No. 13-967, -979, -980 In the Supreme Court of the United States In the Supreme Court of the United States In the Supreme Court of the United States In the Supreme Court of the United States In the Supreme Court of the United States CHRIS CHRISTIE, GOVERNOR OF NEW JERSEY, ET AL., Petitioners, v. NATIONAL COLLEGIATE ATHLETIC ASSOCIATION, ET AL., Respondents. NEW JERSEY THOROUGHBRED HORSEMEN’S ASSOCIATION, INC., Petitioner, v. NATIONAL COLLEGIATE ATHLETIC ASSOCIATION, ET AL., Respondents. STEPHEN M. SWEENEY, PRESIDENT OF THE NEW JERSEY SENATE, ET AL., Petitioners, v. NATIONAL COLLEGIATE ATHLETIC ASSOCIATION, ET AL., Respondents. On Petitions for Writ of Certiorari to the United States Court of Appeals for the Third Circuit BRIEF FOR AMICI CURIAE RYAN M. RODENBERG, ANASTASIOS KABURAKIS, AND JOHN T. HOLDEN IN SUPPORT OF PETITIONS FOR WRIT OF CERTIORARI Becker Gallagher · Cincinnati, OH · Washington, D.C. · 800.890.5001 March 14, 2014 RYAN M. RODENBERG Counsel of Record FLORIDA STATE UNIVERSITY 139 Chieftan Way Tallahassee, FL 32306 (850) 645-9535 [email protected]Counsel for Amici Curiae
Transcript
No. 13-967, -979, -980
In the Supreme Court of the United StatesIn the Supreme Court of the United StatesIn the Supreme Court of the United StatesIn the Supreme Court of the United StatesIn the Supreme Court of the United States
CHRIS CHRISTIE, GOVERNOR OF NEW JERSEY, ET AL.,Petitioners,
v.
NATIONAL COLLEGIATE ATHLETIC ASSOCIATION, ET AL., Respondents.
NEW JERSEY THOROUGHBRED HORSEMEN’S ASSOCIATION, INC.,Petitioner,
v.
NATIONAL COLLEGIATE ATHLETIC ASSOCIATION, ET AL., Respondents.
STEPHEN M. SWEENEY, PRESIDENT OF THE NEW JERSEY SENATE, ET AL.,Petitioners,
v.
NATIONAL COLLEGIATE ATHLETIC ASSOCIATION, ET AL., Respondents.
On Petitions for Writ of Certiorari to theUnited States Court of Appeals for the Third Circuit
BRIEF FOR AMICI CURIAE RYAN M. RODENBERG,ANASTASIOS KABURAKIS, AND JOHN T. HOLDEN
I. PASPA’s Conferral of Property Rights to theRespondent Sports Leagues Violatesthe Intellectual Property Clause of theConstitution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
A. P A S P A V i o l a t e s t h e E x p r e s sLimitations Embodied in the IntellectualProperty Clause . . . . . . . . . . . . . . . . . . . . . . . 4
B. Disputes Over Property Rights in UnderlyingAthletic Events Have Resulted in a CircuitSplit and an Intra-Circuit Split . . . . . . . . . . 12
II. The Conferral of Perpetual Property Rightst o F a v o r e d S t a t e s v i a P A S P A ’ sGrandfathering Clause Violates theConstitution’s Intellectual Property Clause . . . 17
Paul J. Heald & Suzanna Sherry, Implied Limits onthe Legislative Power: The Intellectual PropertyClause as an Absolute Constraint on Congress,2000 U. ILL. L. REV. 1119 (2000) . . . . . . . . . . . . 10
Letter from W. Lee Rawls, Assistant AttorneyGeneral, Department of Justice, to theHonorable Joseph R. Biden, Jr., Chairman,Committee on the Judiciary (Sept. 24, 1991) . . . . . . . . . . . . . . . . . . . . . 2, 3, 22
Thomas B. Nachbar, Intellectual Property andConstitutional Norms, 104 COLUMBIA L. R. 272(2004) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
Plaintiffs’ Memorandum of Law in Opposition toDefendants’ Motion to Dismiss the Complaint,NCAA et al. v. Christie et al., (Oct. 1, 2012) No.3:12-cv-4947 (MAS) (LHG) . . . . . . . . . . . . . . . 5-6
Ryan M. Rodenberg, Anastasios Kaburakis, andJohn T. Holden are sports law analytics scholars witha particular research focus on intellectual property andsports-wagering. They have published a number ofacademic articles in connection with such issues. Theyhave a strong interest in ensuring that the nation’ssports-wagering and intellectual property laws complywith the Constitution.
SUMMARY OF ARGUMENT
The Professional and Amateur Sports Protection Actof 1992, 28 U.S.C. § 3701 et seq. (“PASPA”) violatesArticle I, § 8, cl. 8 of the United States Constitution(“Intellectual Property Clause”). The IntellectualProperty Clause grants Congress the authority: “Topromote the Progress of Science and useful Arts,by securing for limited Times to Authors andInventors the exclusive Right to their respectiveWritings and Discoveries.” (emphasis added).
PASPA’s subsection labeled “Injunctions” includesthe word “whose,” which confers ownership rights of“competitive game[s]” to Respondents and other
1 Pursuant to Rule 37, amici curiae certify that no counsel for aparty authored this brief in whole or in part, and no party orcounsel for a party made a monetary contribution intended to fundthe preparation or submission of this brief. No one other thanamici curiae made a monetary contribution to the preparation orsubmission of this brief. Counsel for all parties were timelynotified more than ten days before the filing of this brief. Lettersfrom the parties consenting to the filing of the amicus curiae briefhave been filed with the Clerk of the Court.
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professional or amateur sports organizations forpurposes of deputizing them to enforce the statute:
A civil action to enjoin a violation of § 3702 maybe commenced in an appropriate district court ofthe United States by the Attorney General of theUnited States, or by a professional sportsorganization or amateur sports organizationwhose competitive game is alleged to be thebasis of such violation (emphasis added). 28U.S.C. § 3703.
The conferral of property rights under PASPAviolates the Intellectual Property Clause because itgoes beyond the scope of the Intellectual PropertyClause’s limitations in two distinct ways. First, theexpress grant of perpetual ownership rights withcharacteristics mimicking both patents and copyrightsruns counter to various prongs of the IntellectualProperty Clause, including the “limited Times,”“Authors and Inventors,” and “Writings andDiscoveries” requirements. Second, conferringperpetual property rights to States exempted underPASPA’s grandfathering provision violates theIntellectual Property Clause’s “limited Times”requirement.
In a September 24, 1991 letter, the Department ofJustice (“DOJ”) raised a number of concerns inconnection with the Senate bill (S. 474) that wouldbecome PASPA. Letter from W. Lee Rawls, AssistantAttorney General, Department of Justice, to theHonorable Joseph R. Biden, Jr., Chairman, Committeeon the Judiciary (Sept. 24, 1991). Two concernspredominated. First, the DOJ flagged a number ofprovisions in S. 474 that raised “federalism issues.” Id.
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Second, the DOJ found it “particularly troubling that S.474 would permit enforcement of its provisions bysports leagues.” Id. Petitioners comprehensivelyaddress the DOJ’s first concern in their petitions for awrit of certiorari. We address the DOJ’s secondconcern in this brief as amici curiae.
PASPA confers a property right to RespondentsNational Collegiate Athletic Association (“NCAA”),National Basketball Association (“NBA”), NationalFootball League (“NFL”), National Hockey League(“NHL”), and Office of the Commissioner of Baseball(“MLB”) (collectively “Sports Leagues”) through the useof statutory language deputizing Sports Leagues toenforce PASPA’s provisions. See 28 U.S.C. § 3703. Bygranting Sports Leagues monopoly-like proprietaryownership of athletic events with authority to act as aprivate attorney general under the statute, PASPA hasconferred a de facto patent and copyright to the SportsLeagues in violation of the Constitution’s IntellectualProperty Clause.
PASPA’s grandfathering clause also has the effectof conferring a property right to Nevada and a smallnumber of other exempted States. The Court wastroubled by PASPA’s carve-outs in Greater NewOrleans Broadcasting Association, Inc. et al. v. UnitedStates. 527 U.S. 173 (1999). Justice Stevens, writingfor a unanimous court, observed that PASPA “includesa variety of exemptions, some with obscuredcongressional purposes.” Id. at 179. PASPA’s conferralof monopoly-like property rights to certain favoredStates through the use of various grandfatheringexemptions is unconstitutional under the IntellectualProperty Clause.
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Deciding whether PASPA is constitutionally validunder the Intellectual Property Clause provides theCourt with an alternative legal ground to decide thiscase. This alternative is considerably narrower thanthe broad anti-commandeering and equal sovereigntyarguments rooted in federalism set forth by thePetitioners. The argument we offer as amici curiae isspecific to PASPA and, in turn, does not directlyimplicate any other federal statutes.
For these reasons, the Court should grant thepetitions for a writ of certiorari.
ARGUMENT
I. PASPA’s Conferral of Property Rights to theRespondent Sports Leagues Violates theIntellectual Property Clause of theConstitution
A. PASPA Violates the Express LimitationsEmbodied in the Intellectual PropertyClause
PASPA’s subsection labeled “Injunctions” includesthe word “whose,” which confers ownership rights of“competitive game[s]” to the Sports Leagues for certainpurposes under the statute:
A civil action to enjoin a violation of § 3702 maybe commenced in an appropriate district court ofthe United States by the Attorney General of theUnited States, or by a professional sportsorganization or amateur sports organizationwhose competitive game is alleged to be thebasis of such violation (emphasis added). 28U.S.C. § 3703.
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As a pronoun, the word “whose” is the possessiveform of the word “who,” and used as an adjective. Theword “whose” is defined as “a possessor” and “thatwhich belongs to whom.” Merriam Webster’s CollegiateDictionary at 1352 (10th ed. 1993).
PASPA was enacted by Congress pursuant to theCommerce Clause. However, the conferral of propertyrights under the straightforward language in § 3703implicates the Intellectual Property Clause. WhenCongress granted ownership of “competitive game[s]”under § 3703 to the Sports Leagues as a mechanism todeputize the Sports Leagues for purposes of PASPAenforcement, such conferral took the functional form ofa patent, with ancillary characteristics common to acopyright, and bestowed the Sports Leagues with theright to exclude sports-wagering otherwise permissibleunder state law. PASPA’s property right conferral iswithin the purview of the Intellectual Property Clauseand must comply with its express limitations.
Reading a conferral of property rights into PASPAis supported by the Sports Leagues’ own statements inthis case. The Sports Leagues posit that they have aproprietary interest in “the degree to which othersderive economic benefits from their own games.”Response Brief of Plaintiffs-Appellees at 18, NCAA etal. v. Christie et al., (June 7, 2013) No. 13-1713, 13-1714, 13-1715. The Sports Leagues also contend thatthey “have an essential interest in how their games areperceived and the degree to which their sporting eventsbecome betting events” (emphasis removed). Id. at 13-14. The Sports Leagues further reference “legallyprotected interests of the organizations that producethe underlying games.” Plaintiffs’ Memorandum of Law
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in Opposition to Defendants’ Motion to Dismiss theComplaint at 1, NCAA et al. v. Christie et al., (Oct. 1,2012) No. 3:12-cv-4947 (MAS) (LHG).
The DOJ supports the Sports Leagues’ legal positionon this point. The DOJ claimed “PASPA does give theleagues a protected legal interest that has beeninvaded by New Jersey’s authorization of sportsgambling…” Brief for Appellee United States at 17NCAA et al. v. Christie et al., (June 7, 2013) No. 13-1713, 13-1714, 13-1715. The DOJ explained its findingof a protected legal interest for the Sports Leagues bydrawing an analogy to intellectual property law: “…thelegal protection that PASPA accords to sports leaguesis similar to the protections traditionally afforded infields such as copyright and trademark law, whereauthors and companies are given the right not to havetheir creative works exploited by other parties.” Id. at22, n. 7.
PASPA’s legislative history also coincides with thecontemporary statements of the Sports Leagues andthe DOJ in this case. PASPA was debated in theSenate by the Subcommittee on Patents, Copyrights,and Trademarks. The title of the statute itself is alsorevealing of PASPA’s intent and effect. PASPA standsfor “Professional and Amateur Sports Protection Act”(emphasis added). PASPA protects select professionaland amateur sports leagues from the perceived ills ofregulated sports-wagering through the allocation ofownership interests to “competitive game[s]” in § 3703. Such protection manifests itself in the Sports Leaguesbeing deputized to sue under PASPA for injunctiverelief in the same way patent holders and copyrightholders can file suit to protect their property interests.
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In testimony provided to the Senate Subcommittee onPatents, Copyrights, and Trademarks on June 26,1991, NBA commissioner David Stern provided hisview on PASPA’s intended protection and the overlapbetween sports-wagering and intellectual property inthe context of PASPA: “Conducting a sports lottery orpermitting sports gambling involves the use ofprofessional sports leagues’ games, scores, statisticsand team logos, in order to take advantage of aparticular league’s popularity; such use violates,misappropriates, and infringes upon numerous leagueproperty rights.” Testimony of David J. Stern,Subcommittee on Patents, Copyrights and Trademarks,Prohibiting State-Sanctioned Sports Gambling,Hearing, June 26, 1991, at 51.
The plain language of PASPA, especially whencoupled with the 1991 Congressional testimony and thestatements by the Sports Leagues and the DOJ in thiscase, implicates the Constitution’s Intellectual PropertyClause. Art. I, § 8, cl. 8 of the Constitution grantsCongress the authority: “To promote the Progress ofScience and useful Arts, by securing for limitedTimes to Authors and Inventors the exclusiveRight to their respective Writings andDiscoveries.” (emphasis added). The Sports Leaguesdid not author, invent, write, or discover the respectiveathletic events they are involved in. Others did. Assuch, PASPA § 3703’s possessive “whose competitivegame” language and Congress’s award of protectableownership rights over such games are contrary to theIntellectual Property Clause.
Congress has enacted patent and copyright lawspursuant to the Intellectual Property Clause. Patent
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law protection is granted for useful, novel, and non-obvious inventions. 35 U.S.C. §101-103. Patents aregranted following review by the U.S. Patent andTrademark Office (“USPTO”). If approved, a patentpermits the holder to exclude others from claiming theinvention for a period of usually twenty years. Patentsoperate as a duly authorized monopoly for a limitedduration of time. The Sports Leagues did not obtain aformal patent from the USPTO in connection withindividual sporting events. Congress simply granted aquasi-patent for sports-wagering purposes via § 3703 ofPASPA.
Copyright law protects “original works ofauthorship fixed in any tangible medium of expression,now known or later developed.” 17 U.S.C. § 101. Copyright categories are specifically enumerated andinclude literary works, musical recordings, and movies.Id. at § 102. Sporting events are not included asdiscussed infra.
PASPA’s conferral of property rights to the SportsLeagues is functionally akin to a patent. The “whosecompetitive game” language in § 3703 of PASPAprovides the holders of the de facto patent with thestatutory authority to exclude others – in this case theState of New Jersey’s desire to offer regulated sports-wagering pursuant to a duly enacted state law. A rightto exclude is exactly the type of property rightconferred on the Sports Leagues by PASPA. Throughthe ownership interests granted in § 3703 of PASPA,the Sports Leagues are permitted to file suit and seekto exclude certain States from organizing sports-wagering activities otherwise permitted in the
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jurisdiction. PASPA’s remedy, an injunction, mirrorsthat afforded to patent holders.
Congress’s conferral of ownership interests overathletic events to Sports Leagues functions as amonopoly and runs counter to Court precedent. TheCourt found: “The monopoly privileges that Congressmay authorize are neither unlimited nor primarilydesigned to provide a special private benefit…It isintended to motivate the creative activity of authorsand inventors.” Sony v. Universal City Studios, 464U.S. 417 at 429 (1984). PASPA fails to meet thisstandard in two ways. First, PASPA’s ownershipprivileges under § 3703 attach to only “a professionalsports organization or amateur sports organizationwhose competitive game is alleged to be the basis ofsuch violation.” Second, PASPA’s purpose is whollyunrelated to the creative activity of authors andinventors.
With PASPA’s grant of a proprietary right to theSports Leagues operating as the functional equivalentof a patent, it is useful to gauge the scope of Congress’sauthority to grant patents. In Graham v. John Deere,the Court made clear:
Congress may not authorize the issuance ofpatents whose effects are to remove existentknowledge from the public domain, or to restrictaccess to materials already available. Innovation, advancement, and things which addto the sum of useful knowledge are inherentrequisites in a patent system which byconstitutional command must “promote theProgress of…useful Arts.” This is the standard
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expressed in the Constitution and it may not beignored. 383 U.S. 1 at 6 (1966).
When juxtaposed with the Intellectual PropertyClause’s requirements, PASPA’s grant of a patent-likeproperty right to Sports Leagues fails on multiplecounts. First, the power to exclude States fromeffectuating regulated sports-wagering programs isunrelated to, and in direct conflict with, theIntellectual Property Clause’s requirement that suchgrants “promote the Progress of Science and usefulArts.” According to two scholars, “[a] corollaryprinciple [of the Intellectual Property Clause] demandsthat Congress initially direct exclusive grants to thosewho provide the public with the new creation. Monopolies are not rewards Congress may grant tofavored special-interest groups.” Paul J. Heald &Suzanna Sherry, Implied Limits on the LegislativePower: The Intellectual Property Clause as an AbsoluteConstraint on Congress, 2000 U. ILL. L. REV. 1119, 1164(2000).
Second, PASPA’s grant of property rights isperpetual, putting it at odds with the “limited Times”requirement of the Intellectual Property Clause. Third,as detailed in National Basketball Association v.Motorola discussed infra, the Sports Leagues do notqualify as “Authors” under the Intellectual PropertyClause. 105 F.3d 841 (2d Cir. 1997). Fourth, athleticevents do not constitute “Writings [or] Discoveries”under the Intellectual Property Clause given theirspontaneous nature and accompanying uncertainty ofoutcome.
PASPA’s grant of copyright-like power to the SportsLeagues is equally evident under § 3703’s “whose
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competitive game” language. The Sports Leagues’complaint in this case makes clear that athleticcontests are not scripted, implicating the “Writings”requirement of the Intellectual Property Clause andthe “fixation” language in the Copyright Act of 1976. 17U.S.C. § 101, et seq. In their initial complaint, theSports Leagues argued that “the outcomes of collegiateand professional athletic contests must be determined,and must be perceived by the public as beingdetermined, solely on the basis of honest athleticcompetition.” Complaint for Decl. and Inj. Relief, at 3NCAA et al. v. Christie et al. No. 3:12-cv-4947 (MAS)(LHG) (Aug. 7, 2012). Unlike live musicals, theatricalplays, and professional wrestling, honestly competitivesports are unscripted, making them incompatible withcopyright law’s constitutional and statutoryrequirements. Contrary to the games’ telecasts andbroadcasts, which have clearly been found to be copyrightable content, the games per se have not beendefinitively deemed worthy of copyright protection(discussed infra). Additionally, the “whose competitivegame” wording of § 3703 creates the suspicion of a suigeneris Intellectual Property Clause violation by basinga property right granted by PASPA to a concept thathas no owner.
PASPA’s conferral of property rights in § 3703 alsohighlights a conflict between the Commerce Clause andthe Intellectual Property Clause. Indeed, a prominentscholar observed: “The overwhelming view amongcommentators is that the Intellectual Property Clause’slimits apply to all of Congress’s power and thereforethat Congress may not look to other Article I, Section8 powers in order to avoid those limits.” Thomas B.Nachbar, Intellectual Property and Constitutional
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Norms, 104 COLUMBIA L. REV. 272, 274 (2004). Theimplications for the Intellectual Property Clause’sexternal limitations on PASPA are profound. Anotherscholar flags the issue generally as follows: “Since thelate twentieth century, Congress has increasinglyreached beyond the [Intellectual Property] Clause’smeans to promote the [Intellectual Property] Clause’sends, often asserting its expansive – and less limited –commerce and treaty powers.” Jeanne C. Fromer, TheIntellectual Property Clause’s External Limitations,61(7) DUKE L. J. 1329.
B. Disputes Over Property Rights inUnderlying Athletic Events Have Resultedin a Circuit Split and an Intra-Circuit Split
It would be a non sequitur to grant property rightsto private actors lacking a valid claim for a particularownership interest. Prior to PASPA, professional andamateur sports leagues in the United States havenever had a property interest in sporting events thatattaches to, and in turn restricts, one’s right to offerotherwise permissible sports-wagering. However, theissue of whether such leagues hold a property interestin the underlying athletic contests generally (preciselywhat § 3703 of PASPA grants via its “whosecompetitive game” language) is unsettled law. Courtsare divided. A review of relevant cases sheds light onhow courts have viewed the same type of property rightthe Sports Leagues were granted under PASPA § 3703. The litany of cases below highlights the difficultycourts have faced in deciding the issue.
Subsequent to the passing of the Copyright Act of1976, and well before PASPA’s adoption, in NationalFootball League, et al. v. Governor of Delaware, 435 F.
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Supp. 1372 (D. Del. 1977), the NFL and 28 teams filedsuit seeking injunctive relief barring Delaware fromconducting a lottery game based on professionalfootball games involving NFL-affiliated teams. Theleague defined its product as being the total end resultof its labor, including the public interest which itgenerated. Deciding on the league’s assertion thatDelaware misappropriated the product of the league’slabor and the games’ popularity, Judge Stapleton held:
“[P]laintiffs’ argument paints with too broad abrush… The only tangible product of plaintiffs’labor, which defendants utilize in the DelawareLottery, are [sic] the schedule of NFL games andthe scores. These are obtained from publicsources and are utilized only after plaintiffshave disseminated them at large and no longerhave any expectation of generating revenue fromfurther dissemination…” 435 F. Supp. 1372,1377.
The district court of Delaware concluded that:(i) featuring NFL schedules and scores, and using thegames’ popularity by the Delaware lottery did notconstitute misappropriation of NFL property and(ii) even if the lottery scheme violated federalantigambling laws, the NFL lacked a private cause ofaction. With the passing of PASPA fifteen years later,the Sports Leagues were granted such a private causeof action via § 3703.
Six years before PASPA’s enactment, and twodecades prior to a different panel of the same Circuitreaching a contrary conclusion, an Eighth Circuitdecision in National Football League v. McBee &Bruno’s, Inc., 792 F.2d 726 (8th Cir. 1986) recognized
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a broad-scope property right in sports leagues’ games. The case revolved around St. Louis restaurateurs, whoused “clean satellite feeds” (stadium images received bya satellite dish without any identifying information) tobroadcast local games otherwise blacked-out in theregion. Agreeing with the district court, the EighthCircuit held that “the game… constituted the work ofauthorship.” 792 F.2d 726, 732. The Eighth Circuitwas convinced by the plaintiffs, who claimed copyrightover “the game, the game action [and] thenoncommercial elements of the game.” 792 F.2d 726,732.
The same year, the Seventh Circuit decidedBaltimore Orioles, Inc. v. Major League BaseballPlayers Assn., 805 F.2d 663 (7th Cir. 1986). TheSeventh Circuit considered whether players’performances contained the necessary “modicum ofcreativity” for copyrightability. 805 F.2d 663, 669 n. 7. The Seventh Circuit ultimately aligned withCongressional guidance during deliberations of theCopyright Act of 1976. H.R. REP. No. 94-1476 at 52(1976). Specifically, competitive games’copyrightability was recognized as long as it pertainedto the broadcast and recording of a game:
“[E]ven if the Players’ performances were notsufficiently creative…the cameramen anddirector contribute creative labor to thetelecasts. The work that is the subject ofcopyright is not merely the Players’performances, but rather the telecast of thePlayers’ performances. The creativecontribution of the cameramen and director
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alone suffices for the telecasts to becopyrightable.” 805 F.2d 663, 669 n. 7.
After the passage of PASPA, federal courtscontinued grappling with pertinent questions regardingthe scope of Sports Leagues’ property rights overunderlying athletic events. Conceivably, theconstitutionality of PASPA’s § 3703 property rightacknowledgment and the Sports Leagues’ deputizationunder the statute, combined with PASPA’s de factopatent and copyright grants, would be espoused bycourts. Namely, if federal courts agreed with PASPA’sconferral of property rights in the underlying games tothe Sports Leagues, decisions would be reachedaccordingly. That, however, has not been the case.
The Second Circuit, in Natl. Basketball Assn. v.Motorola, Inc., et al., 105 F.3d 841 (2d Cir. 1997),decided a dispute over time-sensitive datadissemination as follows:
“[T]he underlying basketball games do not fallwithin the subject matter of federal copyrightprotection because they do not constitute‘original works of authorship’ under 17 U.S.C.§ 102(a)… [The] list does not include athleticevents, and, although the list is concededlynonexclusive, such events are neither similarnor analogous to any of the listed categories.”Motorola, 105 F.3d 841, 846.
Conversely, in Morris Communications Corp. v.PGA Tour, Inc., 364 F.3d 1288 (11th Cir. 2004), theEleventh Circuit held that the PGA Tour may preempta media organization from disseminating time-sensitive information such as compilations of golf
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scores. The factual scenario of this case pertained topurported proprietary data, which the PGA Tourselectively shared with media in the confines of itstournaments and wished to protect prior to onlinepublication (on its own website). Interestingly, in thecourse of ruling in favor of the PGA Tour on antitrustgrounds, the Eleventh Circuit acknowledged that“facts, such as golf scores, and compilations of facts aregenerally not a proper subject for copyright protection.”364 F.3d 1288, 1292 n.6. Further, “[C]opyright lawdoes not protect factual information, like golf scores.”Id. at 1298 n.15.
In C.B.C. Distribution & Mktg., Inc. v. Major LeagueBaseball Advanced Media, LP, 505 F.3d 818 (8th Cir.2007), the Eighth Circuit decided a case involvingfantasy sports operators, in which using combinationsof names and statistics for commercial purposes wasdeemed protected by the First Amendment. The courtconcluded: “[T]he information used in CBC’s fantasybaseball games is all readily available in the publicdomain, and it would be strange law that a personwould not have a First Amendment right to useinformation that is available to everyone.” 505 F.3d818, 823.
PASPA’s deputization of Sports Leagues andembedded property right[s] to “competitive game[s]”under § 3703 have not been uniformly accepted invarious federal courts. The Second Circuit (NationalBasketball Association v. Motorola, Inc., et al.,) and theEleventh Circuit (Morris Communications Corp. v.PGA Tour, Inc.) are largely at odds. The Eighth Circuit(National Football League v. McBee & Bruno’s, Inc. andC.B.C. Distribution & Mktg., Inc. v. Major League
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Baseball Advanced Media, LP) seemingly has an intra-circuit split. Notwithstanding the obvious FirstAmendment issues connected to the commodification ofnews from sporting events, the judicial divergence onthis issue yields substantial doubt in regard toPASPA’s constitutional underpinnings andcompatibility with the Intellectual Property Clause. II. The Conferral of Perpetual Property Rights to
Favored States via PASPA’s GrandfatheringClause Violates the Intellectual PropertyClause
“Grandfathering” or “grandfather clauses” aredefined as: “A statutory or regulatory clause thatexempts a class of persons or transactions because ofcircumstances existing before the new rule orregulation takes effect.” Black’s Law Dictionary at 560(7th ed. 2000).The historical usage of grandfatheringhas been well documented, notably Article II, § 1, cl. 5of the Constitution provides for the exemption of non-natural born citizens to be eligible for the Presidency,provided they were citizens at the time of adoption. Theexemption provided under Article II would see atermination period extending no further than the deathof the last person born prior to adoption. TheConstitution further grandfathered President Trumanfrom the limitations imposed on presidential termlimits, pursuant to the XXII Amendment. See U.S.Const. amend. XXII, § 1. The grandfathering exemptioncontained in both instances is of limited andforeseeable duration. PASPA’s grandfathering clause isof neither a limited nor foreseeable duration.
The PASPA exemptions provided for Nevada andthe other favored States confer an intellectual property
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right and monopoly for the continued operation ofsports-wagering schemes in these states. The openingremarks of Senator Dennis DeConcini noted that the“intent of the legislation is not to interfere withexisting law, operations or revenue streams.” SeeSenator Dennis DeConcini, Opening Statement to theSenate, Subcommittee on Patents, Copyrights andTrademarks, Prohibiting State-Sanctioned SportsGambling, Hearing, June 26, 1991. In grandfatheringthe sports-wagering processes in the exempted states,Congress has granted a property right drawing theinvocation of the Intellectual Property Clause. TheSports Leagues seemingly understood this too. In2009, NBA commissioner David Stern stated “there’s afederal statute that gives [Nevada] a monopoly of types[on sports-wagering]. And we actually supported thatstatute back in [19]92.” See Ian Thomsen, Stern Opent o L e g a l i z e d B e t t i n g , Ru l e Ch an ge s ,SportsIllustrated.com (December 11, 2009).
The Court addressed the interpretation of theConstitution’s “science and the useful Arts” provisionin Eldred v. Ashcroft, 537 US 186 at 216 (2003) citingPennock v. Dialogue, 27 U.S. 1 (1829). The IntellectualProperty Clause was found to create the desirability ofspreading useful and novel creations while providingthe creator with protection. PASPA’s conferral of aproperty right does the opposite, providing protectionfor an activity Congress has deemed undesirable. Additionally, the Court has further elaborated that theIntellectual Property Clause does not require thegovernment to incentivize new works. See Golan v.Holder, 132 S. Ct. 873 at 888 (2012). PASPA does notpromote the creation of new works. Instead, PASPAimposes a prohibition on new forms of sports-wagering
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in States not benefitting from PASPA’s grandfatheringprovisions.
The “limited Times,” provision of the IntellectualProperty Clause has been held by the Court to beevolutionary. See generally Eldred v. Ashcroft 537 US186 (2003). To date, there has been no interpretationthat the “limited Times” provision allows for indefiniteprotection to a rights holder. PASPA’s grandfatheringprovision provides an indefinite monopoly to Nevadaand the other exempted states. The indefinite nature ofthe grandfathering provision is inconsistent with the“limited Times” provision of the Intellectual PropertyClause. PASPA’s grandfathering provisions were notedby the Court as deriving from “obscured congressionalpurposes,” and lead to §3702 being “somewhat unclear.”See Greater New Orleans Broadcasting Ass’n., Inc. v.United States, 527 US 173 at 179-180 (1999).
The Court addressed grandfathering in Dukes v.City of New Orleans, 420 U.S. 297 (1976). It wasdetermined that a New Orleans municipal ordinancebanning pushcart vendors from the French Quarter,except those who had done so continuously for eightconsecutive years, did not violate the equal protectionclause of the 14th Amendment. In Dukes, agrandfathered push cart vendor’s right to operate waslimited to that vendor’s lifespan. The limiteddurational scope of the grandfathering provision wasnot addressed in a manner that would provideelucidation on the indefinite nature of PASPA’scontainment-based grandfathering provision; meaningthat it seeks to contain and prevent the spread of anundesirable activity.
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In Minnesota v. Clover Leaf Creamery, 449 U.S. 456(1981), the Court addressed the constitutionality of agrandfathering provision contained in a Minnesotastate statute banning the sale of dairy products incertain types of containers, but exempting others,including paperboard containers. It was held that theMinnesota statute did not violate the 14th Amendment. The issue in this case can be distinguished from CloverLeaf Creamery, as the purpose of the Minnesotalegislation was to specifically eliminate the use ofcertain non-conforming plastic containers, not toeliminate all non-conforming containers. PASPAdistinctly exempts Nevada and the other favored Statesfrom its prohibition on State-sponsored sports-wagering schemes.
The Third Circuit highlighted both cases, stating“[Christie, et al.] contend that Dukes and Clover LeafCreamery support their position because they upheldtemporary grandfathering clauses, there was noindication in either case that the clauses upheld wereindeed temporary…” See NCAA, et al. v. Governor ofthe State of New Jersey, et al., 730 F.3d at 239-240 (3dCir. 2013). While the Third Circuit noted that theCourt did indeed uphold both ordinances containinggrandfather clauses, PASPA’s exemptions aredistinguishable. The Dukes grandfathering provisionwas foreseeably terminable upon the death of a NewOrleans pushcart vendor. PASPA’s grandfatheringclause is perpetual. Similarly, the ordinance in CloverLeaf Creamery can be distinguished given that thegrandfathering clause banned one type of dairycontainer, but not another. This would be akin toPASPA banning one type of sports wager, but notanother. PASPA does no such thing, as non-
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grandfathered States are barred from offering any typeof sports-wagering.
The Third Circuit’s decision and interpretation ofthe grandfathering clause in PASPA was at leastpartially predicated upon the assumption that“PASPA’s legislative history is clear as the purposebehind its own exemptions…” Id. at 240 n. 18. TheThird Circuit is in error on this point, as its conclusiondirectly contradicts the Court’s decision in Greater NewOrleans Broadcasting Association, Inc. et al., 527 U.S.173 (1999). In Greater New Orleans, the Court foundthat PASPA “includes a variety of exemptions, somewith obscured congressional purposes” (emphasisadded). Id. at 179. The Court further found thatPASPA’s “exemptions make the scope of § 3702’sadvertising prohibition somewhat unclear” (emphasisadded). Id. at 180.
In addition to creating a property right for Nevadaand the other favored states in violation of theIntellectual Property Clause, PASPA has created aperpetual grandfathering clause for containment-basedlegislation. The Intellectual Property Clause requiresprotections be enacted for “limited Times,” and evenlegislation not covered by it with containment-basedprovisions has historically had foreseeable terminationpoints. Not all grandfathering exemptions are createdequal and thereby, even if the conclusion thatgrandfathering need not be for a definitive time horizonfor neutral or ameliorative exemptions, there is alegislative implication that containment-basedexemptions such as PASPA need to include someforeseeable termination point.
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CONCLUSION
In 1991, the DOJ found it “particularly troubling”that the Sports Leagues were deputized to enforcePASPA. Letter from W. Lee Rawls, Assistant AttorneyGeneral, Department of Justice, to the HonorableJoseph R. Biden, Jr., Chairman, Committee on theJudiciary (Sept. 24, 1991). We agree. In 1999, theCourt found some of PASPA’s various exemptions toderive from “obscured congressional purposes.” GreaterNew Orleans Broadcasting Ass’n., 527 U.S. 173 at 179(1999). We agree. In 2013, the DOJ analogizedCongress’s grant of property rights under PASPA tothose of intellectual property. Brief for AppelleeUnited States at 17 NCAA, et al. v. Christie, et al.,(June 7, 2013) No. 13-1713, 13-1714, 13-1715. Weagree. What the amici curiae offer here is analternative to Petitioners’ anti-commandeering andequal sovereignty arguments. Our position is onenarrowly focused on PASPA’s conferral of propertyrights and the implications for such conferral vis-à-visthe Constitution’s Intellectual Property Clause.
The Court should grant the petitions for writ ofcertiorari.
Respectfully submitted,
RYAN M. RODENBERG Counsel of RecordFLORIDA STATE UNIVERSITY139 Chieftan WayTallahassee, FL 32306(850) [email protected]
