Major League Baseball Sues Upper Deck Over Trademark Infringement

Fresh off its settlement with Konami over internationally traded Yu-Gi-Oh trading cards which Upper Deck admitted it counterfeited, the trading card giant is up to its neck in legal battles again. Major League Baseball, which dropped UD from its stable of trading card makers last year, is suing the company for millions of dollars in damages plus a punitive award in the US District Court in New York,. The allegation is trademark infringement. MLB licenses and very strongly protects its various team trademarks. Baseball claims Upper Deck is using those trademarks despite the fact it does not have the rights to do it as licensed by MLB, nor has it been given permission to proceed with MLB licensed trading cards.

“Upper Deck’s current conduct is reflective of a pattern of utter disrespect for the contractual and intellectual property rights of those from whom it licenses valuable trademarks,” the complaint said.

So far a spokesman for Upper Deck has no comment.

Upper Deck, based in Carlsbad, CA started making licensed trading cards of major league baseball players in 1989 when it burst on the scene as the card of the collector. The relationship was a good one and UD was credited with pushing kids trading cards into a new realm of real life collectibles. The industry, led by UD, reached over $2 billion in retail sales in the early 1990’s. Problems began surfacing in the latter part of the decade and now MLB now says UD still owes it $2.4 million in back royalties. Last year MLB and the Players Union began not renewing licenses due to the vast over production which led the category down a path of near non-existence. Topps is once again the only trading card maker of licensed baseball cards.

It is the logos and trademarks which are in question here for the most part when it comes to this lawsuit. The NFL, NBA and NHL as well as other leagues have similar restrictions. This week the NFL, which owns the rights to the New Orleans Saints’ familiar slogan “Who Dat” is using its muscle to try to halt the sale of knock off tee shirts and other items at the Super Bowl which carry the “Who Dat” statement. The NBA for years has raided swap meets and flea markets confiscating and shutting down dealers who print shirts and caps with their official logos as well.

One of the aspects in question is Upper Deck recently released both the high end Ultimate Collection and Signature Stars Baseball products. MLB says UD released these 2010 products (they were released in 2010) but on the packaging UD states these are 2009 products.

“They did put a disclaimer on the box saying the product is not affiliated with Major League Baseball,” said Dave Rodriguez of Sports Source, a baseball card shop in Burbank, CA. “It is confusing to the collector certainly and the product was solicited during 2009.”

Several distributors have also halted distribution of UD trading cards which are under question with the law suit. Usually card makers solicit their products four to six months in advance of release. Upper Deck did have a license in 2009. Whether this will be part of UD’s defense or not will remain to be seen. Upper Deck had been the leader in distributing trading cards world wide including World Cup Soccer beginning in 1993. It even printed basketball in foreign languages for Asia and Europe.

Upper Deck was one of the first companies to take the printing of cards with retired players to another level. Pacific, Topps and Fleer had previously printed cards with retired players as far back as 1960. Upper Deck with it’s SP Legendary Cuts Series however actually put autographs and pieces of jerseys the players wore in the cards. For the most part teams have two jerseys they wear. The home jersey and the away jersey each normally feature either the name of the team across the front or the name of the city. If a company uses the name of the team a license is required and royalties paid but if the city only is used in most cases it is a freebie.

In a previous Examiner article we correctly identified the fact five UD employees pleaded the Fifth Amendment against self incrimination in the Konami case, however CEO Richard McWilliam was not one of them which was incorrectly stated. In the story UD settled out of court with Konami after admitting it counterfeited over 600,000 YGO trading cards.

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