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American Needle Settlement to End Nine-Year Litigation

On February 16, American Needle Inc. reached an agreement in principle with the National Football League to settle its claims. A settlement between the parties would mark the end of an antitrust litigation that has been pending since 2004.

From the 1960s through the late 1990s, the NFL's intellectual property association—the National Football League Properties ("NFLP")—had granted non-exclusive licenses to apparel vendors, including American Needle. American Needle brought suit after the NFLP gave Reebok an exclusive license to manufacture trademarked headwear for all 32 NFL teams in 2000.

The NFL suffered several setbacks during the course of the litigation. Most notably, in 2010, the Supreme Court reversed the grant of summary judgment to the NFL, finding that the NFL was not operating as a single entity with respect to its intellectual property rights for purposes of Section 1. Based on that ruling, the Supreme Court held that the NFL's licensing activities were not categorically beyond the coverage of Section 1. Several months after the Supreme Court’s decision, the NFL announced that New Era would be its new provider of on-field headwear while ’47 Brand would supply headwear for fans.

When can we expect a final settlement? The District Court for the Northern District of Illinois seems to expect one in the near future. The Court scheduled a March 17 status conference to take place only in the event that the parties do not file a stipulation of dismissal before that time.

Because the settlement terms have not been announced, it remains to be seen whether American Needle’s extended effort to upset the NFL’s antitrust position will net it tangible business gains.