Sturgis approves contract with rally trademark holder, despite objections

Publish Date: 
Jan 10, 2013

STURGIS, S.D. – The Sturgis rally trademark wars are flaring up again, with the son of the Black Hills Motor Classic’s founder lobbing barbs at the Sturgis City Council meeting this week.

Jack Hoel, the son of Pappy Hoel, told the council and City Manager Daniel Ainslie Monday night that the city should not have to pay for the use of its own name.

His comments came as the city finalized its contract renewal with Sturgis Motorcycle Rally Inc. (SMRI), which owns the rights to the Sturgis name as it relates to the annual motorcycle rally.

“This is nothing but a gift to SMRi,” Hoel said.

The contract in 2011 cost the city nearly $50,000 that included royalties paid for land the city leased and banner sales to official sponsors, Sturgis Mayor Mark Carstensen said, as reported in the Rapid City Journal.

The city will not have to pay those royalties in the future. The contract passed Monday is retroactive to the 2012 Sturgis motorcycle rally, the mayor said.

Under the five-year contract approved Monday, the city will continue to pay 10 percent to SMRI for the use of the Sturgis trademarks which, in addition to the name Sturgis, includes Sturgis Motorcycle Rally, Sturgis Bike Week, Take the Ride to Sturgis, Sturgis Rally & Races, and Black Hills.

Ainslie said the city received $269,440 from the 2012 rally as a result of its sponsorship license agreement.

“The 10 percent royalty payment is identical to the previous agreement, which was originally entered into between the city and the chamber,” Ainslie said.

Posted by Holly Wagner