In the eyes of the law

I have to admit, I wasn’t really following this case until I read a very articulate editorial by Drew Brees, a Quarterback for the New Orleans Saints and former Austinite, in the Austin American Statesman (1-11-10 – page A7). Apparently the Supreme Court will be hearing American Needle v. NFL, Supreme Court Docket No. 08-661; an antitrust case brought by an Illinois manufacturer of hats who lost its antitrust claim in the Federal Court of Appeals in Illinois (7th Circuit). The antitrust claim arose from the NFL’s granting an exclusive license to Reebok to manufacture NFL fan products such as hats, jackets and the like. As the Illinois company, American Needle, pointed out, the effective monopoly has in fact increased prices for such fan gear since Reebok was awarded the contract in 2001, and has prevented smaller companies from getting into the market. The Supreme Court will decide if the NFL should be considered one entity (in which case there is no monopoly because you can’t have a monopoly with yourself) or 32 separate entities (in which case they could be found to be conspiring to restrain trade in the fan product area). What Mr. Brees pointed out was that this ruling could also affect the NFL’s ability to monopolize other areas. Apparently the NFL made the unusual request to the Supreme Court that it rule the NFL is one entity for purposes other than just fan gear. The result which Mr. Brees fears is that such a ruling could effectively overrule the 1993 decision in McNeil v. NFL, 790 F. Supp. 871, 896-97 (D.Minn. 1992), a previous antitrust lawsuit against the NFL, which paved the way for free agency among football players. Depending on how far the Supreme Court goes, the decision in the American Needle case could have ramifications for free agency, ticket prices, and, of course, fan gear, in other sports as well.