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Despite First Amendment Challenge, Seventh Circuit Allows High School Sports Association to Exclusively License Broadcasting Right

By Abby Lauer – Edited by Andrew Segna

Wis. Interscholastic Athletic Ass’n v. Gannett Co., Inc., No. 10-2627 (7th Cir. Aug. 24, 2011)
Slip Opinion

The Seventh Circuit Court of Appeals affirmed the District Court for the Western District of Wisconsin, which had granted summary judgment to the Wisconsin Interscholastic Athletic Associate (WIAA) in a declaratory judgment action against local news media company Gannett Co., Inc.

The Seventh Circuit held that it is constitutional for the WIAA, a state actor, to exclusively license the right to broadcast tournament games played by member schools. In so holding, the court rejected Gannett’s argument that WIAA’s contract, which grants American Hi-Fi the exclusive right to stream tournament games and requires consent and payment for third-party broadcasts of entire games, violates the First Amendment.

The State Bar of Wisconsin provides an overview of the case. Techdirt criticizes the decision, expressing concern that the Seventh Circuit has created a new intellectual property right.

The WIAA is a voluntary, nonprofit organization that regulates the athletic activities of over 500 public and private high schools in Wisconsin. In 2005, WIAA contracted with American Hi-Fi, a video production company, to stream its post-season tournament events online. Under this contract, American Hi-Fi has the exclusive right to stream nearly all WIAA tournament games. Other broadcasters may stream the games only after obtaining permission from American Hi-Fi and paying a fee. Taking the position that this exclusive license agreement violates a First Amendment right to broadcast entire performances, newspapers owned by Gannett Co. decided to stream four WIAA games without obtaining consent or paying the fee. WIAA responded by filing this declaratory judgment action, asserting its right to grant exclusive licenses to broadcasters.

The district court granted summary judgment to WIAA, holding that the association has the right to control the broadcasting of its sporting events by executing exclusive licensing contracts. The Seventh Circuit affirmed and held that Gannett and other media companies do not have the right to “appropriate the entertainment product that WIAA has created without paying for it.” WIAA, slip op. at 16. The Seventh Circuit stated that the Supreme Court has not recognized any right under the First Amendment that would entitle the media to broadcast any and all public events. Although news outlets may not broadcast “entire acts” without permission, the appellate panel clarified that the media is free to report on any WIAA competition or other public sporting event.

Critics have expressed concern that the Seventh Circuit created a new intellectual property right with its decision in this case. See, e.g., Techdirt. The Seventh Circuit opinion clearly states that the case does not deal with copyrighted material, so copyright law does not apply. It is thus unclear exactly what right the WIAA is granting to American Hi-Fi, its exclusive broadcasting partner. The Seventh Circuit opinion emphasizes the WIAA’s need to earn revenue, a factor that may have influenced the court’s decision in this case.

Abby Lauer is a 3L at Harvard Law School.

Posted On Sep - 5 - 2011 Comments Off

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