SCOTUS Sacks NFL’s Claims of Antitrust Immunity

May 24, 2010 -

The Supreme Court of the United States has ruled against the Nation Football League (NFL) in terms of specific antitrust language, which emerged from a lawsuit brought against the sports entity by apparel manufacturer American Needle.

American Needle had charged that the NFL’s exclusive apparel agreement with Reebok limited competition, violated the Sherman Act and led to higher prices for consumers. American Needle further charged that an agreement between NFL Properties (NFLP) and Reebok did not allow the company to negotiate apparel agreements with individual teams.

In its decision (PDF), authored by retiring Justice Stevens, SCOTUS unanimously reversed a lower court’s ruling, and, according to SCOTUS Blog, “cleared the way Monday for trial of a lawsuit against the joint marketing of the right to use the teams’ logos and trademarks on consumer goods.”

The decision hinged around Section 1 of the Sherman Act, which dictates, “Every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several States, or with foreign nations, is declared to be illegal.”

In the decision, Stevens wrote “We conclude that the NFL’s licensing activities constitute concerted action that is not categorically beyond the coverage of §1 [Section 1].”

Between 1963 and 2000, NFLP granted nonexclusive licenses to a “number of vendors,” including American Needle. December of 2000 saw NFL Properties formed and a 10-year exclusive headwear deal for all 32 teams granted to Reebok. American Needle’s license was not renewed.

While the NFL had argued that “by forming NFLP, they have formed a single entity, akin to a merger, and market their NFL brands through a single outlet,” Stevens wrote, “An ongoing §1 violation cannot evade §1 scrutiny simply by giving the ongoing violation a name and label.”

A few more choice tidbits:

Although NFL teams have common interests such as promoting the NFL brand, they are still separate, profit-maximizing entities, and their interests in licensing team trademarks are not necessarily aligned.

It may be, as respondents argue, that NFLP “has served as the ‘single driver’’ of the teams’ “promotional vehicle,” “‘pursu[ing] the common interests of the whole.’” But illegal restraints often are in the common interests of the parties to the restraint, at the expense of those who are not parties.
 

As the SCOTUS Blog further noted, “The Court also did not decide whether the NFL did in fact act illegally in this specific marketing effort.”

If, in a forthcoming trial, it is ruled that the NFL did act illegally, LawsofPlay (earlier this year) outlined a scenario of what such a ruling could mean for the videogame world:

While this could lead to more competition in the sports gaming markets, it could also lead to really wonky arrangements–imagine EA releasing an NFL game with 20 NFL teams and a dozen or so fantasy teams to round out the roster while 2K releases a game with the 12 NFL teams missing from EA’s game and a handful of its own fantasy teams.


Thanks BearDogg-X!!


Comments

Re: SCOTUS Sacks NFL’s Claims of Antitrust Immunity

The NFL never had anti trust immunity I don't think.

The only two I can think of are Majore League Baseball, and the insurance industry, which was hopefully yanked, and I won't cry for MLB fi theirs is yanked.

Re: SCOTUS Sacks NFL’s Claims of Antitrust Immunity

I am with LawsofPlay here. It would be great if individual teams could market themselves to any company, I don't think it will translate as well for games.

Sure a single team could allow for more than one company to make a game using their logo and players, but who really wants to play Vikings Football. People want to play the whole roster of teams.

In the end, this might work out well for merchandise like shirts, hats, coats, bobble-heads etc, but not do much for games.

E. Zachary Knight
Oklahoma City Chapter of the ECA
http://www.theeca.com/chapters_oklahoma

Re: SCOTUS Sacks NFL’s Claims of Antitrust Immunity

I don't think it'll work out too well for merchandising, either, since, as I understand it, the team owners wanted a single entity to make those decisions.  Now, they're being told that was illegal, forcing every team to do their own merchandising.

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Andrew EisenOh yeah, some outlets sensationalize things (especially with the chosen headline). No argument there. As far as gender issues not being widespread? I'm inclined to disagree but I suppose it depends on what specifically you're talking about.09/19/2014 - 3:43pm
SleakerI think I've been qualitatively informed by those Factual Femenist videos that there isn't reallly a widespread gender issue, and that there are select news outlets that try to sensationalize things.09/19/2014 - 3:37pm
james_fudgeI'm just going to leave this here before someone else does:http://yiannopoulos.net/2014/09/19/gamejournopros-zoe-quinn-email-dump/09/19/2014 - 3:21pm
NeenekoI have met some real jerks and slimeballs in gender activism, but when I hear the idea that there are many 'not nice' people it comes across as code for 'uppity people who do not know their place'.09/19/2014 - 12:10pm
Andrew EisenKrono - Many of the people pushing gender issues aren't nice people? I'm sure not everyone's a sweatheart but so far, everyone I've seen with such a critique had absolutely nothing to back them up.09/19/2014 - 10:46am
InfophileI think there's a qualitative difference between a site and a hashtag though. GP can ban anyone from commenting, so they can have the image they want. But anyone can use any hashtag and try to poison it. Granted, that hasn't happened to the other one yet09/19/2014 - 10:13am
E. Zachary KnightKrono, your comparison to GP does not work. We do not need to get rid of GP, because no one associates GP with trolls and abuse. The same can't be said for gamergate.09/19/2014 - 10:09am
Krono@Michael You don't remember the "other hashtag" because no one actually uses it. We're talking 836,983 uses of #gamergate over it's lifetime, and 8,119 for the "alternative". 47,129 uses on the 18th vs 41. With #notyourshield at 140,133 uses & 5,209 uses09/19/2014 - 9:48am
Kronoresearch it. Changing tags to get away from trolls would be like wiping GamePolitics and restarting under a new name to get away from people calling Jack Thompson a filthy names in the comments section.09/19/2014 - 9:35am
Sleaker@quiknkold - seems like all that page is is a bunch of random developer opinions and rumors that we're supposedto do what with?09/19/2014 - 9:31am
Kronoas an opportunity to push back against them. It's one of the things muddling the issue. @conster A new hashtag would do nothing to improve anything. Trolls will simply follow to the new hashtag, and it will confuse the issue for anyone attempting to09/19/2014 - 9:25am
Krono@Andrew aaah. Yes, I'm sure there's some of that. Part of the problem is many of the people pushing gender issues are not very nice people. Basically the latest incarnation of moralists we've seen in the past couple decades. Naturually some will take this09/19/2014 - 9:23am
quiknkoldhttp://www.nichegamer.net/2014/09/real-gamedevs-sound-off-regarding-the-gamergate-controversy/09/19/2014 - 8:35am
MaskedPixelanteMeanwhile, in news that actually DOES matter, Scotland voted "NO" to Scottish independance.09/19/2014 - 8:20am
ConsterSeriously? "We shouldn't make a new hashtag - it's better to associate ourselves with psychos than to decrease our visibility"?09/19/2014 - 7:54am
Michael ChandraI forget what it is exactly, but there already is another hashtag that some use, exactly to separate themselves from the abusive behaviour. So don't bother lying to me.09/19/2014 - 7:06am
quiknkold2 to 3 or more09/19/2014 - 6:53am
quiknkoldMichael Chandra : I'll say this. The only reason they havent used another hashtag is because it would look like a form of dividing the arguement. Using another Hashtag has come up, and they feel like if they made a new hashtag, it'll split the debate from09/19/2014 - 6:53am
Michael ChandraYou want a debate? Build a wall between you and the poisoned well. Make clear you despise it, despise the behaviour. Then get into the other issues you are troubled with, and don't say a single word again about the poisoned well.09/19/2014 - 3:46am
Michael ChandraAnd someone claiming #notyourshield was to be taken serious, when chatlogs show they wanted it going to hide even more harassment behind? Yeah, not buying a word you're saying. You poisoned your own well.09/19/2014 - 3:45am
 

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