ADV 378S Study Guide - Final Guide: Reserve Clause, Jose Canseco, Commissioner Of Baseball

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10 May 2016
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ADV 378 Final Review:
Olympic Structure
Differences between various Olympic organizations:
oThe International Olympic Committee (IOC)
Founded in 1894, grants rights to host summer and winter games every
four years
Serves as the umbrella organization for various domestic affiliates
(National Olympic Committees)
Interacts with international sports federations which control particular
sports
Owns and controls the intellectual property including the Olympic rings,
motto, and flame
Like the UN of Olympic sports, chief executive is like a league
commissioner without checks and balances
oThe National Olympic Committees (USOC):
Sole authorities responsible for the representation of countries at the
games, authority to recognize a national governing body for any amateur
sport
USOC mostly from donations and sponsorships
USOC battled with AAU/College Sports/Other independent bodies for
control until the 70’s when a Presidential (Ford) Commission was set up
to make recommendations
oInternational Athletic Federations
Worldwide governing bodies of various sports which regulates, conducts
international competitions. Ability to determine eligibility, worldwide
rules of play.
Chooses judges and referees, and resolve technical issues like equipment
Often centralized and autocratic
oNational Governing Bodies
Each international governing body (federation) has a national governing
body
In charge of running sport within the country
EX: International Skating Union = US Figure Skating and Speed Skating
oOrganizing Committees of the Olympic Games (OCOG’s):
More local level groups, logistics of actually hosting games
Different organizing committee specific to host each Olympics
Responsible for facility construction, living arrangements, transportation,
media service, and to sell event to public
Ticket income primary revenue for host
Does not participate in international TV rights/sponsorships
Olympic US TV Rights/Comcast, NBC Strategy
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oTape delay vs. live issue: when the games are held in different time zones
(Beijing, London), not aired live in US market, instead, rebroadcasted during
Prime time
Olympic Levels of sponsors:
oWorldwide Partners
Exclusive category rights
Can use Olympic trademarks
Can develop marketing programs with IOC, National Olympic
Committees, and Olympic site organizing committees
oSuppliers/Providers
Paying for sponsorship, but also play a part in hosting
Ex: Donate resources (UPS gives planes) in exchange for limited
marketing rights
oIn Country Sponsors
Cheapest option of sponsorship, basically, companies within host country
can sponsor at this level
oCountry Team Sponsors
Sponsor the individual Olympic team (United sponsoring Team USA)
Friction between USOC and IOC
oTrack and Field Drug Issues
Both called each other out for inability to properly identify and monitor
athletes that used PED’s
oCommercialization, US related income to IOC is much larger than IOC
contribution to USOC
Team USA is heavily commercialized, has that reputation. IOC was making
a ton off of old TV, revenue deals. USOC wasn’t going to submit Olympic
bids until dispute resolved.
oRule 40, Rule 40 relaxation
Athletes weren’t allowed to participate in generic non-official Olympic
advertising around the games themselves, however, these rules were
relaxed to allow the ads to run during the games (Ex: Phelps & Wheaties
ads, even though they aren’t an official partner)
Contracts
Capacity, consideration
oAgreement between two competent parties based upon the genuine assent of
the parties, supported by the consideration
Made for a lawful objective
In the form required by law
Courts objective in contract disputes
oCourts don’t look at what is fair or what would make a better contract, but what
was the original intent of the parties
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find more resources at oneclass.com
Independent Contractors
oAthletes are not employees, independent contractors. Sign a participation
contract to compete for stipulated prize money
Breach by Coaches
oWhen a contract is breached, remedies may be available. Often, contract is
terminated, non-breaching party is awarded damages. Coaches are more likely
to breach in recent times, and suffer no backlash from other employers
Dilution of Appeal
oMost endorsement deals have out clauses for sponsors based on dilution of
appeal, generally worded, action that causes breach doesn’t have to be illegal or
have a conviction (Phelps, Tiger Woods, Vick, Armstrong)
Elite Talent
oAthletes are elite talent, one in a million
Pay may well be justified in terms of true value created
Status as elite and irreparable has legal consequences that leads to
injunctive relief were they to breach
oWhy don’t athletes breach?
Consequences too great, other owners may not offer employment due to
self interest/legal liability
Relocation and Facilities Issues
Major migrations and reasons
oPhase 1: Pre WWII, Smaller to Larger
Too many teams in Smaller Markets
oPhase 2: Post WWII, Rustbelt to Sunbelt
Followed national trend to West and South
Dodgers to LA, Giants to S.F., NHL to Denver, Phoenix
Newer stadiums away from Downtown areas with crime
Car friendly locations, open land available
Suburbs in metro areas (DFW)
Air travel now available, rail no longer a limiting factor
TV nationalized sports that may have just been regional up until then
o1990’s: Stadium Boom
46 MLB/NFL teams build new stadiums
All sports specific
All downtown
Financial impact of Good stadium deal vs. bad one
oStadium terms sometimes more important to success than the actual market
LA Rams moved to St. Louis because they guaranteed all revenue from
stadium
oSince teams keep local revenue, stadium related income is key. Maximize it.
Baltimore Colts/Imminent Domain
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find more resources at oneclass.com