US: NFL falls victim to sports’ latest antitrust woes

Following a 2010 decision by the Supreme Court to reinstate a lawsuit against the National Football League, reports say a federal judge has ruled that the league may have violated antitrust law in its exclusive contracts to sell merchandise, denying requests for summary judgment.

US District Judge Sharon Johnson Coleman has given new life to the lawsuit, filed by merchandise vendor American Needle, that claims the NFL broke antitrust law in its exclusive contract inked in 2001 with rival vendor Reebok to sell hats. American Needle filed its lawsuit against the NFL, Reebok and 30 of the NFL’s 32 teams after the NFL failed to renew its license with American Needle.

But the 7th Circuit court dismissed the suit in 2008 on the grounds that the NFL acts as a single entity and is immune to antitrust law.

The Supreme Court, however, reinstated the case in 2010 when it ruled that each team acts individually to pursue its own corporate interests when it comes to selling team merchandise and licensing its intellectual property.

While both sides requested a summary judgment, Judge Coleman denied their bid last week, deciding that “there is sufficient evidence to permit a jury to find that American Needle could have continued as a licensee under the traditional structure, and that its prospects were ended by defendants’ concerted decision to limit the number of their licensees.”

American Needle claims NFL licensed hat wholesale prices rose significantly following the agreement made between the League and Reebok. The NFL claims, however, that even if it had not struck a deal with Reebok it would not have necessarily renewed its contract with American Needle.

The lawsuit is only the latest in antitrust woes for professional and collegiate sports in the US.

Major League Baseball is currently embroiled in its own lawsuit regarding competition law that questions baseball’s antitrust exemption, due to a legal dispute over the attempted relocation of the Oakland A’s stadium to San Jose, where the San Francisco Giants have claimed rights.

San Jose is suing the MLB in a case that questions territorial rights and geographical market share of franchises.

The National Collegiate Athletics Association is similarly facing antitrust hurdles as lawsuits bring in to question NCAA athlete compensation. A lawsuit filed accuses the NCAA of price-fixing to keep athlete wages down.

Full Content: Courthouse News Service

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