[MUSIC] We're going to have another play act session with my teaching assistant, Ricky Volante. Welcome back, Ricky. >> Thank you. >> Doing a great job. Keep up the great work. We have to ask as we finish the session on representing the superstar athlete, the management of perhaps the biggest brand in all of sports right at the moment. LeBron James, did he make the right decision from a brand management standpoint to come back to Cleveland? >> Well, I will try to set aside my Cleveland Cavalier fanhood for a second, but I believe that from a brand perspective he made the right choice. Nike and LeBron James now have the opportunity to brand an entire series of agreements focusing on the idea of redemption. Focusing on the idea of the return and coming home. This will allow them to kind of change the perspective that has been created around LeBron James in the last four years of being the bad guy. And turn him back into the white knight that he was during his days in Cleveland. How important is it for LeBron to win a World Championship in connection with exploiting those publicity rights and that marketing campaign worldwide, to China, where that's very important to LeBron and his agents? >> Well, obviously winning championships always helps your brand. However, in this particular instance, I think that his brand has already been maximized by the fact of coming home. It's an idea that appeals to so many Americans, and so many people internationally, of righting your previous wrongs. So from a brand perspective, again, winning a championship, obviously, you want to be at the end of your career and at the end of the day, compared to Michael Jordan or compared to a Kobe Bryant in terms of number of championships. However, the setup that they've managed to take here allows them a lot of ability to maximize, both in terms of dollars and just brand recognition. >> We're going to have a post on this. We want to hear from everybody in the class about what they think about this decision. But let's go to the drafting of the product endorsement agreement and the clauses therein, which we've now studied, and the license agreement. In terms of category definition, how important is it and there have been many case studies written at Harvard Business School about LeBron and Maria Sharapova. How important at drafting, now you're the attorney for LeBron and his agency, what would you say in terms of defining the category for his Nike brand, how narrow could it be? How narrow should it be? And what categories would you leave open? >> Well, if I am LeBron and LRMR, I'm going to try to make those categories as narrow as possible. So, that you can maximize on the number of them. The only way that you ever, as player or agent, want to have a large or broad category is if you are getting the dollars. Worth having, and allowing one company to pigeon-hole yourself into such a broad category. Now with Nike, they tend to have a reputation for, they want everything. [LAUGH] >> Would you give him a piece of the action, so to speak? We see this trend, we see in LeBron's deal with Beats, that he got a percentage equity. And then when that was sold, he got a huge bang for his buck. Or would you go for a licensing fee? Which would you recommend? >> Well, I would say getting a piece of the action in that sense that LeBron got with Beats Dr. Dre. They left the category open enough that they were still able to sign an agreement with Samsung which also sells headphones obviously. And through that careful negotiation and careful categorization, they were able to maintain getting the ownership portion of that as well as getting paid for something for a category very similar at the same time. So again just very well done by LRMR, and the way they just capitalized the total revenues for LeBron. >> So, we're talking also about morals clauses throughout our lessons now that we're representing the peak professional athlete. Given the branding that he has achieved, do you think he could get a clause that would say, you can only cancel this if i'm convicted of a felony. Which is the highest level to protect your athlete. That's what the athlete agent attorney would like to have. Morris Clause it says, you can only cancel me if i'm convicted of a felony. Is that a clause that's even attainable by a LeBron? >> I would say that if there is an athlete that can do it, it may very well be LeBron James. His brand and his power that he has gained over the entire league as we saw during the NBA free agency is almost immeasurable at this point. And again, if there's an athlete that could do it. >> Let's go back to, he's done non-conforming behavior that materially damages the Nike brand. Would you agree that language, if it were offered by Nike back to you as attorney for LeBron and LRMR? >> Well, first I would want material damage. I would want that defined very strictly. [LAUGH] However, in the end, the agreement between Nike and LeBron is a partnership. Both brands want to be able to maximize their efforts. And the only way to do that is if you don't disparage Nike as LeBron. >> Certainly, can't disparage the product. And there was the case last year, where the shoe company was changing shoes publicly during the first quarter of a game, something the shoe company, I'm sure, forgave and forgot. Let's just finish with one last category, since we're going to talk about it, have talked about it, will continue to talk about it, and that is the lithograph or the poster category, the image category, the license agreement, which we've studied throughout this course. In that case, would you reserve that category from Nike, or would you let them own it? >> I would say, it depends. It would obviously depend on the amount that Nike's willing to pay for that category. If you feel that you're getting fair market value or more, then I don't see a reason allowing Nike to possess it. Granted you have to do the appropriate studies and things to determine how much that will be worth going forward. But in the end, from LeBron's standpoint, you're trying to maximize the number of dollars that you can get. So, whatever's going to bring you the most amount of money is the route you want to go. >> As a former sports marketing expert as an undergrad, could a trademark be associated with the slogan the return? >> I would say it could because just with the age that we live in. I know the Twitter hashtag the return was going around quite a bit while LeBron was making his decision. And it became synonymous one with the other. So if you can create that ability to, for people to relate the term the return to LeBron James. And you certainly have the groundworks to, at least, try to make a case to have the trademark. >> For the audience, though, as the attorney now, would you recommend that at least some publicity right be attached to that phrase, to be able to trademark and protect it? >> Yes, and again, with Nike and LeBron, they certainly have the ability right now to create an entire line of clothing focusing on the return. Much like they did with the witness line that they had during LeBron's first time in Cleveland. >> Thank you, Ricky. That was great. And thank you for being with us again. I hope you'll share with us your thoughts. This will be the post for this week, we'll look forward to your thoughts. Please manage this superstar brand with us, let us know what you think. Were we right, wrong? Perhaps we're indifferent to how you view this case? It's perhaps the most important case out there in representative professional athlete right now. We've tried to give you the tricks of the trade, as well as the clauses that could help or hurt the extension of a brand like LeBron. And we hope you'll share this journey with us and let us know what you think you would do if you were representing LeBron James as he returns to Cleveland. So thank you for your attention, and we look forward to catching up with you in the next lesson. [MUSIC]
