September 30, 2022

Volume XII, Number 273

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MLB To Allow CBD Sponsorships

Recently, Major League Baseball (MLB) informed teams that cannabidiol (CBD) sponsorships were no longer off limits and that they were free to pursue sponsorships in the CBD category under certain conditions. CBD companies will also no longer be prohibited from airing commercials during MLB game telecasts.

According to MLB’s Chief Revenue Officer Noah Garden, to be permitted, CBD sponsorships must promote products that are certified as not containing psychoactive levels of THC, the main active ingredient of cannabis. Any CBD product with concentrations of THC above 0.3% would not be permitted, as it is classified as marijuana, which is a Schedule I illicit substance. All CBD sponsorships will also require signoff by the MLB Commissioner’s Office.

MLB is the first of the four major US sports leagues to permit CBD sponsorships. Previously, only UFC and NASCAR had opened up the CBD sponsorship category for sale. And while MLB has opened the door to certain CBD sponsorships, for now, neither MLB nor any of the other major US sports leagues permit sponsorships in the broader cannabis category.

This change follows the new MLB collective bargaining agreement freeing up MLB teams to sell advertising positions on team jerseys and player batting helmets beginning with the 2023 season. MLB has confirmed that these lucrative jersey and batting helmet positions will not be off-limits to CBD companies. Garden noted specifically that “[MLB is] open-minded to doing a patch deal [in the CBD category], depending on the brand and what that brand represents. It has to [be] a brand that represents sports.”

Time will tell if MLB, its teams, and its fans embrace CBD sponsorships, but with cannabis industry valuations exceeding $13 billion in 2021, the rule change opens the door to a potentially lucrative sponsorship category.

© 2022 ArentFox Schiff LLPNational Law Review, Volume XII, Number 230
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About this Author

Richard L. Brand Partner ArentFox Schiff LLP
Partner

Rich focuses on sports law, real estate and corporate transactions, e-commerce, hospitality and leisure, and partnership and corporate law.

Rich is recognized as a leading sports attorney by Chambers USA, a “Leading Lawyer” in sports by Legal 500, and as a leading real estate attorney by Best Lawyers and Legal 500Best Lawyers has also recognized Rich as a “Lawyer of the Year” for his high-profile sports work. Chambers USA notes, “he is highly regarded for his expertise in representing both...

415-757-5507
Shahiedah Shabazz Chicago Cannabis Attorney ArentFox Schiff
Associate

Shahiedah Shabazz is an Associate in ArentFox Schiff's Chicago and Los Angeles offices. She provides land use and zoning, regulatory licensing and compliance, and transactional real estate counsel to clients in a range of cutting-edge industries, drawing from over a decade of experience.

Shahiedah assists property owners, developers, institutions, and investors with local land use and environmental compliance. In addition, Shahiedah advises businesses in the California cannabis industry on compliance with state and local laws and regulations....

312-258-5500
Zak Welsh Associate ArentFox Schiff LLP
Associate

Zak’s practice focuses on advising clients on corporate and transactional matters in the sports, entertainment, media, and real estate industries. Zak has considerable experience representing professional sports franchises, owners and operators of professional sports and entertainment venues, sponsors in connection with naming rights transactions, sponsorship transactions, facility and event leasing and licensing, advertising and promotional agreements, suite and club seat licensing, and other related matters.

In addition to his sports and...

415-757-5901
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