Football NFTs in limbo as Panini loses NFL trading card agreement
This week, the NFL Players Association opted for an abrupt play change, severing ties with Italian collectibles titan Panini S.p.A. three years in advance, passing the baton to rival powerhouse Fanatics. While the statement from the NFL Players Association was lucid on Fanatics securing exclusive rights to produce NFLPA-branded trading cards, the fate of Panini’s NFL-themed NFTs is shrouded in ambiguity.
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License handoff: From Panini to Fanatics
Fanatics, not a neophyte in the trading card domain, having acquired Topps for $500 million and secured licensing deals with MLB, NBA, and NFLPA, is now embroiled in an ongoing lawsuit with Panini.
With the switch in licensure, the cardinal query arising is: What’s the fate of existing NFL NFTs minted by Panini?
Ross Feingold, special counsel at Titan Attorneys-at-Law, illuminates the issue. Citing the “first sale doctrine,” he clarifies that the holder of a legitimate copy of copyrighted material can display, sell, or even modify it without the copyright owner’s approval. Hence, any NFT minted by Panini remains unassailable.
Historical legal precedents from the 1990s and early 2010s, exploring the intersections of the right of publicity, intellectual property ownership, and the first sale doctrine, provide substantial clarity on the matter. This legal rigmarole underscores the chaotic past of trading card companies that often sidestepped intellectual property norms.
Navigating the complex NFT legal waters
The trading card industry has always been a veritable quagmire of licensing issues. Attorney Paul Lesko’s 2013 “Law of Cards” column elucidates this intricate maze, highlighting lawsuits like Kareem-Abdul Jabbar v. Upper Deck and Buzz Aldrin v. Topps. Each case has only contributed to the enigma of when manufacturers must pay for the inclusion of celebrities or athletes in their products.
The trading card industry’s right of publicity is complicated. Further complexities arise when considering the nascent field of NFTs. A paper penned in February 2023 by legal luminary Joshua Durham underscores the rapid evolution of NFTs, outpacing legal doctrines. He pinpoints the absence of a “digital first sale” doctrine and the associated challenges. The law remains ensnared in outdated views, potentially jeopardizing the integrity of NFT secondary sales.
The future of Panini NFTs
Given the historical dynamics between the sports card industry and copyright standards, there’s much room for speculation. However, Feingold holds a hopeful stance, expecting minimal interruptions. He believes Panini’s NFT marketplace will likely continue, though without new additions. Feingold compares this to the long-standing secondary market for sports cards, emphasizing the inherent value of collectibles.
Indeed, current market data aligns with this perspective. ‘Signed’ NFTs of Dallas Cowboys’ Tony Romo are retailing at a mere $6 on Panini’s NFT platform, whereas their physical analogs command an asking price of $600 on eBay.
In January, a CNBC report noted Fanatics’ intention to offload a 60% stake in sports-centric NFT firm Candy Digital. Does this signify Fanatics’ intent to halt NFT operations entirely, or might they continue, albeit without a license, possibly culminating in a settlement?
While the narrative continues to unfold, one thing’s clear: In the convergence of sports, collectibles, and digital innovation, the landscape is perpetually in flux, with the lines between tangible and digital, licit and illicit, constantly blurring.
