Fielding Success: Navigating The Legal Landscape Of Venue Naming Rights And Sponsorship Agreements

For sports fans, stadium names like MetLife Stadium, Coors Field, and the United Center represent more than just famous landmarks. Stadiums and arenas named for corporate sponsors have become inseparable from the teams that call these venues home and the unforgettable, emotional moments that unfold within their walls. Teams and their home venues may be seamlessly connected in the minds of fans, but for venue operators and brand marketers, stadium names are the result of intricate and high-stakes negotiations involving significant financial commitments, strategic branding considerations, and long-term partnerships between the brand sponsors and venue stakeholders.

At its core, a naming rights deal is a sponsorship transaction that accords an entity the exclusive right to incorporate its branding into a venue’s name, usually accompanied by additional sponsorship benefits, in exchange for a substantial annual fee. In recent decades, the prominence and value of these deals have surged. In 1991, only five teams across the major sports leagues played at a venue with a naming rights sponsor,¹ whereas today, more than 90% of professional sports teams in the U.S. play in venues with naming rights sponsors.² Similarly, sponsor naming rights deals in 1991 averaged less than $1,250,000 annually,³ while today, the most lucrative deals may be valued at upwards of $35 million per year.⁴

For sponsors, the benefits of a naming rights deal include the opportunity to gain long-term brand exposure and the positive associations that come with being linked to popular sports teams. In turn, venues receive a considerable revenue stream to help cover construction, expansion, and operational costs. As the value of a naming rights deal continues to rise, the expectations from and complexity of these agreements also increase. For sponsors, venue operators, teams, leagues, and other organizations involved in a stadium naming rights negotiation, it is imperative to address numerous business and legal considerations to set the stage for long-term success for all parties involved.

Defining the Scope of Naming Rights and Related Sponsorship Benefits

The cornerstone of any naming rights agreement lies in defining the scope of the naming rights during the term of the relationship. This includes critical decisions such as the exact name to be used for the venue, the design and appearance of the stadium logo, how, when, and where these elements will be displayed, and the roles and responsibilities of each of the parties involved. Typically, the naming sponsor takes the lead in creating the logos and stylized versions of the stadium name to align these elements with the sponsor’s branding and marketing strategy. Since the venue will have a right of approval over these designs, this process often commences in advance of contract negotiations so that design mock-ups can be approved prior to executing the agreement.

Equally important is the delineation of ownership and control over the naming rights, including the contractual and corporate relationships between the venue operator, the sponsoring entity, the tenant sports teams, and often the leagues that count those teams as members. Teams and their home venues may be seamlessly connected in the minds of fans, but the underlying business and legal structures can be complex. For sponsors, the primary appeal of a venue naming rights deal is often to create an affiliation with the team that plays there and, as a result, the rights to use the branding of the team can be as important as, or more important than, the rights to be associated with the venue itself. When a team and stadium are under common ownership, the path to a naming rights agreement may be more straightforward. Conversely, if the branding of the team is owned by a third party, careful diligence and negotiations by the sponsor will be required to ensure that it can leverage the team’s branding for promotional purposes.

The agreement should precisely define the scope of the term “Stadium” to avoid ambiguity regarding the spatial extent of the sponsor’s rights, particularly with respect to adjacent or ancillary facilities that may fall outside the core venue structure. While it might seem straightforward that the sponsor’s name will appear on the main structure, additional facilities in or around the stadium—such as parking lots, restaurants, training facilities, shops, and hotels—may be controlled by third parties. If the sponsor wants its rights to extend to these areas, separate agreements with these third-party owners or lessees may be necessary. Even areas controlled by the stadium owners might be excluded from the naming rights agreement if the venue reserves the right to sell naming rights for ancillary or adjacent facilities separately. For example, naming rights might be reserved for specific areas or structures within the stadium (e.g., the “Chase Square” entrance at Madison Square Garden) and/or in connection with a title sponsorship at the stadium (e.g., the “Apple Music Super Bowl Halftime Show”).

A major focus of negotiations often centers on signage featuring the sponsor’s branding within and around the stadium. This typically includes incorporating the sponsor’s name into the venue’s name and identifying where the name will be displayed (such as exterior signage on the building, rooftops, or entrance gates) as well as on traditional advertising displays like billboards and video boards. For the sponsor, the goal is to become synonymous with the venue and establish a strong, lasting association between the brand and the home team. The sponsor will want to ensure that its branding stands out compared to any other corporate sponsors with a presence in the stadium and that this prominence extends to all digital and fixed signage in or around the facility and all events held therein. As a result, sponsor representatives will push for precise language in the agreement regarding all aspects of signage rights, including size, location, type, and illumination. Experienced legal counsel and sports marketers will identify the most valuable areas for exposure, including parking lots and major intersections near the stadium, and will seek protection against anything that could obscure or diminish visibility of the signage, such as poor lighting or digital obstructions during broadcasts or streaming of games.

In addition to traditional signage, the agreement must also address the stadium’s obligations to promote the official name and logo. An exclusive naming rights sponsor will want the venue’s name and logo to appear on all programs, trash cans, tickets, media bibs, employee and security uniforms, cups, napkins, luxury suite signs, advertisements, press materials, and on the venue’s website and social media posts. The sponsor’s legal team will also require commitment from the venue that only the new name and logo will be used by the venue and its employees in all references to the facility and events. Additionally, the sponsor will typically seek a commitment from the venue to use its best or commercially reasonable efforts to ensure that third parties, such as local broadcasters, other sponsors, media partners, city signage, and maps also properly refer to the venue by its official name.

Some events may be excluded entirely from the scope of the sponsor’s rights under the naming rights agreement. The brand sponsor should not expect to receive any of its branding benefits, and, in fact, should not be surprised to see fixed signage covered by the party that owns and controls the sponsorship rights to an excluded event (e.g., FIFA World Cup or Olympic events). Comprehensive disclosure by venues and proper diligence by naming rights sponsors are the best ways to avoid problematic situations during negotiations, or, even worse, after signing a long-term agreement.

Exclusivity

Category exclusivity is a crucial element of a naming rights deal, granting the sponsor exclusive rights to promote its products and services within specific categories at the venue. This extends beyond signage at the stadium, encompassing promotional activities, branding initiatives, sales opportunities, hospitality perks, and other sponsorship affiliations. By carving out specific product or service categories, sponsors can create a distinct space within the venue’s commercial landscape. This exclusivity also gives sponsors a competitive edge by preventing rivals from using the venue’s platforms and channels to promote competing products or services—an especially important advantage in industries where brand differentiation is key. It also enhances the sponsor’s affiliation with the venue and the teams when paired with designators identifying the category (e.g., “the official bank of X venue and team name”).

Defining product categories within naming rights agreements requires careful consideration and negotiation between sponsors and venue operators. Venues tend to favor narrowly tailored definitions to preserve future monetization opportunities with other partners, whereas sponsors tend to advocate for broad and inclusive definitions of product or service categories to capture evolving business models and maximize exclusivity protection. Venues also must ensure compliance with any restrictions on exclusive rights to third parties within the category. These competing interests result in negotiations that delve into granular details, such as subcategories or specific exclusions, to ensure that both parties’ expectations are met.

Crafting category definitions that effectively protect sponsors from key competitors can be particularly challenging, especially as companies diversify their business lines, making traditional categorization less clear. Consider a scenario where the naming sponsor is a telecommunications company, and a key competitor operates not only in telecommunications but also in entertainment and technology. If the sponsor’s exclusive category is telecommunications, can the stadium sell sponsorship rights to the competitor for its entertainment or technology divisions? What about general advertising that promotes the competitor’s brand without mentioning specific products or services? In such cases, the sponsor might seek broader contractual protections concerning specific named competitors or define the category to include any company that offers directly competing products or services within the relevant market.

From the venue operator’s perspective, it’s imperative to clearly delineate any exceptions or carve-outs to exclusivity provisions, including rights retained by leagues, third-party event organizers, or pre-existing sponsors, to avoid conflicts and post-signing disputes. The parties may agree to exceptions for certain events at the stadium where sponsorship rights are controlled by third parties. Similarly, if a team playing its home games at the venue is owned by a third party, that team may have its own sponsorship arrangements allowing competitors some visibility within the stadium. Leagues, too, enter into their own sponsorship deals that supersede the rights of the venue naming rights sponsor pursuant to league regulations. Pre-existing sponsorship deals may also need to be addressed, although naming rights sponsors are often only willing to proceed with deals with assurances that no such pre-existing conflicts exist.

Intellectual Property Usage Rights

A shared benefit of any naming rights deal is the mutual granting and definition of intellectual property rights, particularly trademark rights, between the sponsor and the venue. With top-level professional teams, the brand’s use of a team’s intellectual property is primarily to establish an affiliation with the team for the benefit of the sponsor. For smaller teams and venues, association with a high-level brand partner can boost the team’s value and consequently increase the value of other sponsorship opportunities. To derive these benefits, each party grants the other a license to use their respective trademarks and applicable copyrightable materials. Clearly documenting the scope and terms of these licenses is necessary to avoid conflicts and protect the interests of both sides.

Typically, the sponsor retains ownership of the newly developed trademarks, including the stylized venue name and associated logos, while granting the venue a limited, non-exclusive license for use in connection with the venue’s branding, operations, and promotional materials. While the venue’s use of the sponsor’s trademark as the name for the venue is the most visible aspect of the deal, the sponsor’s right to use the venue’s and team’s trademarks for marketing and promotional purposes is equally important. Careful consideration should be given to the needs of the brand in connection with the use of the venue’s and team’s intellectual property. For example, sponsors frequently seek to promote their association with the venue and team through titles like “Official Soft Drink Partner” or “Exclusive Vehicle Sponsor.” They may also want to use these trademarks on their websites and social media platforms, and in digital marketing campaigns, advertising spots, co-branded merchandise, or event-based activations. To enable this, the naming rights agreement must include a license from the venue and/or team that allows the sponsor to leverage its intellectual property, reinforcing the sponsor’s connection with the venue and team.

Each party to a naming rights agreement is bound by specific constraints and restrictions regarding the usage of the other’s intellectual property. For instance, it is common for the venue to stipulate that the licensed marks cannot be used to promote products or services beyond the naming sponsor’s contractually defined exclusive category. This provision not only helps the venue avoid conflicts with existing sponsors but also preserves the option to extend exclusive rights to other categories.

Additionally, venue and team trademarks may be subject to league rules, collective bargaining agreements, and other third-party rights and/or restrictions limiting where and how the sponsor can use the trademarks and other IP. For example, some professional sports leagues control the licensing of team and venue trademarks outside the local television territory and across various media channels, including social media, websites, and mobile apps. In an era where business transcends geographical boundaries and brand engagement is increasingly shifting to digital platforms, such limitations can present significant hurdles for sponsors.

Furthermore, any use of player-related attributes—including name, image, and likeness—will typically require separate authorization, as these rights are governed by the right of publicity and, in many cases, controlled collectively through players’ unions or third-party licensing agencies. All players have the legally recognized right to control the commercial exploitation and/or appropriation of their name, nickname, image, likeness, signature, and other characteristics that are inherently associated with their identities. Historically, unions have been aggressive in enforcing certain exclusive rights to the commercial use of the names, images, and likenesses of their player-members. Accordingly, a sponsor’s use of materials incorporating the name, image, or likeness of league players will typically require a separate license from (and, often, additional fees to) a third-party rightsholder. Sponsors should fully understand any applicable third-party restrictions, such as league rules and collective bargaining agreements, and work with venues to obtain any required licenses to support the sponsor’s marketing strategies.

Risks

Stadium naming rights agreements are generally long-term commitments, frequently lasting between ten and twenty years for more established teams in the most popular U.S. leagues, and represent a significant investment for both corporate sponsors and stadium operators. The extended duration of these deals, while financially rewarding, also carries inherent risks, including:

Events of Force Majeure: Extraordinary events beyond the control of either party, or so-called force majeure events, can severely impact naming rights deals by disrupting the stadium’s ability to host games and provide the agreed-upon benefits to the sponsor. When games are canceled or fans are restricted from attending events, high-value benefits such as suites, club-level seating, and in-venue hosting privileges cannot be delivered, often with little or no alternative that offers comparable value. A prime example is the COVID-19 pandemic, which led to the cancellation of numerous sports seasons and events worldwide, but more common disruptions include natural disasters and weather-related incidents. ⁵

Lockouts and Strikes: Labor disputes, including lockouts and strikes, can halt sports seasons or delay event schedules, significantly affect the sponsor’s return on investment, and present another risk to stadium operations. A prime example is the 2011 NBA lockout, which shortened the season from 82 to 66.⁶ Similarly, the 1994 MLB strike resulted in the cancellation of that year’s World Series and the final eight weeks of the regular season, with attendance declining by 20% when games resumed in 1995.⁷The strike’s long-lasting impact on fan interest and attendance further eroded the return on investment for sponsors tied to baseball venues across the country.

Relocation of Teams: If the home team relocates to a new venue, the operator of the new venue may not be obligated to provide the sponsor with the same benefits it enjoyed at the original stadium. Take, for example, the relocation of the Seattle SuperSonics (now the Oklahoma City Thunder) from their home arena in Seattle to Oklahoma City in 2008. Following the Supersonics’ departure, their naming sponsor faced a drastic reduction in brand exposure and marketing opportunities without the draw of a major sports team playing its home games at the arena.⁸ In that case, however, the naming rights deal reportedly accorded the Supersonics’ naming rights partner the right to renegotiate the agreement in the event of the team’s relocation, giving it leverage to renegotiate the agreement on more favorable terms.⁹ The sponsor’s reduced sponsorship fee under the new deal (reportedly less than a quarter of what it paid under the prior agreement)¹⁰ reflects the dramatic loss in sponsorship value that resulted from the relocation.

The relocation of a team can also eliminate access to premium hospitality benefits (such as branded suites or exclusive ticket blocks) that were central to the sponsor’s activation strategy at the original venue. These hospitality assets may be tailored to the sponsor’s needs and located in prime areas designed to impress and engage key business stakeholders. If the sponsor is not guaranteed comparable rights in the new venue, the loss of these assets may be difficult to recoup.

Scandals: Scandals involving any associated parties can have far-reaching repercussions, impacting the reputation of both the venue and its sponsors. One striking example is the Astros’ ill-fated stadium naming rights deal with Enron. In 2000, the Houston Astros secured a lucrative 30-year, $100 million naming rights agreement for the Astros’ ballpark, then known as Enron Field.¹¹ However, just over two years later, Enron’s fraudulent accounting practices came to light, leading to public outrage, shareholder lawsuits, and one of the largest corporate bankruptcies in U.S. history.¹² The continuing affiliation of Enron with the team and stadium was clearly problematic for the team.

Superseding Third-Party Rights and Obligations: Naming rights agreements may be subject to various third-party actions, agreements, policies, and rules, including venue lease agreements, league agreements and policies, collective bargaining agreements, and local, state, and federal laws and regulations. This complex web of obligations can sometimes lead to conflicts and challenges, affecting the sponsor’s branding objectives and expectations. For instance, during national game broadcasts, a stadium may be obligated by their league agreements to digitally replace the naming sponsor’s signage with on-screen graphics that incorporate the branding of league sponsors. While the naming rights agreement may prohibit the venue from physically covering or obscuring the naming rights sponsor’s signage, these restrictions may be superseded by the venue’s obligations to the league. Stadiums and leagues now resell prime signage real estate—such as the signage behind home plate—on a territory-by-territory basis, allowing different advertisements to appear depending on the viewer’s location. This evolving practice of localized ad replacement creates opportunity for leagues, teams and venues, but poses a growing challenge to preserving the value of naming rights deals for sponsors.

Addressing Risks

Given the risks and the long-term nature of most naming rights agreements, it is crucial for each of the parties to proactively address potential risks and establish contingency plans. One of the venue’s preferred solutions for mitigating these concerns is the so-called “make-good” or substitute benefit. This involves offering the sponsor additional benefits to make up for any contractual benefits that the venue is unable to deliver. Make-goods can take many forms, such as extra in-stadium or broadcast advertising, social media promotions, or hospitality perks like complimentary tickets, exclusive tours, or invitations to special events. During the COVID-19 pandemic, for example, many venues shifted their focus to digital platforms to provide substitute benefits to their sponsors.¹³ Make-good arrangements frequently incorporated substitute digital and broadcast assets, including social media activations and additional branded content opportunities intended to offset the loss of traditional in-person exposure.

However, from the sponsor’s standpoint, substitute benefits may not adequately compensate for the opportunity cost or brand value lost due to disrupted or diminished in-venue activation. This is particularly true where business objectives depend on in-person engagement and hospitality assets, such as corporate suites. The intangible value of being associated with a live, professional sporting event can be difficult to quantify or replicate through digital alternatives. Additionally, the make-goods offered by the venue may not align with the sponsor’s marketing goals or timing. For instance, if the sponsor has already saturated the market with ads, adding more through make-goods might lead to diminishing returns. Many sponsors use sports venue sponsorships as part of a business-to-business marketing strategy, where hospitality benefits on game day are of primary importance and designed to maximize opportunities to develop business with potential clients or strategic partners. For these sponsors, the loss of a premium suite used for networking or client engagement cannot be compensated by additional ads or digital exposure primarily aimed at consumers.

While make-goods may be the initial solution for missed benefits, it is essential to consider what happens if the parties cannot agree on what constitutes an acceptable substitute. Accordingly, sponsors frequently seek more robust contractual remedies, including prorated fee adjustments, refund rights and/or early termination rights, triggered by defined contingencies such as prolonged force majeure events, team relocation, or reputational harm resulting from scandal. From the venue’s perspective, on the other hand, the primary goal in any sponsorship deal is to maximize revenue and establish financial security, as stadium naming rights are regularly part of key financing relationships for the venue.

Losing a naming sponsor can be highly disruptive, as it takes time and resources to secure a new deal and replace existing signage. As a result, venues are generally resistant to contract terms that allow for early termination or a reduction in the sponsor’s financial commitment. The terms governing a sponsor’s right to terminate the agreement or receive a refund or credit are often the most heavily negotiated in naming rights deals. The agreement must clearly outline the specific circumstances that trigger termination, refunds, or credits. For example, if a prolonged lockout prevents home games, can the sponsor terminate the deal? How many missed games would justify termination? What happens if the home team relocates—does the sponsor have termination rights, and does it matter if the move is temporary? Should either party have the right to terminate if the other is involved in a scandal? If so, the agreement must define what type of scandal qualifies (e.g., actions of moral turpitude, hate speech, or disparaging remarks) and whose conduct is relevant (e.g., owners, executives, employees, players, or coaches). Carefully defining these conditions is essential to ensure that risk is allocated fairly.

Naming rights deals have evolved into essential partnerships that drive value for both sponsors and venues. The surge in the prominence and financial stakes of these deals underscores their importance in today’s sports ecosystem. Securing naming rights offers unparalleled brand visibility for sponsors, while venues benefit from a revenue stream that supports operational costs and enhances the overall fan experience. The complexity and scale of these agreements require due diligence on one’s partners, and meticulous negotiation to navigate an increasingly intricate landscape of business and legal considerations. Comprehensive drafting, anticipatory risk allocation, and ongoing cooperation between legal and commercial stakeholders are essential to maximizing the strategic value of naming rights transactions and safeguarding both parties’ interests over the contract term.

Footnotes

1. Maidie Oliveau, What’s in a Name? (Or, Why Pay Millions to Name a Building), 32 Entertainment and Sports Lawyer (Spring 2005).

2. Naming rights agreements: coming soon to an arena near you!, Lavery (Sept. 20, 2023), available at https://www.lavery.ca/en/publications/our-publications/4344-naming-rights-agreements-coming-soon-to-an-arena-near-you-.html.

3. Oliveau, supra note 1.

4. Barry M. Bloom, Crypto.com Buys Naming Rights to Staples Center in Los Angeles, Sportico (Nov. 17, 2021), available at https://www.sportico.com/business/sports/2021/crypto-com-buys-naming-rights-staples-center-1234646772/.

5. How the coronavirus is affecting sports leagues and events, Los Angeles Times (Mar. 30, 2020), available at https://www.latimes.com/sports/story/2020-03-09/coronavirus-latest-news-sports-world.

6. Howard Beck, N.B.A. Schedule a Cram Course for Teams, New York Times (Dec. 6, 2011), available at https://www.nytimes.com/2011/12/07/sports/basketball/nba-schedule-a-cram-course-for-teams.html/.

7. 1994 strike was a low point for baseball, ESPN.com (Aug. 10, 2004), available at https://www.espn.com/mlb/news/story?id=1856626.

8. Bill Virgin, KeyArena lost a tenant; will it lose a name?, Seattle Post-Intelligencer (July 21, 2008), available at https://www.seattlepi.com/news/article/keyarena-lost-a-tenant-will-it-lose-a-name-1279874.php.

9. Andrea Cirignano, With Sonics Gone, City Renegotiates Key Arena Contract with KeyCorp, Seattle Courant (Mar. 25, 2009), available at https://seattlecourant.com/With_Sonics_Gone_City_Renegotiates_Key_Arena_Contract_with_KeyCorp.html.

10. Key To The City: Seattle Renegotiates Arena Naming-Rights Deal, Sports Business Journal (Oct. 6, 2008), available at https://www.sportsbusinessjournal.com/Daily/Issues/2008/10/07/Facilities-Venues/Key-To-The-City-Seattle-Renegotiates-Arena-Naming-Rights-Deal/? .

11. Bill Shaikin, Astros Rid Selves of Enron, Los Angeles Times (Feb. 28, 2002), available at https://www.latimes.com/archives/la-xpm-2002-feb-28-sp-enron28-story.html.

12. Id.

13. Five Ways Covid-19 Reshaped Sports Sponsorship and Marketing, Sportspro (Mar. 20, 2025), available at https://www.sportspro.com/features/sponsorship-marketing/covid-19-sports-sponsorship-marketing-trends-five-years-crypto-influencers-revenue/.

Originally published by LA Lawyer, May/June 2026 issue.

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