Yesterday's Fantasy Ruling

I received an email from http://www.thomasgeorge.com summarizing yesterday's CDM ruling.

I am reproducing the email here because it is an good summary of what occurred. (And it does not cost anything to be on the mailing list to receive this.)

If this is offensive to the people at thomasgeorge, I apologize in advance and will remove it once I've been notified via the email option above.

(And yes, I see the irony of a site who just won a battle on publicly-available info asking another site to remove publicly-available info.)

"Yesterday, a federal judge in St. Louis ruled that fantasy baseball leagues can use player names and statistics without a license from Major League Baseball. This decision, assuming it is upheld in higher courts if appealed, will have far-reaching consequences for everyone who plays fantasy sports.

Here is a little background on yesterday's decision. In 2005, Major League Baseball Advanced Media (MLBAM) bought the exclusive rights to own the statistics from the MLB Players' Association for $50 million. MLBAM decided only to award seven licenses for the 2006 season, all to the 'big boys', ESPN, CBS Sportsline, Yahoo, etc. The reported cost of this license was $2 million per season. One of the companies that were shut out of this license, CBC Distributing and Marketing (CDM) decided to sue. CDM claimed that the players' names and statistics are readily available in newspapers throughout the country and, as such, are public information, and a license is not necessary.

Major League Baseball claimed that intellectual property laws and so-called 'right of publicity' make it illegal for fantasy leagues to make money off the identities and stats of professional players. This was a very interesting take on these laws since, in 1996, MLB won a case in which it claimed that the use of video of a player without that player's permission was permitted, based on the freedom of press principles. It's amazing how $50 million can turn one's opinion 180 degrees. The greediness of Major League Baseball is truly astounding and has, for once, been stopped.

Yesterday, Judge Medler wrote that the First Amendment takes precedent because CDM is disseminating the same statistical information that is found in newspapers every day.

"The names and playing records of major league baseball players as used in CBC's fantasy games are not copyrightable," Medler wrote. "Therefore, federal copyright law does not pre-empt the players' claimed right of publicity."

In an e-mail, Dan Okrent, a co-founder of the original Rotisserie League Baseball, described the ruling as "wonderful.. The only thing that saddens me about it is that there won't be a public trial, during which MLB's incredible greed would have been on public display."

It should be noted that while this ruling was specific to fantasy baseball, there's no reason to think that the ruling would be any different for fantasy football, fantasy hockey, fantasy basketball, fantasy NASCAR or fantasy tidily-winks.

Today, it costs about $5,000 to obtain a daily feed of statistics from any of the major sports. If you want live scoring, it's more than double. The majority of this ridiculously high cost comes from professional sports leagues charging exorbitant licensing fees for the rights to use the players' names and statistics.

Thanks to this ruling, fantasy sports participants should now expect to see those fees drop considerably There are literally hundreds of companies, mostly Web based, that would like to use these statistics but due to the prohibitive costs of licensing, have either used the statistics without a license, or have been forced out of business.

CBS Sportsline, ESPN and Yahoo figure to be hurt by increased competition from these companies. They will be forced to lower their prices to compete with many small businesses that are sure to appear once the cost of data feeds gets down to a reasonable level.

There are two winners today. One is the fantasy baseball player, who will see many more less expensive options when running their fantasy leagues. The other is the small business owner, who now can compete on a more level playing field with the "big boys" in the industry.This extra competition can only spawn further innovation and different types of fantasy games, making them available to even more people than the estimated 15 million players today.

All in all, August 8, 2006 was a landmark day in the world of fantasy sports and, for once, the little guy came out on top."