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Los Angeles partner Maurice Suh, Washington, D.C. partner Andrew Tulumello and Los Angeles associate Zathrina Perez are the authors of "Ruling in NCAA case has the potential to remake the amateurism system," [PDF] published by the Daily Journal on May 26, 2020.

Click for PDF In a decision that directly addresses an issue of critical importance for the daily fantasy sports industry, on April 16, 2020, the Illinois Supreme Court held that head-to-head daily fantasy sports matches do not constitute “gambling” as contemplated by the state’s criminal statutes. Dew-Becker v. Wu, 2020 IL 124472. In this alert, we summarize (1) the current landscape of sports betting regulation in the United States, as well as treatment of daily fantasy sports vis-à-vis sports betting, (2) the analysis of the Illinois Supreme Court in the Dew-Becker case, and (3) the potential impact of the Dew-Becker ruling, and rulings by other state courts on the issue decided in the Dew-Becker case, on the daily fantasy sports industry.

Current Landscape – Sports Betting and Daily Fantasy Sports

Following the historic reversal of the federal ban on sports betting in 2018 by the U.S. Supreme Court in Murphy v. National Collegiate Athletic Association, et al., 138 S.Ct. 1461 (2018)[1], the regulation of sports betting was placed in the hands of each state, which has caused a patchwork of state legislation and case law governing sports betting to emerge in the last two years. The federal Interstate Wire Act of 1961 further complicates this state-by-state legal landscape, as it prohibits the transmission of sports bets or wagers through interstate commerce. As a result, online sports betting operations (where legalized) currently require the bettor to be geographically located in the same state as the sportsbook operator accepting bets. While daily fantasy sports have not been generally viewed as sports betting, the question remains an important one for daily fantasy sports operators and their customers. At the federal level, daily fantasy sports are specifically excluded from the definition of “bet” or “wager” under the Uniform Internet Gambling Enforcement Act of 2006, the federal statute regulating online gambling. See 31 USC 5362(1)(E)(ix). For the states that have adopted legislation regarding sports betting, those that have chosen to explicitly address the treatment of daily fantasy sports are in the minority, although more than twenty states have passed laws declaring that daily fantasy sports are not gambling or otherwise regulating the contests as a lawful activity. Currently, the industry’s largest platforms offer paid contests in 43 states and the District of Columbia, but do not offer paid contests in seven states (Arizona, Hawaii, Idaho, Louisiana, Montana, Nevada, and Washington). In the case of Nevada, the state Gaming Control Board has classified daily fantasy sports as a form of gambling (which is legal in the state) that is subject to Nevada’s existing regulatory scheme requiring a state license, thus practically preventing operators from entering the market. One state appellate court has concluded that daily fantasy sports are a form of gambling. Earlier this year a New York state appellate court, in a split decision, affirmed a lower court’s finding that interactive fantasy sports constitute gambling after applying the “material degree of chance” test applied by a minority of courts. White v. Cuomo, 62 Misc. 3d 877 (N.Y. Sup. Ct. 2018), reargument denied, (N.Y. Sup. Ct. 2019), and aff'd as modified, 181 A.D.3d 76 (N.Y. App. Div. 2020). The New York State Attorney General has filed a notice of appeal to challenge this ruling.

Dew-Becker Ruling

In making its determination in the Dew-Becker case, the Illinois Supreme Court, in an opinion penned by Chief Justice Burke, applied the “predominant factor test” used by most courts and concluded that daily fantasy sports do not constitute gambling. The “predominant factor test” is used to determine whether a game is a “game of chance”, and therefore constitutes gambling, by evaluating whether the element of chance or the element of skill predominantly controls the game’s result. Relying heavily upon recent statistical studies demonstrating the importance of player skill in head-to-head daily fantasy sports games, the majority concluded that the outcomes of such games are predominantly skill-based, and therefore, not gambling. The court discussed, but ultimately did not use, two other tests that other states have employed to determine whether a contest is one of skill or chance. First, the court rejected the “material element test” (employed by the New York court in White v. Cuomo discussed above), which analyzes whether the game involves the element of chance to a material degree, reasoning that the test “depends too greatly on a subjective determination of what constitutes ‘materiality.’” Second, the court rejected the “any chance test”, which analyzes whether the game involves any element of chance whatsoever, reasoning that the test “is essentially no test at all” because “every contest involves some degree of chance.” Furthermore, the court underscored the ability of the state legislature to change the laws and regulations applicable to daily fantasy sports in Illinois, noting that the determination of whether “regulation of DFS is unnecessary or inappropriate…is for the legislature. We determine here only that the DFS contest at issue in this case does not fall under the current definition of gambling.” Dew-Becker v. Wu, 2020 IL 124472 at *6. The decision was not unanimous, however - in a dissent, Justice Karmeier sharply questioned the majority’s application of the predominant factor test, stating in his dissent that because the element of chance (e.g., the participant cannot influence the athletes’ performance) might ultimately thwart the participant’s efforts or skill in daily fantasy sports, the character of such game is one of chance. The dissenting opinion also foreshadowed the plaintiff’s intent, as stated by his counsel in press reports following the decision, to file a motion for rehearing on the grounds that the issue of head-to-head daily fantasy sports as a game of skill v. chance was not directly litigated by the parties.

Potential Impact

As the legal and regulatory treatment of both sports gambling and daily fantasy sports continues to unfold on the state level, the outcomes could have significant consequences for the development of the daily fantasy sports industry and for the business of daily fantasy sports operators. Whether state courts classify daily fantasy sports as a form of sports gambling may determine whether the industry is subject to the evolving and complex (and costly) regulatory laws governing sports gambling in the particular state. State regulatory schemes governing sports betting have varied widely. Emerging issues facing gaming operators include: market access based on a limited number of state licenses, distinctions between brick and mortar, mobile, and online platforms, the use of official sports league data, integrity fees, and player protections. If courts in other states follow the reasoning applied by the Illinois Supreme Court in Dew-Becker, using the “predominant factor test” or otherwise, in likewise reaching the conclusion that daily fantasy sports do not constitute gambling, daily fantasy sports operators conducting business in those states will have greater certainty that their operations are not subject to the legal and regulatory hurdles and costs imposed by evolving, and at times ambiguous, laws and regulations applicable to sports betting in those states. ______________________ [1] Gibson, Dunn & Crutcher LLP represented the State of New Jersey in this victory.

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Gibson Dunn’s lawyers are available to assist with any questions you may have regarding these developments.  For further information, please contact the Gibson Dunn lawyer with whom you usually work, or the following authors in Gibson Dunn’s Betting and Gaming and Sports Law practices. Authors:  Kevin Masuda, Maurice Suh, Sarah Graham and Maya Hoard © 2020 Gibson, Dunn & Crutcher LLP Attorney Advertising:  The enclosed materials have been prepared for general informational purposes only and are not intended as legal advice.

Click for PDF On March 11, 2020, the massive and worldwide business of professional sports began to shut down because of the COVID-19 pandemic.  First it was the National Basketball Association shutting down “until further notice.”  The next day it was the Professional Golf Association Tour and Formula 1, and by months-end, March Madness, Major League Baseball, the Premier League, Champions League, the 2020 Tokyo Olympic Games, the National Hockey League, and every other prominent sporting event was suspended, postponed, or canceled.  That has sent ripples through the entire inter-connected business of sport:

• Television and Radio Networks: The golden goose for many networks is live sports.  ESPN2 is not built to show a six-hour “National Puppy Day” marathon like it did recently.  And not to state the obvious, but there is no new sports content to show right now.  That calls into question the multi-billion dollar deals that give the networks the right to broadcast games that are on ice now.
• Satellite and Cable companies: Like television networks, the satellite and cable companies rely on sports to draw in customers, and thus pay huge sums to the networks to have the right to transmit those games into our homes.  Moreover, many satellite and cable companies sell packages or add-ons that are based on the ability to access sport-specific content.
• Media, Gambling, and Fantasy Sports: In today’s hyper-connected world, every play and game is dissected in the print, online, radio, and television media.  There are entire operations—with blogs, news services, podcasts, and 24-hour content—devoted not just to leagues, but even specific teams.  And then on top of all that, wagering on sports creates millions in revenue just in the United States, and fantasy sports is in the billions.  But without games, there is less to wager on, and most fantasy sports depend on the real players performing on the field, pitch, ice, or court.
• Sponsors and Advertisers: Companies sponsoring and advertising during sporting events count on these events to obtain a return of investment on their sponsorship and media spend.  In addition to the lost exposure during the event, many companies have marketing campaigns, promotions, on-site activities, and other activations planned in connection with the events.  Some companies’ businesses and brands are built around specific sports or events.
• Leagues, Teams, and Athletes: Leagues face the prospect of losing significant revenue from the broadcast rights and from sponsors.  Teams also face the loss of media revenue and attendance revenue.  And the stoppage of play will affect player salaries, trades, and transfers, and the sponsorship opportunities for athletes.  And, of course , the health of players, coaches, and fans, is at top of mind for all.

With all this upheaval across a multi-billion dollar industry that is not just a business but a passion for many, it is not all doom and gloom.  Just as companies, leagues, teams, and event organizers must consider potential obligations and liabilities, there are also opportunities.  All stakeholders may wish to renegotiate or modify existing deals, as additional opportunities and risks unfold.  It might also be the right time to adjust to a changing landscape and prepare for the possibility that the demand for sports may diminish, or that pent up demand brings additional sponsorship opportunities on the horizon. So stakeholders need to consider the short-, medium-, and long-term impacts of this abrupt shutdown of professional sports and worldwide health crisis.  In the short-term, stakeholders should be focused on an analysis of their rights and liabilities and any opportunity to restructure unfavorable deal terms.  It also requires monitoring of the changing landscape and patchwork of federal, state, and local regulations to respond to COVID-19 (e.g., bans on gatherings).  In the medium- and long-term, stakeholders should evaluate their goals and strategies, with attention to the economic climate since spending on sports is discretionary, and the industry may be vulnerable in a prolonged stoppage and worldwide recession or depression.  Further, stakeholders need to identify new contractual protections for future non-traditional events that may result in the cancellation of events.

So What Does the Contract Say?

The analysis for all stakeholders will often start, and sometimes end, with the contract.  Whether it is the relationship between the network and the league, the cable/satellite providers and the networks, advertisers and the networks, the sponsors and the league or teams, or the players associations and the league, the fundamentals of the original deals have likely changed or merit change.  Now is the time to identify and clear possible contractual roadblocks by considering the common contractual terms and issues below. For example, sponsors of sporting events, leagues, and teams will want to examine common provisions that permit the sponsor or media company to reduce the fees it pays, require the parties to renegotiate key terms like price, or that permit the parties to terminate the agreement:

• Reductions/Quotas: review any clauses requiring the league or team to deliver a minimum number of qualifying sponsorship opportunities within a given period.
• Changed Circumstances: determine whether your contract contains a clause that protects the sponsor from circumstances that have a material adverse effect on the rights granted to the sponsor.  A key focus here is often on whether the event has been postponed or canceled.
• Termination Rights: most contracts contain a clause that permits a party to terminate the contract for another party’s material uncured breach of the agreement.  (This can often be used as leverage to renegotiate the terms.)
• Ancillary Benefits: a failure of the league or team to receive ancillary benefits—tickets, media rights, etc.—could qualify as damages if not received.
• Excusing Performance Under a Contract – Force Majeure Clauses: Force majeure is a contractually defined event that may excuse performance under a contract.  While force majeure clauses are most often triggered by “acts of God,” such as natural disasters, the various government lock-down orders may be a triggering event.  A mere change in market conditions or the economics of the deal will not be sufficient to trigger the clause.

The express language of the contract provision will govern.  Review your force majeure clause to determine (1) whether the COVID-19 pandemic may trigger the clause; (2) what the force majeure clause excuses; (3) what the contract requires when giving notice; and (4) whether the contract requires a specific form of notice.  A more detailed discussion of force majeure provisions and a helpful flowchart are available at https://www.gibsondunn.com/force-majeure-clauses-a-4-step-checklist-and-flowchart/.

• Choice of Law/Forum Selection Clauses: If contractual or other disputes require adjudication, the forum in which the dispute is heard may affect the strength or weakness of the contractual claims.  Many contracts contain forum selection clauses or arbitration clauses, which will designate the substantive law that governs the dispute and the forum, whether federal or state court or arbitration.  The COVID-19 pandemic has dramatically affected the ability of the courts to proceed as usual.  In many state and federal courts, in-person hearings before judges are temporarily on hold.  In some courts—including New York Supreme Court—only “essential” filings are being accepted.  Arbitrations may be experiencing less change, though in-person hearings have been replaced with videoconference hearings.

While the contract terms are critical, even if the contract does not address this current situation, there are equitable common law defenses to any breach of contract action that will need to be analyzed.  The most common equitable defenses are frustration of purpose and impossibility (a.k.a., impracticability).  Both require an unforeseen event that affects performance of the contract.  But frustration of purpose is available when that event makes one party’s performance virtually worthless to the other while impossibility generally requires performance to be objectively impossible. In addition, stakeholders should conduct a comprehensive analysis to determine whether an efficient breach exists.  For instance, to the extent the contract contains provisions on the available damages, the cost of performance may be more than the worst case exposure if there were a breach.  It is important, however, that this analysis take into account both economic and non-economic factors, such as loss of goodwill or damage to a stakeholder’s brand. In sum, the current situation likely requires consideration of a stakeholder’s current contractual obligations.  Stakeholders should then leverage that knowledge to consider whether to terminate contracts, ask for relief, renegotiate certain terms, enforce rights, or proceed as business as usual.  Now may be the time to engage in formal or informal discussions with contractual counterparties regarding their plans or to send a reservation of rights letter along with sponsorship payments.

What Else Is on the Horizon?

In addition to examining existing contractual obligations, many will need to negotiate and draft new contracts and address emerging issues against the backdrop of great uncertainty ahead.  For instance, those stakeholders planning marketing and promotional events in connection with NBA playoffs will need to enter into new contracts with vendors and others associated with the playoffs.  But it is not clear when the playoffs may occur, if at all. It is important to consider how the current fluid and dynamic situation, including further government orders and policies, can be addressed in contracts drafted today.  For example, parties may wish to address discretionary, rather than mandatory, cancellations or delays as well.  Likewise, when events are rescheduled or employees are hard at work addressing new challenges, parties will want to consider the allocation of risks for workers, contractors, and guests who may be exposed to the virus. Throughout all of this, you will also want to keep in mind that when times are tumultuous, email communication may be rapid-fire, and usual precautions for internal communications can slip.  Remember that communications may be discoverable in future litigation and remind your employees of policies regarding confidentiality and privacy.

What About Potential Bankruptcies and Insolvencies?

The COVID-19 crisis is already affecting the financial solvency of global businesses in unprecedented ways.  Even if bankruptcy is not anticipated, it is critical that companies understand the triggers and thresholds for financial stress for their own businesses and also for material contract counterparties.  Early forecasting and flexibility, as well as understanding how your contractual rights in sponsorship and other contracts may be impacted in bankruptcy, can allow companies to react in this fast-changing economic environment.  Here are some steps you can take now:

• Understand Your Material Contracts and Sponsorship Agreements:  Even when your company’s financials look solid, it is important to investigate the health of contractual counterparties.  Make sure you understand both parties’ rights and obligations related to liquidity and performance.  By doing so, you can identify how to maneuver within the documents to avoid breaching or where to seek amendments if needed.
• Understand the Impact of Bankruptcy on Your Material Contracts and Sponsorship Agreements:  If distressed sponsorship parties are insolvent or nearing or threatening bankruptcy, the ability of a company to reject, assume, or assign a contract in bankruptcy may impact negotiations and how you structure any potential modifications.  Understanding your claims and rights in bankruptcy will help preserve value in the event a bankruptcy filing occurs.
• Review Debt Documents:  If you are experiencing potential defaults under a debt facility due to unexpected covenant breaches, or otherwise, it is important to understand your rights and remedies under your debt documents.  Restructuring alternatives may be available even if not obvious.  In the current environment, lenders are not surprised by proactive requests for forbearance and similar relief.

Gibson Dunn’s restructuring professionals have a wealth of experience navigating complex restructuring scenarios, and can assist in developing a value-maximizing game-plan.

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Gibson Dunn’s lawyers are available to assist with any questions you may have regarding these developments.  For further information, please contact the Gibson Dunn lawyer with whom you usually work, or the following authors in Gibson Dunn’s Sports Law Practice. Authors:  Maurice Suh, Richard Birns, Kevin Masuda, Daniel Weiss, Jeremy Smith, Michael Neumeister, and Harper Gernet-Girard © 2020 Gibson, Dunn & Crutcher LLP Attorney Advertising:  The enclosed materials have been prepared for general informational purposes only and are not intended as legal advice.

Law360 named Gibson Dunn one of its five Sports & Betting Groups of the Year for 2019.  The profile was published on February 7, 2020. The Sports Law Practice Group advises clients on the most complex sports industry matters, from the purchase and sale of U.S. and non-U.S. professional teams to precedent-setting litigation.  Gibson Dunn’s global sports practice represents a wide range of clients in matters relating to professional and amateur sports, including individual teams, sports facilities, athletic associations, athletes, financial institutions, television networks, sponsors and municipalities. The Betting and Gaming Practice Group is one of the most preeminent betting and gaming legal practices worldwide, representing the most prestigious and influential clients in the industry across Europe, Asia and the Americas.

Law360 named Gibson Dunn a Firm of the Year for 2019 in its article, “The Firms That Dominated in 2019,” featuring seven firms that received the most Practice Group of the Year awards.  Of the seven, Gibson Dunn is one of two firms with the most winning Practice Groups of the Year, noting that the firm “scored big wins across several practice groups for major technology companies such as Facebook and Uber in lawsuits that tackled hot-button issues like internet privacy and the gig economy.” Law360 also noted Gibson Dunn “dominated the competition again this year” in announcing its Practice Groups of the Year, which “honor the law firms behind the litigation wins and major deals that resonated throughout the legal industry in the past year.” The firm was named a Practice Group of the Year in the following categories:

• Appellate [PDF] – Gibson Dunn’s Appellate and Constitutional Law Practice Group’s lawyers participate in appeals in all 13 federal courts of appeals and state appellate courts throughout the United States and have presented arguments in front of the Supreme Court of the United States more than 100 times.
• Class Action [PDF] – The Class Actions Practice Group has unrivaled experience in defeating enterprise-threatening class action lawsuits throughout the United States.  The group has an unparalleled record in securing early dismissal in cases where other defendants facing similar lawsuits have been forced to litigate through costly, burdensome discovery and other pretrial proceedings.
• Cybersecurity & Privacy [PDF] – The firm’s Privacy, Cybersecurity and Consumer Protection Practice Group has a demonstrated history of helping companies successfully navigate the complex and rapidly evolving laws, regulations, and industry best practices relating to privacy, cybersecurity and consumer protection.  Our global and interdisciplinary team advises clients across a broad range of industries in high-stakes matters on the full spectrum of issues in these areas.
• International Arbitration [PDF] – The International Arbitration Practice Group advises leading multinational corporations in arbitration proceedings around the world.  The International Arbitration group’s lawyers have appeared before many of the world’s leading arbitrators and work with all major arbitral institutions and rules.
• Real Estate [PDF] – The Real Estate Practice Group handles the most sophisticated real estate transactions worldwide.  Our team of lawyers handles complex and challenging matters for a wide array of clients, such as the owners, developers and financiers of the largest real estate projects in the United States and Europe, both in the private and public sectors.
• Sports & Betting [PDF] – The Sports Law Practice Group advises clients on the most complex sports industry matters, from the purchase and sale of U.S. and non-U.S. professional teams to precedent-setting litigation.  Gibson Dunn’s global sports practice represents a wide range of clients in matters relating to professional and amateur sports, including individual teams, sports facilities, athletic associations, athletes, financial institutions, television networks, sponsors and municipalities.  The Betting and Gaming Practice Group is one of the most preeminent betting and gaming legal practices worldwide, representing the most prestigious and influential clients in the industry across Europe, Asia and the Americas.
• Technology [PDF] – The Media, Entertainment and Technology Group represent both established and emerging media, entertainment and technology companies and handle our clients’ most important and complex corporate and intellectual property transactions, litigation, antitrust, internal investigations and other legal challenges.
• Trials [PDF] – Acclaimed as a litigation powerhouse, Gibson Dunn has a long record of outstanding successes.  The members of our litigation practice group are not just litigators, they are first-rate trial lawyers who have tried cases and argued appeals before the U.S. Supreme Court and state supreme courts in addition to federal and state courts across the United States involving almost every foreseeable area of controversy.

Law360 named nine Gibson Dunn partners among its 2019 MVPs and noted that Gibson Dunn was one of two law firms with the most MVPs this year.  Law360 MVPs feature lawyers who have “distinguished themselves from their peers by securing hard-earned successes in high-stakes litigation, complex global matters and record-breaking deals.” The list was published on November 12, 2019. Gibson Dunn’s MVPs are:

• Richard J. Birns, a Private Equity MVP [PDF] – Rich is a partner in the New York office and Co-Chair of the Sports Law Practice Group. He focuses his practice on U.S. and cross-border mergers, acquisitions, divestitures, joint ventures and financings for both corporations and leading private equity firms.  He also advises private investment funds on a variety of corporate issues, including securities law and shareholder activism matters.  He has extensive experience advising clients on significant transactional matters in media, sports and entertainment.
• Michael P. Darden, an Energy MVP [PDF] – Mike is Partner-in-Charge of the Houston office and Chair of the Oil & Gas practice group. His practice focuses on International and U.S. oil and gas ventures (including LNG, deep-water and unconventional resource development projects), international and U.S. infrastructure projects, asset acquisitions and divestitures, and energy-based financings (including project financings, reserve-based loans and production payments).
• Scott A. Edelman, a Trials MVP [PDF] – Scott is a partner in the Century City office and Co-Chair of the Media, Entertainment and Technology Practice Group. He has first-chaired numerous jury trials, bench trials and arbitrations, including class actions, taking well over 25 to final verdict or decision. He has a broad background in commercial litigation, including antitrust, class actions, employment, entertainment and intellectual property, real estate and product liability.
• Theane Evangelis, a Class Action MVP [PDF] – Theane is a partner in the Los Angeles office, Co-Chair of the firm’s Class Actions Practice Group and Vice Chair of the California Appellate Practice Group. She has played a lead role in a wide range of appellate, constitutional, media and entertainment, and crisis management matters, as well as a variety of employment, consumer and other class actions.
• Mark A. Kirsch, a Securities MVP [PDF] – Mark is Co-Partner-in-Charge of the New York office. His practice focuses on complex securities, white collar, commercial and antitrust litigation. He is routinely named one of the leading litigators in the United States.
• Joshua S. Lipshutz, a Cybersecurity MVP [PDF] – Josh is a partner in the Washington, D.C. and San Francisco offices. His practice focuses primarily on constitutional, class action, data privacy, and securities-related matters.  He represents clients before the Supreme Court of the United States, the Ninth Circuit Court of Appeals, the California Supreme Court, the Delaware Supreme Court, the D.C. Court of Appeals, and many other state and federal courts.
• Jane M. Love, a Life Sciences MVP [PDF] – Jane is a partner in the New York office. Her practice spans four areas: patent litigation, Patent Office trial proceedings including inter partes reviews (IPRs), strategic patent prosecution advice and patent diligence in transactions. She is experienced in a wide array of life sciences areas such as pharmaceuticals, biologics, biosimilars, antibodies, immunotherapies, genetics, vaccines, protein therapies, blood factors, medical devices, diagnostics, gene therapies, RNA therapies, bioinformatics and nanotechnology.
• Matthew D. McGill, a Sports & Betting MVP [PDF] – Matthew is a partner in the Washington, D.C. office. He has participated in 21 cases before the Supreme Court of the United States, prevailing in 16.  Spanning a wide range of substantive areas, those representations have included several high-profile triumphs over foreign and domestic sovereigns. Outside the Supreme Court, his practice focuses on cases involving novel and complex questions of federal law, often in high-profile litigation against governmental entities.
• Jason C. Schwartz, an Employment MVP [PDF] – Jason is a partner in the Washington, D.C. office and Co-Chair of the Labor & Employment Practice Group. His practice includes sensitive workplace investigations, high-profile trade secret and non-compete matters, wage-hour and discrimination class actions, Sarbanes-Oxley and other whistleblower protection claims, executive and other significant employment disputes, labor union controversies, and workplace safety litigation.

Seven Gibson Dunn lawyers were named among Law360’s Rising Stars for 2019 [PDF], featuring “attorneys under 40 whose legal accomplishments transcend their age.”  The following lawyers were recognized: Washington D.C. partner Chantale Fiebig in Transportation, San Francisco partner Allison Kidd in Real Estate, Washington D.C. associate Andrew Kilberg in Telecommunications, New York associate Sean McFarlane in Sports, New York partner Laura O’Boyle in Securities, Los Angeles partner Katherine Smith in Employment and Century City partner Daniela Stolman in Private Equity. Gibson Dunn was one of three firms with the second most Rising Stars. The list of Rising Stars was published on September 8, 2019.

The Best Lawyers in America® 2020 has recognized 158 Gibson Dunn attorneys in 54 practice areas. Additionally, 48 lawyers were recognized in Best Lawyers International in Belgium, Brazil, France, Germany, Singapore, United Arab Emirates and United Kingdom.

Law360 named Gibson Dunn one of its four Sports Groups of the Year [PDF] for 2018. The practice group was recognized for “locking down two multimillion-dollar stadium deals, helping NFL players fight back against various league decisions and clearing the way for legal sports betting.” The firm’s Sports practice was profiled on February 20, 2019. Gibson Dunn’s Sports Law Practice Group advises clients on the most complex sports industry matters, from the purchase and sale of U.S. and non-U.S. professional teams to precedent-setting litigation. The firm’s global sports practice represents a wide range of clients in matters relating to professional and amateur sports, including individual teams, sports facilities, athletic associations, athletes, financial institutions, television networks, sponsors and municipalities. The Gibson Dunn global betting and gaming practice is one of the most preeminent betting and gaming legal practices worldwide, representing the most prestigious and influential clients in the industry across Europe, Asia and the Americas. We believe that the Gibson Dunn global betting and gaming practice provides our clients with a unique offering – no other global law firm can offer an award-winning regulatory and compliance capability alongside a market-leading transactional practice in the betting and gaming sector in the United Kingdom, the United States, Europe and the Asia-Pacific Region.

Gibson, Dunn & Crutcher LLP is pleased to announce its selection by Law360 as a Law Firm of the Year for 2018, featuring the four firms that received the most Practice Group of the Year awards in its profile, “The Firms That Dominated in 2018.” [PDF] Of the four, Gibson Dunn “led the pack with 11 winning practice areas” for “successfully securing wins in bet-the-company matters and closing high-profile, big-ticket deals for clients throughout 2018.” The awards were published on January 13, 2019. Law360 previously noted that Gibson Dunn “dominated the competition this year” for its Practice Groups of the Year, which were selected “with an eye toward landmark matters and general excellence.” Gibson Dunn is proud to have been honored in the following categories:

• Appellate [PDF]: Gibson Dunn’s Appellate and Constitutional Law Practice Group is one of the leading U.S. appellate practices, with broad experience in complex litigation at all levels of the state and federal court systems and an exceptionally strong and high-profile presence and record of success before the U.S. Supreme Court.
• Class Action [PDF]: Our Class Actions Practice Group has an unrivaled record of success in the defense of high-stakes class action lawsuits across the United States. We have successfully litigated many of the most significant class actions in recent years, amassing an impressive win record in trial and appellate courts, including before the U. S. Supreme Court, that have changed the class action landscape nationwide.
• Competition [PDF]: Gibson Dunn’s Antitrust and Competition Practice Group serves clients in a broad array of industries globally in every significant area of antitrust and competition law, including private antitrust litigation between large companies and class action treble damages litigation; government review of mergers and acquisitions; and cartel investigations, internationally across borders and jurisdictions.
• Cybersecurity & Privacy [PDF]: Our Privacy, Cybersecurity and Consumer Protection Practice Group represents clients across a wide range of industries in matters involving complex and rapidly evolving laws, regulations, and industry best practices relating to privacy, cybersecurity, and consumer protection. Our team includes the largest number of former federal cyber-crimes prosecutors of any law firm.
• Employment [PDF]: No firm has a more prominent position at the leading edge of labor and employment law than Gibson Dunn. With a Labor and Employment Practice Group that covers a complete range of matters, we are known for our unsurpassed ability to help the world’s preeminent companies tackle their most challenging labor and employment matters.
• Energy [PDF]: Across the firm’s Energy and Infrastructure, Oil and Gas, and Energy, Regulation and Litigation Practice Groups, our global energy practitioners counsel on a complex range of issues and proceedings in the transactional, regulatory, enforcement, investigatory and litigation arenas, serving clients in all energy industry segments.
• Environmental [PDF]: Gibson Dunn has represented clients in the environmental and mass tort area for more than 30 years, providing sophisticated counsel on the complete range of litigation matters as well as in connection with transactional concerns such as ongoing regulatory compliance, legislative activities and environmental due diligence.
• Real Estate [PDF]: The breadth of sophisticated matters handled by our real estate lawyers worldwide includes acquisitions and sales; joint ventures; financing; land use and development; and construction. Gibson Dunn additionally has one of the leading hotel and hospitality practices globally.
• Securities [PDF]: Our securities practice offers comprehensive client services including in the defense and handling of securities class action litigation, derivative litigation, M&A litigation, internal investigations, and investigations and enforcement actions by the SEC, DOJ and state attorneys general.
• Sports [PDF]: Gibson Dunn’s global Sports Law Practice represents a wide range of clients in matters relating to professional and amateur sports, including individual teams, sports facilities, athletic associations, athletes, financial institutions, television networks, sponsors and municipalities.
• Transportation [PDF]: Gibson Dunn’s experience with transportation-related entities is extensive and includes the automotive sector as well as all aspects of the airline and rail industries, freight, shipping, and maritime. We advise in a broad range of areas that include regulatory and compliance, customs and trade regulation, antitrust, litigation, corporate transactions, tax, real estate, environmental and insurance.

Law360 named eight Gibson Dunn partners among its 2018 MVPs and noted that the firm had the most MVPs of any law firms this year.  Law360 MVPs feature lawyers who have “distinguished themselves from their peers by securing hard-earned successes in high-stakes litigation, complex global matters and record-breaking deals.” Gibson Dunn’s MVPs are:

• Christopher Chorba, a Class Action MVP [PDF] – Co-Chair of the firm’s Class Actions Group and a partner in our Los Angeles office, he defends class actions and handles a broad range of complex commercial litigation with an emphasis on claims involving California’s Unfair Competition and False Advertising Laws, the Consumers Legal Remedies Act, the Lanham Act, and the Class Action Fairness Act of 2005. His litigation and counseling experience includes work for companies in the automotive, consumer products, entertainment, financial services, food and beverage, social media, technology, telecommunications, insurance, health care, retail, and utility industries.
• Michael P. Darden, an Energy MVP [PDF] – Partner in charge of the Houston office, Mike focuses his practice on international and U.S. oil & gas ventures and infrastructure projects (including LNG, deep-water and unconventional resource development projects), asset acquisitions and divestitures, and energy-based financings (including project financings, reserve-based loans and production payments).
• Thomas H. Dupree Jr., an MVP in Transportation [PDF] –  Co-partner in charge of the Washington, DC office, Tom has represented clients in a wide variety of trial and appellate matters, including cases involving punitive damages, class actions, product liability, arbitration, intellectual property, employment, and constitutional challenges to federal and state statutes.  He has argued more than 80 appeals in the federal courts, including in all 13 circuits as well as the United States Supreme Court.
• Joanne Franzel, a Real Estate MVP [PDF] – Joanne is a partner in the New York office, and her practice has included all forms of real estate transactions, including acquisitions and dispositions and financing, as well as office and retail leasing with anchor, as well as shopping center tenants. She also has represented a number of clients in New York City real estate development, representing developers as well as users in various mixed-use projects, often with a significant public/private component.
• Matthew McGill, an MVP in the Sports category [PDF] – A partner in the Washington, D.C. office, Matt practices appellate and constitutional law. He has participated in 21 cases before the Supreme Court of the United States, prevailing in 16. Spanning a wide range of substantive areas, those representations have included several high-profile triumphs over foreign and domestic sovereigns. Outside the Supreme Court, his practice focuses on cases involving novel and complex questions of federal law, often in high-profile litigation against governmental entities.
• Mark A. Perry, an MVP in the Securities category [PDF] – Mark is a partner in the Washington, D.C. office and is Co-chair of the firm’s Appellate and Constitutional Law Group.  His practice focuses on complex commercial litigation at both the trial and appellate levels. He is an accomplished appellate lawyer who has briefed and argued many cases in the Supreme Court of the United States. He has served as chief appellate counsel to Fortune 100 companies in significant securities, intellectual property, and employment cases.  He also appears frequently in federal district courts, serving both as lead counsel and as legal strategist in complex commercial cases.
• Eugene Scalia, an Appellate MVP [PDF] – A partner in the Washington, D.C. office and Co-Chair of the Administrative Law and Regulatory Practice Group, Gene has a national practice handling a broad range of labor, employment, appellate, and regulatory matters. His success bringing legal challenges to federal agency actions has been widely reported in the legal and business press.
• Michael Li-Ming Wong, an MVP in Cybersecurity and Privacy – Michael is a partner in the San Francisco and Palo Alto offices. He focuses on white-collar criminal matters, complex civil litigation, data-privacy investigations and litigation, and internal investigations. Michael has tried more than 20 civil and criminal jury trials in federal and state courts, including five multi-week jury trials over the past five years.

Law360 named Gibson Dunn one of its five Sports Practice Groups of the Year [PDF] for 2017. The practice group “set itself apart from the pack in 2017 by taking on some of the biggest sports cases, including a challenge to the federal sports wagering law, while simultaneously helping clients secure a major broadcasting deal and an Olympic bid.” The firm’s profile was published on February 6, 2018.

On June 19, 2017, the Supreme Court unanimously held in Matal v. Tam that a decades-old statute prohibiting the registration of disparaging trademarks violates the First Amendment to the U.S. Constitution.  The Court concluded that, because trademark registration is a mere administrative recognition of private speech rather than government speech, the registration process must be viewpoint-neutral.  Gibson Dunn filed a brief in the case on behalf of the United States Chamber of Commerce as amicus curiae, urging the conclusion that the Court reached.

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The Tam case arose from a decision of the United States Patent and Trademark Office ("PTO") to refuse registration of a trademark for "THE SLANTS," the name of an Asian-American rock band.  The PTO relied on a provision of the Lanham Act prohibiting the registration of trademarks that "may disparage . . . persons, living or dead, institutions, beliefs, or national symbols, or bring them into contempt, or disrepute."  15 U.S.C. § 1052(a).  Applying the PTO's framework for disparagement, the examining attorney concluded that "THE SLANTS" was likely to disparage a significant number of Asian Americans. On appeal, the U.S. Court of Appeals for the Federal Circuit found that the Lanham Act's disparagement clause was facially unconstitutional under the Free Speech Clause of the First Amendment.  The Supreme Court agreed, though several Justices expressed a difference of opinion as to the reasoning. Justice Alito announced the judgment of the Court, which was unanimous with respect to the conclusion that, despite the role of government in the registration process, trademarks constitute private rather than government speech.  The Court reasoned that the government merely registers the contents of others' trademarks; it "does not dream up these marks," "it does not edit marks submitted for registration," and the PTO has made clear in the past that registration does not constitute government approval of a particular mark.  It also found that prior Supreme Court precedents fail to support trademark registration as a form of government speech.  Trademarks are vastly different from, for example, speech used to convey a government message—as was the case with selected monuments placed on governmental property in Pleasant Grove City v. Summum—and there is no evidence the public associates trademarks with the government itself—as was the case with specialty license plates in Walker v. Texas Division, Sons of Confederate Veterans.  Further backing away from Walker, which the Court noted "likely marks the outer bounds of the government-speech doctrine," the Court emphasized that government registrations in other, related contexts like copyright registration do not constitute government speech.[1] Justice Alito went on to reject the remainder of the government's arguments, writing only for himself, Chief Justice Roberts, Justice Thomas, and Justice Breyer.  First, Justice Alito explained that trademark registration is not a form of government subsidy, which would permit the government to subsidize speech expressing a particular viewpoint while refusing to subsidize activities it does not wish to promote.  He also refused to create a new "government-program" doctrine for trademarks that would allow for some content- and speaker-based restrictions.  Finally, Justice Alito explained that it is unnecessary to decide whether the relaxed-scrutiny afforded commercial speech under the First Amendment applies here, because the disparagement clause is too broad to withstand even that lesser standard of review. Justice Kennedy, in a separate opinion joined by Justices Ginsburg, Sotomayor and Kagan, emphasized in greater detail why the First Amendment protects "THE SLANTS" trademark from governmental disapproval of a viewpoint the government finds unacceptable.  He reasoned that the case involved viewpoint discrimination that warranted heightened scrutiny, without undertaking a commercial speech analysis as in Justice Alito's opinion. Justice Thomas filed a short concurrence in part and in the judgment, reiterating his view that whenever the government seeks to restrict truthful speech in order to suppress the ideas conveyed, strict scrutiny applies.  Justice Gorsuch took no part in the consideration or the decision.

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Tam's central holding—that the Lanham Act's disparagement clause is unconstitutional—is likely to have only a limited impact, as most trademarks are not accused of disparagement.  One company likely to benefit from the decision, however, is the Washington Redskins professional football team, which had seen several of its trademark registrations invalidated by the PTO under the same Lanham Act provision.  The Supreme Court's decision resolves a split on the constitutionality of the statute between the approach of the Federal Circuit in the Tam case and that of the U.S. District Court for the Eastern District of Virginia in the Washington Redskins case, Blackhorse v. Pro-Football, Inc. More broadly, the Supreme Court's unanimous government-speech ruling suggests that it is poised to cabin what is considered to be government speech in the context of government registration and regulation.   The Court explicitly warned that courts "must exercise great caution before extending" government-speech rules to messages that originate from private parties.  And the Justices' emphasis on viewpoint-neutrality as it relates to the government suggests that the Court is unlikely to extend the government speech doctrine any time in the near future.

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   [1]   In a portion of the opinion in which only Justice Thomas abstained, Justice Alito also wrote for the majority in concluding that the term, "persons," in the Lanham Act's disparagement clause was meant to prohibit registration of marks that disparage members of a racial or ethnic group.

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Gibson Dunn's lawyers are available to assist in addressing any questions you may have regarding these developments.  Please contact the Gibson Dunn lawyer with whom you usually work, or the authors:

Howard S. Hogan - Washington, D.C. (+1 202-887-3640, hhogan@gibsondunn.com) Michael R. Huston - Washington, D.C. (+1 202-887-3793, mhuston@gibsondunn.com) Christine Demana - Dallas (+1 214-698-3246, cdemana@gibsondunn.com) Rachel Y. Wade - Dallas (+1 214-698-3273, rwade@gibsondunn.com)

Please also feel free to contact the following practice group leaders:

Intellectual Property Group: Josh Krevitt - New York (+1 212-351-4000, jkrevitt@gibsondunn.com) Wayne Barsky - Los Angeles (+1 310-552-8500, wbarsky@gibsondunn.com) Mark Reiter - Dallas (+1 214-698-3100, mreiter@gibsondunn.com) Appellate and Constitutional Law Group: Mark A. Perry - Washington, D.C. (+1 202-887-3667, mperry@gibsondunn.com) James C. Ho - Dallas (+1 214-698-3264, jho@gibsondunn.com) Caitlin J. Halligan - New York (+1 212-351-4000, challigan@gibsondunn.com) Fashion, Retail and Consumer Products Group: David M. Wilf  - New York (+1 212-351-4027, dwilf@gibsondunn.com) Howard S. Hogan - Washington, D.C. (+1 202-887-3640, hhogan@gibsondunn.com) Media, Entertainment & Technology Group: Ruth E. Fisher - Los Angeles (+1 310-557-8057, rfisher@gibsondunn.com) Scott A. Edelman - Los Angeles (+1 310-557-8061, sedelman@gibsondunn.com) Orin Snyder- New York (+1 212-351-2400, osnyder@gibsondunn.com) Sports Law Group: Andrew S. Tulumello - Washington, D.C. (+1 202-955-8657, atulumello@gibsondunn.com) Maurice M. Suh - Los Angeles (+1 213-229-7260, msuh@gibsondunn.com) Richard J. Birns - New York (+1 212-351-4032, rbirns@gibsondunn.com) © 2017 Gibson, Dunn & Crutcher LLP Attorney Advertising:  The enclosed materials have been prepared for general informational purposes only and are not intended as legal advice.

​New York partners Richard Birns and Alexander Southwell are the authors of "How a New Defensive Line Can Protect Sports Properties" published on August 29, 2016 by Sports Business Journal.

​New York partner Richard Birns, Los Angeles partner Benyamin Ross and associate Andria Montoya are the authors of "Fiduciary Duties, Reverse Endorsements and Fundraising in 'Jeter'" [PDF] published on August 17, 2016 by Delaware Business Court Insider.

​Dallas partner James C. Ho is the author of "Paxton Ruling on Fantasy Sports is Good for Texans" [PDF] published on January 26, 2016 by Austin American-Statesman, and "Let Texans Keep Daily Fantasy Sports" [PDF] published on January 12, 2016 by Dallas Morning News.

Washington, D.C. partner and Co-Chair of the Fashion, Retail and Consumer Products Practice Group, Howard Hogan and Washington, D.C. associate Alexander Mooney are the authors of "Lynch provides a 'Beast Mode' seminar on use of trademarks" [PDF] published in the Sports Business Journal on April 27, 2015.