Who owns your gimmick?

March 30, 2017

The subject of who owns a wrestling character’s gimmick came up earlier this month when Matt and Jeff Hardy left Impact Wrestling and appeared to take their characters they developed in the organization with them.

It was reported by Ryan Satin’s The Wrestling Sheet and Dave Meltzer that Impact Wrestling’s lawyers sent a cease and desist letters to independent wrestling promotion Ring of Honor and its distributors to prevent the Hardys to use their gimmicks developed and used in Impact Wrestling on a Ring of Honor PPV.  As a result, Matt and Jeff Hardy did not use their characters on the ROH PPV.  Rather, they were generic versions of the Hardy

Prior to the ROH PPV, the Hardys made a “surprise” appearance at a ROH show which may have tipped off Impact Wrestling that the two were going forward in using the gimmicks in another organization.  Impact Wrestling’s Ed Nordholm stated that the “Broken Universe” character(s) were created by the company’s creative team which would mean that the organization would have ownership rights.

Notably, Matt Hardy applied for the trademark rights to his character he used in TNA, Broken Matt Hardy on March 1, 2017.  The process for obtaining a trademark takes 8-10 months if there are no issues.

Still, the question is whether or not the Hardys can use the gimmick without repercussions from Impact Wrestling lawyers.

There are a number of scenarios to consider.

The first is what does the contract say.  One would think that the terms of their contract with Impact Wrestling would dictate who has control of the intellectual property, then again, TNA did not secure its right to the intellectual property rights by not filing for the trademark.  Since Hardy filed for the trademark, one would think that he might be in breach of his contract by attempting to assert his rights when/if they contracted with TNA.

But trademarks are just one issue to discuss.  Trademarks protect items that help define a company brand, or in this case, performers.  With a trademark, the Hardys can monetize the Broken Matt Hardy brand through selling t-shirts or other merchandise.

There is also the issue of copyright protection for the Matt Hardy gimmick.  A copyright protects “original works of authorships.”  For the most part, a copyright would protect the use of characters.  In this case, a copyright would be created through the Hardys’ gimmicks of Broken Matt Hardy and Brother Nero.

With respect to the copyrighted material, we assume like most professional wrestlers, they were classified as an independent contractor.  Thus, a “work for hire” scenario in which TNA would own the characters since the creation occurred during the Hardys employment would not apply.  Under the theory of “work for hire” an employee’s invention or creation would be owned by the employer considering that it was within the scope of employment.  Going back to the terms of the contract, usually, even if a worker is considered an independent contractor, the contractor would include a provision that would assignment of the intellectual property would fall in favor of the contractor.  In this case, TNA.

We note that a Copyright search, as of March 30, 2017, of “Matt Hardy” reveals Copyrights owned by the WWE in 2011.  A search for “Broken Matt Hardy” yielded nothing.  A search for Brother Nero (Jeff Hardy’s character, revealed no Copyright licenses.

The character issue is similar in nature to what occurred with the character Stephen Colbert when the individual Stephen Colbert left Comedy Central to replace David Letterman as the host of The Late Show on CBS.  Courts have found cartoon or fictional characters to be protected by copyright if they are sufficiently distinct and unique.  For instance, as this article points out Superman, Mickey Mouse and Tarzan are all protected under copyright law.

In comparison, the WWE tends to trademark its characters currently under contract.  It also trademarks phrases that it might market (i.e., make into t-shirts).  Notably, at Wrestlemania 29, held on March 29, 2015, Brock Lesnar used the phrase “Suplex City” during his match.  The next day, March 30, WWE filed for the trademark.  The WWE had trademarks for the Hardys WWE gimmick but let it lapse when they left the company.

As stated, the WWE holds some copyright licenses over Matt Hardy, but nothing related to the “Broken” gimmick he developed in Impact Wrestling.

Impact Wrestling “wrote off” the Hardys gimmick in an episode after the duo were released from their contract.

In response, on Matt Hardy’s YouTube page, the Hardys recreated their Impact Wrestling characters to give their own ending of their stint at Impact Wrestling.  Will Impact Wrestling take legal action for the Hardys’ latest reincarnation of their characters?  Probably not, although if this continues, you might see them flexing legal muscle.

While many might think this exercise in examination is ridiculous, it really is entertainment and intellectual property law wrapped up in the world of professional wrestling.  It does have serious legal repercussions when you think of the right to make money off the characters.  Will Impact Wrestling seek a cut of the Hardys future use of the gimmick if they go to WWE? Think about the independent wrestling shows and autograph shows in which they are paid a fee to attend.  Would Impact Wrestling want a cut of their appearance fees?  Will the WWE seek to acquire the gimmick if the Hardys make a return?  Does the loss of the gimmick hurt the future employment of the Hardys?  There are a lot of issues in the business-side in the creation of a gimmick.

Judge angered by WWE and Plaintiffs disregard for brief rules

March 29, 2017

A federal judge in Connecticut has issued a written smackdown of the litigation between the WWE and former wrestlers in a contentious lawsuit claiming that the company knew of information concerning a link between repeated head trauma and permanent neurological conditions that it exposed to its wrestlers.

The lawsuit involves former pro wrestlers Evan Singleton and Vito LoGrasso and World Wrestling Entertainment.  The Plaintiffs originally filed their lawsuit in Pennsylvania in January 2015.  They were among several former wrestlers that filed suit which were represented by the same lawyer and law firm.  The WWE successfully moved the case to Connecticut where the company is headquartered.  Judge Vanessa L. Bryant issued an order denying a motion for summary judgment from the WWE on the issue of fraud by omission claim brought by the wrestlers.

As part of the summary judgment motion, the parties must submit a statement of undisputed material facts (“SUF”) .  The party opposing the motion, has the opportunity to admit or deny the facts submitted by the moving party and then assert its own SUF.

The judge chastised both sides for submitting briefs that were longer than the rules allowed.  “[T]he parties have buried the Court in extraneous information, a substantial portion of which is argument and not fact.

The Court allows briefs for Motions for Summary Judgment to have a maximum limit of 46 pages.  However, WWE’s brief was 60 pages.  Plaintiffs submitted a 125-page statement in response to the WWE’s overlong brief.

As a result, the Court determined that the parties should refile its statements as they were “unnecessarily long and argumentative, and reviewing them in full would be wasteful of the Court’s scarce resources.”

The Court order both parties to submit revised Statement of Facts with a limit of 30 pages for the WWE and Plaintiffs to file a short response admitting or denying Defendant’s SUF and then filing 30 pages with its own disputed issues of material fact.

Order Denying Defendant’s MSJ by JASONCRUZ206 on Scribd

Payout Perspective:

The venom between the lawyers in this lawsuit is exemplified by the overlong briefs as they cannot agree on even the undisputed facts of this case.  As a requisite part of the filing, a concise statement is required.  Here, long does not necessarily mean effective.  Moreover, the order issued by the Judge shows she is not happy with either side.

Singelton and LoGrasso are the last WWE wrestlers standing as Judge Bryant dismissed similar claims brought by Russ McCullough, Ryan Sakoda, Matthew Wiese and William Albert Haynes, III as the Court concluded they didn’t wrestle with WWE after the company allegedly learned of a link between concussions and degenerative neurological diseases in 2015.

WWE and StubHub announce partnership

March 28, 2017

The WWE and StubHub announced a multi-year agreement making the ticket company the WWE’s exclusive ticket resale marketplace for fans in the U.S. and Canada.  The agreement comes in time for the WWE’s biggest event of the year, WrestleMania.

In addition to the WWE, StubHub has deals with Major League Baseball, the San Francisco Giants, the NBA’s Philadelphia 76ers, the NHL’s LA Kings and college football’s Alabama Crimson Tide.

Payout Perspective:

Although the arrangement was not spelled out in the news release, its likely StubHub buys a sponsorship with the WWE for brand placement at WWE’s events or on its web site.  If there is a sell-out at WWE events, it will direct its fans to the StubHub marketplace.  In all likelihood, StubHub will provide the WWE with consumer data from those that purchase on its site so that the WWE can use the information for marketing and promotion purchases.

WWE earnings for Q4 impress Wall Street

February 13, 2017

WWE set a 52 week record for stock price as it announced its end of year earnings for 2016 this past Thursday.

According to its earnings call, WWE Network subscribers grew 14% to 1.41 million paid subscribers. Revenue increased 11% to a company record $729.2 million.

Per a company press release, “[T]he Company reported Net income of $8.0 million, or $0.10 per share, as compared to a Net loss of $1.2 million, or a $0.02 loss per share, in the prior year quarter. Operating income increased to $13.9 million from an Operating loss of $1.5 million.”

Notably, television rights fees saw a big year-to-year increase (i.e., 2015-2016).  The television division ended the 4th quarter with $68.6 million as opposed to $55.6 million in 2015.  The network was up $43.7 million to $40.8 million.  Overall, revenue was up across all business divisions except PPV which is likely since the Network is taking over this segment.

As of this writing, the stock is up at $22.37 which is slightly below its 52 week high of $22.56.

Payout Perspective:

The earnings reflect that business is good for the WWE.  It is capitalizing on television rights fees while its Network continues to grow according to the numbers.

Netflix acquires rights to Hogan v. Gawker documentary

January 25, 2017

Netflix has acquired the worldwide rights to the documentary “Nobody Speak: Hulk Hogan, Gawker and Trials of a Free Press,” according to The Hollywood Reporter.  The documentary is about the case that brought down media company Gawker due to a short video it published of a sex tape involving the former wrestler.

As you may recall, a jury handed Hogan a $115 million verdict which brought Gawker and its founder Nick Denton to bankruptcy.  It also destroyed the career of A.J. Daulerio who has been negotiating a settlement with Hogan although he would like the right to write his own book (presumably) about the case.

The documentary is screening in the Sundance Film Festival’s U.S. Documentary Competition.

Payout Perspective:

The purchase of the rights reflects the aggressive nature of Netflix strategy to go after intriguing content.  It continues to pick up subscribers and its original productions are gaining notoriety. The case and its characters are primed for more than this documentary as you might expect more retellings of the trial.

Gawker pays $31M to settle Hogan lawsuit

November 3, 2016

The New York Times reports that Gawker Media Group and Hulk Hogan have settled Hogan’s invasion of privacy lawsuit for a reported $31 million.  Hogan prevailed at trial and a jury verdict awarded him a $140 million judgment but Gawker appealed the court decision.  Instead of pursuing the appeal, the parties decided to settle the dispute.

The jury verdict sent Gawker, the owners (at the time) of websites such as Jezebel and Deadspin, into bankruptcy.  The company and its web sites were sold out of bankruptcy to Univision Communications for $135 million this past August.  In addition, Gawker’s founder, Nick Denton, filed for personal bankruptcy.

The settlement includes $31 million plus a portion of the proceeds from any future sale of the Gawker.com domain per a filing in the U.S. Bankruptcy Court.

Payout Perspective:

Hogan will likely receive 1/3 of the reported $31 million as he will likely need to pay his attorney fees, costs and Peter Thiel who was reportedly funding the lawsuit.  Despite the fact that Hogan will not receive $140 million, the settlement prevents more legal costs and waiting.

Combate Americas names former WWE star as president

October 12, 2016

Combate Americas has hired former WWE star Alberto Del Rio, now known as Alberto “El Presidente” Rodriguez, as the new president of the Hispanic Mixed Martial Arts sports franchise.

Rodriguez was recently released from the WWE.  In his new role, he will be “actively involved in all aspects of athlete relations and development, from recruitment to enhancing their showmanship skills,” per the Comate Americas press release.

Rodriguez has a background in MMA prior to his pro wrestling career.  He also was a part of the Mexican National Greco-Roman wrestling team in the late ‘90s according to the press release.

Rodriguez will make his debut on Friday, October 14th.

Payout Perspective:

The move is a way to elevate the promotion and maybe his notoriety can grab a few viewers as well as influence some young up and coming fighters to join the promotion.

UFC 203: Payout Perspective

September 11, 2016

Welcome to another edition of Payout Perspective.  This time we take a look at UFC 203 from Cleveland, Ohio where CM Punk’s debut and Stipe Miocic’s title defense were the headlining events.

Gall mauls CM Punk

We all knew that this was going to happen.  3 pro fights in and Mickey Gall looks like a top prospect.  Of course, his opponent was former pro wrestler CM Punk.  Despite being a huge favorite, Gall had a game plan which was to take down and grapple Punk.  Gall is a brown belt, Punk is a white belt as astutely pointed out by Joe Rogan.  Gall had his way with Punk on the ground and eventually choked him out in round 1.

Mickey Gall wants fellow pretty boy Sage Northcutt next.  Please UFC, book this.  As for Punk, he gave a very nice speech about dreams and believing in yourself.  Certainly this was a huge risk for a person in his late 30s but if he does continue his MMA dream it appears that it would be on a smaller, regional card.  Or Bellator.

Stipe stops Reem

Stipe Miocic successfully defended his UFC 203 heavyweight title against Alistair Overeem in one of the best and craziest rounds of this year.  Miocic was in trouble early in the first and almost was submitted (Reem thought there was a tap) by Overeem.

It looks like that Stipe gets Cain Velasquez next.  So long as the fight is at sea level, this will be a tough fight for Miocic.

Attendance, gate and bonuses

Cleveland came out for the UFC as the company reported a sell out for the event where the Cavaliers play.  The event drew 18,875 for $2.6M.

Bonuses went to Miocic-Overeem for Fight of the Night and Yancy Medeiros and Jessica

Promotion of the Fight

ESPN aided the UFC with the promotion as it had Stipe Miocic on Sportscenter talking up the fight.

Of course, there was the 3-part series on FS1 for CM Punk.

Miocic and Jessica Eye did local promotions since they are from the area.

The Cleveland Cavaliers through their support behind Miocic and Eye.

They also let Dana White handle the Larry O’Brien trophy.

Eye had a chance to throw out the first pitch at the Cleveland Indians home game as seen on Embedded.

There were tons of tweets from athletes, celebrities and pro wrestlers throwing their support for CM Punk.

Sponsorships

The newest sponsor in the Octagon for this PPV was IrishFireVodka.com.  The company is based out of Dallas, Texas per its web site. Aside from that, there were the usual sponsors including MetroPCS, Harley Davidson, Toyo Tires, Bud Light and Monster Energy Drink in the center.  They also promoted the UFC 204 PPV in the octagon.

MetroPCS had the fighter prep point.  Throughout the PPV, they had voiceover ads for Topps Fighter Trading Cards App.

Odds and Ends

UFC offered a 10% discount on purchasing this PPV if you had previously filled out a survey regarding UFC Fight Pass.  I’m sure they offer this periodically.  It’s just another subtle way to get consumers to gravitate to the UFC web site as opposed to PPV cable and satellite distributors.

CB Dolloway was involved in an elevator accident after the weigh-ins which caused his fight to be cancelled.  Expect a lawsuit.

Jessica Andrade looks like a legitimate title contender for the 115 pound women’s division.

What went on in that Browne-Werdum fight?  If a fighter asks for a halt to the fight without the referee first calling it, shouldn’t that be a verbal submission?  Then there’s the fracas with Edmund Tarverdyan post-fight.

Embedded showed Ronda Rousey’s dog with Travis Browne, but no Rousey.  She was in Cleveland as she was present for a pro wrestling show the night before to support her friend and former MMA fighter Shayna Baszler.

The Ohio Athletic Commission allowing the CM Punk license was one thing.  Its explanation for doing it was another.  Punk has publicly admitted to several concussions while wrestling, is 37 years old and the OAC waived its license requirements citing he was a top end pro wrestler.  But, to show its force, it stated it would investigate the Jessica Eye-Bethe Corriea shoving incident at the ceremonial weigh-ins.  It also fined Alistair Overeem $500 for being late to the weigh-ins.  Speaking of the Browne-Werdum fight, why did the referee allow for Browne to call an injury timeout on his own and not know that if Browne called for a stop to the fight, the fight was over.  Will the OAC look into that debacle?

After Joe Rogan interviewed Stipe Miocic who thought he was knocked down by a kick (instead of a punch) and then Overeem believed Miocic tapped to a guillotine, Rogan made the comment that maybe he shouldn’t interview guys after a fight.  Especially those that have been knocked out.  Makes sense to me although this is unlikely to happen.

Conclusion

Saturday night’s event drew over 1M searches for UFC 203 and another 200,000 for “UFC 203 Fight Card.”  Certainly, the attendance at the event was great as it was pushing for Miocic and Eye as hometown favorites. But was the allure of CM Punk reason for casual viewers to purchase the PPV?  It may have received a bump from pro wrestling fans but unlikely to move much with the rest.  Although the PPV had a heavyweight title fight, Miocic-Overeem are not PPV draws.  Since there was a little more marketing behind this event, I think we could see about 325-375K PPV buys.

CM Punk explains his move to MMA in his own words

September 10, 2016

CM Punk penned an article in The Player’s Tribune on the bliss in finding his passion for MMA.  Punk has been the headliner this week for UFC despite it being his first fight in the UFC.

While Punk should be better prepared than James Toney when he fought Randy Couture at UFC 118, we all may conclude that this is a gimmick fight despite what the UFC may say.  If Punk was Phil Brooks, aspiring MMA fighter, he wouldn’t be given the privilege of a PPV fight right off the bat.  He’d have to prove himself in smokers, amateur fights and on the regional scene before he would get a shot with the UFC.  He is a heavy underdog against Mickey Gall.  The 24-year-old has just one UFC fight (2 pro fights altogether) after being “discovered” on Dana White’s UFC Fight Pass reality show.  Aside from giving up 13 years in age and millions of dollars in career earnings, Gall should have every advantage in the Octagon to Punk.

Yet, Punk explains in his post on his love of MMA and the reasons why it’s far better than his life as WWE superstar CM Punk.

Certainly, finding your passion equals happiness.  But, like most everyone else in the world, Punk’s dream job was paved through a turbulent road with a crappy former job.  Although Punk did not explicitly discuss his time in the WWE, there were enough inferences that even a non-WWE fan could tell he is in a much better place than when he made much more money with the WWE.

FS1 aired a 3-part series on Punk and his training for Saturday’s fight so there’s a certain belief that his celebrity as a pro wrestler would garner interest in this event.  Despite the main event being Stipe Miocic making his first heavyweight title defense in his hometown, Punk has been the main story line. We shall see if attaching his name to the card equates to a bump in PPV buys.

Payout Perspective:

The Player’s Tribune is an outlet for an athlete to handle its own PR without the filter of a journalist to tell their story.  It’s a great source for first person accounts from an athlete’s perspective but one has to read it knowing that it does not tell the full story. In Punk’s case, it’s a good read that tells you why he is doing it.  Of course, what’s left out is the fact that in general fighter pay is low in the UFC compared to revenues and they are treated as independent contractors like in the WWE.  Thus far, it does not appear a “hack journalist” has asked about the seemingly parallel between his current contractor (UFC) and his former contractor (WWE).  Would be interesting questions to ask of him.  Of course, the story is too good thus far to ask these questions.

WWE invests in FloSports

August 15, 2016

The Wall Street Journal reports that online sports content provider FloSports has raised $21.2 million in Series B financing with World Wrestling Entertainment and Discovery Communications participating in this new round of financing.

FloSports, based out of Austin, Texas, provides online streaming of niche sports which includes amateur wrestling, grappling and regional MMA events.  The $21.2 million adds on to the Series A round which netted the company $8 million.

FloSports is a subscription-based service although there is also free content.  If you follow MMA writing, you know that MMA journalists have gravitated to the site including Jeremy Botter who broke the story that Zuffa was looking to sell the UFC.

Payout Perspective:

The deal shows the influence and value of online viewership, content and niche audiences.  This round of funding shows that companies like the WWE see value in the over the top platform and subscription-based business models.  The new funding will likely help expand the company’s reach in sports, rights fees and technology.

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