On September 24, 2013, Electronic Arts, Inc. (“EA”) reached a $40 million dollar settlement of lawsuits over the use of college athletes’ likenesses in EA’s popular college football video game series NCAA Football. EA also announced it has canceled the latest installment of the NCAA Football video game series. The developments follow decisions by two appellate courts earlier this year holding that EA could not invoke the First Amendment as a defense to the athletes’ right of publicity claims. The central issue in both cases, Hart v. Electronic Arts, Inc., 717 F.3d 141 (3d Cir. 2013) and Keller v. Electronic Arts, 724 F.3d 1268 (9th Cir. 2013), concerns the proper balance between a video game publisher’s First Amendment rights and college football players’ rights of publicity where the players’ likenesses were featured in the video game series.
Since 1998, EA has developed and published its NCAA Football video game series. A new version was developed every year and allows players to simulate playing NCAA football games in a realistic setting, namely one that imitates the look of actual games played by real NCAA-sanctioned college football teams. The video games feature the graphical representations of real-life college football players. Two former NCAA quarterbacks — Ryan Hart and Samuel Keller — filed suit against EA seeking compensation for the use of their likenesses as a violation of the right of publicity.
This alert discusses the reasoning of the Hart and Keller appellate decisions and examines possible implications of the courts’ holdings on the balance between a person’s right of publicity and the constitutional right of free expression under the First Amendment.
A person’s right of publicity is an offshoot of his or her right of privacy. It is the right of an individual to control the commercial use of his or her identity. The right of publicity is primarily a creature of state law. Protections vary significantly from state to state, as some states recognize a statutory right while other states rely on common-law protections. Nearly 30 states recognize some version of the right of publicity.
EA’s NCAA Football video games present actual college athletes who were on the teams that year as digital “avatars” i.e., graphical representations of each athlete. The athletes’ names are not displayed. However, their “likenesses” (in the form of realistic appearance, biographical information, and physical attributes) are represented accurately. Players have the option of altering the default settings by editing each avatar’s physical characteristics and attributes. EA does not license or compensate the players for use of their likenesses. EA also does not ask the players for their consent prior to incorporating their likenesses for use in the video game.
Video games, such as NCAA Football, are considered expressive works deserving of protection under the First Amendment. However, when a person asserts that his or her right of publicity has been violated by an expressive work, the right of publicity and the constitutional right of free expression must be balanced. Courts do not have a definitive method for doing this. Rather, courts may apply various balancing tests depending on the facts of each case. Two of the most common balancing tests are the trademark-based Rogers test, and the copyright-based transformative use test.
The Rogers test originated in Rogers v. Grimaldi, 875 F.2d 994 (2d Cir. 1989). It examines a work to determine (1) whether the use of an identity has “artistic relevance” in relation to the underlying work, and (2) whether the use of the mark explicitly misleads as to the source of the product. The test is usually applied to Lanham Act claims involving misappropriation of a celebrity’s identity, but has appeared in the state-law right of publicity context.
The transformative use test was formulated in Comedy III Prod., Inc v. Gary Saderup, Inc., 21 P.3d 797 (Cal. 2001). The test borrows the concept of the “transformative use” from copyright law’s fair use doctrine. Its rationale is that works containing significant transformative elements are especially deserving of First Amendment protection and less likely to interfere with economic interests protected by the right of publicity. Thus, under this test, a work is only given First Amendment protection if it is considered to be significantly transformative. The transformative use test was adopted in both the Hart and Keller cases.
The Hart Case
In NCAA Football 2006, Rutgers’ digital quarterback looks just like the team’s actual quarterback that year, Ryan Hart. Although Hart’s name is not used, the Rutgers’ quarterback in the game has Hart’s No. 13 jersey, stands 6’2” tall, weighs 197 pounds, and wears an armband on his left wrist, just like the real Hart. In 2010, Hart filed a complaint seeking compensation for EA’s violation of his right of publicity. EA’s motion to dismiss on the basis of free expression under the First Amendment was granted by the District Court of New Jersey. On appeal, the Third Circuit, in an opinion written by Judge Greenaway, reversed the district court, finding that EA’s First Amendment rights did not outweigh Hart’s right of publicity claims on the facts of this case. A rehearing en banc was denied on June 25, 2013.
The Hart decision relied upon and interpreted New Jersey’s property-like right of publicity, which is derived from common law. The balancing of the right of publicity and the First Amendment was an issue of first impression for the Third Circuit. The Third Circuit dismissed the Rogers test as unfit for “non-trademark-like” right of publicity cases because it protects the right of publicity only when the work is “wholly unrelated” to the celebrity’s name or likeness. Thus, the concern was that the Rogers test would provide sports-related products inadequate protection under the right of publicity. This would be worrisome because products aimed at Hart’s market segment — sports fans — would be the most lucrative uses of Hart’s identity. Thus, sports-related products provide the greatest incentive for exploitation, but would unjustly receive the least protection under the Rogers test, the court argued.
Ultimately, the Third Circuit applied the transformative use test because it believed the test: (1) accounts for misappropriation occurring in the celebrity’s own market segments, and (2) favors the right of publicity over the First Amendment when a work is created merely to exploit the likeness of a celebrity.
Judge Greenaway’s Application of the Transformative Use Test
First, the Third Circuit’s application of the transformative use test focused only on the digital avatar representing Hart in NCAA Football. The court examined whether Hart’s identity was sufficiently transformed. It found that both Hart’s physical characteristics and accessories were replicated closely, despite being “computerized.”
Second, the court looked to the context within which the digital avatar exists:
The digital Ryan Hart does what the actual Ryan Hart did while at Rutgers: he plays college football, in digital recreations of college football stadiums, filled with all the trappings of a college football game. This is not transformative; the various digitized sights and sounds in the video game do not alter or transform the Appellant’s identity in a significant way.
Thus, NCAA Football was not considered a transformative use of Hart’s identity because it merely simulates college football.
Third, the court examined the ability of users to change the digital avatar’s appearance. The Third Circuit acknowledged that this was a creative feature deserving of some First Amendment protection, but concluded that the right of publicity outweighed this interest. The fear was that granting First Amendment protection to a video game on the grounds that it allowed for customization would lead video game companies to avoid liability by merely including such a feature. Moreover, the court stated that when a user makes significant changes to an avatar, that avatar no longer represents Hart. As such, a heavily edited digital avatar was irrelevant to the analysis — it would not qualify as a “use” of Hart’s likeness under the transformative use test, despite Hart’s likeness constituting the initial basis of the customization.
Finally, the court held that the other creative aspects of EA’s NCAA Football were inapplicable. Its interpretation of the transformative use test focused only on how aspects of the work altered Hart’s identity. The broader context of the work, i.e., elements of NCAA Football not tied to reality, was distinct from the use or meaning of Hart’s identity and was not considered.
Thus, the Third Circuit held that EA’s video game does not transform Hart’s identity sufficiently to defeat Hart’s right of publicity claim. The case was reversed and remanded back to the District Court of New Jersey.
Judge Ambro’s Dissent
Dissenting, Judge Ambro believed the majority opinion underplayed NCAA Football’s significant creative elements. He argued that limiting the transformative use inquiry to Hart’s avatar alone, without considering the creative elements of the entire work, was both incorrect and at odds with precedent.
Examining NCAA Football as a whole, Ambro concluded that it constitutes a transformative use. The video game uses creative means in the form of graphics, sounds, and game play features to simulate the experience of college football. Thus, it deserves First Amendment protection. To hold otherwise, Ambro explained, would penalize EA for its hard work and success. Moreover, it would be inconsistent with the broad First Amendment protections generally afforded to realistic depictions of real persons and for-profit works.
The Keller Case
Samuel Keller was the starting quarterback for Arizona State University in 2005, before transferring and assuming the same role at University of Nebraska. In NCAA Football 2005, the virtual starting quarterback for Arizona State wears Keller’s No. 9 jersey, and resembles Keller in height, weight, appearance, play style, and biographical information. In NCAA Football 2008, the virtual quarterback for Nebraska also has most of the same characteristics as Keller.
Keller asserted that EA violated his right of publicity by including his unauthorized likeness in the video game, pursuant to California Civil Code § 3344 and common law. Keller then became a lead plaintiff in a putative class action involving other college athletes also depicted in NCAA Football. On July 31, 2013, the Ninth Circuit, in an opinion written by Judge Bybee, affirmed the district court’s denial of a motion to strike the right of publicity complaint under Cal. Civ. Proc. Code § 425.16.
EA raised various affirmative First Amendment defenses, including the Rogers test and the transformative use test. The Ninth Circuit declined to adopt the Rogers test for right of publicity claims. It noted that the Rogers test is designed to protect against consumer confusion. However, according to the court, the right of publicity protects not against consumer confusion, but rather the celebrity as a form of intellectual property in one’s person. The Ninth Circuit adopted the transformative use test as more relevant to this aim.
Judge Bybee’s Application of the Transformative Use Test
The Ninth Circuit explained that it was extending the reasoning of a California Court of Appeals case, No Doubt v. Activision Publishing, Inc., 122 Cal. Rptr. 3d 397 (Ct. App. 2011). In No Doubt, users simulate performing as a rock band in the video game called Band Hero. Users can choose from a variety of avatars, including avatars representing the members of the popular rock band, No Doubt. No Doubt sued the creator, Activision, for a violation of its right of publicity. The band alleged that Activision exceeded the scope of its license by allowing the user to play any song in the game using No Doubt avatars and to alter the avatars’ voices. The California appellate court held that the transformative use test was not a defense to the band’s right of publicity claim because the virtual avatars are simply re-creations of the band members doing the same activity that made No Doubt famous celebrities — playing in a rock band.
Applying No Doubt, the Ninth Circuit concluded that EA’s use of Keller’s likeness did not contain significant transformative elements. Thus, it could not act as a defense against the right of publicity suit. The court explained:
[U]sers manipulate the characters in the performance of the same activity for which they are known in real life — playing football in this case, and performing in a rock band in Band Hero. The context in which the activity occurs is also similarly realistic — real venues in Band Hero and realistic depictions of actual football stadiums in NCAA Football.
Further, although the court admitted that the work contains creative elements as a whole, this does not transform the avatars themselves for purposes of a transformative use test.
Also, like the Third Circuit, the Ninth Circuit was not persuaded that the ability to alter the players’ likenesses constitutes a transformative use. Keller’s likeness can be modified, unlike the immutable No Doubt avatars in Band Hero. However, this is not transformative because the virtual athletes cannot be transformed into “fanciful, creative characters” or “portrayed as. . . entirely new characters.” Further, the court explained that customizing the players means little when the draw of the game is for fans to be able to play as their favorite players.
Therefore, the Ninth Circuit declined to shield EA’s use of Keller’s likeness under the First Amendment by finding the transformative use test was not met. Instead, it affirmed the Northern District of California’s decision and allowed the right of publicity suit to proceed.
Judge Thomas’s Dissent
Judge Thomas, like Judge Ambro, concluded that the creative elements inherent in NCAA Football as a whole constituted a transformative use. Additionally, though, Thomas observed that Keller’s case constitutes a weak right of publicity claim. Unlike other right of publicity cases, it involves thousands of virtual actors so the potential for exploiting any of the class members’ identities, including Keller’s, is low. He also noted that the data used in the game, namely the athlete’s playing statistics and biographical information, is public and not proprietary. Moreover, the structure of the game renders the players anonymous, so the marketability of the game is not dependant on any single celebrity. Finally, college athletes’ economic rights are extremely restricted under NCAA rules. This is significant because the right of publicity is solely an economic right. Thus, Thomas argued that even apart from NCAA Football’s transformative elements, the balance tips in favor of the First Amendment.
There is concern regarding the scope of the right of publicity and its balance with the First Amendment: Certain prior applications of the transformative use test have granted First Amendment protections so long as a work as a whole contains transformative elements. The majority opinions in Hart and Keller, however, focused mainly on the fact that the celebrity’s likeness itself was not transformative. While a victory for celebrities, Judge Thomas and others believe that this focus on only the plaintiffs’ likeness has the potential to make an author’s realistic depiction of public figures in an expressive work subject to right of publicity suits even in a creative context. If the Third and Ninth Circuit’s transformative use test framework is extended to other mediums — for example, documentaries, biographies, websites, and movies — creators may find their works increasingly vulnerable to right of publicity suits.
The state-law right of publicity is more capable of trumping the First Amendment than federal claims: The Hart and Keller rulings are in contrast to another Ninth Circuit ruling, Brown v. Electronic Arts, Inc., 724 F.3d 1235 (9th Cir. 2013). Brown involves the Madden NFL video game series, which simulates NFL football instead of college games. The retired, acclaimed NFL running back James “Jim” Brown alleged, under the federal Lanham Act, that EA misappropriated his likeness by including a player that resembles him on two historical teams. The Ninth Circuit applied the Rogers test. It dismissed the claim because Brown’s likeness was relevant to the underlying work and did not “explicitly mislead” consumers. Moreover, in Novalogic v. Activision Blizzard et al., 12-4011 (N.D. Cal. June 18, 2013), a California district court applied the Rogers test to a trademark and unfair competition suit under the Lanham Act. The court held that Activision’s use of Novalogic’s “Delta Force” trademarks in the video game Call of Duty: Modern Warfare 3 was protected because the marks have artistic relevance and their use in the game is not explicitly misleading to consumers. Thus, the right of publicity, as a proprietary right, appears to be more capable of trumping the First Amendment than similar, but consumer confusion-driven, claims under the Lanham Act.
Immediate impact: The NCAA announced that it is not renewing its licensing agreement with EA, and withdrew support of NCAA Football. EA subsequently canceled the 2015 installment of its college football video game series. This is not the end to EA’s legal troubles, however. Ex-NFL running back Jim Brown filed suit in August 2013, alleging under California’s state right of publicity law that his likeness was used without permission in EA’s Madden NFL series. This follows Brown’s previous unsuccessful misappropriation claim against EA, noted above.
The future of the right of publicity is uncertain: Supreme Court review is a possibility due to the enormity and complexity of the issues involved. Prior to EA’s settlement, it had announced plans to appeal the Hart and Keller decisions to the Supreme Court. The NCAA remains in the litigation and, on October 25, 2013, filed documents requesting that the Supreme Court review Keller. In the interim, those involved in a potential right of publicity dispute should seek experienced counsel.
 On October 21, 2013, Ryan Hart announced in New Jersey court filings that he did not consent to EA’s $40 million dollar settlement. He has retained new counsel, but has not yet announced whether he will object to the settlement.
 Keller was part of a larger class-action lawsuit against EA by various college athletes collectively referred to as In re NCAA Student-Athlete Name & Likeness Licensing Litigation.
 In the wake of Hart and Keller, Shawne Alston — a former West Virginia running back who was recently drafted by the NFL’s New Orleans Saints — filed suit in New Jersey alleging that EA infringed his right of publicity by using his likeness in the 2011, 2012, and 2013 editions of NCAA Football. Alston’s case was part of the settlement.
 See, e.g., Parks v. LaFace Records, 329 F.3d 437, 461 (6th Cir. 2003) (indicating that the Rogers test is appropriate in the context of expressive works other than movie titles, including right of publicity claims) (citing Restatement (Third) of Unfair Competition § 47 cmt. c).
 The four factors comprising copyright’s fair use doctrine are: “(1) the purpose and character of the use; (2) the nature of the copyrighted work; (3) the substantiality of the portion used in relation to the copyrighted work as a whole; (4) the effect on the potential market for or value of the copyrighted work.” Harper & Row, Publishers, Inc. v. Nation Enterprises, 471 U.S. 539, 560-61 (1985).
 The Restatement (Second) of Torts states the current formulation: “One who appropriates to his own use or benefit the name or likeness of another is subject to liability to the other for invasion of privacy.” Restatement (Second) of Torts § 652C. Further, the comments to the Restatement make clear that New Jersey’s right of publicity is “in the nature of a property right.” Restatement (Second) of Torts § 652C cmt. a.
 The Third Circuit also rejected another balancing test called the predominant use test, which originated in Doe v. TCI Cablevision, 110 S.W.3d 363 (Mo. 2003). This test examines a work to determine whether the primary purpose of the work is commercial or expressive. Works that are primarily commercial in nature are likely to receive less First Amendment protection than works that are primarily expressive.
 Hart also claimed that EA’s use of Hart’s image in the promotion for NCAA Football 2009, wherein actual footage of Hart throwing a pass was used as part of a montage, violated his right of publicity. The court found that montage “imbues the image with additional meaning beyond simply being a representation of the player.” Thus, the photograph was protected by the First Amendment and did not contribute to the right of publicity violation.
 California’s anti-SLAPP (“strategic lawsuit against public participation”) statute, Cal. Civ. Proc. Code § 425.16, subjects lawsuits to a special motion to strike unless there is a probability that the plaintiff will prevail on the claim. Cal. Civ. Proc. Code § 425.16(b)(1). It is intended to prevent lawsuits that “masquerade as ordinary lawsuits but are brought to deter common citizens from exercising their political or legal rights or to punish them from doing so.” Batzel v. Smith, 333 F.3d 1018, 1024 (9th Cir. 2003) (internal quotation marks omitted).
 EA put forth two additional state-law defenses. The first is that liability will not lie for common-law right of publicity claims “constituting publication of matters in the public interest.” Montana v. San Jose Mercury News, Inc., 40 Cal. Rptr. 2d 639, 640 (Ct. App. 1995). The second is that liability will not lie for statutory right of publicity claims regarding the “use of a name, voice, signature, photograph, or likeness in connection with any news public affairs, or sports broadcast or account, or any political campaign.” Cal Civ. Code § 3344(d). The Ninth Circuit dismissed both defenses because they protect only “broadcast[s] or account[s],” and EA was not, according to the court, publishing or reporting factual data.
 The Ninth Circuit also cited, as precedent for its transformative use test framework, two other California appellate cases, Winter v. DC Comics, 69 P.3d 473 (Cal. 2003), and Kirby v. Sega of America, 50 Cal. Rptr. 3d 607 (Cal. Ct. App. 2006).
 See, e.g., Kirby, 50 Cal. Rptr. 3d at 616 (finding the video game transformative in part because “the setting for the game that features [the avatar]. . . [is] a space-age reporter in the 25th century” and “is unlike any public depiction of [the celebrity]”); Winter, 69 P.3d at 479 (finding a comic book involving guitarists Johnny and Edgar Winter was transformative because the characters were distorted and the setting and story were expressive).
 See, e.g., Keller, 2013 WL 3928293, at *17 (“The stakes are not small. The logical consequence of the majority view is that all realistic depictions of actual persons, no matter how incidental, are protected by a state-law right of publicity regardless of the creative context. This logic jeopardizes the creative use of historic figures in motion pictures, books, and sound recordings.”) (Thomas, J., dissenting).