Free Statement - District Court of Arizona - Arizona

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Morgan & Morgan, P. A. 20 N. Orange Avenue, 16th Floor Orlando, FL 32801 Clay M. Townsend, Esquire Bar No.: 023414 Brandon S. Peters, Esquire Bar No.: 022641 Keith R. Mitnik, Esquire Bar No.: 436127 Attorneys for Plaintiffs UNITED STATES DISTRICT COURT DISTRICT OF ARIZONA MEADOWLARK LEMON, a married man, Plaintiff, Case Nos.: CV 04 0299 PHX DGC and CV-04-1023 PHX DGC

11 vs. 12 HARLEM GLOBETROTTERS INTERNATIONAL, 13 INC., an Arizona corporation; HARLEM GLOBETROTTERS INTERNATIONAL 14 FOUNDATION, INC., an Arizona corporation; 15 MANNIE L. JACKSON and CATHERINE JACKSON, husband and wife; FUBU THE COLLECTION, LLC, a New York limited liability 16 company doing business in Arizona; GTFM, LLC, a 17 New York limited liability company doing business in Arizona; 18 Defendants. 19 20 FRED "CURLY" NEAL, LARRY "GATOR" RIVERS, DALLAS "BIG D" THORNTON, 21 ROBERT "SHOWBOAT" HALL, MARQUES HAYNES and JAMES "TWIGGY" SANDERS, 22 Plaintiffs, 23 vs. 24 HARLEM GLOBETROTTERS INTERNATIONAL, INC., an Arizona corporation; HARLEM 25 GLOBETROTTERS INTERNATIONAL FOUNDATION, INC., an Arizona corporation; 26 MANNIE L. JACKSON and CATHERINE JACKSON, husband and wife; FUBU THE COLLECTION, LLC, a New York limited liability

STATEMENT OF FACTS PURSUANT TO LOCAL RULE 1.10(1)(1) IN SUPPORT OF MOTION FOR SUMMARY JUDGEMENT

(Refiled in Lead Case)

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1 company, GTFM of Orlando, LLC; and GTFM, LLC, a New York limited liability company doing business in 2 Arizona, 3 4 Defendants.

HARLEM GLOBETROTTERS INTERNATIONAL, 5 INC., an Arizona corporation, 6 vs. 7 8 9 10 11 PLAINTIFFS, FRED "CURLY" NEAL, LARRY "GATOR" RIVERS, DALLAS "BIG D" 12 THORNTON, ROBERT "SHOWBOAT" HALL, MARQUES HAYNES AND JAMES 13 14 15 16 17 18 19 20 21 22 before the License Agreement of 2002 (FUBU Motion p. 6, lines 8-15) citing to Plaintiffs' 23 24 25 26 27 28 depositions), wherein HGI granted FUBU a license to manufacture and distribute merchandise. 2) The United Basketball Players Association (hereinafter "UBPA"), organized to represent players for the Harlem Globetrotters, entered into several Collective Bargaining Agreements (CBA's), including agreements in 1977 and 1983, with various amendments pursuant to which Harlem Globetrotters, "TWIGGY" SANDERS (hereinafter collectively the "PLAINTIFFS"), by and through their attorneys and pursuant to Local Rule 1.10(1)(1) of the United States District Court for the District of Arizona, submit their Statement of Facts in Support of Motion for Summary Judgment against Harlem Globetrotters International, Inc. and Mannie and Catherine Jackson (hereinafter collectively with other party Defendants as "Defendants" or individually "HGI") and GTFM, LLC (hereinafter collectively with other party Defendants as "Defendants" or individually "FUBU") as follows: 1) Plaintiffs were variously employed as players and player-coaches for Harlem Globetrotters entities from 1946 (Hayes) through 1991 (Sanders), most having terminated their employment decades MEADOWLARK LEMON, a married man, Counter-defendant. Counter-claimant,

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Inc. (a corporate name utilized by various owners) agreed to pay royalties on merchandise sales to the players (Exhibit "2", CBA, article 14.12), and provided rights considered "minima" and supplemental to, and superceding, the individual players contracts (Exhibit "2 (B)" CBA, Article 2.1). The term was through August 31, 1986, with annual automatic renewals. (Id., Article 16.1) 3) Harlem Globetrotters, Inc. (unrelated to Defendant Jackson's HGI) bought the Harlem

6 Globetrotters from International Broadcasting Corp ("IBC"), a corporation that filed for bankruptcy 7 8 9 10 11 12 13 14 15 16 6) Plaintiffs never entered into any agreement with HGI at all orally or in writing, nor were Plaintiffs 17 contacted for their authority. (Exhibit "1" (A) Jackson Tr.204, (D) Vaughn Tr.62 stating "I'm 18 19 20 21 22 23 24 25 26 and sold in interstate commerce in the United States, and overseas (Exhibit "9 (C)"). 27 28 certain that they were not asked", (K) Neal Tr. 168, Hayes Tr. 57). 7) The parties to the Agreement and their attorneys testified that Plaintiffs' names and contracts were never brought up during the negotiations and execution of the Agreement (Horton Tr. 29, 30). 8) FUBU (as GTFM, LLC), entered into a License Agreement with HGI on June 1, 2002. Plaintiffs names are not specifically mentioned as "Licensed Property." (FUBU Motion p.3, 1.20) (Sacks Decl. Ex A, section 1.3(b)). 9) The clothing line bearing Plaintiffs' names and jersey numbers have been marketed offered for sale on August 30, 1991. (Exhibit "5 (A)"). 4) Jackson formed HGI in 1993 and entered into the Asset Purchase Agreement of August 1, 1993 (Exhibit "5 (D)"- Asset Purchase Agreement). 5) The Asset Purchase Agreement includes a schedule of "Player and Personnel Contracts" (schedule "2.1 (I)" to Exhibit "5 (D)" Bates Stamp # 1386), and a schedule of trademarks and "Intellectual Property Rights" (schedule "2.1 (F)" to Exhibit "5 (D)" Bates stamp # 1368). Neither of these schedules or the Agreement list Plaintiffs' names or contracts, but specifically identify other players contracts (i.e. Lou Dunbar (# 7 (b) of schedule 2.1 (i)).

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10) Much of the Harlem Globetrotters apparel sold by FUBU had hang tags listing the specific player's names, including Plaintiffs', which were used as marketing tools (Exhibit "12"). 11) FUBU representatives never conducted any due diligence as to Plaintiffs' rights, and relied solely on the representations of Jackson (Exhibit "1 (A)" Jackson Tr. p. 261, Weisfeld Tr. 68, stating contracts were "boxed up" and "not accessible" "due to the bankruptcy.)

6 12) HGI represented to FUBU in the License Agreement that "each such player has granted HGI in 7 8 9 10 11 12 13 14 15 16 15) Simply because Mannie Jackson was the owner of the Globetrotters and was former player, FUBU 17 relied on Mannie Jackson's assertions that every player singed the same contract and every player had 18 19 20 21 22 23 24 25 26 players or seek out their permission in any way. (Exhibit "1 (A)", Jackson Tr. p. 204). 27 28 given up his rights to HGI to use his name (Exhibit "1 (F)" Weisfeld Tr. p. 35-36). 16) Larry Blenden does not recall seeing any player contracts that were signed by the Plaintiffs. (Exhibit "1 (G)", Blenden Tr. p. 36-37) 17) No one from FUBU contacted any player directly, especially since it was warranted and represented to FUBU that HGI already had the right to use the players names and likenesses (Exhibit "1 (G)", Blenden Tr. p. 47-48), "1 (Q)" Haynes Tr. p. 92). 18) Before entering into the agreement with FUBU, HGI did not contact Plaintiffs or any other former perpetuity the rights ... and the unlimited right to sublicense such rights to third parties". (FUBU Motion p. 4, 1.8, Sacks Decl. Ex. A section 1.9(a) (viii) 13) FUBU asked for an indemnity in their contract with HGI because HGI represented to FUBU that all of the players contracts were "standard" player contracts and FUBU was "not interested in looking at 600 plus contracts stuffed away some place". (Exhibit "1 (A)" Jackson Tr. p. 262). 14) Only a sample player contract was attached to the contract between FUBU and HGI, and FUBU never expressed any concern as to its enforceability as to Plaintiffs. (Exhibit "1 (C)" Lenihan, Tr. p. 20-21).

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19) Aurum did not make any effort to contact any of the Plaintiffs about their permission or approval of the FUBU clothing line. (Exhibit "1 (E)", Aurum Tr. p. 23-24). 20) Aurum is CEO of FUBU the collection LLC. (Exhibit "1 (E)", Aurum Tr. p.7). Aurum is in charge of marketing, distribution, and product placement. Id. 21) "Some" of the FUBU/HGI apparel contained Plaintiffs' trademarks (FUBU Motion, p. 5, L.4)

6 Weisfeld Decl. Paragraph 5). 7 8 9 10 11 12 13 14 15 16 sales to go directly to players. This program was established as a good will gesture. You are not 17 entitled to any payments." (Exhibit "9 (B)"). But, checks were written to Plaintiffs for FUBU sales 18 19 20 21 22 23 24 25 26 Plaintiffs). The FUBU licensing agreement was actually for 10% of the first $10 million (Exhibit "9 27 (D)" Article II). 28 (Exhibit "9 (A) (B)"). 25) Jackson testified that he stated that the FUBU deal was a "100 million dollar" deal in an ESPN interview and that the reference in the book "Spinning the Globe" to $60 million in sales was accurate (Exhibit "1(A)" Jackson Tr. p. 121, Exhibit "7"). 26) Plaintiffs were never paid a dime under the License Agreement before Plaintiffs sent a demand letter on September 29, 2003 (Exhibit "11"). Then, Plaintiffs received a check for 8% of HGI's 8% royalty while being told "you are not entitled to any money "(Exhibit "9 (A)", Jackson letter to 22) Approximately 45,000 units of garments bearing Plaintiffs' names were reported by HGI for a limited period ending November 2003 (Exhibit "9 (A)", report of FUBU sales), (FUBU states the number is "insignificant" at fn 1, p. 5 FUBU Motion). Plaintiffs have recently confirmed that overseas sales have occurred that FUBU did not report, (Exhibit "1 (O)" Phipps Tr. 58,59; "1 (P)" Gallo Tr. 1-19). 23) Michael Syracuse is the chief financial office of HGI and is responsible for financial matters and accounting records of HGI (Exhibit "1 (B)" p. 9 and 11). 24) Syracuse wrote Plaintiffs on October 31, 2003 and stated "Mannie approved a portion of the net

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27) Jackson wrote to the former players (including Plaintiffs) on September 4, 2003 that the total would be "approximately $30,000.00" (Exhibit "9 (C)"). 28) The FUBU sales reported to HGI as of November 2003 were actually $22,661,645.50 (Exhibit "9 (D)"). 29) Revenues from sales of FUBU merchandise bearing Plaintiffs' names went to Harlem Globetrotters

6 International Foundation, Inc. (Exhibit "9 (A) (B)). 7 8 9 10 11 12 13 14 15 16 34) "Curly" Neal's last player contract terminated 1989, and was with IBC, owned by IBC and governed 17 by the laws of Delaware (Exhibit " 3 (A)" page 1, 2, and paragraph 7). 18 19 20 21 22 23 24 25 26 Globetrotters, Inc., owned by Harlem Globetrotters, Inc. and governed by the laws of California 27 (Exhibit "3 (D) para 2, p. 1, and para 1b). 28 35) Marques Haynes' last player contract terminated 1980, and was with Harlem Globetrotters, Inc., owned by Harlem Globetrotters, Inc. and governed by the laws of Illinois (Exhibit "3 (B)" p. 1, p. 1, and paragraph 20). 36) Showboat Hall's last player contract terminated 1974, and was with Harlem Globetrotters, Inc., owned by Harlem Globetrotters, Inc. and governed by the laws of Illinois (Exhibit "3 (C)" para 2, p. 1, and para 1b). 37) "Big D" Dallas Thornton's last player contract terminated in 1982, and was with Harlem 30) Jackson stated that the Foundation helped former players experiencing hardships but could not name a single former player that he had helped (Exhibit "1(A)", Jackson Tr. p. 198, 199). 31) Governor Vaughn, head of alumni affairs for HGI could not name a single former player who had been helped by the foundation, nor did he know what the Foundation actually does (Exhibit "1 (D)", Vaughn Tr. p. 6 & 7). 32) Vaughn has been employed by Jackson since 2000 (Exhibit "1 (D)", Vaughn Tr. p. 5). 33) Plaintiffs never agreed to allow their names to be used to raise money for Jackson's Foundation (Exhibit "1 (L)", Haynes Tr. p. 107-108, and p. 98) and don't know what it does.

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38) "Gator" River's last player contract terminated 1985, and was with Harlem Globetrotters, Inc., owned by Harlem Globetrotters, Inc. and governed by the laws of California (Exhibit "3 (F)" para 2, p. 1, and para 1b). 39) "Twiggy" Sanders last player contract terminated 1992, and was with Harlem Globetrotters, Inc., owned by IBC and governed by the laws of Minnesota (Exhibit "3 (E)" para 2, p. 1, and para 17).

6 40) Since the inception of Plaintiffs' relationships with various "Harlem Globetrotters" entities, Plaintiffs 7 8 9 10 11 12 13 14 15 16 44) Haynes contract states that it may not be assigned without his prior written consent (paragraph 18) 17 and that the employer rights to use his name may be used for promotion, but only "with respect to 18 19 20 21 22 23 24 25 26 47) Rivers consistently received payments for merchandise (i.e. converse) endorsements and 27 appearances, including $30.000 for same in Rivers last year (1985) because "that has always been the 28 commitments made by HGI prior to such termination" and for "the same uses they were put to prior to such termination." (paragraph 15 a, Exhibit "3 (B)" and "1 (Q)" Haynes Tr. p. 102). 45) Neal's contract states that rights granted to "HG" are only for the term of the contract (paragraph 9) and that Neal will receive 75% of "non-Globetrotter" services (paragraph 11, Exhibit "3 (A)"). 46) The publicity provisions in player contracts are coupled with obligations to appear, interview, etc. ­ obligations that terminated when the contracts terminated (i.e. Exhibit "3 (E)" Sanders para. 12, Rivers "3 (F)" para 12 (a) ). have received payment for endorsements, merchandise appearances and cartoon appearances while employed under the player contracts (Exhibit "1 (L)" Rivers Tr. 102, "1 (K)" Neal Tr. 168). 41) Aside from the FUBU clothing line and some bobble head dolls, HGI has not licensed or utilized the Plaintiffs' names and likenesses (Exhibit "1 (A)" Jackson Tr. p 249-250). 42) Not even the clothing sold in the arenas at Harlem Globetrotters events contains Plaintiffs' name and likeness (Exhibit "1 (A)" Jackson Tr. p. 259). 43) Retailers are still selling the Platinum FUBU Harlem Globetrotters clothing line bearing Plaintiffs' names (Exhibit "1 (O)", Phipps Tr. p. 19,58,59, 76, 83, "1 (P)" Gallo Tr. p. 1-19).

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position that we've been under." (Exhibit "1 (2)" Rivers p. 101, 102 and Exhibit "10" Rivers letters). Other Plaintiffs were paid for merchandise in addition to salaries in player contracts (Neal testimony at Exhibit "1 (K)" p. 175). 48) Current HGI employee coach Lou Dunbar testified that if there were additional sales of FUBU clothes bearing his name he believes he should be paid by HGI (Exhibit "1 (M)" Dunbar Tr. p. 96)

6 Dunbar was also on the UBPA negotiating committee that secured additional merchandising rights 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Joel L. Herz, Esquire LAW OFICES OF JOEL L. HERZ LaPolma Corporate Center 3573 E. Sunrise Dr., Suite 215 Tuscon, AZ 85718-3206 PLEASE TAKE FURTHER NOTICE that copies of the above-referenced documents have been served via first class mail upon the following attorneys: CLAY M. TOWNSEND, ESQUIRE Florida Bar No.: 363375 KEITH MITNIK, ESQUIRE Florida Bar No.: 436127 BRANDON S. PETERS Florida Bar No.: 965685 Morgan & Morgan, PA 20 N. Orange Avenue, 16th Floor Orlando, FL 32802 Telephone (407) 420-1414 Facsimile (407) 425-8171 Attorneys for Plaintiffs Fred Neal, Larry Rivers, Robert Hall, Dallas Thornton, Marques Haynes and James Sanders By: _____/S/Clay M. Townsend________________ DATED this 2nd day of December 2005. supplemental to individual contracts (Exhibit "1 (A)", p. 37, 41) and there is no evidence that formal actions was ever taken to disband the UBPA (Id, p.. 45)

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Attorney for Defendants GTFM, LLC, FUBU the Collection, LLC and GTFM Of Orlando, LLC Edward R. Garvey, Esq. and Christa Westerberg, Esquire Garvey & Stoddard, P.A. 634 W. Main St. #101 Madison, WI 53703 Attorneys for Defendants Harlem Globetrotters Int'l, Inc., Harlem Globetrotters Int'l Foundation and Mannie L. & Catherine Jackson Anders Rosenquist, Jr., Esquire Florence M. Bruemmer, Esquire ROSENQUIST & ASSOCIATES 80 E. Columbus Phoenix, AZ 85012 Attorney for Plaintiff Lemon Safia A. Anand, Esquire Ira S. Sacks, Esquire 499 Park Avenue New York, NY 10022 Attorneys for Defendants GTFM, LLC, FUBU the Collection, LLC and GTFM of Orlando, LLC Certificate of Service Vanessa Braeley, declares as follows: 1. I hereby certify that on December__2nd_, 2005, a true and correct copy of the Plaintiffs' Statement of Facts was electronically transmitted to the Clerk's Office using the CM/ECF System for filing and transmittal of a Notice of Electronic Filing to the following CM/ECF registrants: Safia Anand ­ [email protected] Florence M. Bruemmer ­ [email protected], [email protected] Joel Herz ­ [email protected], [email protected]

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Ira Sacks ­ [email protected]

2. I am and was at all times mentioned herein a citizen of the United States and a resident of Orange County, Florida, over 18 years of age and not a party to the within action or proceeding. My business address is 20 N. Orange Avenue, 16th Floor, Orlando, FL 32801, and I am employed as a legal assistant by Morgan & Morgan, P.A., Clay Townsend is an attorney admitted to practice in Florida and has been admitted pro hac vice in the District Court of Arizona, and directed that service be made.

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1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Joel L. Herz LAW OFFICES OF JOEL L. HERZ LaPolma Corporate Center 3573 E. Sunrise Dr., Suite 215 Tuscon, AZ 85718-3206 Attorney for Defendants, GTFM, LLC, FUBU the Collection, LLC and GTFM OF Orlando, LLC Anders Rosenquist, Jr. Florence M. Bruemmer ROSENQUIST & ASSOCIATES 80 E. Columbus Phoenix, AZ 85012 Attorney for Plaintiff Lemon Edward R. Garvey Christa Westerberg 634 W. Main Street, Ste. 101 Madison, WI 53703 Attorneys for Defendants Harlem Globetrotters Intl Inc. and Harlem Globetrotters Int'l Foundation Safia Anand, Esquire and Ira S. Sacks, Esquire Dreier, LLP 1350 Broadway 11th Floor New York, NY 10018 Attorneys for Defendants, GTFM, LLC, FUBU the Collection, LLC and GTFM of Orlando, LLC 3. I declare under penalty of perjury under the laws of the United States that the foregoing is true and correct. DATED: December___2nd_, 2005 Signed: _____/S/Vanessa L. Braeley_______ _______ Vanessa L. Braeley Legal Assistant to Clay Townsend MORGAN & MORGAN 20 N. Orange Avenue, 16th Floor Orlando, FL 32801 3. I hereby certify that on December __2nd__, 2005, a true and correct copy of Plaintiffs' Statement of Facts, postage paid thereon, was sent via U.S. Mail to the following parties, at the addresses listed, to-wit:

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Attorneys for the Plaintiffs Curly Neal, Larry Rivers, Dallas Thornton, Marques Haynes, Robert Hall and James Sanders

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