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Marketing professionals around the world recognize the power of sports brands and content as a consumer draw. As a result, advertising and sponsorship in sports are big business. But the approaches taken in different sports vary markedly – in terms of both the overall level of commercial exposure and the exclusivity offered to sponsors.
We’ve advised professional sports leagues on seasonal and product “official” sponsorships, and on entitled events and half-time entertainment. We’ve also played an active role in the growing world of facility and amenity naming rights – a response to the ever-increasing costs of sports facilities and the increasing demand for fan amenities as part of the “game-day” experience. We understand the concerns of both leagues and sponsors – and how to balance a league’s or team’s need to maximize the other sales opportunities with the sponsor’s need for category protection for its investment in sports marketing.
Representative Matters
- Representation of Barclays in connection with its acquisition of the naming rights to the new Barclays Center located in Brooklyn, New York for a term of 20 years.
- Facility naming rights -- rare only a decade ago -- have become a longer-term and more stable revenue source for sports teams and facilities. Where the payor is a strong credit, long-term naming rights agreements may provide revenues stable enough for financial markets to value. Covington has been at the forefront of these developments, recently representing the NFL in connection with a Dallas Cowboys stadium financing which was collateralized with still-to-be-sold naming rights proceeds and the NHL in connection with the Montreal Canadians' securitization of naming rights revenues for Bell Centre in Montreal.
- For understandable reasons, the NFL carefully limits and regulates the pinnacle of its official sponsorship rights -- on-field product placement. When Motorola wanted to renew its sideline sponsorship with the NFL for coaches’ headsets and other wireless equipment, Covington helped the NFL to define the rules – and the scope of the covered business category – to ensure a win for both sides.
- On the international front, the firm played a leading role in the negotiations on behalf of Nike of stadium sponsorship transactions and associated sports apparel merchandizing agreements involving F.C. Internazionale Milano, the Football Union of Russia, and the Cardiff Rugby Football Club.
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