As I type this article, the Kansas City Chiefs JUST defeated the Buffalo Bills to secure their spot in the Super Bowl, where they will face off against the Philadelphia Eagles.
If the Chiefs win, it will be their THIRD Super Bowl victory in a row. And as you probably know, winning three championships in a row in any sport is universally referred to as a “three-peat.“
And because we are in the realm of a potential “three-peat,” the Chiefs will have a very unusual fan pulling for them to win. That person? Retired NBA coach Pat Riley. Why? Well, thanks to an extremely shrewd business decision roughly 25 years ago, Pat Riley happens to own the trademark for the term “three-peat.” Pat will get paid a royalty for every hat, poster, bumper sticker, mug, jacket, commemorative plate… that uses any variation of those two little words. Here’s how this all came to be and what it could mean for Mr. Riley’s bank account if the Chiefs win…
(via Getty)
Pat Riley has an impressive resume. He won his first NBA Championship as a player on the 1972 Lakers, then went on to win five more rings as a head coach. Two of his rings came consecutively in 1987 and 1988 while he was coach of The Lakers. Heading into the 1989 season, Lakers guard Byron Scott was the first person to use the term “three-peat” as a way to motivate his teammates. Pretty soon, “three-peat” became the rallying cry for all Lakers fans throughout Los Angeles. The three-peat looked like a done deal after The Lakers, led by league MVP Magic Johnson, swept Portland, Seattle, and Phoenix to land in the NBA finals against The Detroit Pistons. Unfortunately, The Pistons shut down all hope of a three-peat when they crushed The Lakers in a swift four-game sweep. But for Pat Riley, there was a silver lining.
After hearing Byron Scott use the phrase “three-peat,” Riley made a shrewd business decision: In November 1988, Riley submitted an application to trademark the term “three-peat” through his corporate entity “Riles & Co.”. A few months later, the application was approved, and trademark #1552980 was granted. This meant that anytime someone used that phrase commercially, they would have to pay Pat Riley a licensing royalty. If the Lakers had won in 1989, “three-peat” would have been plastered on thousands of t-shirts, mugs, hats, banners, stickers…etc… and Pat Riley would have cashed in.
As we know now, The Lakers came up short of their three-peat in 1989, but just a few years later, the Chicago Bulls were finally able to pull it off. Twice. The Bulls won three consecutive championships from 1991 to 1993 then again from 1996 to 1998. After both series, Pat Riley made out like a bandit when at least half of the NBA’s official merchandise licensees opted to use “three-peat” on some form of collectible.
In 1993, Riles & Co. reportedly earned $300,000 in licensing royalty fees. After the 1998 series, Pat’s royalty income doubled to nearly $600,000. Over the last 25 years since the trademark was granted, Riles & Co has cashed in on dozens of other three-peat occurrences all over the world. Even Riley’s own Lakers finally pulled off the feat between 2000 and 2002. The Lakers’ 2002 three-peat put $1 million into Riles & Co’s coffers.
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Side trivia: Boxing announcer Michael Buffer got the idea to trademark his famous catchphrase “Let’s Get Ready to Rumble!” after hearing about Pat Riley’s success with “threepeat.” Michael’s half-brother Bruce Buffer helped secure the trademark in 1993, just a few months after the Bulls pulled off their first three-peat. Recollecting the origin, Bruce would later say in an interview: “When I decided to trademark the rumble phrase, part of my inspiration was ‘three-peat’ and the Riley story. It just solidified that you can do this.” Thanks to the Rumble trademark, Michael Buffer would eventually go on to earn more than HUNDREDS OF MILLIONS of dollars in licensing and royalty fees. I wonder if Michael ever sent Pat a thank you note?!
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If the Chiefs pull off a three-peat, Pat’s company will likely demand (and receive) either a 10-15% royalty rate for every dollar’s worth of three-peat merchandise that is sold or a one-time flat fee for the rights. Either way, Riles & Co could earn $2-3 million in merchandise royalties.
Over the years, Riles & Co. was granted several other trademarks based on variations of the term, most notably “3 Peat”. Riley also successfully defeated a group in Los Angeles that attempted to trademark the term “Three-Pete” in reference to USC football coach Pete Carroll’s run at three consecutive national championships. When Riley challenged the trademark application, a patent court ruled that the spelling was not dissimilar enough, and “three-Pete” was rejected.
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