Philly Phanatic lawsuit

The Philly Phanatic has been a mainstay of Philadelphia culture since he arrived on our shores in 1978.  But did you know that the Phanatic has been the subject of numerous lawsuits? He’s even been called “the most sued mascot in baseball.”  His most recent lawsuit involves the facts surrounding his birth. It’s a long, convoluted story so we’ll just briefly review the facts as originally summarized in Sports Illustrated and set forth in detail by the parties’ answer and complaint.

In the 1970’s, according to the Phillies, Phil Giles, club vice president, had a “vision” for an “in-your-face” mascot. The Phillies hired one of the creators of the Muppet Show, Bonnie Erickson and her husband Wayde Harrison to design the costume (Harrison/Erickson Company). A 1978 agreement between the parties gave the Phillies’ right to use the Phanatic on television and personal appearances. Several other licensing agreements followed in the 1980s, covering promotional products such as keychains, pennants and clothing.  In 1979, Harrison/Erickson sued the Phillies for copyright infringement and eventually settled with the Phillies.  During this period Harrison/Erickson filed a copyright registration covering the Phanatic for an “artistic sculpture.”

In 1984, Harrison/Erickson assigned all of its rights in the Phanatic to the Phillies for $215,000. The assignment was “forever.” The Phillies continued to invest in the Phanatic. Then, in June 2018, the Phillies organization received a letter from Harrison/Erickson claiming that the company is the legal author of the Phanatic and can terminate the Phillies’ rights by June 15, 2020.  Predictably, the Phillies sued Harrison/Erickson for declaratory relief in the Federal District Court of the Southern District of New York. Among the allegations made by the Phillies is that Harrison/Erickson do not have a valid copyright mainly because it is not the sole author of the Phanatic concept and costume, and that it misrepresented the nature of the work (as an artistic sculpture) when it registered it with the U.S. Copyright Office.

The New York litigation continues but you may have heard that the Phillies just created a minor revamp of the Philly Phanatic costume. This was much talked about in the press and speculation was that it had something to do with the pending copyright litigation.  Let’s explore that.

Can Harrison/Erickson claim a copyright interest – – assuming that it had one – – when in 1984 it assigned (or transferred) all its rights in the Phanatic to the Phillies “forever”?  Yes, theoretically, it can reclaim its rights. Section 203 of the Copyright Act provides that in situations where an author has transferred his or her rights in a copyright to another party after January 1, 1978, after passage of 35 years, the author may terminate the transfer and reclaim the copyright.  The author has five years beginning at the end of the 35 year period to serve advance notice in writing to the copyright owner (i.e, the transferee). The unstated purpose of this provision is to enable authors to reclaim works that were later found to be more valuable than when originally created. 

This explains the June 2018 letter to the Phillies but it also explains the Phantic’s new makeover. Section 203(b)(1) of the Copyright Act, provides that “a derivative work prepared under authority of the grant before its termination may continue to be utilized under the terms of the grant after its termination…” In other words, the “new” Phanatic costume is a derivative work created before termination of the Phillies’ rights and therefore not subject to the statutory reversion of rights pursued by Harrison/Erickson. Crafty lawyers at work!

Nevertheless, the question of copyright ownership continues to be litigated. We’ll keep you informed.

–Adam G. Garson, Esq.