NCAA Finds Bootleg Products Patently Offensive -- Officials Apply Full-Court Press To Protect Trademark On Final Four Merchandise
College basketball had been conducting plain-old championships for as long as anyone could remember. Then, in 1983, an executive on the business side of the NCAA walked into the office of his boss, Walter Byers, with an idea to register the name of the "Final Four" with the U.S. patent office.
"You can't do that," Byers said. "That's a generic term."
Jack Waters, the NCAA's director of licensing, applied anyway. His life - and the financial livelihood of the NCAA basketball tournament - hasn't been the same since.
Armed with a trademark on "Final Four," the NCAA in the past decade has gotten a cut of every licensed T-shirt, key chain or other piece of merchandise that uses the term on its product. Retail sales approached $100 million last year, generating about $2 million in royalties for the schools involved.
That means that after the NCAA takes its cut, the schools that reach next spring's Final Four in Seattle could take home more than $100,000 each in royalties, with lesser amounts going to other teams that make the 64-team tournament, Waters said.
The bonanza is worth protecting from counterfeiters, the NCAA has decided. To prevent the sale of unlicensed merchandise, NCAA officials met this week with local law-enforcement officials, members of Seattle Mayor Norm Rice's staff, Kingdome security, licensing groups and the local organizing committee to prepare for the April event.
Anyone caught selling bootleg products that use the Final Four name or logo will have their inventory confiscated, Waters said. No criminal charges will be brought, but sellers will be asked to pay a 15 percent royalty, double the usual fee, for all offending merchandise already sold, he said.
Off-duty police officers will patrol hotel lobbies in Seattle and several suburban cities, he said. Local officials also have agreed to create a "sanitary zone" in an area around the Kingdome that would be devoid of street vendors.
Cost of the extra security: about $30,000. Waters said the NCAA will pick up the tab. He insists the scorched-earth effort is worth it, even though he said only 5 percent of the merchandise sold is counterfeit.
"The license needs to be protected, as does the consumer," he said.
Waters traces the Final Four, as big business, back to 1979 when Magic Johnson's Michigan State team met Larry Bird's Indiana State team in the championship game. In television terms, the game is still the highest-rated final in the history of NCAA men's basketball.
The event last year in Charlotte, N.C., received 253,000 ticket requests, with an average of two tickets per request, for the 2,000 tickets made available to the public. The other tickets in the 22,000-seat building went to the schools, coaches and other parties associated with the NCAA.
In Seattle, 99,000 requests have been received for 9,000 available tickets, he said.
"It may be the toughest ticket in sports," Waters said.
Increasingly aware of the event's appeal, the NCAA has sold licenses to use the Final Four name and logo to 46 companies, including Nintendo of America, which makes a video basketball game. Many of those companies were in Seattle yesterday at a downtown hotel to sell their products to local store owners.
Another 15 national "corporate partners" pay about $500,000 each to be affiliated with the event, Waters said. They get television air time and exclusive product visibility at the event, during which stadium signs are covered by the NCAA.
Retail sales of licensed NCAA products overall, with the Final Four included, is a $2 billion business, up from $1.7 billion last year, Waters said. He expects the figure to reach $3 billion by the turn of the decade.
All that new money, though, begs a question in an era when players are lobbying for stipends beyond the expense of their scholarships: Will the NCAA someday soon have to share its loot with its athletes, as in the pro leagues? Waters said he wasn't prepared to answer that one, but hoped it wouldn't come to that.
"The education they get is certainly important to them," he said.