Nike Tells Kawhi Leonard to "Talk to the Hand"


Intellectual property laws define the rights that individuals and entities have in new and creative products of the mind. Thus, brands value intellectual property because that is how their business thrives. A massive spike in merchandise sales is a given when a company gets an endorsement deal with a star athlete. These deals can often be more significant money-makers for the athlete themselves than the multi-million-dollar contracts they have with their respective professional sports team.

NBA superstar Kawhi Leonard filed a lawsuit against Nike last June, over the “Claw” logo. At the time, he was playing for the eventual NBA Champs, the Toronto Raptors. In April, a federal judge ruled in favor of Nike, stating the logo and all rights belong to them.

The logo prominently showcases Leonard’s “signature” large hands, which stretch out to be 11.5 inches wide. The Claw became part of his brand as he established more and more popularity over the years. Leonard’s credit for creating the original sketch has never been disputed, but the intellectual property rights embedded in the logo are at the heart of this case. Leonard claims he created the logo way back in 2011, sharing his design with Nike, with whom he signed an endorsement deal as a rookie on the San Antonio Spurs. Take a look at the dueling hands below.

Photo credit to Sports Illustrated.


Nike and Leonard worked together over the next several years to design various apparel and footwear, which included variations of the Claw logo, generating millions of dollars for both of their brands.


In 2018, Leonard chose not to resign with Nike and signed a new endorsement contract with New Balance, essentially telling Nike to “talk to the hand.” Shortly after leaving Nike, Leonard filed suit claiming Nike engaged in fraud by obtaining a registered copyright of the Claw logo. In response, Nike countersued Leonard for copyright infringement, breach of contract, and fraud. Further, Nike stated that Leonard himself admitted during a 2014 interview with Nice Kicks to the role Nike played in creating the logo that turned him into the highly-marketable basketball star he is today.

“I came up with the idea of incorporating my initials in this logo. I drew up the rough draft, sent it over and they (Jordan Brand) made it perfect. I give the Jordan Brand team all the credit because I’m no artist at all. They refined it and made it look better than I thought it would ever be, and I’m extremely happy with the final version.”

At first glance, both logos include a hand design in a similar position, as well as display the letters “KL” and the number “2.” However, the size of the fingers and hand itself, the depiction of “KL” and “2,” and the overall style of the design differ. Leonard’s main argument asserts that Nike’s logo is a derivative of his initial design. A derivative work is a work based on or derived from one or more already existing works, ineligible for copyright protection. On the other hand -- pun intended -- Nike asserts that the two logos are clearly different and unique from each other.

The presiding judge, distinguished the two logos as independent pieces of intellectual property, as Nike’s design is “not merely a derivative work of the sketch itself… [it is] new and significantly different” from Leonard’s original.

What does this mean for Leonard’s current deal with New Balance?

The Claw is now definitively Nike’s property and Leonard, therefore, has no rights to it. Leonard cannot license it to New Balance and is thus not able to use it on any new merchandise. Given the fact that Nike and New Balance are competitors, it does not seem likely that the two companies will engage in any negotiations to buy or license the Claw anytime soon. While he holds the title of being the first player in NBA history to win a Game 7 with a buzzer-beater, unfortunately he does not hold the title to the intellectual property of the Claw. For now, Leonard will have to wave good-bye to using his signature Claw and explore other design options.



Sources:

McCann, Michael. “Kawhi Leonard Loses Copyright Lawsuit Against Nike.” Sports Illustrated, 23 Apr. 2020

Jovanovic, Dusan. “19 Biggest Athletic Endorsements in 2020.” Athletic Panda Sports Editors, 8 Apr. 2020

Janura, Brian. “Kawhi Leonard Told to Keep His Hands off Nike's Logo.” JD Supra, 14 May 2020

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