delivered the opinion of the court:
Defendants, the National Collegiate Athletic Association (the NCAA) and the March Madness Athletic Association, L.L.C. (the MMAA), appeal from the order of the circuit court of Cook County entering a declaratory judgment in favor of plaintiff Intersport, Inc. Specifically, the circuit court found that Intersport’s license from the MMAA to use the trademark term “March Madness” to “advertise, promote, and sell videos” of certain sports programming encompassed the right to distribute content to video-enabled wireless communications devices on demand. On appeal, defendants now contend that: (1) the circuit court erred in interpreting the term “videos” as including material transmitted to Sprint PCS cell phone customers on demand; (2) the circuit court impermissibly rewrote the language of Inter-sport’s license agreement; and (3) the circuit court had an insufficient factual basis to enter judgment on Intersport’s declaratory judgment claim. For the following reasons, we affirm the judgment of the circuit court.
The record discloses that Intersport filed an amended verified complaint for declaratory relief alleging the following facts relevant to this appeal. Intersport
Intersport has been using the term “March Madness” in connection with its programming since 1986. In 1989, Intersport registered the term “March Madness” as a service mark with the United States Patent and Trademark Office. The registration was for the purpose of using the term in connection with Intersport’s business.
However, in 1990, the Illinois High School Association (the IHSA) sought to register the mark, claiming that it had used the term “March Madness” in connection with its state high school basketball championships since the 1940s. The IHSA discovered Intersport’s registration, and a dispute ensued. Ultimately, the IHSA and Inter-sport agreed to resolve any dispute regarding the ownership of the mark by pooling their trademark rights into a new entity, March Madness, L.L.C. This arrangement continued until 1995, when the IHSA became involved in a dispute with the NCAA over the use of the term. At that time, Intersport assigned its rights in the March Madness mark to the IHSA in exchange for, inter alia, royalties and an exclusive, perpetual license to use the mark in connection with its Coaches Shows. The license agreement specifically provided:
“SECTION 2 — LICENSE GRANT
2.1 IHSA hereby grants Intersport an exclusive, paid-up license to use the March Madness Mark in the following manner:
(a) in connection with entertainment services, namely the presentation of athletic and entertainment personalities in a panel forum; and
(b) to advertise, promote, and sell publications, videos, and media broadcasts in connection with section 2.1(a).”
The license agreement further provided that Intersport could not use the mark in any manner inconsistent with the above license grant. The agreement also provided that “[t]he term of this Agreement shall be perpetual.” The parties also simultaneously entered into a perpetual marketing and representation agreement, under which Intersport agreed to “use all reasonable efforts to promote and further the licensing and use of the March Madness Marks in a manner consistent with this Agreement.”
The NCAA claimed that its rights in the March Madness mark began in 1982, when CBS announcer Brent Musburger described the NCAA men’s Division I basketball tournament as “March Madness.” Litigation between the NCAA and the Illinois State High School Association continued from 1995 until 2000, when they agreed to pool their rights in the mark and form the March Madness Athletic Association (the MMAA). The written agreement between the IHSA and the NCAA forming the MMAA specifically provided that the IHSA thereby assigned the Intersport license agreement, exactly as written, to the MMAA.
In March 2006, Intersport entered into an agreement with Sprint, under which Intersport would provide Sprint with a variety of original programming to be disseminated to Sprint customers via Sprint’s mobile wireless media network. Intersport would also provide edited segments of its Coaches Show programming for dissemination
The day after Intersport and Sprint announced their agreement, the NCAA sent Intersport and Sprint a letter asserting that if Inter-sport were to provide the Coaches Shows to Sprint for distribution to mobile communications subscribers, Intersport will have violated the license agreement. The NCAA also took the position that the term “media broadcast” as used in the license agreement should be interpreted in accordance with the definition of “broadcast” in the Federal Communications Act of 1934 (47 U.S.C. §153(6) (2000)), which defines “broadcasting” as a distribution to the public via television or radio, and the federal regulations concerning personal communications services (47 C.F.R. §24.3 (2007)), which prohibit personal communications service providers from broadcasting as defined in the Federal Communications Act.
Intersport asserted that the language of its license agreement with the MMAA did grant it the authority to contract with Sprint to disseminate Coaches Show programming to mobile communications customers. Thus, Intersport sought a declaratory judgment proclaiming that Intersport was within its rights to use the mark “in connection with the Coaches Shows and ‘to advertise, promote, and sell videos or media broadcasts’ of the Coaches Shows to be distributed via any broadcast media,” including video-enabled mobile wireless communications devices.
Intersport attached several items to its complaint, including the license agreement, the perpetual marketing and representation agreement, a letter from the NCAA dated November 15, 2000, indicating that the NCAA and the MMAA would honor Intersport’s agreements with the IHSA, and another letter from the NCAA dated March 10, 2006, warning Intersport that it considered Intersport’s agreement with Sprint to be a violation of the license agreement. Attached to the March 10, 2006, letter was a Sprint press release, which announced that Sprint would be delivering “exclusive, made-for-mobile collegiate hoops programming to its customers.” The press release quoted the vice-president of marketing for Sprint as saying, “Mobile phones offer so much more than just voice applications today.” Among the “programming” or “on-demand video segments” offered to Sprint customers would be “installments” of the March Madness Coaches Preview. This programming would be provided by Intersport, which the release described as “an Emmy Award-winning creator, producer and distributor of original sports programming content and an industry leader in sports hospitality and event marketing.” The press release further explained that the majority of this “mobile-exclusive content is free to Sprint Vision and Power Vision subscribers.” The Sprint subscribers would be able to “enjoy” this content “on demand.”
In their answer, defendants admitted that Intersport had been granted the license as alleged, but denied that the language of the license agreement encompassed distribution of the Coaches Shows for viewing on mobile communications devices. Defendants also raised two affirmative defenses and several counterclaims. The affirmative defenses were that Intersport had materially breached the license agreement by granting rights to use the mark to Sprint, which was prohibited by the agreement, and that Intersport’s admitted and continued efforts to license the mark to third parties constituted a further material breach of the license agreement.
In their counterclaims, defendants asserted that Intersport’s actions in intentionally allowing Sprint to use the mark
Thereafter, defendants moved for partial summary judgment on Intersport’s declaratory judgment claim and on their own breach of contract claim. Therein, they claimed that the plain and ordinary meaning of the terms used in the 1995 license agreement did not give Intersport the authority to stream content to consumers through a personal wireless communication system. In addition, defendants pointed out that the license agreement did not contain a later-developed technology clause. Intersport responded to defendants’ motion for partial summary judgment asserting that it did not make sense to interpret its perpetual, exclusive, broadly worded license to broadcast the Coaches Shows as being limited to only the technology available in 1995.
Following a hearing, the court found that the license agreement was unambiguous and that the term “videos” encompassed any recorded visual production. The court further found the term “videos” not to be limited to a particular type of distribution, in contrast to “media broadcasts,” which, according to federal law governing the television industry, required distribution to the general public by television or radio. Thus, the court denied defendants’ motion for partial summary judgment.
Thereafter, Intersport filed a “motion for the entry of judgment” based upon the grounds articulated by the court in its ruling on defendants’ motion for partial summary judgment. The court granted the motion and entered a final judgment, reiterating:
“Intersport has the exclusive right under the Intersport License Agreement to use the March Madness Trademark (as defined therein) in connection with entertainment services, namely the presentation of athletic and entertainment personalities in a panel forum (herein Coaches Shows)' and to advertise, promote, and sell videos (defined as recorded visual presentations that could be distributed for the benefit and enjoyment of a viewer) of the Coaches Shows which may be distributed to the public in any manner, including but not limited to distribution to video-enabled mobile wireless media devices.”
Defendants subsequently filed this timely appeal from that order.
Defendants now contend that the transmission of Intersport’s Coaches Shows to Sprint’s subscribers does not constitute selling videos within the meaning of the license agreement. Specifically, defendants claim that the plain and ordinary meaning of “videos” in 1995 implies that
We must initially note that Intersport’s “motion for the entry of judgment” was, in essence, a motion for judgment on the pleadings because the facts contained therein were not in dispute, the issue to be decided was a matter of law, and Intersport did not file a motion for summary judgment. See, e.g., Kim v. State Farm Fire & Casualty Co.,
We now turn to the merits of the appeal. A license to use a trademark is a contract, and disputes over the language of a trademark license are governed by the rules of contract interpretation. 3 McCarthy on Trademarks and Unfair Competition §18:43, at 86 (4th ed. 1996); see, e.g., McDonald’s Corp. v. Mazur,
First, the court will examine the language of the contract alone, as the plain and ordinary meaning of the terms are the best indication of the parties’ intent. Gallagher,
Contract terms should also be interpreted in accordance with the custom and usage of those particular terms in the trade or industry of the parties. Merchants Environmental Industries, Inc. v. SLT Realty Ltd. Partnership,
Second, the court must determine if the contract language is ambiguous. Gallagher,
The United States Court of Appeals for the Second Circuit has developed a test to determine whether a license agreement would permit the licensee to exploit the intellectual property in question through new channels made possible by technologies developed after the agreement was entered into. Boosey & Hawkes Music Publishers, Ltd. v. Walt Disney Co.,
The license agreement at issue here provides that Intersport has the exclusive, perpetual right “to use the March Madness Mark” in connection with its Coaches Shows and to use the March Madness mark “to advertise, promote, and sell publications, videos, and media broadcasts” in connection with its Coaches Shows. The license agreement specifically provides that Intersport must comply with all applicable laws and regulations in conducting its activities using the mark.
As the circuit court found, the term “media broadcast” has a particular, limited meaning in the television industry. See Merchants Environmental Industries,
However, for the following reasons, we agree with the circuit court that the term “videos” is broad enough to encompass dissemination to mobile wireless media devices on demand. The Oxford English Dictionary, which is a highly accepted authority on the evolution of the meanings of words in the English language over the last millennium, explains that the term “video” is derived from the Latin verb video, videre, meaning, “I see, to see,” and is patterned after the term “audio,” which is Latin for “I hear.” XIX Oxford English Dictionary 614 (2d ed. 1989). The advent of the use of the term “video” in the English language occurred in the late 1930s to describe the “sight channel in television, as opposed to audio, the sound
However, it is clear that the definition of “video” has continued to evolve since 1989, when the second edition of the Oxford English Dictionary was published. Cathode-ray tube televisions have been replaced by those with LCD and plasma screens. Moreover, the means for viewing video content is no longer limited to television.
Defendants have directed the court to the “best-selling” Newton’s Telecom Dictionary as a source for meanings of the words used in the contract. Although defendants conspicuously failed to include the definition of “video” from the Newton’s Telecom Dictionary, our research reveals that it defines “video” as:
“From Latin, translated as T see,’ video adds the element of sight to communications. While some of us are visually-oriented, and others of us are more oriented kinesthetically-oriented [s¿c] (learn by doing, as in with muscles and tendons and energy and sweat), we all find a communication to be enhanced through pictures... especially motion pictures. Motion pictures are the essence of video, and video is the essence of true and full communications.” Newton’s Telecom Dictionary 969 (22d ed. 2006).
This definition of “video” is much broader than the definition given in the Oxford English Dictionary and could be summarized as a visual communication. It is also significant that the Newton’s Telecom Dictionary does not limit the manner or media in which video may be disseminated.
Defendants nevertheless maintain that the term “videos,” because it is a noun, requires that a “video” be a tangible object and that the content be stored in a tangible form by the end user. However, neither the Newton’s Telecom Dictionary nor the Oxford English Dictionary defines “video” as requiring that the content be stored in a tangible form. Significantly, the Newton’s Telecom Dictionary does not require that content be stored at all in order to constitute “video.” Of course, the term “video” can also be combined with other words to indicate more specific uses of recorded visual content that can be displayed for a viewer, such as “video camera,” “videocassette,” “video-telephone,” or even “video jockey,” which is often shortened to “veejay.” See XIX Oxford English Dictionary 614 (2d ed. 1989); see also Newton’s Telecom Dictionary 969-70 (22d ed. 2006) (defining more than 30 compound terms using “video,” including “video capture,” “video pill,” “Videophone,” and “videotape.”) Here, the term “video” is used without any such modifying word.
Therefore, we must ascribe the common meaning of the term “video” to the term as it is used in the contract here. As noted above, based on the Newton’s Telecom Dictionary definition and the Oxford English Dictionary definition, “video” constitutes a “visual communication,” especially when it involves moving images. Newton’s Telecom Dictionary 969 (22d ed. 2006); XIX Oxford English Dictionary 614 (2d ed. 1989). We find that this definition is broad enough to encompass the recorded visual presentations of the Coaches Shows that Intersport would like to disseminate to Sprint PCS subscribers on demand. See Boosey & Hawkes,
Defendants further assert, without citing any authority, that the dissemination of
However, the 2006 Draft Addition to the Oxford English Dictionary documents that as early as 1979, the dissemination of video content to mobile wireless communication devices was foreseeable and that the term “video” was used to refer to that content. XIX Oxford English Dictionary 614 (2d ed. 1989), Draft Additions September 2006, available at http://www.oed.com (quoting the October 15, 1979, edition of U.S. News & World Report magazine). In addition, the Newton’s Telecom Dictionary includes an entry for “Videophone 2500,” which states:
“In January, 1992, AT&T introduced a product called Videophone 2500, which transmitted moving (albeit slowly-moving) color pictures over normal analog phone lines. The phone carried a price tag [sic] $1,500 a piece. It was compatible with one MCI later introduced, made for it by GEC-Marconi of England and costing only $750 retail. Videophone 2500 relies on video compression from Compression Labs, Inc. of San Jose, CA. According to the New York Times, the phone took two years, about $10 million and 30 full-time people at AT&T to develop.” Newton’s Telecom Dictionary 970 (22d ed. 2006).
Therefore, at the time Intersport and the IHSA entered into the license agreement in 1995, the parties would have been able to contemplate distribution of video content to mobile wireless communications devices and comprehend this meaning of the term “video.” See 11R. Lord, Williston on Contracts §32:7 (4th ed. 1999) (explaining that the court must interpret the contract in light of the objectively determinable circumstances at the time that the contract was made). We accordingly find, as the Second Circuit in Boosey & Hawkes did, that the license agreement in question here encompasses the so-called “new use” of disseminating video content to mobile telephones and other mobile wireless communications devices. Boosey & Hawkes,
We also find it significant that Intersport’s license is exclusive and perpetual. The fact that there is no time limitation on the license, and no clause specifically excluding later-developed technology, suggests that the terms of the license should be interpreted broadly. Indeed, as the perpetual marketing and representation agreement, executed simultaneously with the license agreement (see Gallagher,
Defendants assert that this conclusion would render the use of the term “media broadcast” in the license agreement superfluous. Defendants claim that we must
We disagree. The license agreement cannot be read as limiting the manner in which Intersport may disseminate “videos.” The entire license grant, although spread over multiple subsections and clauses, actually consists of a single sentence. Pared down to its empirical elements, the grant would read: the IHSA grants Intersport a license. The license is further described by the infinitive verb forms in the sentence. The IHSA grants Intersport a license “to use,” but also “to advertise,” to “promote,” and to “sell.” Focusing on subsection (b) of the grant, “publications, videos, and media broadcasts” are what Intersport may “advertise, promote, and sell.” The term “videos” is used in a parallel sentence construction with the term “media broadcasts.” Therefore, it cannot be said that the term “videos” is in any way modified or limited by the term “media broadcasts.” As a result, the license agreement cannot be read as limiting or qualifying the manner in which the videos may be advertised, promoted or sold, nor can it be read as dictating how the video content must be stored, maintained, transmitted, or disseminated. The license agreement also does not limit to whom Intersport may “sell” the videos. Thus, the sentence structure of the license grant endows Intersport with broad power to use the mark in connection with its Coaches Shows in several independent ways.
In reaching this conclusion, we find the two cases that defendants discuss at length in their opening brief, Cohen v. Paramount Pictures Corp.,
We must now address defendants’ second over-arching contention on appeal, in which they claim that the circuit court effectively rewrote the parties’ license agreement in its order. Contrary to defendants’ position, the court did not rewrite the contract. The interpretation and enforcement of a contract as it was written does not constitute the rewriting of the contract. See, e.g., Wright,
Defendant’s final contention is that the circuit court lacked a sufficient factual basis to enter judgment on the pleadings. The construction of an unambiguous contract based on the plain and ordinary
For these reasons, we affirm the judgment of the circuit court of Cook County.
Affirmed.
GREIMAN and CUNNINGHAM, JJ., concur.
