Minor League Baseball Teams Petition Supreme Court to Challenge Century-Old Antitrust Ruling Against MLB
Two minor league baseball teams, the Tri-City Valleycats and the Norwich Sea Unicorns, are seeking to challenge a century-old Supreme Court ruling that exempts professional baseball from antitrust scrutiny. The teams are urging the Court to overturn the exemption, arguing that it lacks supporters, benefits one organization, and fails to promote fairness or uniformity.
The Valleycats and Unicorns have filed a lawsuit against Major League Baseball (MLB) and its 30 teams under the Sherman Antitrust Act. They claim that MLB unlawfully conspired to deprive MiLB teams of MLB affiliations during the reorganization process a few years ago. However, both the Southern District of New York and the U.S. Court of Appeals for the Second Circuit have sided with MLB, citing the Supreme Court’s decision in Federal Baseball Club v. National League.
In 1922, the Supreme Court ruled that MLB is exempt from federal antitrust law because the games are played within one state, and antitrust law requires interstate activity. This ruling has been heavily criticized for its inconsistency, as players, fans, equipment, and broadcasts associated with baseball games often cross state lines. The Supreme Court has declined to disturb the ruling over the past century, despite reservations expressed by some justices.
The teams’ petition draws on statements from justices who have questioned the exemption. Justice Samuel Alito, in an article, highlighted the irony that the real losers in the Federal Baseball Club case were local people. Justices Neil Gorsuch and Brett Kavanaugh have also criticized the exemption in recent rulings.
The petition argues that while stare decisis, the principle of following established Supreme Court precedent, is important, it should be less confining when interpreting the Sherman Act. The petition also claims that Congress did not intend to exempt specific businesses or industries from the Act’s coverage.
The potential relocation of the Oakland Athletics (A’s) to Las Vegas is presented as an argument for Supreme Court review. The petition argues that MLB has leveraged its exemption to facilitate the relocation, prioritizing its own needs over the needs of the market, fans, and consumers.
Additionally, the petition contends that MLB’s franchise policies create artificial scarcity, depriving smaller markets of clubs that could thrive in a competitive environment. MLB Commissioner Rob Manfred has defended the exemption, stating that it promotes franchise stability and preventing antitrust challenges when relocation requests are denied.
The Valleycats and Unicorns face an uphill battle in getting the Supreme Court to hear their case, as only a small percentage of petitions are granted review each year. Although the baseball exemption may seem like a niche topic, the Department of Justice has shown interest by filing statements seeking clarification on the exemption’s validity. Members of Congress have also discussed potentially revoking the exemption.
It remains to be seen whether the Supreme Court will consider the case. The outcome could have significant implications for the future of antitrust regulation in professional baseball.
