HBO’s Ballers: Touchdown Or Legal Fumble?

Posted by Oliver Herzfeld on June 25, 2015

This post originally appeared on forbes.com.

Tackling Unlicensed Trademarks In Fictional Works 
By Oliver Herzfeld and Tal Benschar

NBC Sports Pro Football Talk reported that, in an unprecedented move, HBO’s new TV series Ballers will use the names and logos of NFL teams without a license from, or the consent of, the NFL. A spokesperson for HBO stated: “HBO is always mindful of other intellectual property owners, but in this context there is no legal requirement to obtain their consent.” The NFL has so far declined comment. If HBO’s legal analysis is correct, then why did so many past works such as Any Given Sunday and The Replacements use fictional team names and logos? This provides a good opportunity to explore the legal issues raised by the use of unlicensed trademarks in fictional works, as well as the key legal claims the NFL could make and HBO’s possible defenses.

Trademark Infringement

Trademark infringement would be the most likely claim asserted by the NFL. Such a claim would probably involve the following three legal issues:

1. use in commerce;
2. likelihood of confusion; and
3. First Amendment rights.

The U.S. Trademark Act expressly requires a “use in commerce.” Courts are divided about what that phrase means. Some courts require that the symbol be used as a trademark, to identify goods or services, and not just as a reference within the goods or services. According to this view, Ballers’ use would not be a use in commerce because the NFL team names and logos are not used to identify the show or the studio, but only as a background to the show. But other courts, probably the majority, only require that some kind of use be made of the mark.

Second, a trademark owner must show likelihood of confusion. Confusion is not limited to who created the show; it is enough that the use of the trademark misleads the public into believing that the show is sponsored or endorsed by the trademark owner. In one famous lawsuit involving professional football, the Second Circuit Court of Appeals enjoined the pornographic film Debbie Does Dallas because the use of the Dallas Cowboys Cheerleaders’ uniforms and logos created confusion as to sponsorship.

So if the NFL team names and logos used in Ballers are mistakenly understood by the average viewer to mean the NFL has somehow sponsored or endorsed the series, then the NFL could have a good claim. The NFL as plaintiff would have the burden of proving HBO’s use of its marks has created a likelihood of confusion and both parties could present expert witness and consumer survey evidence to support their positions. It is hard to predict the results because prior cases involving mention of trademarks in films or television shows have reached different conclusions. For example, in contrast to the Debbie Does Dallas case, last year the Seventh Circuit Court of Appeals upheld dismissal of a claim that the use of the trademark “CLEAN SLATE,” referring to fictional software in the movie The Dark Knight Rises, created a likelihood of confusion with the plaintiff’s same mark for a real-life software product.

Third, federal courts have developed special rules regarding use of a trademark as part of an expressive work. These rules were first developed in a lawsuit brought by Ginger Rogers against the producer of the film Fred and Ginger. The Second Circuit Court of Appeals held that the First Amendment rights of the producer outweighed whatever rights Rogers had in her name and persona. According to the court, the public interest in avoiding confusion will usually not outweigh the First Amendment interests in free expression unless either:

1. the mark has no artistic relevance to the underlying work whatsoever; or
2. the mark has some artistic relevance, but use of the mark misleads as to the source of the work.

Applying that case to the football context, the Eleventh Circuit Court of Appeals held in 2012 that use of University of Alabama’s colors and logos in artistic depictions of football games (sold in paintings, prints and calendar reproductions) did not infringe the university’s trademarks in its uniform’s colors and logos.

This is probably HBO’s best argument. The use of actual NFL team names and logos is highly relevant to the central story of the show, and there is no indication that HBO intends to affirmatively mislead anyone about sponsorship (e.g., by using the logos in the opening credits).

Dilution, Blurring and Tarnishment

The Federal Trademark Dilution Act protects famous trademarks from uses that reduce, or are likely to reduce, the public’s perception that the marks signify something unique, singular or particular, even in the absence of any likelihood of confusion or competition. Dilution claims come in two types:

1. blurring, where the distinctiveness of a famous mark is impaired by association with another similar mark or trade name; and
2. tarnishment, where the reputation of a famous mark is harmed through unsavory or unflattering associations.

According to NBC Sports Pro Football Talk: “The first episode of Ballers focuses in part on an NFL player who has sex in the bathroom of a nightclub with a woman he had just met, and who then beats up a fan who confronts the player about keeping the bathroom occupied for an extended period of time.” Such plotlines might expose HBO to potential claims of dilution by tarnishment. However, such a claim would not be clear cut. Tarnishment cases usually involve overtly offensive subject matter, like pornography or close association with criminality. The description of the first episode, in contrast, seems like a hard-hitting depiction of real-life incidents of violence and sex, rather than empty titillation – more R-rated than X-rated.

One legal factor that would favor HBO is that most courts require use in a trademark capacity (i.e., to identify goods or services as emanating from a producer or source) before they will allow a dilution claim. Referential use of a mark within an expressive work would, according to most courts, not even qualify for a dilution claim.

Of course, HBO could also assert a First Amendment defense, raising similar arguments to those discussed above.

Defamation

Defamation is the communication of a false statement of fact that harms the reputation of an individual person, business, or other entity. To determine whether a plaintiff has been defamed, courts have generally required the following three elements:

1. communication of a false statement of fact to one or more other parties;
2. willful intent or negligence on the part of the defamer regarding the truthfulness of the statement; and
3. harm caused to the subject of the statement.

Defamation actions are not limited to aggrieved individuals. An organization like the NFL can be a plaintiff in a defamation lawsuit, too. The NFL may pursue claims against a fictional work such as Ballers if it is reasonable for viewers to believe that the organization in the series is intended to portray the real-life NFL. But any claimed defamation would have to be directed at the NFL as such (e.g., if the NFL is depicted as a corrupt entity that engages in illegal activities). Portrayals of football players who engage in domestic violence or other criminal behavior would not by itself constitute defamation against the NFL.

A disclaimer that Ballers is not meant to depict any real-life persons or entities would not automatically exculpate HBO from such claims, but it would still be a good idea for HBO to include such a disclaimer as it could be used as evidence that it is in fact not reasonable for viewers to believe that the organization, characters and teams in the fictional series are intended to portray the real-life NFL, its players and teams.

Even if the NFL is able to successfully claim the use of its team names and logos in connection with distasteful plotlines is tantamount to false statements of fact, it would still have to prove that:

1. the false statements of fact were made without adequate research into the truthfulness of the statements; and
2. the NFL’s reputation was actually harmed by HBO’s false statements.

The NFL would have to prove it suffered real economic harm, such as lost ticket sales or other business opportunities, as a result of the negative depiction of the NFL on the show. The law does not permit organizations to claim hurt feelings or other emotional injuries. Nor does it allow recovery for damages that are merely speculative. The NFL would have to prove its damages by providing evidence establishing to a reasonable certainty the nature and extent of the economic loss it sustained or will in the future sustain.

Finally, truth is a defense to any claim of defamation, and a defamation plaintiff bears the burden of proving falsity. HBO would be free to introduce evidence that its depiction of the NFL is true or substantially true, and if believed, would completely relieve it of liability for defamation claims.

Conclusion

There are many nuances to the legal issues surrounding the use of unlicensed trademarks in fictional works. The NFL could raise trademark and defamation claims, but HBO would have a variety of possible defenses. Avoiding the foregoing issues and potential claims is the precise reason why the film and TV industry usually either procures a trademark license or changes names and includes standard disclaimers in title cards and credits essentially stating “All names appearing in this work are fictitious. Any resemblance to real persons or entities is purely coincidental.”

Oliver Herzfeld is the Chief Legal Officer at Beanstalk, a leading global brand extension agency and part of the Diversified Agency Services division of Omnicom Group.

Tal Benschar is a partner in the law firm of Springut Law, and practices all types of intellectual property law. He has represented such companies as Gucci, Cartier, Montblanc and Van Cleef and Arpels, both before the PTO and in federal courts.