Fantasy Leagues Win Against MLB; Supreme Court Refuses To Hear Appeal

Fantasy sports companies like Yahoo (NSDQ: YHOO), CBS (NYSE: CBS) Sportsline and others can now breathe a sigh of relief: the U.S. Supreme Court on Monday refused to hear an appeal from Major League Baseball and its Players Association that, if successful, could have given these leagues the ability to control the lucrative fantasy-sports business via high data-licensing fee. This tussle has been going on for some years now…the situation began in 2005 when MLBAM acquired the rights to represent the MLBPA in licensing, decided to limit its licenses for fantasy baseball and refused to grant one to St. Louis-based CDM Sports, which then filed suit. CDM won the suit in federal court last year.

WSJ: Fantasy-sports companies and the leagues had a mostly peaceful relationship through the 1990s, and these companies paid licensing fees of 5% to 10% of revenues for the rights to the players’ names and statistics. Deals with the largest companies produced nearly $1.5 million a year, the story says. But three years ago, MLB tried to limit the number of companies that could use its statistics, even though they were readily available from variety of sources, and that’s when CDM filed the lawsuit.

SBJ: Even before Monday’s decision, many fantasy game operators had begun to reduce or eliminate their rights payments for fantasy games, or demand other intellectual property such as online game highlight video. Monday’s decision likely will embolden game operators further, and perhaps bring further revisions to MLBAM’s five-year, $50 million deal with the union for the players’ interactive rights.

LAT: The justices’ decision was a setback not only for baseball players, but for other professional athletes who maintained that outside companies had no right to “exploit players’ identity for commercial gain.” The NFL, NBA and NHL had supported baseball’s players and owners in their appeal to the court.