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Saturday, February 6, 2010

Hobby News - The Saturday Edition

MLB Files Trademark Infringement Lawsuit Against Upper Deck

Upper Deck, which last week agreed to pay millions to Japanese video game publisher Konami to settle a dispute over counterfeit "Yu-Gi-Oh" cards, is now being sued by Major League Baseball. On Monday, Major League Baseball Properties, the league's licensing division, filed a federal lawsuit against Upper Deck which accuses the company of trademark infringement and illegally selling cards that feature official team logos and uniforms. The complaint also notes that Upper Deck owes MLB $2.4 million.

In August, MLB granted Topps an exclusive, long-term license to produce baseball cards. The agreement gave Topps a monopoly on baseball and ended Upper Deck's 22-year relationship with MLB. In related news, Panini has become the exclusive producer of basketball cards and Upper Deck is reaching the end of its' five-year exclusive NHL license this season.

In a defiant move, Upper Deck responded by re-signing its licensing agreement with the MLB Players Association, a deal that provides rights to sell cards with players' images and likenesses. Upper Deck recently unveiled two new sets of cards for the 2009 season that do not have team names or logos printed on the borders of the cards but do include pictures of players in MLB uniforms. For example, Boston Red Sox's first baseman Kevin Youkilis' card shows him wearing the Boston jersey and helmet but the card identifies his team only as "Boston." In The Game, an NHL card manufacturer, creates sets without an NHL license however it follows the rules by not including logos and full team names.

The two new card sets are at the center of MLB's complaint. They allege that Upper Deck's conduct is "reflective of a pattern of utter disrespect for the contractual and intellectual property rights of those from whom it licenses valuable trademarks."

For Upper Deck, the suit is the latest in a string of legal and management setbacks. In the Konami case mentioned above, one Upper Deck executive testified that she witnessed CEO Richard McWilliams shred counterfeit cards in his office. That settlement came on the heels of a separate dispute with Topps, which sued Upper Deck last year for stealing its card designs. Topps claimed that designs for some of Upper Deck's 2009 cards were virtually identical to cards Topps produced in the '70s.

It's not the first time MLB has sued a card company for improperly using official logos. In the past decade, MLB filed claims against Donruss and Pacific, both of which put official MLB marks on cards after their agreements had expired. Ironically, Topps has been in Upper Deck's current position in the past. During the '70s, Topps had a licensing deal with the pro football players' union to make cards, but did not have an agreement with the NFL. As a result, its cards for several years featured no NFL marks and obscured logos on uniforms and helmets.

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