Yahoo Inc. has dropped its lawsuit against the NFL Players union over paying for the right to use players’ names and statistics in its fantasy football games. The two sides reached a settlement, but the details weren’t disclosed.

Yahoo filed suit in federal court in Minneapolis last month, following the lead if CBS Interactive, which sued the players union last year on behalf of Fort Lauderdale-based CBSSports.com. A federal judge ruled in CBS’ favor in April that the names and stats are protected by the First Amendment.

That ruling followed an earlier federal appeals court decision in a case involving Major League Baseball that said MLB players’ names and stats are in the public domain. Both CBS and Yahoo believed the baseball ruling applies to football games as well.

The players association has appealed the ruling in the CBS case.

The Fantasy Sports Trade Association has supported Yahoo and CBS in their legal action, but has contended repeatedly that the fantasy game providers and leagues should work together to promote the games.

Andrew Feffer, the union's chief operating officer and executive vice president, told the Associated Press the NFLPA and Yahoo "continue to explore additional opportunities to work together."

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Concerned about threats that it would be sued, Yahoo Inc., became the second major fantasy sports provider to sue the NFL Players union over use of players' names and statistics in its fantasy football games.

The suit filed in federal court in Minneapolis on Monday is similar to one filed by CBS Interactive on behalf of Fort Lauderdale-based CBSSports.com last year. A federal judge ruled in CBS’ favor on April 28, saying the players’ names and stats are protected by the First Amendment.

That ruling followed an earlier federal appeals court decision that said Major League Baseball players’ names and stats are in the public domain. Last year, the U.S. Supreme Court refused to hear that case.

Last week, the NFL Players Association and its marketing arm, Players Inc., appealed the ruling in the CBS case.

Yahoo, whose last licensing agreement with Players Inc., expired March 1, cites the CBS ruling in its suit. Yahoo believes the ruling should apply to all fantasy providers, just as the judge in the CBS case ruled the baseball ruling also applies to football.

“In the CBSI case, the court held that the provider of a fantasy football game did not require a license from Players Inc. in order to operate a game that used player names, statistics, images and other information,” Yahoo’s case states.

The Yahoo case was filed in Minneapolis, which is where the both the baseball case and the CBS case were decided. Friendly courts, anyone?

The Fantasy Sports Trade Association is supporting Yahoo’s case, but as it has said repeatedly, it hopes the leagues and game providers can work together to promote fantasy gaming.

“The fact that the NFL Players Association continues to demand licensing fees is disheartening news for the industry, and for fantasy sports participants,” FSTA President Paul Charchian said in a statement. “The Players’ Association is seemingly oblivious to the obvious and tangible benefits derived from the proliferation of fantasy sports, along with the many cases that have already been decided in favor of fantasy operators. While the FSTA will support Yahoo in this case, we also hope to cooperate with each of the players’ associations to help maximize fantasy sports products.”

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Founded in 2006 to serve as the business backbone for a wide range of fantasy sports Web sites, Fantasy Sports Ventures is continuing to expand its footprint. The New York company that handles the marketing and advertising sales for some 400 Web sites across sports announced this week it has added 35 independent college Web sites, including NoleInsider focusing on FSU, and The Bulls Pen, which covers USF.

Other college sites now in FSV’s network include SECTalk, Tiger Droppings (LSU), and TotalUGA (Georgia).

FSV was formed early on in the growth of fantasy sports as a way to help sites – many of them niche – build their businesses through dynamic online advertising, contests and promotions.

“We started about three years ago when the notion of fantasy sports marketing was just evolving,” FSV CEO Chris Russo said. “We really pioneered the notion that marketers could do marketing programs online beyond banner advertising.”

That means content widgets and modules and a variety of programs that promote advertisers and sponsors across FSV’s network. With 400 sites in its network, FSV offers companies an attractive advertising opportunity. Because it can count traffic to all its affiliated sites – it owns about 25 percent of them and has affiliations with the rest – FSV is ranked fifth among online sports properties with more than 10 million unique visitors each month, according to Nielsen Online. (Yahoo! Sports is No. 1, followed by ESPN, CBSSports.com and Fox Sports).

Since fantasy sports boast some 27 million players in the U.S., leagues and other companies recognize the power of the industry as a business tool.

“By adding 400 sites together, you have enough scale. You really become relevant to advertisers,” Russo said. “Marketers want to be around passion points. People care about fantasy sports. That’s a hobby and an avidity. More and more money is going to continue to move from traditional media to new media.”

While FSV might not be recognizable to consumers – its Fantasy Players Network branding can be found on many of its affiliated sites – the company allows for smaller sites with avid fan bases to flourish because of the company’s business backing.

“We are providing, at the end of the day, a way for niche sites to grow and prosper and continue offering more and better content to their users,” Russo said. “We’re helping a whole cottage industry.”

Among the programs FSV created was a Gillette Young Guns fantasy game that allowed fans to pick winning drivers from among a group of drivers, including Gillette’s sponsored drivers. The game was on Gillette’s Web site, but was promoted and distributed across FSV’s affiliated sites. For college basketball, the company launched a site this year devoted to the NCAA Tournament that featured Bobby Knight and Billy Packer, who provided analysis, and was sponsored by Irish Spring.

Russo said the company plans to activate a number of its promotions around events throughout the year, including the upcoming NBA draft and the NFL season.

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Fort Lauderdale-based CBSSports.com scored a victory this week when a federal judge in Minneapolis ruled CBS Interactive does not have to pay to use NFL players’ names and statistics in its fantasy football games.

U.S. District Judge Ann Montgomery said in her April 28 ruling the names and stats are protected by the First Amendment. Her ruling follows an earlier federal appeals court decision that said baseball players’ names and stats are in the public domain. Last year, the U.S. Supreme Court refused to hear that case. Montgomery said the ruling applies to football as well.

“The court declines to indulge in a philosophical debate about whether the public is more fascinated with baseball or football,” Montgomery wrote in her ruling.

“CBS is pleased that the court confirmed the use of player names, statistics and other materials in CBS’ online fantasy games is protected under the First Amendment,” CBSSports.com’s General Manager Jason Kint said in a statement. “CBSSports.com, along with the rest of the fantasy sports industry, looks forward to continuing to provide the fun and excitement of fantasy sports.”

The baseball case began in 2005, when a fantasy baseball game provider sued Major League Baseball seeking the right to use player statistics without a license. The district ruled the First Amendment applied to the information. The Eighth Circuit Court of Appeals agreed.

CBSSports.com took the ruling in the baseball case to apply across sports, and even added college players’ names to its college fantasy football game. When its agreement to pay for the use of NFL players stats expired in February 2008, the company declined to renew.

The players’ union threatened to sue, but CBS struck first, filing suit against the NFL Players Association Sept. 3 in Minnesota, where the baseball case had been decided. Players Inc., the marketing arm of the players union, counter-sued Sept. 9 in Florida, where CBSSports.com is based. The Florida case was stayed until a decision could be made in Minnesota.

“We are evaluating the decision now and we haven’t determined what our next steps are going to be,” Jeffrey Kessler, an attorney representing the players, said Thursday.

The union clearly thought a different district court might rule differently and chose Florida because of where CBSSports.com is based.

Where the sports leagues and their players unions have supported the notion the players’ identities require licensing, the fantasy sports providers have lined up squarely against the need to pay licensing fees. Those providers have to be rejoicing: the fantasy sports industry counts some 27 million players in the United States, who spend an estimated $800 million annually on magazines, draft boards and Web site game subscriptions.

“This victory further cements the autonomy of fantasy sports operators from sports leagues and player unions,” newly-elected Fantasy Sports Trade Association President Paul Charchian said in a statement. “The ruling ensures that the industry’s hundreds of fantasy companies will continue creating wide ranging products to serve the needs of fantasy players."

According to an FSTA release, Charchian and Glenn Colton, a New York lawyer who filed friend of the court briefs on behalf of the FSTA in the baseball case, both said they hoped the fantasy sports industry and leagues and players' associations could work together.

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With college football season underway, so is Fort Lauderdale-based CBSSports.com’s college fantasy football game, which comes with a new option this year: the opportunity to draft players by name, rather than position.

Instead of picking Florida QB, you can actually draft Tim Tebow.

The move has already ruffled those looking to ensure college athletics maintain the amateur label and meant more players of the game.

The NCAA’s bylaws are aimed at preventing the commercial use of players’ likenesses –their names and images – to protect their athletic eligibility.

CBSSports.com has interpreted a court ruling earlier this year that baseball players' names and statistics are in the public domain to also apply to college athletes. The Eighth Circuit Court of Appeal ruled a fantasy company’s use of baseball players’ names and stats was a right of publicity, but was outweighed by the First Amendment. The U.S. Supreme Court refused to hear the case.

“As the leader in the fantasy sports business, we’re constantly looking for ways to distinguish our service from the competition,” CBSSports.com General Manager Jason Kint said in a statement, adding that he expected the change to increase the game's popularity.

And that’s troubling the NCAA and the Knight Commission on Intercollegiate Athletics. CBSSports.com doesn’t charge for the college game or award prizes, but does sell advertising to support the game. If players’ names make the game more popular, no doubt other fantasy providers will add names.

Will that lead to expansion of college athletes’ names in other merchandise? Will video game manufacturers add in players’ names and likenesses, rather than just Tebow's No. 15? Will jerseys be sold with players' names already on them?

The NCAA, which CBS is paying $6 billion for 11 years to broadcast the Final Four, says it must comply with the court ruling, but board members don’t want to see further erosion of the amateur bylaws.

“We’re monitoring it carefully,” NCAA President Myles Brand said in a conference call this month. “We do know there will be further activity in the fantasy league area. We think what has occurred has been a modest change from the current situation, but one of which we’re greatly concerned and we will look to see what our options are in the future, if there are further developments in the future.”

Rick Karcher, associate professor of law and director of the Center for Law and Sports at Florida Coastal School of Law in Jacksonville, thinks the NCAA needs to take a firmer approach.

“It’s hard to draw a logical line between the use of names in fantasy leagues and the use of names in video games ... It’s a slippery slope. They’re all commercial uses whether you’re talking about jerseys or trading cards," Karcher said.

“I don’t have a problem with the concept of amateurism. I’m not of the view they need to be compensated or paid, I understand amateurs and I get it, but this is different,” Karcher said. “When you’re talking about a third party outside of the NCAA and its member schools profiting off the athletes, to me it’s the NCAA’s job, if their mission is amateurism, it’s their job to prevent it as much as possible.”

Steve Peretz, an intellectual property lawyer in Miami, disagrees, saying the fantasy decision is isolated.

“The difference in the fantasy league is the player’s name is not being used to endorse a product. It’s being used as part of a gaming activity. It’s not being used to endorse Nike. It’s being used for this derivative purpose," Peretz said. “I don’t see this ruling as changing those sorts of merchandising rights. This decision is not allocating who has a proprietary right. It’s in the public domain … it would diminish proprietary rights, not expand it.”

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