Topline
E-commerce sports platforms Fanatics and Panini have each filed lawsuits accusing the other of unfair business practices in a fight over licensing rights for NBA and NFL trading cards as Fanatics looks to grow its e-commerce merchandise platform to include collectables and sports betting businesses.
Key Facts
Panini kicked off the legal battle last week with an antitrust lawsuit filed in a federal court in Florida against Fanatics, alleging it engaged in “calculated, intentional, anticompetitive conduct” to establish a monopoly in the trading card industry when it bought card maker Topps last year and later won the exclusive rights to produce cards for the NBA and NFL after Panini’s deals to do so expire in 2025 and 2026, respectively.
Panini alleged that it was not “given an opportunity to bid or otherwise compete for the licenses,” and said Fanatics “positioned itself to drive Panini and other potential competitors out of the market”—its lawsuit asks a judge to block Fanatics new deals, require it to divest from Topps and force Fanatics to pay an unspecified amount of monetary damages.
On Monday, Fanatics fired back with a countersuit filed in a federal court in Southern New York asking for a jury trial and unspecified amount of damages, alleging Panini tried to ” block Fanatics’ hard-earned success through a series of tortious, unfair, and unlawful actions.
“It was after Fanatic’s won deals with the players’ associations and leagues to make NBA and NFL cards that Panini “launched a campaign of dirty tricks,” Fanatic’s countersuit claims, including negotiating a “sham agreement” to terminate licenses early and “disrupt Fanatics Collectibles’ momentum.”
Fanatics also said it was not because of unfair practices that Panini lost the licenses, but because its competitor failed to “invest in marketing or innovation” and also “failed to capitalize on opportunities that stood to benefit collectors and business partners.”
Panini did not immediately respond to Forbes’ request for comment on the new lawsuit Monday.
Key Background
Panini America is part of the Panini Group, an Italian company founded in 1961 that produces books, magazines, trading cards and other items. It published the first FIFA World Cup trading cards and sticker album in 1970 and later moved into making products for the UEFA European Championship in the 1980s, followed by the major American sports leagues. Panini has had the league and player union licenses to make trading cards for the NFL and NBA since 2009 and the MLB and NHL since 2011, Fanatic’s lawsuit claims, as well as holding exclusive deals with NASCAR, WWE, the Collegiate Licensing Company and UFC. Panini is privately held and doesn’t share annual revenue figures, but Business Insider in 2021 estimated it had a $3 billion valuation. Fanatics launched as a platform to buy sports merchandise in 2011 and now sells licensed merchandise for the NFL, NBA, NCAA, MLS and other leagues, as well as the International Olympic Committee. Recent years have seen a push to expand into trading cards, collectibles and sports betting, according to CNBC, which started with a 2021 deal to produce baseball cards. MLB cards had been produced for 70 years by the company Topps, which was later acquired by Fanatics for $500 million. The company’s specific trading card business was valued at $10.4 billion in September 2021 and, in December, its overall valuation was $31 billion.
Big Number
$12.2 billion. That’s how much the core sports memorabilia market was estimated to be worth in 2021, with an expected growth of 15% over the following 10 years. The trading card market is estimated to be a $13 billion industry, the Buffalo News reported, and the auction market is estimated to generate $500 million per year.
Tangent
This isn’t the first time Panini and Fanatics have met in court. Panini sued Fanatics for hiring its employees after 13% of its American workforce—including those in “high-ranking management positions”—was hired by their top competitor. A Texas judge in April ruled against Panini, which sought an injunction to stop future hiring.
Further Reading
Fanatics and competitor Panini launch legal battle with a pair of lawsuits (CNBC)
Fanatics Launches Fanatics Live, A Livestream Commerce App Redefining The Trading Card Ecosystem (Forbes)
Fanatics Teams With MLB, MLB Players Inc For MLB Debut Patch Cards (Forbes)
Tamika Mallory Advocates For Sports Collectibles Company Panini To Improve Its DEI (Forbes)
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