NFL Players Union Loses Licensing Lawsuit

NFL Players Union Loses Licensing Lawsuit

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The National Football League Players Association has been ordered to pay $28 million to its retired members as the result of a lawsuit stemming from licensing deals that include EA's Madden NFL franchise.

The lawsuit was filed on behalf of over 2000 former NFL players, claiming the union and its licensing unit failed to pay millions in royalties earned through licensing arrangements for videogames, trading cards and other football-related products. The suit alleged that the players were entitled to royalty payments even though the products didn't use their actual names and images; as an example, the players' lawyers claimed an image of former Green Bay Packers player Herb Adderly was scrambled in the Madden NFL games because the union didn't want to pay him.

"There are 143 vintage team games from Electronic Arts. These are teams that are people's favorite," attorney Ronald Katz said. "These men did nothing but trust their union."

The jury agreed, awarding $7.1 million in damages for the union's breach of its fiduciary duty to retired players, and another $21 million in punitive damages. Naturally, the players' union claims that only active players were covered by the licensing contracts, and union lawyer Jeffrey Kessler said they would seek a reversal of the verdict and, if unsuccessful, launch an appeal. "The decision is contrary to the law and it's an unjust verdict and we are confident it will be overturned," he said.

The Madden NFL franchise is one of the most successful series of sports videogames in history, and despite its age and the fact that it's often held up as one of the prime examples of everything that's wrong with videogames today, it remains the flagship title of the EA Sports lineup. Electronic Arts was not named as a defendant in the lawsuit.

Source: Bloomberg

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