Antitrust Case Could Change Landscape of Sports (NFL vs. American Needle)
 

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Lester Munson is giving the doomsday scenario, but it sounds pretty bad if the NFL (and other leagues including the NCAA and BCS) can declare themselves a single entity. It would essentially eliminate all antitrust actions against these organizations. Doesn't sounds pleasant or reasonable at all.

Clickable link

National Football League goes after big game in landmark American Needle antitrust case - ESPN

Hopefully the Court sides with the unions. If not there will probably be strikes.

I like all the naive comments on there suggesting owners will drastically lower ticket prices if the NFL wins and can force a reduction in player salaries.

This is a fascinating case. But I doubt the Supreme Court will go as far as to issue anything definitive.

I also don't think the NFL expects to win, or understands what will happen if it does win and fails to make life even better for the players.

On the surface, there's nothing wrong with a league owning all player contracts and operating all the franchises. But if they expect to maintain their current economic power and fight off competition from what we now consider jokes like the UFL and the XFL and the USFL, the NFL had better avoid the doomsday stuff predicted in this article.

Again, though, the idea that the Court is suddenly going to throw out Sherman entirely is ludicrous.

+1

Has always amused me that American sports have such a socialist backdrop to them ... ie. they act as a collective and avoid capitalist principles as much as possible, heck even the drafts are a way of sharing 'nicely' with other teams.

I've always wondered why people who are so anti-socialist principles in other areas - ie. healthcare for instance, accept it so readily in the sporting arena.

Also if the leagues do get accepted as a true single entity will people still really believe the teams are competing against each other rather than just putting on a WWF kind of show?

+1

In all honesty, I would expect swift action from Congress should the Court grant a sweeping victory for the NFL. Sherman needs an overhaul as many majority opinions have incorporated Chicago school theories.

Prepare to get flamed for 2 pages by fans of small market teams.

You can't be serious.

yeah-wtf are we hxxp'ing goddamn espn for?

I really don't see how the NFL can sell anyone on the idea that they are a single-entity when they have 32 different businesses with their own books and profits and the compete for players, personnel and money. It really seems to me the NFL is overplaying its hand here.

It's also hard to believe the Supreme Court will even touch the question the NFL wants answered. The court rarely if ever answers a question beyond what is asked in the substance of the lawsuit. The lower court ruling is that NFL Properties is a single entity, not the NFL. It seems very unlikely the court will go all the way and rule that the NFL is a single-entity, especially when it clearly is not.

To me the danger is that the court seems much more likely to reverse or limit the scope of Copperweld, the precedent used to support the lower court ruling.

And as noted above, the NFL getting what it wants would almost certainly invite a Congressional response and write into law restrictions and limits on the power of the NFL, BCS and other sports leagues. The sport leagues don't have a lot of fans in DC right now.

I have a feeling that the NFL is going to end up disappointed on this one. No matter how "pro business" the justices are on the Supreme Court, they still tend to rule based on case law. I don't see them effectively overturning past rulings like free agency and such in favor of complete domintation of the league.

Isn't baseball exempt from antitrust laws anyway? And yet none of these doomsday scenarios have played out.

I assume you are using the major European soccer leagues as the alternative, where the free market in players is the rule, buy or sell anyone and the market determines the price. I don’t think that model would work well in a static league where there is only one trophy to play for. In soccer there are the domestic cups, there are the relegation battles and there are the European spots to try to qualify for. So while there are only a few teams in each league that are realistically playing for the league title (and it is no mystery who those teams will be even before the first game is played) virtually every team is playing for something late into the season.

I haven't read the 7th Circuit's opinion yet (been way too busy at work), but I plan to.

Despite this court's pro-business leanings and the recent string of rulings that have cut hacked away at some aspects of antitrust law, I would be surprised if the Supreme Court granted the NFL the blanket exemption they are looking for. From what I've read, I sort of agree with the 7th Circuit's opinion on this issue.

I don't think there's any real chance of the Supreme Court cutting back on Copperweld. Not this Court.

There's another case currently going on in Federal Court in California that strikes a little closer to home. It's a class action brought on behalf of gamers in California and DC suing EA sports for abuse of monopoly power in football games as a result of acquiring the exclusive NCAA and NFL rights.

Yay, antitrust! Keep up the lawsuits, people. H_B needs to keep putting food on his table.

it always amazes me how few people cant figure out how the NFL (and other major leagues in the US) work. the NFL is a single corporation with 32 franchises, its competition is other entertainment and sporting events. this isnt european soccer where the teams compete against each other for prize money, NFL teams arnt competing over $$. the games are the entertainment, NBA NHL and other tv programs are the opponents.

you dont see Mcdonald franchises trying to get an advantage and put other Mcdonald franchises out of business, they compete against other food joints.

I think some European leagues are also reluctant to try and level the playing field because that would hurt their team's chances of success in continental competitions, something that US leagues don't have to worry about.

Bullpuckey. Fast Food is not sports. they are a football monopoly. As a football fan, if you get locked out of the NFL, you're locked out period. Especially when it comes to TV, etcetera (for example, Sunday Ticket)

It's funny, I have a good friend whose English we often go 'round and 'round on this debate, usually with respect to the salary cap.

I think the reasons are pretty easy to root out. I think people, Americans and otherwise, are all for sports teams competing vigorously and in a very capitalist type fashion. It's just a question of where this competition is taking place. Those in favor of salary caps and drafts and what not, believe that competition in sports should take place within the realm of the sport, not left up to which team has the most money. The team who has the best management, best scouts, best player development and, thus, the best players and teams should be the teams that are rewarded, not the team whose owner happens to have the deepest pockets.

If it all comes down to which team has the richest owner, then you get a situation like you have in the Premiership (or whatever it's called these days) where the same 4-5 teams compete each year and all of the other teams essentially become "feeder teams" for the teams with the most money. Granted, some teams got to their position of wealth because of solid management and taking advantage of TV contracts and the like, but others rose to prominence just because a wealthy owner happened to buy them instead of some other team.

Obviously, the flaw in the salary cap system is that even teams who draft great, develop great could still get "punished" for being too successful. Still, I will take that risk for the fact that this system allows for more than just a handful of teams can actually compete for the championship.

American Needle wins 9-0.

I'll post a link to the opinion when it is available.

Basically, the NFL is not exempt from anti-trust. This opinion does NOT hold whether the agreement in question violates anti-trust. It just holds that the district court erred in holding that it should not even apply the anti-trust law b/c the NFL is legally exempt from it.

Interested to see how this affects something like the EA Sports exclusive agreement, if at all.

I believe the exclusive agreements are awful for sports game consumers, as the games seem to thrive most when they have healthy competition.

any more legally educated posters have any thoughts on this?

I will have to read it before I can really comment. I know there are a number of pending antitrust litigations regarding EA Sports exclusive agreements with the NFL. I imagine that every plaintiff in every one of those cases has already filed this decision with their respective court as "Supplemental Authority".

I just hate how taxpayers support these businesses (stadiums) and then get locked out. Never made a whole lot of sense of me.

Yay the Supreme Court got one right. Not that the company will necessarilly win its anti-trust suit, but this woulda been an ugly precedent.

To be fair, 9-0 is pretty much "Thanks for coming. You had no shot at winning but here's a lovely copy of our home game". Getting these 9 to agree on something, well...

SI