Antitrust Exemption: Major League Baseball

Antitrust Exemption: Major League Baseball

ANTITRUST EXEMPTION

MAJOR LEAGUE BASEBALL

ANTITRUST EXEMPTION

MAJOR LEAGUE BASEBALL

Federal Antitrust Laws have not applied to professional major league baseball since the first milestone decision of the U.S. Supreme Court in 1922 in the case of Federal Baseball Club of Baltimore, Inc. v. National League of Professional Baseball Clubs, 1922. This work will review the federal antitrust exemption in major league baseball and summarize the same and will state findings and a conclusion

The work of Glaucio Scremin published in the Sports Journal and entitled: "Impact of Antitrust Laws on American Professional Team Sports" states that: "Major antitrust litigation decisions involving professional sports have not only affected the sport industry but they have also played a role in overall antitrust jurisprudence." (Cozzillio & Levinstein, 1997; as cited by Scremin, 2005; page number not cited by Scremin). According to Scremin (2005): the first professional sport to be granted exemption form the federal antitrust laws was the case of Baseball Club of Baltimore vs. The National League of Professional Clubs claiming antitrust violations had occurred. The contention of the plaintiff in this case in addition to antitrust violations were that the "acquisition of baseballs clubs from other leagues gave the National League monopoly over the relevant market of baseball teams." (Scremin, 2005; p.1)

The findings of the U.S. Supreme Court were unanimous that: "the National League monopoly over the relevant market of baseball teams." (Scremin, 2005; p.1) The Supreme Court made reaffirmation in the antitrust exemption in baseball in the case involving George Toolson and the New York Yankees which challenged the player reserve system as being in violation of federal antitrust laws. Toolson was reportedly, while under contract with the Yankees assigned to another club and refused to report and placed on the ineligible list. (Toolson v. New York Yankees, 1953; Picher, 1997; as cited by Scremin, 2005; p.1) Interstate commerce law was not upon what the court relied in its decision but stated that ruling to be based on the factors of: congressional awareness of the Federal Baseball Club decision coupled with legislative inaction; (2) the baseball industry's development during the previous thirty years, on the understanding that it was not subject to existing antitrust legislation; (3) a reluctance to abrogate Federal Baseball Club with the consequential retrospective effect; and (4) a declared desire that, if there are evils in this field, any remedy should be adopted by legislative fiat" (Toolson v. New York Yankees, 1953; Picher, 1997; as cited by Scremin, 2005). It is interesting to note that: "with the exception of baseball, to some extent, all other major professional sports have had to adapt their rules and policies to comply with antitrust law." (Scremin, 2005) The principle was again tried in the case Flood v. Kuhn in 1972 but the U.S. Supreme Court reaffirmed the exemption.

ANALYSIS

According to the U.S. Supreme Court due to exemption from antitrust laws claimants making claims based on federal antitrust laws in the major league did not have sufficient basis for suit because the U.S. Supreme Court did not assume jurisdiction over the baseball teams even though clubs did travel across state lines and even though players could be transferred across a state line to another club. The reasoning for this is the fact that during the development of the existing antitrust legislation as well as the development of the national major league of baseball that no consideration existed for the federal antitrust laws as they did not have jurisdiction of the league historically and that none was assumed by the baseball league to exist.