Revisiting Lawsuit Against Jack Nicklaus Over Name, Image, And Likeness (NIL) Rights

Nicklaus Companies, LLC ("Company"), which focused on real estate development, golf course design, and the licensing and marketing of golf apparel and products under golf legend Jack Nicklaus' GOLDEN BEAR brand, filed for bankruptcy last month in Delaware. The filing followed a $50 million judgment entered in favor of Nicklaus in his Florida defamation suit against the Company. The recent Chapter 11 filing provides an opportunity to revisit the original case (separate from the defamation action) addressing noncompete obligations, intellectual property rights, and Name, Image and Likeness (NIL) ownership. Nicklaus Companies, LLC v. GBI Investors, Inc., 229 N.Y.S.3d 910 (Sup. Ct. 2025). The court's summary judgment ruling in favor of Nicklaus is likely to be meaningful regarding the treatment of one's NIL rights in intellectual property, business, and employment agreements.

NIL refers to a person's legal right to control how their image is used, namely, commercially. NIL has been a lightning rod for conversation and controversy since July 1, 2021, when the National Collegiate Athletic Association (NCAA) changed its rules to allow college student athletes to profit from their own NIL in endorsements, social media, and appearances, which had long been prohibited. The NCAA changes were sparked by the Supreme Court's unanimous decision in NCAA v. Alston, 594 U.S. 69 (2021) (holding that the NCAA could not limit education-related payments to student athletes). The conversation about NIL is still intensifying, especially as federal legislation in the form of the new SCORE Act directed to regulating the compensation of college student-athletes regarding their NIL rights is being heavily debated. Although often discussed in the context of college athletes, the scope of NIL extends to professional athletes, entertainers, public figures, and influencers.

Turning back to the underlying case, the parties entered into a Purchase and Sale Agreement (PSA) in 2007 under which Nicklaus' wholly owned company, GBI Investors, Inc. (GBI), agreed to sell various assets and liabilities to the Company for $145 million. These assets included:

However, a schedule to the PSA provided: "For the avoidance of doubt, the right of Jack W. Nicklaus to utilize his endorsement, name, nickname (the "Golden Bear"), likeness, signature, and biographical information to identify himself as a professional golfer and for personal, investment, and charitable purposes is not an asset of GBI and continues to be retained by Mr. Nicklaus individually."

Importantly, Nicklaus was not a party to the PSA. However, around the same time, he entered into two separate agreements with the Company:

• Employment Agreement – Nicklaus agreed to work with the Company for five years, later extended for an additional five years.
• Non-Competition Agreement – This barred him from competing with the Company or soliciting its customers for five years following the end of his employment.

After Nicklaus ended his employment with the Company and began engaging in golf course design, the Company brought suit against him and GBI for various claims related to violations of non-competition obligations and improper NIL use in 2022.

Because GBI, not Nicklaus entered into the PSA with Company, the court focused on whether GBI had the authority to grant the Company exclusive rights to Nicklaus's name and NIL, even against Nicklaus himself. Such an interpretation would effectively create a permanent non-compete, preventing Nicklaus from using his own NIL to promote or endorse products or services similar to those sold or endorsed by the Company. The court noted that "there is no dispute that GBI transferred to the Company via the PSA the Intellectual Property the Company needed to continue GBI's business of designing golf courses, licensing trademarks, and manufacturing and distributing golf equipment if it so chooses." Importantly, Nicklaus did not seek to prevent the Company from using the Nicklaus-related trademarks conveyed in the PSA. As a result, the court drew a clear distinction between Nicklaus's NIL rights and the transferred trademarks.

In its ruling, the court was laser focused on the language of the PSA that provided the Company receive the commercial and publicity rights held by GBI, not Nicklaus himself. The Company sought a broader interpretation, but the court was not persuaded and stated that the language relied on by the Company to support its position "focuses on ownership interests in various entities, and does not unambiguously (let alone perpetually and exclusively) convey Mr. Nicklaus's name, image, and likeness rights that are his personal intellectual property." The court took issue with the drafting of the agreement by noting the rights held by GBI were "not expressly defined in the PSA" and it made clear that the parties could have used the term "exclusive" in describing the rights "held by GBI" to use and/or license Nicklaus' endorsement and NIL, but did not. The court also refused to read the Employment Agreement and Non-Competition Agreement executed by Nicklaus himself as conveying his NIL "rights in a way that would be the equivalent of a perpetual non-competition agreement." The court's ruling dismissed all the claims of the Company and made clear that Nicklaus retains control over his NIL.

While court decisions on NIL are in their infancy, there are several takeaways from this case that are likely to extend to intellectual property and employment agreements in a number of fields relating to NIL. First, despite the overlap between intellectual property rights and NIL rights, this court treated them as distinct rights, i.e., ownership of the trademark in a person's name or nickname does not automatically provide any right to commercially use that person's NIL. Second, contract language matters and courts will interpret narrowly to protect a person's ability to monetize its NIL rights. Consequently, if any NIL rights are contemplated in an agreement, the grant of those NIL rights should be clearly stated both in terms of what rights are being granted to the NIL and the scope of those rights, i.e., the parties must use the terms "perpetually and exclusively" if they want those terms to apply to the NIL rights grant. Finally, because the court declined to "read in" any language not expressly stated in the agreement, employers and businesses should review and update any talent, endorsement, or employment agreements drafted before the NIL boom. New agreements should include explicit NIL provisions, and previously executed agreements should be re-negotiated to incorporate appropriate NIL language.

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