When considering entering into any Esports contractual agreement, one legal issue that should be carefully reviewed and negotiated concerns name, image, and likeness (“NIL”) rights. Often, the contract templates that are offered to esports athletes include “breezy” language stating that the promoter will be allowed to “use” the event photographs, video, statements, etc. However, caution is required. These vaguely stated provisions are legally binding words that grant to the promoter certain of your NIL rights. Your name, image, and likeness are valuable commodities that should be sold and licensed for money, as well as other valuable considerations INDEPENDENTLY and SEPARATELY from the money and consideration that you obtain for your services as an athlete. Note that payment for services is not allowed for NCAA athletes; payment is only for NIL rights. That is not generally true for esports athletes.
Of course, in practice, payment for service and NIL rights are almost always combined. Nevertheless, the contract should be negotiated to address each separately. Here are four issues to focus on.
Term/length of NIL license
When you are granting/licensing your NIL rights, a key matter is the term/length of the grant/license being given. For example, if you are attending and playing a tournament, you can allow use of your NIL for any period of time, including during just the tournament itself, for a month afterward, or for a year after, etc. However, do you want to grant your NIL rights for ten years, 20 forever? Probably not.
Note that the longer your term/length, the longer an esports athlete is bound by other terms in the contract, such as the morals provision.
Exclusivity
In theory, you can grant your NIL rights to everyone and every business who is willing to pay for them. So, be cautious when agreeing to any sort of exclusive NIL deal. Not that the answer should always be “no,” but it must be carefully considered.
Note that there is a logical linkage between negotiating the term/length and the exclusivity. If the promoter wants exclusivity, the term/length should be very short (or the price should be very high).
Dividing NIL rights and defining what is being granted/licensed
Generally, NIL grants/licenses can be subdivided geographically, via market channels, and via usage. For example, geographically, the NIL rights could be given for just the event venue, the city hosting the event, or the State, nation, continent, globally, etc. Likewise, the marketing channels include one specific website, a type of website (game-related), the internet only, the internet and print media, television, film, all media, creation and physical placement of cardboard cutouts, etc. Usage could be subdivided into advertising and marketing for just this event, company, website, game, or for all uses, including other games, companies, etc. In general, the broader the NIL grant/license, the more money an esports athlete should be paid.
NIL use on, with, as, or in salable merchandise
Most NIL rights are used for marketing/advertising, but a sizable amount of NIL rights involve the separate issue of use on, with, as, or in salable merchandise. On the one hand, it might be “fun” to have a promoter make a bobblehead doll in your likeness. On the other hand, you should get paid a percentage of all the sales proceeds.
Contact the NIL Rights and Esports Attorneys at Revision Legal
For more information, contact the experienced NIL and Esports Lawyers at Revision Legal. You can contact us through the form on this page or call (855) 473-8474.
