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We have a ruling on Panini& #39;s motion to dismiss the MJ-in-the-Background case! And while Panini did get a couple of Upper Deck& #39;s claims dismissed, the best way to describe the order is a bloodbath for Panini.
TLDR: Ruling does not mean UD will win, BUT UD& #39;s case is going forward!
TLDR: Ruling does not mean UD will win, BUT UD& #39;s case is going forward!
Before getting into specifics, we need to generally talk about motions to dismiss (MTD)
A MTD cannot dive into who will win and who will lose. It can only address whether plaintiff 1) properly alleged it has the rights to be here and 2) pled sufficient facts to support its claim
A MTD cannot dive into who will win and who will lose. It can only address whether plaintiff 1) properly alleged it has the rights to be here and 2) pled sufficient facts to support its claim
If facts are properly alleged, even weak claims will survive a MTD. And in most cases, plaintiffs do not need to provide evidence to support their claims...simply alleging that facts exist to support their claims are sufficient.
MTDs have huge upsides. If granted, the case is over quickly and cheaply.
There& #39;s also not much downside because if a defendant loses, it does not mean it will ultimately lose the case. It still may very well win, BUT, it will take time (lots of time) and money (even more).
There& #39;s also not much downside because if a defendant loses, it does not mean it will ultimately lose the case. It still may very well win, BUT, it will take time (lots of time) and money (even more).
What dooms Panini& #39;s MTD is that the court agrees with UD that UD alleged sufficient facts to proceed. While some of the facts asserted and conclusions drawn seem implausible, the court has held this isn& #39;t the right time to address them.
For example, the first claim the court addressed is UD& #39;s false endorsement claim. Basically, UD claims because MJ appears in these two cards, a consumer could be confused into thinking MJ endorsed these cards.
From a commonsense stand point, this claim seems dumb. BUT...
From a commonsense stand point, this claim seems dumb. BUT...
...to determine that requires weighing evidence...which is not proper this early on.
And this is exactly why Panini loses. Here, the judge critisized Panini because it only alleged that after looking at the facts, it should win. That& #39;s not proper in a MTD.
And this is exactly why Panini loses. Here, the judge critisized Panini because it only alleged that after looking at the facts, it should win. That& #39;s not proper in a MTD.
Arguments on the merits (who will ultimately win) are improper at the MTD stage, so UD& #39;s false endorsement claim survives.
As dumb as it is, it survives.
For now.
As dumb as it is, it survives.
For now.
This does not mean UD will ultimately win.
To win, UD must show consumers were deceived into believing MJ endorsed these products because of these cards.
While UD alleges it will show this, I think that& #39;s unlikely. BUT...it will take time and money for either side to prevail.
To win, UD must show consumers were deceived into believing MJ endorsed these products because of these cards.
While UD alleges it will show this, I think that& #39;s unlikely. BUT...it will take time and money for either side to prevail.
The court also DENIED Panini& #39;s MTD on UD& #39;s false advertising claims for the same reasons (basically UD pled that consumers would be confused about MJ& #39;s relationship to this product).
This is still a difficult claim for UD to PROVE...but for now it proceeds.
This is still a difficult claim for UD to PROVE...but for now it proceeds.
The court also held that UD sufficiently pled that Panini intended to use MJ in these cards to deceive consumers.
I think what swayed the court here was the fact Panini had released one card with MJ removed, while another with him in it. Kinda looks suspicious.
I think what swayed the court here was the fact Panini had released one card with MJ removed, while another with him in it. Kinda looks suspicious.
A big issue for the future of the case will be whether UD can bring these claims. Really, UD is not suing on UD& #39;s rights...it& #39;s suing on behalf of MJ.
Panini argued it does not believe UD has such rights because it did not show the license.
Panini argued it does not believe UD has such rights because it did not show the license.
UD on the other hand argued at this point we don& #39;t need to produce the license...all we need to do is say we have the rights.
The court agreed with UD on this. Just saying you have a license is good enough...for now.
The court agreed with UD on this. Just saying you have a license is good enough...for now.
As a lawyer, this is an issue if I were Panini I& #39;d poke at IF this case progresses. UD could have easily blown up Panini& #39;s argument at the MTD stage by showing the license. It chose not to. And the court held it did not need to. BUT, it still makes me suspicious.
The reason is there is a difference between an exclusive license (one where only one manufacturer has the right to make a product) and the right to EXCLUDE OTHERS from making a product (to sue). It& #39;s a minor nuance, but the law requires BOTH rights to be given to bring lawsuits.
Going back to the order, Panini did get the court to dismiss UD& #39;s counterfeiting claim....but really...when there are a bunch of other ways you can lose, getting rid of the weakest claim is not that big of a win.
A big issue for this case (and for most outside observers) is "come on...this infringement is either so small or unintentional...so who cares?"
Again, the court holds this issue weighing evidence, so cannot be looked at at MTD stage.
Again, the court holds this issue weighing evidence, so cannot be looked at at MTD stage.
The only other bright moment for Panini is it got the intentional interference with a contract claim dismissed. Court dismissed this claim because it found UD did not properly allege actual disruption to the UD/MJ contract, economic harm or an independently wrongful act by Panini
There& #39;s more...but it& #39;s all not good for Panini.
And really, where UD lost...the court is giving UD the ability to amend its complaint and add more facts to potentially bring the dismissed claims back.
And really, where UD lost...the court is giving UD the ability to amend its complaint and add more facts to potentially bring the dismissed claims back.
So, where does that leave us?
Panini is NOT in a good position. Judge is not saying who will win, but, if Panini is to win, it& #39;ll take time and money.
Same thing for UD. To show consumer confusion, that will require a survey...and that& #39;s expensive.
Panini is NOT in a good position. Judge is not saying who will win, but, if Panini is to win, it& #39;ll take time and money.
Same thing for UD. To show consumer confusion, that will require a survey...and that& #39;s expensive.
Given this, I think the case will settle confidentially soon.
Panini made its run to try and knock off the case, and it failed. To win from here it will need to spend hundreds of thousands of dollars...to defend two cards.
Panini made its run to try and knock off the case, and it failed. To win from here it will need to spend hundreds of thousands of dollars...to defend two cards.
For UD, this is a huge victory. While I still think legally this is a dumb lawsuit (one it will ultimately lose), it has drawn a line in the sand for other competitors. If ANYONE tries to use its exclusive athletes...even inadvertently...it will sue. And the claims will proceed.
For #TheHobby this decision strengths exclusive licenses with athletes as well.
Not in the way you think. It does not say that a manufacturer will ultimately win on such claims, BUT, it does say if a defendant wants to challenge them...it& #39;ll take time and won& #39;t be cheap.
Not in the way you think. It does not say that a manufacturer will ultimately win on such claims, BUT, it does say if a defendant wants to challenge them...it& #39;ll take time and won& #39;t be cheap.
So, congratz Upper Deck! I have repeatedly mocked and critisized this lawsuit (and I think if it continues you will lose), but, from a business standpoint, bringing this suit appears to be the correct decision.
In hindsight, this is a beautiful business/legal maneuver by UD.
Had it lost this motion, Michael Jordan would pop up in the background of a lot more cards (not to mention the damage done to the MJ/UD license). But...UD won.
From a legal observer standpoint that& #39;s pretty neat!
Had it lost this motion, Michael Jordan would pop up in the background of a lot more cards (not to mention the damage done to the MJ/UD license). But...UD won.
From a legal observer standpoint that& #39;s pretty neat!