made the Pro Bowl under, based upon how the language of the CBA is constructed, such an argument would seem only to show that Graham is a tight end by name, but not by use. The difference in the amount of money Graham stands to make depending on the arbitrator’s ruling is substantial. If Burbank sides with Graham and decides he should be labeled as a wide receiver under the franchise tag, based upon the numbers released by the NFL for the 2014 season, Graham stands to make $12.312 million for the upcoming season. However, if the Saints are able to persuade Burbank otherwise, Graham would have to settle for $7.035 million.

While one of the Saints’ arguments relies on the basis that Graham’s Twitter profile states he is a Saints tight end, other corners of social media shows that other members of the Twitter community view Graham as a wide receiver as well. Michael David Smith, managing editor of Pro Football Talk, believes that the language of the CBA makes this an easy decision for the arbitrator ruling in Graham’s favor. Vernon Davis also states that he believes Jimmy Graham should be paid as a wide receiver in an article shared on procanes.com. If the Saints are going to rely on the Graham’s Twitter handle to persuade Burbank to label him as a tight end, it follows that other social media arguments should also play a role in order to help clarify this truly intriguing situation.

Graham’s designation is not only important to him, personally, but also to the grand scheme of the league. Over time, the tight end position has been revolutionized with the emergence of NFL teams drafting ex-college basketball players to play the position. Just this past year, NFL fans were able to witness the breakout season of Denver Broncos tight end, Julius Thomas. Drafted in the fourth round by the Broncos in 2011, Thomas had not played collegiate football prior to the year 2010, but did play four seasons for the Portland State basketball team, where he was twice named to Big Sky All-Tournament Team. It is not unimaginable to envision the Broncos utilizing Thomas in role more similar to Graham as he further progresses in the league. Therefore, whatever decision that Burbank makes may play a role in determining how teams will utilize players in hybrid roles in the future.

A (Big?) Win For Defendants Named In Mass-BitTorrent Copyright…

On May 15, 2012, the Southern District of New York released an opinion that could have a far reaching effect with regards to mass-BitTorrent copyright infringement cases. I have represented many individuals who have been named as defendants in these types of cases, and more often than not, they are targeted for purportedly downloading pornographic films without paying for the right to view those movies. I have covered some defense tactics in the past, but the new Southern District of NY opinion could be the best tool in the arsenal for future defendants.

Basically, the court determined in the case of Digital Sins, Inc. v. John Does 1–245, 2012 WL 1744838 (S.D.N.Y. May 15, 2012), that each of the 245 defendants should be named in separate cases and that the plaintiff did not satisfy the requirements of Rule 20(a)(2) – the federal civil rule that governs permissive joinder. The court dismissed the plaintiff’s claims, but said that the plaintiff could once again bring those claims in separate lawsuits against each John Doe defendant.

Not surprisingly, the case was based on the allegation that the 245 defendants downloaded and uploaded a pornographic film (name of film you can search on your own). The “commonality” alleged by plaintiff is that all John Does used BitTorrent to obtain the film as part of a “swarm.” As the Court explains, “The collection of users who simultaneously ‘share’ a particular file is known as a ‘swarm.'” The Court was not buying that argument.

What I believe is most important is that the Court sitting in New York said,

There is no need for this Court to write another lengthy opinion discussing why plaintiff’s theory is wrong. Rather, I adopt and expressly incorporate into this memorandum order the reasoning of Judge Gibney in K–Beech; Magistrate Judge Spero of the Northern District of California in Hard Drive Productions, Inc. v. Does 1–188, No. C–11–01566, 809 F. Supp, 2d 1150 (N.D.Cal. August 23, 2011); several other courts in the Northern District of California, including Diabolic Video Productions, Inc. v. Does 1–2099, 10 Civ. 5865, 2011 U.S. Dist. LEXIS 58351, at *10–11 (N.D.Cal. May 31, 2011); and most especially the comprehensive Report and Recommendation of The Hon. Gary R. Brown, U.S.M.J., that was filed just last week in our sister court, the Eastern District of New York, in In re BitTorrent Adult Film Copyright Infringement Cases, No. 11–cv–3995, 2012 U.S. Dist. LEXIS 61447 (E.D.N.Y. May 1, 2012).

The fact that the Court in New York looked to courts’ decisions across the country in California leads me to believe that courts in other jurisdictions may do the same. It is not so much of an “easy way out” as it is courts attempting to get a streamlined set of precedent across the country.

While a large number of people may have used the same method to violate the law (BitTorrent downloads and uploads), the Court said that such does not authorize them to be joined as defendants in a single lawsuit. It went on to say that there is no basis from the allegations of the complaint to believe the defendants were not acting independently when using the BitTorrent client. Why is this important? It may not be worth it if a plaintiff has to pay the filing fee to sue each of the 245 defendants separately and pay attorneys to even do the simple task of modifying the pleadings for each individual. Perhaps that will put at least a temporary halt to the mass-BitTorrent copyright infringement lawsuits.

Entertainment Law

How Should Artists React To Not Receiving Much Compensation…

I was reading Billboard magazine when I came across an interesting blurb in a discussion about the American rock duo, The Black Keys. The blurb states that The Black Keys have refused to allow Spotify to stream their new music (from the album El Camino). It was simply a business decision for the duo. They explain that it would take an unprecedented number of full steams on Spotify to even equal the amount they would receive on one digital download. Billboard did the tough work and figured out exactly how many full streams would actually be necessary to equal that 99-cent digital download. Billboard found that it takes 64 full streams for an artist to make as much $ on Spotify as they would w/a single 99-cent download on iTunes.

The Black Keys are not the only artists to shun Spotify. Major names including Adele and Coldplay have limited what can be heard on Spotify in the past.

While Spotify provides an excellent platform for artists to easily publicize their works, it leaves much to be desired in the realm of compensation. Artists must recognize that they will not be able to earn a living off of Spotify streams, and then work with their management teams to determine whether the benefits of having new releases on the service outweighs the negative of basically giving away their music for free.

Further, artists would do themselves good to hire competent counsel in the negotiation of 360 agreements, which includes language for the distribution of revenue between the artists and labels. A good attorney will be able to negotiate the highest percentage possible for the artists in important categories such as concert revenue and merchandise sales, which are the categories that tend to provide the most money to artists in today’s day and age.

Headline

Robert Griffin III a Perfect Example of Proactively Protecting…

High profile athletes who are between their last game of college and their first game of professional ball would do themselves a strong service to put a competent attorney on retainer. The earlier said athlete hires such a lawyer to start putting his business affairs in order, the more likely that athlete will profit off of his intellectual property rights for years to come.

Take Robert Griffin III (RG III or RG3) for example. Griffin played his college ball at Baylor University, where he became one of the most sought after quarterbacks in the United States and won the prestigious Heisman Trophy in 2011. His abilities and accolades allowed him to be the 2nd overall pick of the 2012 NFL Draft, selected by the NFL’s Washington Redskins. Not only is Griffin talented on the field, but he also displays a glowing personality, amazing wit, and is known for his quirky socks collection.

Other athletes need to follow the lead of Griffin. Following his declaration for the NFL Draft, Griffin hired an attorney. Thereafter, he created his own company, Thr3escompany, LLC and submitted applications to the United States Patent and Trademark Office (USPTO) for a total of four trademarks – RGIII, RG3, Robert Griffin III, and Unbelievably Believable. The first three trademark filings were made for “Shirts, sweatshirts, jackets, pants, shorts, footwear, hats, caps, athletic uniforms.” But, why the last phrase? At the ceremony where Griffin received the Heisman Trophy, he said the following:

“This is unbelievably believable. It’s unbelievable because in the moment we’re all amazed when great things happen. But it’s believable because great things don’t happen without hard work.”

The phrase “unbelievably believable” got quite a bit of attention after the ceremony, as well. The following clip is from CBS News:

Griffin’s filing for “unbelievably believable” is a bit different than the previous three filings. He hopes to use the phrase for “promoting the goods and services of others, sponsorship of sports and athletic events and activities.”

Jeremy Lin is fighting for the “Linsanity” trademark and Tim Tebow is fighting to own the “Tebowing” trademark. It is refreshing to see a young man like Robert Griffin be ahead of the curve and proactively begin to protect his intellectual property before any potential disputes arise. I am always available for a consultation regarding such matters.

Defamation

Couple Charged with Sexual Assault Gets $13.78 Million in…

There are two big problems with filing defamation lawsuits (obviously, without looking at the facts of the various potential cases): 1) Defamation lawsuits are very difficult to win, and 2) Even if the plaintiff gets a judgment in his/her favor, the damages awarded tend to be small. But there are always exceptions to the rule.

Recently, a jury awarded $13.78 million to the plaintiffs in a defamation action filed in Texas roughly 3 years ago. Under Texas law, the plaintiffs had to prove that there was a false statement made about them, published to a third party, without legal excuse, which damaged their reputation. The plaintiffs had been charged with sexual assault. Thereafter, individuals posting anonymously on a website’s discussion forum posted comments that the couple found to be defamatory in nature. That was the foundation for the lawsuit that the plaintiffs filed and for which they recently received a handsome judgment.

In all, 6 defendants were named in the lawsuit, all posting comments in anonymity on the website Topix.com. The anonymity veil was destroyed once the judge appointed to the case ordered Topix to release information that identified all of the once anonymous commentators. The people posting on the forum called the plaintiffs phrases such as “Child molesters,” “Rapists,” “Drug dealers,” and “Herpes infested.” Yet, the plaintiffs were found not guilty of the sexual assault accusation.

What kind of damage can those anonymous posts do to a couple’s reputation and credibility? The husband is a prominent attorney and the wife is the owner of a spa. The accusations on the forum destroyed their reputations and their businesses and certainly caused quite a deal of pain and suffering. And a jury agreed, awarding the couple the large $13.78 million in damages.

Sometimes plaintiffs do win defamation lawsuits. And sometimes, the damages are quite large.

Cyberspace

Your Tweets Belong to Twitter and May be Subpoenaed…

In April 2011, I had an article titled, You May Not “Like” This Title: Everything Stored On Facebook Is Discoverable, published in the NYU Law Journal of Intellectual Property and Entertainment Law. The premise is that enjoying the openness of Facebook may come at an unexpected cost, especially for those who do not understand how the website’s content may be used as evidence in a lawsuit.

A real world example of how social media content can and will be used in lawsuits comes via a lawsuit concerning an Occupy Wall Street protester. In New York (where a lot of precedent appears to have been established concerning “social media law” to date), a judge recently ruled that no warrant was needed to subpoena a person’s Twitter account, since such information (tweets) are made publicly available by Twitter. The judge reasoned that “Twitter’s license to use the defendant’s tweets means that the tweets the defendant posted were not his.”

Websites’ Terms of Service (“TOS”) are frequently ignored by users, but that does not mean that the TOS fail to exist or are not valid and enforceable. Twitter’s TOS states, in relevant part,

By submitting, posting or displaying Content on or through the Services, you grant us a worldwide, non-exclusive, royalty-free license (with the right to sublicense) to use, copy, reproduce, process, adapt, modify, publish, transmit, display and distribute such Content in any and all media or distribution methods (now known or later developed).

Tip: This license is you authorizing us to make your Tweets available to the rest of the world and to let others do the same.

The result – an attempt to quash a subpoena seeking Twitter records will likely be futile, but of course, there are always exceptions to the rule.

Headline

Football v. Football: A Comparison of Agent Regulation in…

The Pace Intellectual Property, Sports, & Entertainment Law Forum recently published its second annual publication. There are a total of 11 articles in the most recent issue, including an article by Thomas A. Baker III, Darren A. Heitner, Jean Francois Broçard, and Kevin K. Byon titled, Football v. Football: A Comparison of Agent Regulation in France’s Ligue 1 and the National Football League. The abstract is as follows:

Baker, Heitner, Broçard and Byon, in their article Football v. Football, analyze agent regulation in the NFL and compare it to how agents are regulated in France for Ligue 1. The article begins with a brief discussion on the concept of a sports agency that includes analysis of governmental regulation of agency in both the United States and in France. The article continues by exploring how agents are regulated in their representation of the NFL and Ligue 1 football players. Subsequently the article concludes with a discussion that includes suggestions concerning future agent regulation for both the NFL and Ligue 1.

Some Hope For Quashing Copyright Infringement Subpoenas

Mass defendant copyright infringement cases are not rare these days. Many movie studios (particularly adult entertainment companies) find it economical to attach a long list of John Doe defendants to their copyright infringement lawsuits. The procedure is typically the same. The company joins a bunch of Doe defendants, subpoenas the internet service provider(s) (ISP) to obtain the names, current and permanent addresses, telephone numbers, email addressees, and Media Access Control addresses (“MAC addresses”) of the Doe Defendants, some Doe Defendants may move to quash the subpoena, and a Doe may either fight it out in court or settle the claim pre-trial.

I have defended quite a few individuals who have been accused of copyright infringement. A common question that I receive is whether or not a motion to quash the subpoena to the ISP should be filed. I have written about these motions in the past. Today, I will address it again and shed some light as to why the motion to quash may find success in court.

Under Rule 45(c)(3) of the Federal Rules of Civil Procedure, a court must modify or quash a subpoena that, inter alia, “requires disclosure of privileged or other protected matter, if no exception or waiver applies, or subjects a person to undue burden.”

Furthermore, Rule 26(c)(1) provides:

A party or any person from whom discovery is sought may move for a protective order in the court where the action is pending … The court may, for good cause, issue an order to protect a party or person from annoyance, embarrassment, oppression, or undue burden or expense, including … forbidding the disclosure or discovery.

Fed.R.Civ.P. 26(c)(1). The court also must:

limit the frequency or extent of discovery otherwise allowed by [the Federal Rules of Civil Procedure] or by local rule if it determines that … the burden or expense of the proposed discovery outweighs its likely benefit, considering the needs of the case, the amount in controversy, the parties’ resources, the importance of the issues at stake in the action, and the importance of discovery in resolving the issues.

I have seen motions to quash subpoenas work when courts found that the joinder of Doe Defendants in an action was improper under Rule 20 (Permissive Joinder of Parties) of the Federal Rules of Evidence. Case law exists, which states that use of BitTorrent to allegedly download and share the copyrighted material is not sufficient for a Plaintiff to satisfy the requirements of Rule 20(a), even if the Doe defendants are part of a single swarm. Courts have held permissive joinder of certain Doe Defendants to be improper based on a finding that the copyright infringement claims did not arise out of the same transaction, occurrence or series of transactions or occurrences. Merely committing the same type of violation in the same way does not necessarily link defendants together for purposes of joinder.

Not all courts will adopt this interpretation and not all lawsuits are filed in a fashion where a motion to quash a subpoena will work under the guise of improper joinder. That is why it is important to hire competent counsel if you receive a letter explaining that your ISP has been subpoenaed to provide your personal information and that a lawsuit has been or may be filed against you.

Cyberspace

Have You Purchased Your .xxx Domain Name Yet?

Have you purchased your .xxx domain yet? I am only half joking. Many companies (big and small) that have absolutely no relation to the pornography industry have been buying up their tradenames at the .xxx level. They have been reserving those domains from registration (see: Walmart.xxx) so that third parties cannot scoop up the domains and take advantage of the strength of their brand names. Even colleges are buying up .xxx domains. And then there are legitimate pornography companies that have purchased their own names and have used generic nouns and verbs in an effort to bolster their online presence.

Domain-name registrars (i.e. GoDaddy) can buy .xxx domain names for $60 each, but those registrars then increase the price on those domain names to earn a handsome profit. GoDaddy.com currently sells .xxx domain names for $99.99 per year (darren.xxx is still available for anyone who wants it).

Those who do not buy their own tradename’s .xxx domain may find that a cybersquatter will spend the money and either park himself on it or build out and try to monetize a website on the .xxx domain. In that case, a lawyer can help with the drafting of a demand letter and possibly instituting litigation strategies against the infringing cybersquatter.

Cyberspace

Who Owns A Tweet And How Much Is A…

How much money is a Twitter follower worth, what about the value of an individual Tweet, and who actually owns a Twitter account? Those are a few questions that may be answered if a lawsuit that was filed on July 15, 2011 in the United States District Court Northern District of California ends up going to trial.

The lawsuit was brought by a company named PhoneDog against its former employee, Noah Kravitz for the value of Kravitz’s Twitter followers. Kravitz left PhoneDog in October 2011 after serving as a product reviewer and video blogger since April 2006. While working at PhoneDog, Kravitz tweeted under the handle @Phonedog_Noah and built up a large list of followers. After leaving the company, Kravitz changed his handle to @NoahKravitz, but was able to transfer all of his former followers to his new account. PhoneDog wants $2.50 per @NoahKravitz follower, multiplied by eight (the number of months between when Kravitz left PhoneDog up until PhoneDog filed the lawsuit against him), which comes out to roughly $340,000. PhoneDog alleges that it owns the Twitter account that Kravitz has been using and that the compilation of followers and the password used to access the account are trade secrets.

While it is unknown whether there were any discussions between Kravitz and his former employer about Kravitz possibly changing his Twitter handle at some point post-termination of employment, Kravitz has stated that he came to an agreement with PhoneDog whereby he could keep his account and all of its followers in exchange for continuing to occasionally tweet on the company’s behalf. In fact, it appears that PhoneDog may have asked Kravitz to make specific posts from his account post-employment.

PhoneDog recently made the following statement to the New York Times,

“The costs and resources invested by PhoneDog Media into growing its followers, fans and general brand awareness through social media are substantial and are considered property of PhoneDog Media L.L.C. We intend to aggressively protect our customer lists and confidential information, intellectual property, trademark and brands.”

On August 4, 2011, Kravitz filed his first motion to dismiss the Complaint filed by PhoneDog based on lack of jurisdiction and failure to state a claim. Kravitz submitted a declaration in support of his motion, which in part states that he was the person who initially set up the Twitter account and created its password, he was the only person to utilize and maintain the account, and that he always used the account to create and disseminate information regarding his personal and professional life. What I believe may be most important in this case is that Kravitz claims PhoneDog did not have any policy that required him to return the account after his separation from employment.

On November 8, 2011, the Chief United States Magistrate Judge denied Kravitz’s motion to dismiss for lack of subject matter jurisdiction, denied his request to dismiss PhoneDog’s misappropriation of trade secrets claim, and denied his request to dismiss PhoneDog’s conversion claim. But the Judge granted the motion to dismiss PhoneDog’s claims for intentional interference with prospective economic advantage and negligent interference with prospective economic advantage with leave to amend.

PhoneDog filed its amended complaint on November 29, 2011, Kravitz filed his motion to dismiss the first amended complaint, and a hearing on that motion to dismiss has been set for January 26, 2011.

My thoughts are that if PhoneDog actually did not have a stated policy that required employees to return their social media accounts to PhoneDog after their separation from employment and there was no agreement between PhoneDog and Kravitz whereby Kravitz agreed to relinquish the account post-termination of employment, then Kravitz should be found to be owner of the Twitter account. This is especially true if he created the account, was the only person who had the account’s password, and tweeted personal messages from the account. I also find it hard to believe that the account’s list of followers can be considered to be a customer list containing confidential information. The public has free access to a Twitter account’s followers. Follower lists are not confidential. Twitter users can opt to pick who is able to follow them, but most users allow anyone to follow their updates. Thus, these lists cannot be considered customer lists; the lists are not generated by the Twitter account owner, but are modified constantly depending on whether third parties wish to follow the account. The power is entirely in the third party.

If you have any cyberspace, internet, social media related matters, please feel free to contact me.

Kyle Elliott, MPA, CHES: Darren is the best there is. He is the ideal lawyer — smart, dependable, and wickedly fast at responding to email. I love my lawyer!

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Shaun P. Herness, Ph.D.: Darren Heitner is the only attorney I’ve met that communicates effectively with the client and gets things done in a timely manner.

Rob Katz of Webonise: I have have solicited Darren’s advice and have hired him to help us with some intellectual property matters and would strongly recommend him to others.

Leon McKenzie of Sure Sports: There isn’t a sports attorney in the country that will protect your interests better for your current situation or your foreseeable future.

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