67 Am. U. L. Rev. F. 1 (2018).

*Professor Emeritus, Wake Forest University School of Law.  A.B., Brown University, 1968; J.D., University of Chicago Law School, 1971.  Professor Newman would like to acknowledge Professor Thomas S. Goho, the Thomas S. Goho Chair of Finance (Emeritus), Wake Forest University School of Business, and Professor Ralph Peeples, Wake Forest University School of Law, for their help.  Professor Newman offers these acknowledgements free of charge.

In his Article, Professor Drennan notes that naming rights often have significant value.  Therefore, he reasons that, when charitable contributions are made, the value of such naming rights should be subtracted from the amount of the contribution.  Only the excess should be a tax-deductible contribution, and the burden should be on the donor to show that such an excess exists.

To make this proposal work, there must be a way to determine (1) which categories of naming rights might be significant benefits; and (2) how such benefits can be valued.  As to the first, Professor Drennan has given us some examples of some rights that are clearly significant, and some rights that are clearly not.  However, there are a lot of rights in between that should be addressed.

As to the second, in the noncommercial context, valuation is impossible.  Therefore, donors will fail to meet their burden, and their contributions will be nondeductible.  To solve this problem, as Professor Drennan suggests, donors and donees will agree at the outset on the value of the naming rights.  However, such agreed valuations will also serve as liquidated damages, making it easier for donees to renege.  As a result, donors will probably limit the duration of their naming rights in the first place.  This result would be a step forward.