Some of this week's highlights include:
- Emerging trends are showing signs of change in the sponsorships and endorsement markets. A segment once largely overlooked, athletes in the LGBTQ+ community are finally ringing in the big endorsement deals. Female athletes are also being wooed by smaller, up-and-coming brands that are willing to be more flexible with the individuals' needs and preferences, including increased involvement with new product development and opportunities for equity in the business.
- NFTs continue to boom – but is it just a fad? Perhaps not so, as Coca-Cola, MasterCard, NARS Cosmetics and more celebrities continue to jump on the bandwagon. And did we mention that NFTs literally rocketed out of this world?
- While the Tokyo Olympics is projected to lose record amounts of money, two Hollywood starlets, Reese Witherspoon and Jennifer Garner, are seeing green after each signing big production and film deals.
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Just months after breathing life into to the "Sports & Entertainment Spotlight," I am (well, my wife is) giving birth to a new creation — a baby boy. As such, I will be taking a break from the usual commentary (sleep deprivation isn’t exactly the best for the creative juices), but will keep up with the weekly curated content until my return from paternity leave. In the meantime, you’ll have to come up with your own puns and snarky, yet insightful commentary!
As a friendly reminder, if there are topics you’d like to see featured, please feel free to contact me at firstname.lastname@example.org.
Strange as it may be, with vast majority of the world still reeling from the COVID-19 pandemic, we are on the eve of the opening ceremony for the “2020” Tokyo Summer Olympics. Olympic games in “normal” times are logistical feats involving tons of preparation and organization. Pair that with the challenge of trying to prevent a full-blown outbreak of COVID-19 (and potential losses in the tens-of-billion-dollars range) in a densely populated country seeing a new surge of cases, and you have Olympic officials in dire need of Japanese whisky. While these Olympics will be held without the usual crowds in attendance, making for another eerie sight (unless you’re used to watching Mets games), the risks of holding the Games still remain high. Hopefully, the Games go on without a hitch and will highlight their virtues of human resiliency and cooperation on the global stage, but I, like many others, cannot help but wonder about the further propagation of this virus, and whether we would be better served to stay on the sidelines just a little longer. Besides, I generally favor spotlights over torches.
…Which reminds me, it’s time to dive in to the Spotlight for this week:
Just two weeks into the name, image, and likeness (NIL) era in college sports, and we are already starting to see not only novel and creative partnerships, but also the emergence of legal gray areas and pitfalls for college athletes. This was, of course, to be expected with the NCAA acting with last minute haste (rather than methodical planning) coupled with the euphoria of athletes who could finally make endorsement money without losing NCAA eligibility. Under those circumstances, nuance is out the window — until it isn’t. Case in point: the rise of Barstool Athletes, the fledgling collegiate athlete marketing arm of digital media giant, Barstool Sports. On its face, Barstool Athletes offers a straightforward, merchandising- and social media-driven formula for athletes to market themselves to fans. However, in the rush to capitalize on this opportunity, student-athletes of schools in states that prohibited NIL deals with traditionally vice-oriented businesses, overlooked that Barstool could be construed as a company in the gambling business. Indeed, Barstool operates a sportsbook and was acquired by Penn National Gaming in early 2020. Now some of those who leapt before they looked could be risking their eligibility, after all. Above all, until there is more uniformity and/or stronger guidance across the country, student-athletes are safest clearing deal with their schools’ compliance departments.
From reference to vices, I shift to celebrating your virtue as you patiently waited for this week’s installment of the Spotlight. So let’s get to it:
Laws — like people — are imperfect. They can be slow to adapt to evolving societal norms, and worse still, their application can yield unjust outcomes. Indeed, look no further than this past week’s developments involving Olympic-hopeful Track & Field athlete, Sha'Carri Richardson. Almost as quickly as Richardson could sprint, we saw her go from Gold Medal favorite to spectator after a drug test administered (after her first place finish in her U.S. Olympic trials) revealed that she had used marijuana, a substance banned by the U.S. Anti-Doping Agency and still officially illegal at the federal level. Never mind the facts that first, marijuana was legal in Oregon (the state in which she had used the drug) and a substantial plurality of states; second, she had used the drug as a means of coping with the trauma of learning of her biological mother’s abrupt death; and lastly, the drug is not performance-enhancing. To the U.S. Track & Field team, the rules are the rules. Perhaps Richardson’s plight will spur policy change — much like the years of collegiate athletes being declared ineligible for having received compensation, which have led to overdue name, image and likeness (NIL) reforms — but you cannot help but feel for Richardson for all she has lost, personally and financially. I know I will be pulling for her when her chance at Olympic glory hopefully comes back around in 2024 (approximately 150 Spotlights) from now.
With that, here’s what else is making waves this week:
Well, today is the big day. If you’re reading this week’s installment of the Spotlight, it means that you survived the long and arduous journey of the name, image and likeness (NIL) era in college sports. Indeed, with the National Collegiate Athletic Association (NCAA) Board of Directors agreeing this week (Wednesday, June 30) to waive enforcement of its prohibition against collegiate athletes making money off of their NIL rights (their fame) amid interim guidance to schools, we find ourselves in a brave new world where you might see your alma mater’s star quarterback licensing his or her NIL rights, newly-designed logos (I see you, Graham Mertz) for commercial use in anything from an advertisement for the off-campus car dealership to one for a multinational car brand. As ever, the devil is in the details, and in schools adopting their own rules and programs designed to educate and empower their student-athletes – particularly in the vast majority of states that do not have NIL legislation coming into effect today – those details are all the more devilish given that the NCAA spotted them less than a week to prepare its athletes (and themselves) for a moment that the NCAA could not itself prepare for in the span of years. With so much potential for uncertainty and confusion in this landscape, now more than ever, it is incumbent on educators, business advisors, coaches and parents to play an active role to ensure that the NIL era gets off on the right foot. Still, as we roll into a weekend in which the U.S. celebrates its independence, it’s gratifying to know that college athletes will be celebrating their newfound independence (to a degree).
“The NCAA is not above the law.” Those seven words capped Justice Brett Kavanaugh’s searing concurring opinion issued in connection with Monday’s (June 21) unanimous (9-0) U.S. Supreme Court ruling in Alston v. National Collegiate Athletic Association, in which the Court held that the NCAA’s limits on education-related benefits constituted a violation of antitrust law. Though the legal issue decided was relatively narrow in scope, the ruling sent shockwaves across the country, calling into question, and in many ways, paving the way for future challenges to the NCAA’s “amateurism” rules – including the arcane limits on student-athletes’ abilities to receive compensation from endorsements. This ruling came during an already perilous time for the NCAA, which has been facing the specter of chaos wrought by a slew of states’ name, image and likeness (NIL) legislations coming down the pipe, and Congress failing to pass the uniform legislation at the 11th hour last week. Now, just when it seemed that, after years of foot-dragging, the buck would be coming back to the NCAA for it to finally take ownership of meaningful reforms to its stance on NIL. NCAA President Mark Emmert circulated a memorandum yesterday, Wednesday (June 23), advising its constituent colleges and universities that they (not the NCAA) would be responsible for adopting their own policies within the not-yet-developed interim NIL guidelines to be hastily prepared by the NCAA – all in just seven (!) days’ time.
Lucky for you, I will not shirk my responsibility to deliver a selection of noteworthy stories in this week’s Spotlight:
As we inch closer to the summer solstice here in the Northern Hemisphere (the first day of summer for those of you who were asleep in science class), the heat is not rising only on the thermometer, but also in the halls of Congress, where the push for federal name, image and likeness (NIL) legislation forges ahead of the July 1 “cliff” — when at least six of the states’ own NIL legislation (including the latest, and perhaps most significant entrant, Texas) will come into effect, and the world of collegiate athletics will be turned upside down.
With that backdrop, the Senate Commerce Committee recently convened for its second NIL hearing in as many weeks — this time, commendably giving current and former athletes, and the father of Jordan McNair (a University of Maryland football player who tragically died of heat stroke during a team practice in 2015) an opportunity to speak for themselves. Although there remains general bipartisan consensus on the need for NIL legislation, loftier — but no less important — aims of mandating the provision of health care and other benefits to collegiate athletes along with the NIL legislation, may spoil the brew in an oft-deadlocked Congress. Still, various states and universities including my alma mater (ON, WISCONSIN!), are preparing as if NIL rights are a foregone conclusion. Buckle up, folks, this situation looks like it will continue to develop over the next few days and come down to the wire.
Less than three weeks remain for either the National Collegiate Athletic Association (NCAA) or for Congress to act to stem the impending chaos on July 1 when college athletes’ name, image and likeness (NIL) laws go into effect in several states. These laws will enable college athletes to enter into endorsement and licensing deals and otherwise monetize their NIL without reprisal from their school or the NCAA itself. This past Wednesday, with the NCAA being an extremely unlikely long shot to meaningfully act, a panel of witnesses consisting of law professors, a head coach, a college sports analyst and NCAA Commissioner Mark Emmert (but conspicuously no current athletes) were convened to testify before the Senate Committee on Commerce, Science and Transportation as it considered various legislative proposals addressing NIL rights, as well as health care and scholarships. Overall, there appears to be bipartisan support (no small feat in D.C.) for the core issue of monetizing NIL rights, but not all agree on how to accomplish those aims. Still, the clock is ticking, and while we’re about as close as we have ever been to sweeping federal legislation giving athletes the same rights that their fellow students have, the question must be asked: “If not now, when?”
As we continue to play the NIL waiting game, I won’t keep you waiting any longer for the highlights in this week’s Spotlight.
Athletes and entertainers are people, too. Albeit, incredibly talented people, but deserving of the same treatment with dignity and respect as how we would want ourselves to be treated. For better or worse, sometimes their larger than life fame, accomplishments and performances on courts, fields, screens and stages, cause others to lose sight of that fact. But, that is no excuse for the type of treatment of, or behavior towards several high-profile athletes over the past week or so. Specifically, in plain sight during the NBA playoffs, we have witnessed the demeaning acts of basketball “fans” toward three of the league's point guards in the form of pouring popcorn on Washington Wizards point guard, Russell Westbrook, spitting at Atlanta Hawks point guard Trae Young and throwing a water bottle at Brooklyn Nets point guard Kyrie Irving. The first two incidents resulted in indefinite bans, and the third resulted in a felony assault charge.
Perhaps the most insidious has been the apparent lack of regard for mental health on display at the French Open, as professional tennis player Naomi Osaka was fined and threatened with disqualification from the Grand Slam event for failing to meet with the media – notwithstanding her open struggles with anxiety and depression. Osaka later made the tough but roundly supported move (including by her sponsors) to withdraw from the tournament to take time for herself. Hopefully these recent events will be a much needed flashpoint for change in sports and beyond.
With that weightier topic behind us, I’ll go back to our normal programming (corny dad jokes a-plenty!) in the form of the spotlighted stories below:
The Sports, Arts & Entertainment group at Foster Garvey provides full service legal representation on sports, entertainment and business matters, including handling transactions related to brand management, licensing, joint ventures, venture capital, private equity, technology, the Internet and new media.