Rario vs Striker: the battle over athlete personality rights in a Web3 world

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In one of the early editions of The Playbook, back in November, I had written about the murky concoction of non-fungible tokens (NFTs) and fantasy sports. Platforms such as Rario and FanCraze offer fantasy cricket games involving NFTs, where users need to buy digital cards of the players they want in their fantasy teams in order to participate. Unlike a regular fantasy sports game, the points these NFT player cards earn depend on various factors such as their rarity.

That edition was about how this format of fantasy sports doesn’t really produce a level playing field, which skews the game towards being a game of chance rather than a game of skill.

Last week, a judgement by a single-judge bench at the Delhi High Court brought forth another important aspect of this web 3 version of fantasy sports.

Whose personality rights are they, anyway?

Photo credit: Striker

On April 26, the Delhi High Court dismissed a plea by cricket NFT platform Rario seeking an interim injunction to prevent rival Striker from offering its services. While this judgement will have no bearing on the final adjudication of the suit, which could take years, it’s still a significant development for the industry.

Here’s what happened:

In February, Rario, a platform that allows users to buy, sell, and trade officially licensed digital cards of cricketers via blockchain technology, filed a petition with the Delhi High Court. The petition said that Striker, an NFT-based fantasy cricket platform, allows users to buy, sell, and trade digital player cards with caricatures of cricketers that have licensing deals with Rario.

Apart from Rario, the petition included five cricketers as plaintiffs: Harshal Patel, Arshdeep Singh, Shivam Mavi, Umran Malik, and Mohammed Siraj. Rario said that it had spent over ₹148 crore (~$18 million) in the last year alone to get exclusive licensing deals with these cricketers for making their digital cards. And by using caricatures of the same cricketers, Striker is unlawfully using the “player marks and other attributes”, leading to unfair competition, unjust enrichment, unlawful interference with economic interest of the plaintiffs, and breach of the cricketers’ personality rights.

In its response to the petition, Striker said that its NFT cards are just an

entry requirement to play its online fantasy game and they can’t be traded or used outside the platform. It added that it had commissioned independent artists to create original artworks of the cricketers and didn’t use their photographs. Its cards also “do not suggest any kind of endorsement or association” with any player.

Photo credit: Striker

The company also pointed out that it’s standard industry practice to use player identifiers, including, names, images and statistics in fantasy games as they’re all available in the public domain. “The player identifiers claimed to be owned by the plaintiffs are in the nature of factual information not protectable under any law in India,” Striker said.

In response, Rario said that it’s not necessary for Striker users to participate in a fantasy game after purchasing an NFT player card. They can simply trade the card on its marketplace to earn money. Furthermore, the value of NFTs on Striker is “derived from the identity/personalities of the players” and isn’t a function of the artwork. As a result, Striker is “commercially gaining from the sale/trade of such NFTs without authorization from the players.”

Striker replied that the outcome of its fantasy game is based on four factors: a player’s on-field performance, the card’s rarity, and two game features called experience points and health points. Out of these, a player’s on-field performance is available in the public domain and the remaining three factors are not related to their identity/personality.

As for the purpose of buying cards on Striker, Maanav Kumar, an independent intellectual property rights lawyer who represented the company, told The Playbook, “In theory it’s possible for someone to just buy the card for bragging rights and not use it in the game. But if I want the value of the card to go up, I need to keep playing it in the game since the value is dependent on in-game features like the experience points and health points. So, if you want to buy a card only for bragging rights and put it on your digital mantlepiece, it makes sense to go to a platform that has official player-licensed cards, like Rario.”

Photo credit: Rario

Those were the arguments from both sides. Now, let’s get into what the court said.

In his judgement, Justice Amit Bansal said that the right to publicity cannot be an absolute right in India since there’s no statutory basis for it—basically, there’s no specific legislation that deals with it. As a result, the violation of the right of publicity in India “has to be considered on the touchstone of the common law wrong of passing off” and also weighed against the right to freedom of speech and expression, which is a fundamental right under Article 19(1)(a) of the Indian Constitution.

“Passing off” refers to a case where, for instance, the identity or the image of a celebrity is used to promote the sale of a product or a service without their consent. Consumers would be misled into believing a celebrity is endorsing that company. This would be an infringement of the celebrity’s right to publicity.

“...there has to be misappropriation of goodwill and reputation of a celebrity in selling a good/service. The right of publicity cannot be infringed merely on the basis of a celebrity being identified or the defendant making commercial gain, as is sought to be contended on behalf of the plaintiff.”

  Justice Amit Bansal, in the judgement

The court said that fantasy sports platforms use the names, images, and other public information of all players, rather than select ones, for the purposes of identification. This “obviates any possibility of confusion” that a player is endorsing the fantasy sports platform.

As for the right to freedom of speech and expression, the court said that the use of celebrity names and images for purposes such as satire, parody, art, and news is allowed under Article 19(1)(a) of the Constitution and would not infringe the right to publicity. And hence, the use of players’ names, images, and other public information by fantasy sports platforms is also protected under this section, even if it is being done for commercial gain.

The court also noted that the original artwork used by Striker on its cards contained “creative elements that distinguish them from the actual image of the players in question”. The artwork would, therefore, be protected under Article 19(1)(a) of the Constitution.

It’s also worth noting that Rario conceded it doesn’t have exclusive rights over the players’ names, images, and statistics that are used in a regular fantasy game. The company’s grievance was just with the use of the NFT-enabled digital player cards that can be traded. However, the court ruled that there is no difference between a fantasy game with NFT-enabled player cards and a regular fantasy game as far as the use of the player’s name or image/artistic impression is concerned.

It also agreed with Striker’s argument that the primary purpose of its digital cards is to use them to play its fantasy game. “A collector or a fan of a player would be less inclined to buy such a card as memorabilia when other NFTs using the actual photograph/video moments of sportspersons are available to purchase on the Rario platform,” it said.

Considering all these things, the court ruled that Rario has failed to make a valid case for the grant of an interim injunction against Striker.

Now, what?

Rario is expected to appeal the judgement considering the finances involved. But as things stand, this ruling brings forth a fundamental question that could alter the functioning of the industry: is there any point in NFT platforms signing exclusive deals with players?

Because, if using images of players in digital cards—whether they’re actual photographs or artistic impressions—is not an infringement of the right to publicity, then why spend crores of rupees on exclusive contracts with the players?

Kumar, the intellectual property rights lawyer who represented Striker, says that’s a valid question. However, it depends on what the platform plans to do with the exclusive contracts.

“Our argument to the court was that Rario’s licences, on which they spent ₹150 crore, haven’t gone to waste. There are a number of things they can do that other NFT platforms can’t, such as organising meet and greets with the players for the card holders. Some NFT platforms offer videos of historic moments involving their contracted players. But if all you want to do is run a fantasy game, that doesn’t require licences.”

  Maanav Kumar, lawyer representing Striker

Rario’s fantasy game—or “strategy game” as the company refers to it—D3 is a big part of its proposition. Incidentally, the other defendant in this suit, Mobile Premier League, which has backed Striker in terms of providing tech support and hosting the game on its platform, said that Rario has “deliberately not disclosed” that it also offers a fantasy game. The court noted in its judgement that Rario did not rebut this submission.

Photo credit: Striker

As I wrote in a previous edition of The Playbook, Rario’s D3 is particularly skewed towards a game of chance, which is illegal in India, because it allows you to pick fantasy cricket teams of only three players. And one of those three players need not even be playing in that match or tournament.

In fact, whether it’s Rario or FanCraze or Striker, I’m still failing to understand how an NFT-based fantasy game would work in a market like India. Unlike a regular real-money fantasy game, where you can put in as little as ₹1 to play in a contest, NFT-based fantasy platforms require you to buy individual player cards. If the game requires you to pick five players in a team, you need to buy five cards. In Rario’s marketplace for the Indian Premier League, a single player card can cost anywhere between $1 and $299, while match packs can be bought for $5 and upwards.

Such a model would perhaps work better in a season-long fantasy game, where you have to pick a squad of, say, 15 players for the entire season, with a limited number of transfers/trades allowed between matches. Fantasy Premier League, the official fantasy game of the Premier League, follows this format, although it’s a free-to-play game and doesn’t involve NFT cards.

In India, though, the prevailing format is daily fantasy sports, where you have to pick a different team for every match. The country’s per capita income is ₹1.72 lakh ($2,100). How many Indians can afford to spend even $5 per match to participate in a fantasy contest? Rario did not respond to my request to participate in this story.

Anyway, the legality and affordability of NFT-based fantasy sports are separate matters. Coming back to the suit, as mentioned earlier, Rario could appeal the single-judge bench’s decision to dismiss its plea for an interim injunction. If that happens, the matter will go to a division bench, which could agree with the single judge or reverse the judgement. Depending on which party is unhappy with that decision, the matter could then go to the Supreme Court.

Meanwhile, the original suit will continue on a parallel track until there is a final relief, which would include other reliefs such as damages. There will be detailed pleadings from both sides, with evidence and witnesses. Realistically, nobody expects a final judgement on the matter for at least a few years, says Kumar. “That’s why you have interim applications and hearings, because commercial realities are such that you can’t wait five years for a final decision. An interim application is filed with more or less every intellectual property suit.”

And so, we wait…

Have you played an NFT-based fantasy sports game?

⚡️Quick Singles

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🏏📺📱 Indians are largely watching the IPL on both television and digital. According to market research company Hansa Research, dual viewership (TV + digital) comprises 57% of the total pie this season, followed by television-only (33%), and digital-only (10%). Looks like TV still rules in India. Meanwhile, Chennai Super Kings, Mumbai Indians, and Royal Challengers Bangalore are the most popular teams in the IPL, the report added.

👟🇺🇸 German sportswear major Adidas plans to play to its strengths and focus on sports to boost its business in the United States, as it seeks to recover from recent setbacks. This includes the failure of some of the brand’s most high-profile celebrity partnerships, including the Yeezy line with rapper Kanye West. Adidas also suffered setbacks in Russia and China. Meanwhile, the brand with three stripes is being sued by investors who claim the company knew about the risks of associating with West long before his anti-Semitic comments were made public.

🎮🇯🇵📈 Sony expects to sell 25 million PlayStation 5s in the year ending March 2024. That’s six million more than it sold in the previous financial year and would be a record. Sony posted rising quarterly unit sales for the PS5 in the same week Microsoft announced a 30% year-on-year drop in sales for its Xbox console.

⚽️🔴💰 British billionaire Jim Ratcliffe has reportedly submitted the highest bid for Manchester United in the third round of bidding, offering more than £5 billion ($6.2 billion), according to the The Daily Telegraph. It was later reported that Ratcliffe’s main rival, Sheikh Jassim bin Hamad Al Thani, also bid bid over £5 billion and promised to erase Manchester United’s debt of $620 million. Meanwhile, United’s current owners, the Glazer family, are now reportedly seeking at least $7 billion to sell the club, per the Independent.

🎮🎞️ The Super Mario Bros. Movie became the first film to cross the $1 billion milestone at the global box office this year. Nearly half of that collection came from North America. It’s the fifth movie to join the $1 billion club since the pandemic, after Spider-Man: No Way Home, Top Gun: Maverick, Jurassic World Dominion, and Avatar: The Way of Water.

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