Daniels v. Fanduel, Inc.
| Decision Date | 24 October 2018 |
| Docket Number | Supreme Court Case No. 18S-CQ-00134 |
| Citation | 109 N.E.3d 390 |
| Parties | Akeem DANIELS, Cameron Stingily, and Nicholas Stoner, Plaintiffs-Appellants v. FANDUEL, INC. and DraftKings, Inc., Defendants-Appellees |
| Court | Indiana Supreme Court |
ATTORNEYS FOR APPELLANT: Stephen B. Caplin, Stephen B. Caplin Professional Corporation, Indianapolis, Indiana W. Clifton Holmes, The Holmes Law Group, Ltd., Chicago, Illinois Todd L. McLawhorn, Siprut PC, Chicago, Illinois
ATTORNEYS FOR APPELLEE: Ian H. Gershengorn, Kenneth L. Doroshow, Ishan K. Bhabha, Jenner & Block LLP, Washington, District of Columbia John R. Maley, Peter J. Rusthoven, Barnes & Thornburg, Indianapolis, Indiana Damien J. Marshall, Boies Schiller Flexner, New York, New York
ATTORNEY FOR AMICUS CURIAE, CMG WORLDWIDE: Theodore J. Minch, Sovich Minch, LLP, Indianapolis, Indiana
ATTORNEY FOR AMICI CURIAE, INTELLECTUAL PROPERTY LAW PROFESSORS: John A. Conway, LaDue Curran & Kuehn LLC, South Bend, Indiana
ATTORNEYS FOR AMICUS CURIAE, FANTASY SPORTS TRADE ASSOCIATION: Rudolph A. Telscher, Jr., Kara R. Fussner, Husch Blackwell LLP, St. Louis, Missouri John W. Borkowski, Husch Blackwell LLP, South Bend, Indiana
ATTORNEYS FOR AMICI CURIAE, MAJOR LEAGUE BASEBALL PLAYERS ASS'N, ET AL.: Michael Rubin, P. Casey Pitts, Altshuler Berzon LLP, San Francisco, California Gabriel A. Hawkins, Lynn Toops, Cohen & Malad, LLP, Indianapolis, Indiana
ATTORNEY FOR AMICUS CURIAE, NEW SPORTS ECONOMY INSTITUTE: Libby Yin Goodknight, Krieg DeVault LLP, Indianapolis, Indiana
Indiana's right of publicity statute provides, "a person may not use an aspect of a personality's right of publicity for a commercial purpose... without having obtained previous written consent." Ind. Code § 32-36-1-8(a). Pursuant to Indiana Appellate Rule 64, our Court accepted a certified question from the United States Court of Appeals for the Seventh Circuit, which asked:
Whether online fantasy-sports operators that condition entry on payment, and distribute cash prizes, need the consent of players whose names, pictures, and statistics are used in the contests, in advertising the contests, or both.
In short, we answer this question narrowly and find online fantasy sports operators that condition entry to contests on payment and distribute cash prizes do not violate the Indiana right of publicity statute when those organizations use the names, pictures, and statistics of players without their consent because the use falls within the meaning of "material that has newsworthy value," an exception under the statute.
Plaintiff-Appellants Akeem Daniels, Cameron Stingily, and Nicholas Stoner were collegiate student–athletes at various times between 2014-2016. The players' on-field performances were collected as numerical statistics and published by various fantasy sports website operators including Defendants-Appellees DraftKings, Inc. and FanDuel, Inc. Consumers wishing to use Defendants' products could pay a fee to access detailed information such as Plaintiffs' names, images, and statistics, assess the athletes' weekly performances, and assemble a virtual team of real-life athletes to compete against other users' teams on the Defendants' websites.
To participate in Defendants' fantasy sports competitions, consumers were required to follow certain rules imposed by the Defendants. For example, Defendants assigned a fictional dollar value to each Plaintiff based on the player's statistics and overall performance. To prevent a consumer from assembling a team composed only of the league's best players, each consumer's fantasy team was subjected to an overall salary cap. Each athlete's performance on the field translated to a point value determined by Defendants. At the end of a designated period, consumers were eligible to win cash prizes based on the points accumulated by their fantasy sports team.
Plaintiffs filed a class action complaint against Defendants in Marion County alleging that Defendants "used their names and likenesses in operating and promoting online fantasy sports contests without Plaintiffs' consent, and that doing so was a violation of their right of publicity under Indiana law." Daniels v. FanDuel, Inc. , 2017 WL 4340329, at *1 (S.D. Ind. Sept. 29, 2017). Defendants removed the case to the U.S. District Court for the Southern District of Indiana and moved to dismiss, arguing that Plaintiffs failed to state a claim upon which relief could be granted because the use of Plaintiffs' names and statistics fell under certain statutory exceptions to the right of publicity. Id. The District Court dismissed the suit, finding no violation of Plaintiffs' right of publicity because the use of their likenesses was in material that had newsworthy value and was a matter of public interest under the exceptions in Indiana Code section 32-36-1-1(c). Id. , at *7, *9. Plaintiffs appealed to the Seventh Circuit Court of Appeals, which certified a question of Indiana law to this Court. Daniels v. FanDuel, Inc. , 884 F.3d 672, 674 (7th Cir. 2018).
The parties in this case ask us to consider a wide range of issues touching on the right of publicity and its implications in our State. We recognize at the onset that our decision will carry considerable weight not only with respect to these parties, but for other potential right of publicity litigants in our state courts. We also understand that certain factual determinations and allegations remain unresolved and are squarely within the jurisdiction of our federal colleagues. We therefore proceed cautiously, maintaining a narrow focus on the question before us.
To maintain this narrow focus, we begin with a brief overview of the statutory scheme for the right of publicity. We then examine in detail the "newsworthy value" exception to the statute, finding that certain principles of statutory construction inform our reading of that exception. Through this lens, we next analyze the spectrum of "material that has newsworthy value" to evaluate the parties' arguments. The conclusions we draw from this analysis lead to the ultimate result that the use of players' names, pictures, and statistics in fantasy sports contests do not violate the right of publicity in Indiana.
We turn first to the right of publicity statute, including its pertinent definitions and exceptions. Since its enactment in 1994 and recodification in 2002, the statutory right of publicity in Indiana has remained largely untouched.1 See, e.g., H.E.A. 1258, 117th Gen. Assemb., 2d Reg. Sess. (Ind. 2012) (). Be that as it may, our Court has never had the opportunity to review Indiana's right of publicity statute.
In relevant part, the statute provides, "a person may not use an aspect of a personality's right of publicity for a commercial purpose during the personality's lifetime or for one hundred (100) years after the date of the personality's death without having obtained previous written consent." Ind. Code § 32-36-1-8(a). The right of publicity is defined as "a personality's property interest in the personality's (1) name; (2) voice; (3) signature; (4) photograph; (5) image; (6) likeness; (7) distinctive appearance; (8) gestures; or (9) mannerisms." Ind. Code § 32-36-1-7. A person who violates this right of publicity may be liable for damages. Ind. Code § 32-36-1-10.
The legislature has codified several key exceptions to this statute, two of which were argued before our Court. The "newsworthy value" exception provides that the right of publicity does not apply to "[t]he use of a personality's name, voice, signature, photograph, image, likeness, distinctive appearance, gestures, or mannerisms in ... [m]aterial that has political or newsworthy value." Ind. Code. § 32-36-1-1(c)(1)(B). Another provision, the "public interest" exception, concerns the use of a personality's right of publicity "in connection with the broadcast or reporting of an event or a topic of general or public interest." Ind. Code § 32-36-1-1(c)(3). If the use of a personality's right of publicity falls into either of these categories, the statute does not apply and no consent is needed for its use.
Keeping in mind our narrow approach to answering the certified question, and because we find that the use of players' names, pictures, and statistics by fantasy sports operators falls into the "newsworthy value" exception, we decline to examine the "public interest" exception. We will, however, examine the contours of the "newsworthy value" exception to determine its scope.
We turn our focus now to whether the use of the players' names, pictures, and statistics fall within the newsworthy value exception. Because "newsworthy value" is not expressly defined in the statute, our primary goal is to determine and give effect to the intent of the legislature. Moryl v. Ransone , 4 N.E.3d 1133, 1137 (Ind. 2014). In doing so, we examine the statutory language itself to "give effect to the plain and ordinary meaning of statutory terms." State v. Hancock , 65 N.E.3d 585, 587 (Ind. 2016). We also presume that the legislature "intended the statutory language to be applied logically and consistently with the statute's underlying policy and goals." Walczak v. Labor Works-Ft. Wayne LLC , 983 N.E.2d 1146, 1154 (Ind. 2013).
We begin by addressing two arguments advanced by plaintiffs in this case. First, we are not persuaded that the statutory exception for newsworthiness does not apply in the context of commercial use. The statute itself does prohibit the use of a person's right of publicity "for a commercial purpose." See Ind. Code § 32-36-1-8. The newsworthy value exception, however, removes the material from the right of publicity's application. Ind. Code § 32-36-1-1...
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