Upper Deck and Panini America have resolved their issues over images of Michael Jordan that appeared in the background of three Panini cards.
According to a notice filed in U.S. District Court, Southern District of California, the two trading card companies have resolved the issues that have been in litigation for nearly 18 months. An attorney for Upper Deck told Bloomberg Law on Friday that the parties have reached a confidential agreement.
Both companies are preparing a written settlement agreement, according to the latest filing. Upper Deck and Panini will file a joint stipulation to dismiss the case, perhaps as early as this week.
That means the settlement is over, but the actual final details of a case will remain a secret.
The settlement ends a flap between the two companies that centered around images of Jordan used in Panini cards, which Upper Deck claimed was a violation of its exclusive deal with the Hall of Famer.
The lawsuit, The Upper Deck Company v. Panini America, Inc., was originally filed on Jan. 29, 2020, in the Southern District of California. Upper Deck sued Panini over images of Jordan that appeared in the background of cards released by the Dallas-based company. Panini countered with a motion for dismissal in late May 2020, alleging that Upper Deck’s claims were baseless and that the California-based card and memorabilia company resorted to “vague allegations and third-party Internet posts” in filing their complaint.
Upper Deck alleged in its complaint that Jordan was not the main focus of two Panini cards featuring Scottie Pippen and Dennis Rodman, but added that the presence of the Chicago Bulls superstar in the background violated the exclusive contract Upper Deck had with MJ. Upper Deck argued that even an incidental appearance by Jordan on a rival’s trading card violated its exclusivity deal.
In its defense, Panini argued that “notably absent” from Upper Deck’s objection was “the alleged license agreement” on which the claims were based. “Because Upper Deck has failed to state plausible claims for relief, its complaint must be dismissed,” Panini wrote in its motion to dismiss.
The motion to dismiss by Panini was rejected by a federal judge in June 2020.
The Pippen cards were part of Panini’s 2017-2018 Donruss Basketball set and Donruss’ 2017-2018 Optic NBA Retro series. Pippen is shown in both series driving to the basket. According to Upper Deck, Panini intentionally cropped the image from the first set to remove any images of Jordan. In the higher-end Optic set, the same image was used — but this time, Jordan can be seen in the bottom right corner of the card.
Panini countered that Jordan was not “readily identifiable” on the Pippen card and that his jersey number was not clearly visible. According to the filing, Panini claimed Upper Deck conceded the image of Jordan was “no bigger than Pippen’s shoe.”
Meanwhile, Jordan was visible on the right side of a 2018-2019 Panini Contenders card that featured Rodman.
Upper Deck alleged that Panini failed to crop Jordan out of the photo to increase the card’s value. Upper Deck claimed that the background on the Rodman card “caught more consumer interest and excitement” than the main photo because the card “prominently and intentionally featured Jordan.”
Panini argued that it required “an implausible flight of fancy” to suggest that the value of the Pippen and Rodman cards was enhanced because of Jordan’s “passing appearance.”
Upper Deck, in its January 2020 filing, alleged two violations under the Lanham Act, trademark infringement, intentional interference with a prospective economic relationship, intentional interference with a contractual relationship, commercial misappropriation, right of publicity, and unfair competition.
The Lanham Act, passed by Congress on July 5, 1946, is a federal law that governs trademarks, service marks and unfair competition. It went into effect on July 5, 1947.
Upper Deck filed an amended complaint on Aug. 24, 2020, alleging six causes of action: 1) False affiliation/false endorsement, false advertising and unfair competition under the Lanham Act; 2) Trademark dilution under the Lanham Act; 3) Trademark infringement; 4) Commercial misappropriation; 5) Right of publicity under the California Civil Code; and 6) Unfair competition.
In April 2021, U.S. District Judge Gonzalo P. Curiel ruled against Upper Deck’s claims of trademark dilution and trademark infringement but ruled for the California trading card company on the other four complaints.
That set the stage for the settlement between the two trading card companies.