Who Owns a Sporting Event in Wisconsin?

The ownership rights to live athletic events has been the subject of much legal controversy since the rise of commercialized spectator sports a century and a half ago. In 1885, the Detroit Wolverines baseball club, then a member of the National League, sued John Deppert ,who owned a barn adjacent to Recreation Field, where the team played. Deppert was charging baseball fans a fee to climb on to the roof of his barn, from which the Wolverine games could be watched. A half-century later, the issue shifted to radio broadcasting, and the question became whether or not a radio station could broadcast live accounts of an ongoing game without the permission of the home team.

Today’s version of the question involves streaming images of games across the Internet. Earlier this month, Wisconsin federal district court judge William Conley weighed in on this question. The ruling came in a case involving the Wisconsin Interscholastic Athletic Association and The Appleton Post-Crescent newspaper and the Wisconsin Newspaper Association.

The WIAA sued The Post-Crescent after it streamed live coverage of four high school football playoff games in 2008.

The paper was apparently lawfully on the premises from which it “broadcast” the games, and it does not appear to have violated the terms of any license acquired from the WIAA.

In 2004, the WIAA had entered into a exclusive agreement with the When We Were Young Internet broadcasting firm that granted the company the exclusive right to stream live WIAA football games across the Internet. In the lawsuit, the WIAA took the position that it “owned” the rights to the games it produced, and thus could exclude the Post Crescent from broadcasting the games in competition with the official licensed broadcaster. The newspaper defended on the grounds that the exclusive agreement ran afoul of the First Amendment and the Fourteenth Amendment’s Equal Protection Clause.

In his opinion, Judge Conley ruled on behalf of the WIAA, essentially finding that the association “owned” the rights to its games and that its granting a monopoly streaming license to one entity did not offend First Amendment values. Although John Deppert won his case back in 1886, twentieth- and twenty-first-century decisions in the United States have tended, with a few exceptions, to favor the party that puts on the athletic events, although the precise legal rationale for so finding has varied from case to case.

The issue is also not exclusively an American one, and the resolution of these disputes in the courts of other nation’s has not been uniform. An Israeli court recently reached a decision contrary to the Wisconsin decision in a case involving the streaming of English Premier League soccer matches to Israel, via the Internet. The court ruled that the league and its teams had no ownership interest in the games themselves, and thus could not prevent the dissemination of the games in Israel.

There is no question that the party who controls the grounds on which the games are played can impose restrictions on those who enter as licensees. However, whether or not there should be an additional property right in the games themselves is a question on which there appears to be no greater consensus today than there was in Deppert’s time.

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Libertarians and Liberals

It is a peculiar characteristic unique to our country that Americans talk about political issues in constitutional terms, thereby turning every policy debate into an argument over basic principles.  That was my thought when I read about Senate candidate Rand Paul and his “Constitutionalist” view that the federal government has no right to dictate the behavior of private enterprises.  Mr. Paul came under fire last week for suggesting that the Civil Rights Act of 1964 went too far when it prohibited discrimination by private businesses.  You can read more here (astute students in my Constitutional Law class will observe that Mr. Paul inspired one of the questions on my final exam this year).

Paul objects to federal policies regulating business due to his reading of the U.S. Constitution.  His political philosophy might best be characterized as extreme libertarianism.  Following the objectivist principles of Ayn Rand, he argues that the public should be left to their own devices and that greater social benefits will accrue naturally over time from the enlightened (and rational) self-interest of individuals.  Ironically, Paul’s embrace of self-interest as a moral good in itself is directly at odds with the view of the Framers of the Constitution.  The people who designed our constitutional system spent much time criticizing the biases, prejudices, and self-interested motivations of the general public.  The system of government that they created was intended to ameliorate the very aspects of human nature that objectivists like Rand Paul celebrate.

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ERISA Supreme Court Attorney Fees Case Goes Way of Plaintiffs

4United States Supreme Court 112904 For those who care about ERISA participants and beneficiaries being able to find good counsel for their claims, the U.S. Supreme Court decision this morning in Hardt v. Reliance Insurance Co., No. 09-448 (U.S. May 24, 2010) is welcome news.

In a nearly unanimous opinion written by Justice Thomas (Justice Stevens wrote to concur in part), the Court held that:

A fee claimant need not be a “prevailing party” to be eligible for an attorney’s fees award under §1132(g)(1) [Section 502(g)(1)]. Interpreting the section to require a party to attain that status is contrary to §1132(g)(1)’s plain text. The words “prevailing party” do not appear in the provision. Nor does anything else in §1132(g)(1)’s text purport to limit the availability of attorney’s fees to a “prevailing party.” Instead, §1132(g)(1) expressly grants district courts “discretion” to award attorney’s fees “to either party.” (Emphasis added.) That language contrasts sharply with §1132(g)(2), which governs the availability of attorney’s fees in ERISA actions to recover delinquent employer contributions to a multiemployer plan. In such cases, only plaintiffs who obtain “a judgment in favor of the plan” may seek attorney’s fees.§1132(g)(2)(D). The contrast between these two paragraphs makes clear that Congress knows how to impose express limits on the availability of attorney’s fees in ERISA cases. Because Congress failed to include in §1132(g)(1) an express “prevailing party” requirement, the Fourth Circuit’s decision adding that term of art to the statute more closely resembles “invent[ing] a statute rather than interpret[ing] one.” Pasquantino v. United States, 544 U. S. 349, 359.

The case is interesting because it poses a common legal issue in ERISA litigation.  The court, after pointing out problems with a plan administrator’s interpretation of plan terms, remands the case back to the company and the company ends up awarding the initially requested benefits to the employee.

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