Antitrust Law Daily Wrap Up, ANTITRUST—S.D.N.Y.: Photographers unable to pursue discovery in action against NFL, AP, Getty, (Nov 19, 2015)

By Jeffrey May, J.D.

Discovery will remain on hold in an antitrust and copyright action brought by professional sports photographers against the National Football League (NFL) and its teams, as well as licensing agents Getty Images (US), Inc. and the Associated Press (AP), pending resolution of the defendants’ latest motions to dismiss. The federal district court in New York City granted the defendants’ motion for a stay, in light of the potential breadth of discovery in the complex matter, the uncertain viability of the plaintiffs’ claims, and the lack of prejudice to the plaintiffs resulting from the stay (Spinelli v. National Football League, November 17, 2015, Sweet, R.).

The seven complaining photographers brought the action in 2013, alleging antitrust, copyright, breach of fiduciary duty, and contract claims stemming from the defendants' use and licensing of their photographs of NFL events. In March, the court dismissed the complaint but granted leave to replead. According to the court, the photographers had failed to adequately allege that the NFL, in concert with Getty and the AP, “conspire[d] to create a monopoly in favor of NFL in order to illegally restrain trade and otherwise fix and control the market for commercial licensing of NFL-related ‘stock’ photos.” In addition, the plaintiffs did not state plausible claims for direct copyright infringement or vicarious and contributory copyright infringement against the AP. Further, the NFL’s purported failure to pay royalties under a valid license agreement would not amount to copyright infringement, the court concluded.

The plaintiffs filed a second amended complaint in August. Motions to dismiss, filed in October, are scheduled to be heard on February 11, 2016. There was a dispute between the parties whether a stay of discovery imposed by the court during the pendency of the original motion to dismiss remained in effect. The stay has now been extended.

The defendants were entitled to a stay of discovery under Federal Rule of Civil Procedure 26(c), the court ruled. Under Rule 26(c) a party seeking a motion to stay discovery bears the burden of showing good cause. The court considers the following when ruling on such a motion: (1) the defendant’s showing as to the merit of the plaintiff's claim; (2) the breadth of discovery and the burden of responding to it; and (3) the risk of unfair prejudice to the party opposing the stay.

In discovery, the plaintiffs were seeking usage information regarding the plaintiffs' photographs and communications among the defendants. “Given the fact that there are currently 40 defendants named in the lawsuit, the intricacy of the contractual provisions involved, and the complex copyright and antitrust claims asserted, discovery is likely to be broad and significant, weighing in favor of a stay,” the court concluded.

The court rejected the plaintiffs’ assertion that they would be prejudiced because the stay would delay discovery in a case that was already two years old. With the viability of the new complaint unresolved, a stay of discovery, without more, did not amount to unfair prejudice.

The case is No. 1:13-cv-07398-RWS.

Attorneys: Danial A. Nelson (Nelson & McCulloch LLP) for Paul Spinelli. Jeffrey A. Mishkin (Skadden, Arps, Slate, Meagher & Flom LLP) for National Football League. Andrew Lawrence Deutsch (DLA Piper US LLP) for the Associated Press.

Companies: National Football League; Associated Press; Getty Images U.S., Inc.

Cases: Antitrust NewYorkNews