SportsMEDIA Technology Corp. (SMT), a technology company whose predecessor was hired to help build Major League Baseball’s PITCHf/x system, has sued the league’s media rights arm, MLB Advanced Media (MLBAM), for patent infringement, trade secret theft and breach of contract. The 92-page complaint describes a relationship that began more than a decade ago to create the pitch-tracking technology, real-time graphics and live-sports video enhancements that are ubiquitous today during MLB broadcasts, but ended acrimoniously when MLBAM allegedly hired a competitor to run the new Statcast system and declined to engage with SMT for the 2017 season.
Here’s what else you need to know:
-According to a copy of the contract attached to the complaint, Sportvision, Inc. (which was acquired by SMT in the fall of 2016) originally contracted with MLBAM in February 2006 to “capture, collect, market and disseminate pitch data.” The parties agreed that the original agreement would remain in effect until the end of 2011.
-The original agreement was amended four times, pursuant to which the term of the agreement was extended three times, most recently in January 2016 when the parties agreed to extend the deal until the end of 2019.
-In the fall of 2016, less than two hours after SMT acquired Sportvision, a key Sportvision employee allegedly resigned his position and MLBAM hired him.
-Shortly after the employee joined MLBAM, that employee allegedly told SMT that MLBAM would not work with it to execute PITCHf/x for the 2017 MLB season.
-Beginning with the 2017 MLB season, the league allegedly began referring to the PITCHf/x technology as PITCHcast, which became a component of the Statcast system that is used today.
-According to the complaint, in March 2018, an SMT account manager was inadvertently copied on an email chain between MLBAM and a representative from Fox Sports discussing the use of solutions from alleged competitors of SMT: TrackMan, which provides Doppler radars, and ChyronHego, which offers both an optical-tracking system (called TRACAB) and broadcast visualization tools.
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SportTechie Takeaway:
This has the potential to be a big and ugly one. Statcast data is among the top storylines we highlighted for the 2018 MLB Season, and Chris Marinak, MLB’s EVP of strategy, technology and innovation, recently discussed the technology and its uses on the SportTechie Podcast.
It appears that the crux of the dispute centers around the interpretation of a term-renewal provision that was included in the amended agreements. That provision in the fourth and final amendment reads, in relevant part:
This Agreement will…remain in force until December 31, 2019, unless otherwise terminated as provided herein (the “Term”). Within six (6) months prior to the end of the Term, the parties shall enter into good faith negotiations regarding the renewal of this Agreement and the terms of such renewal, provided, that whether or not this Agreement is renewed following the end of the Term (i) MLBAM shall permit Sportvision to render all services to ESPN under Sportvision’s current agreement with ESPN through the expiration thereof; and (ii) the Parties agree to negotiate in good faith to continue the commercial exploitation of PITCHf/x Derivative Data beyond the 2016 MLB season, but absent such a continuation Sportvision’s obligations with respect to PITCHf/x System will cease and MLBAM’s obligations with respect to payment for the PITCHf/x System set forth in Section 5.6 will likewise cease.
We’ll examine the court filings further and update the SportTechie audience as we learn more. SMT’s attorneys could not be reached in time for comment, and MLB declined comment.