by Jordan S. Paul
In a town like Los Angeles, sometimes nothing is more valuable than image. One of the more valuable images is that of a public persona, protectable in California as a right of publicity. Today more than ever, celebrities are exercising their right of publicity to endorse an increasingly broad spectrum of products.
This recent expansion of monetization of right of publicity makes perfect sense. Once a celebrity’s acting or sports career ends, so does that income stream. However, a celebrity endorsement can go on for years. Michael Jordan is the iconic example. Michael Jordan played professional basketball for thirteen years. In those thirteen years, he earned approximately $90 million – a large sum by any measure. When his basketball career ended, so did his NBA salary (which was only around $1 million a year in his final two years). However, by the time he retired, Michael Jordan had created numerous additional income streams that dwarfed his NBA income. Starting in 1984, at the outset of his career, Michael Jordan signed a five-year, $2.5 million endorsement contract with Nike. The flagship of this endorsement deal became the now ubiquitous Air Jordan brand. Today, the Air Jordan brand includes a wide array of sportswear and grosses over $1 billion a year in sales. A staggering three out of every four pairs of basketball shoes are Jordan Brand and 86.5% of basketball shoes over $100 that are sold are Jordan Brand. In combination with other endorsement deals from Gatorade, Hanes, Upper Deck, 2K Sports and Five Star Fragrances, Michael Jordan’s net worth is estimated to be around $500 million. While wildly successful and tremendously compensated as a basketball player, Michael Jordan’s net worth is obviously attributable to his business savvy in exploiting his right of publicity early and effectively to create a life-long income stream.
Of course, part of monetizing a right of publicity is protecting it. As a celebrity’s fame increases, so does the value of the right of publicity. And the celebrity won’t be the only one capitalizing on it. In the past year alone, there have been cases concerning a retail chain’s alleged misappropriation of an heiress’s likeness; a pop star’s suit against a video game’s use of his name in a rodent-themed app; and most recently, a California federal judge refused to dismiss an Israeli university’s lawsuit over General Motors LLC’s use of Albert Einstein’s image in magazine advertisements.
This article, authored by David Leichtman, Yakub Hazzard, David Martinez, and me, explores the recent development of fair use jurisprudence in right of publicity litigation, focusing particularly on the importation of the copyright transformative use analysis. It is unclear how widespread the adoption of the copyright fair use analysis will become, but what is clear is that right of publicity will only gain in value. Celebrities would be wise to adopt a sound combined business and legal strategy to simultaneously exploit and protect their name and likeness.
(Please note that this article first appeared in the September/October 2011 edition of Landslide magazine, an ABA publication.)
Jordan Paul is an attorney with Robins, Kaplan, Miller & Ciresi L.L.P. where his practice focuses on intellectual property and complex commercial matters, with an emphasis on copyright infringement and contract disputes in the entertainment industry.