October 26, 2018

On Wednesday, October 24, the firm secured a victory in the Indiana Supreme Court for client FanDuel in a closely watched putative class action accusing daily fantasy sports operators of profiting off the unauthorized use of the names and likenesses of former NCAA athletes.  The high-profile case addressed questions about the scope of the “newsworthy” exception to Indiana’s right of publicity law and presented huge stakes not only for fantasy sports businesses, but also for the burgeoning sports betting industry.

Appellate and Supreme Court Practice Chair Ian Heath Gershengorn and Partners Kenneth L. Doroshow and Ishan K. Bhabha represented FanDuel.

The athletes claimed their publicity rights under Indiana state law were violated when FanDuel and its co-defendant DraftKings Inc. used their names and game performance data to determine the outcomes of their “fantasy” contests, for which the companies charged entry fees.  Indiana’s right of publicity statute states that a company can’t use a person’s name or likeness without permission, subject to certain exceptions, including for material that has “newsworthy value.”  

The case was heard on referral from the US Court of Appeals for the Seventh Circuit after Mr. Doroshow secured a dismissal in US District Court in Indianapolis.

In June 2018, Mr. Gershengorn argued on behalf of both defendants in front of Indiana’s high court that the state’s right of publicity statute contains exceptions for material that is protected by the First Amendment, including information that is newsworthy or in the public interest, such as the athletic performances of college athletes (click here to see video of the argument).  The five-judge panel unanimously agreed that the use of players’ names, images, and statistics in fantasy sports offerings is “newsworthy” and is thus excepted from Indiana’s right of publicity law.

“Considering the arguments presented in this case, Defendants’ use of players’ names, images, and statistics in conducting fantasy sports competitions bears resemblance to the publication of the same information in newspapers and websites across the nation,” Judge Steven H. David wrote in the opinion, which is available here.  “This information is not stripped of its newsworthy value simply because it is placed behind a paywall or used in the context of a fantasy sports game.”

Although this was a major victory for FanDuel and its competitor DraftKings, the decision is also a significant win for other content and media businesses that often confront right of publicity claims, as well as for the nascent sports betting industry that’s expected to generate billions of dollars in revenue in the coming years.  An adverse ruling against the daily fantasy site operators would have imperiled the business of companies across this burgeoning industry, which relies on the open sharing of information about athletes and their statistics.

Several major news outlets covered the decision, including The Washington Post, The New York Times, ESPN and Indianapolis Star, among others.  Law360 recognized the firm as a “Legal Lion” (subscription required) for the victory in the case.

The case is Akeem Daniels, Cameron Stingily, and Nicholas Stoner v. FanDuel, Inc. and DraftKings, Inc., Indiana Supreme Court Case No. 18S-CQ-00134.