Only days after Indiana's own Purdue University completed one of the biggest upsets of the 2018 college football season, drubbing Ohio State 49-20, the Indiana Supreme Court handed down a different kind of upset. In Daniels v. FanDuel, Inc., No. 18S-CQ-00134 (Ind. October 24, 2018) the court ruled that fantasy sports operators do not violate the Indiana right of publicity statute when using the names, images, and statistics of college football athletes without their consent.
Defendants DraftKings and FanDuel each operate fantasy sports websites where consumers pay a fee to assemble a "fantasy" team of real-life college football players to compete against other teams. Defendants use the names and images of players to identify them, and collect detailed statistics on the athletes' weekly performances, which the Defendants then translate to a per-player point value. The highest-performing consumers receive cash and other prizes.
Three former college football athletes filed a class action complaint in federal court alleging that Defendants "used their names and likenesses in operating and promoting online fantasy sports contests without [their] consent," which they contended violates their right of publicity under Indiana law. After the district court dismissed the suit based on the right's "newsworthiness exception," the Plaintiffs appealed to the Seventh Circuit, and it certified the question to the Indiana Supreme Court.
Under Indiana law, "a person may not use an aspect of a personality's right of publicity for a commercial purpose . . . without having obtained previous written consent." Ind. Code § 32-26-1-8(a). This includes a person's name, voice, signature, photograph, image, likeness, distinctive appearance, gestures, or mannerisms. The Indiana newsworthiness exception exempts "material that has political or newsworthy value" from attack based on the right of publicity. Ind. Code § 32-36-1-1(c)(1)(B).
Initially, the court wrestled with the scope of the newsworthiness exception, rejecting two arguments Plaintiffs made to limit it: that the exception should not apply in the context of commercial use, and that it should only protect media companies or news broadcasters. According to the court, the statutory language supported neither argument. Then, the court held that there were "several compelling reasons" why the newsworthiness exception should be construed broadly to allow "fantasy sports operators' use of players' names, pictures, and statistics." First, the court observed that the common law prior to the statute's adoption implied a broad exception to the right of publicity "extend[ing] far beyond" the dissemination of news "to include all types of factual, education, and historical data, or even entertainment or amusement, concerning interesting phases of human activity in general." Second, relying on the principle that statutes should be construed "to avoid constitutional issues," the court held that "a broad interpretation of the term 'newsworthy value' would likely avoid a First Amendment issue."
In sum, the court saw no basis for distinguishing the Defendants' use of players' names, images, and statistics in conducting fantasy sports competitions from "the publication of the same information in newspapers and websites across the nation." Thus, it found no reason that the information should be "stripped of its newsworthy value" simply because it was used "in the context of a fantasy sports game."
The court recognized the import of its decision at the outset of the opinion. Knowing that its decision would "carry considerable weight . . . for other potential right of publicity litigants in [the Indiana] state courts," the court explicitly narrowed its decision to the question before it—whether fantasy sport operators may use the names, images, and likeness of athletes for profit without the athletes' consent. But even so, the potential impact of the case on college and professional athletes alike is likely to be considerable.
College athletes have long endeavored to achieve protection over their rights of publicity, and they achieved success recently in Keller v. Electronic Arts, Inc., 724 F.3d 1268 (9th Cir. 2013), where college athletes were able to prevent EA Sports from releasing video games using college athletes' names, images, likeness, and statistics. The decision in this case, though, may undermine the Keller victory. Although not precedential outside Indiana, this case could spur further challenges within Indiana state courts, the 7th Circuit, and elsewhere regarding the breadth and applicability of the Indiana Supreme Court's newly minted definition of "newsworthy." Such challenges could result in a further split of authority as to whether the "newsworthy" exception should be applied to college sports video games. Although Keller explains in a footnote that there is a difference between using statistics in fantasy sports and creating a virtual likeness in a video game, the Indiana Supreme Court's broad definition of "newsworthy," which includes "entertainment or amusement" generally, provides an avenue for distinction.
This case could also change the business norms in professional leagues. Currently, for example, most fantasy sports operators pay professional leagues (including the NFL) for the use of their athletes' names, images, and statistics. Armed with this court's definition of "newsworthy," however, that business model could be challenged.
Only time will tell what effects this case will have, particularly in areas other than fantasy sports. But for now, the members of Purdue's football team are the only college athletes cheering in Indiana.
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