National Pastime Case

As this article is being written, a strike scuttled one of the most exciting baseball seasons in years and threatens future ones as well. The strike marked the eighth consecutive time the "National
Pastime" has been interrupted following the expiration of a labor-management agreement. At the same time, baseball owners steadfastly refuse to appoint a Commissioner for fear that the
Commissioner's traditional power to act "in the best interests of baseball" might interfere with their own personal interests.' Additionally, two precedents arising out of the National League's refusal to allow the San Francisco Giants to relocate to Tampa Bay pose a serious threat to baseball's historic exemption from the antitrust laws.' The litigation follows several
congressional inquiries, during which former Commissioner Fay Vincent acknowledged that a significant motivation for baseball owners' reluctance to permit expansion or relocation to Tampa Bay was their desire to keep that area open as a "baseball asset"3-a candid admission that many franchises have used the threat to relocate to Tampa in or-
* Professor of Law, University of Illinois. A.B., J.D., University of California (Berkeley).
This Article has been in the making for several years. I have had the opportunity to employ some of the arguments contained herein in testimony before a House committee, see
Baseball's Antitrust Exemption: Hearing Before the Subcomm. on Econ. and Commercial
Law of the House Comm. on the Judiciary, 103d Cong., 1st Sess. 163-89 (1993) [hereinafter
Brooks Hearings], and in a brief filed as pro bono counsel to the Consumer Federation of
America and Sports Fans United in Butterworth v. National League, 644 So. 2d 1021 (Fla.
1994). For extremely helpful comments on earlier drafts, I wish to thank Jim Brudney, Bill
Eskridge, Phil Frickey, Lee Goldman, Warren Grimes, Kit Kinports, John Nowak, Ed Weil, and Nick Zeppos.
1. Murray Chass, A Decision: No New Commissioner, N.Y. TImEs, Jan. 20, 1994, Sec.
B, at 15.
2. Piazza v. Major League Baseball, 831 F. Supp. 420 (E.D. Pa. 1993); Butterworth v.
National League, No. 82,287 (Fla. 1994). Baseball owners reached a monetary settlement with the Piazza plaintiffs; in Butterworth, the Florida Supreme Court held that baseball's exemption would be narrowly construed and did not immunize the National League from the Florida Attorney General's antitrust investigation, which is apparently closed.
In addition, a class action has recently been filed on behalf of businesses located near baseball stadia, season-ticket holders and fans, asserting Sherman Act challenges to a host of practices by Major League Baseball. McCoy v. Major League Baseball, No. C95-0383R
(W.D. Wash).
3. See Baseball Antitrust Immunity: Hearing Before the Subomm. on Antitrust, Monopolies and Business Rights, Senate Comm. on the Judiciary, 102d Cong., 2d Sess. 33
(Serial No. J-102-90) (1992) (hereafter Metzenbaum Hearings).
ENTERTAINMENT & SPORTS LAW REVIEW der to force their existing communities to provide generous public subsidies for new stadia at below market rents." Moreover, even if the 1994 season had been completed, a new broadcast agreement signed by baseball's moguls would have denied fans, for the first time since national telecasting began, the opportunity to watch all post-season games on over-the-air television. Combined with the looming threat of pay-per-view, baseball fans may well be forced to pay to watch games they can now view for free.
Each of these woes can be traced directly to the monopoly power that Major League Baseball exercises-power that is attributable to the judicially created exemption baseball enjoys from the antitrust laws. This exemption was last ratified by the Supreme
Court in its 1972 decision in Flood v. Kuhn.5 Flood's specific holding was that the historic "reserve clause," by which clubs agreed never to compete for the services of players who were the "property" of another team, was exempt from antitrust scrutiny. At the time, the Court believed that requiring clubs to compete under the antitrust laws would ruin the sport. Today, by contrast, it appears that the Court's assumption is wrong: (1) the competition for players resulting from developments in labor law has helped, not hurt, the sport; (2) allowing owners to demand that players agree to excessive restrictions on competition, and depriving players of the option of filing an antitrust suit to block such restrictions, has increased, rather than decreased, labor strife; and (3) permitting baseball owners to conspire to block expansion or relocation into lucrative areas has hurt fans and taxpayers, both in these areas and in communities with existing teams. Given the current labor
4. See, e.g., John Kass & Daniel Egler, Sox Will Stay if Legislature OKs Proposal,
CHICAGO TRIB., May 12, 1988, Part I, at 1; Giants OK Deal to Leave - League to Vote on
Sale to Florida Group, SAN FRANCISCO CHRON., Aug. 8, 1992, at Al (San Francisco Giants owner, disenchanted with current stadium and voter refusal to subsidize a new one, shopping team around to any buyer, with no regard for keeping team in the area); Stefan Fatsis,
Seven Strikes and Still Swinging: St. Petersburg Still Hopes to Get a Major-League Team,
CLEVELAND PLAIN-DEALER, July 14, 1993, at 5F (detailing emergence of local buyers to prevent relocation to Tampa of teams in Oakland, Minnesota, and Dallas-Fort Worth).
Tax subsidies and favorable stadium deals have replaced local media revenues as the most important factor in franchise value and profitability, allowing mid-size market clubs such as the Texas Rangers, Baltimore Orioles, and Cleveland Indians to earn above-average incomes. Michael K. Oznian and Brooke Grabarek, Foul!, FIN. WORLD, Sept. 1, 1994, at 18-
20.
Of course, baseball's acting Commissioner, Milwaukee Brewers' owner Bud Selig, would never threaten to move to Tampa for such exploitive purposes. Rather, if sufficient tax subsidies were not forthcoming in Wisconsin for the Brewers, Selig threatened to move to Phoenix or Charlotte! Andrew Zimbalist, Baseball Economics and Antitrust Immunity, 4 SgroN
HALL J. SPORT L. 297, 303 (1994).
5. 407 U.S. 258 (1972).
[Vol. 12:169
FLOOD v. KUHN dispute and the recent precedents about franchise location, reconsideration of the holding in Flood v. Kuhn could not be timelier.
Within the academia, two very different groups of legal scholars have devoted a great deal of attention to Flood. Those specializing in sports law have either attacked Flood as a ridiculous decision that improperly distinguished between baseball and other professional sports, or have praised it for waging guerilla warfare on the idea that Section 1 of the Sherman Act should apply to intra-league arrangements by owners of professional sports teams.6
Those viewing Flood through the lens of statutory interpretation perceive the decision as adhering rigidly to the principle of stare decisis; this rigidity has been both praised and criticized, and
Flood has also been attacked for unjustifiably relying on legislative inaction to infer congressional support for earlier precedents.7
In this Article, an alternative theory is sketched. Although
Justice Blackmun's majority opinion in Flood was eminently sensible in 1972, as a matter of both judge-created sports law doctrine and the legisprudential application of stare decisis, this is no longer the case. In 1972, Justice Blackmun and his colleagues in the majority were justifiably concerned that applying the Sherman
Act to professional baseball might ruin our "National Pastime."
However, a brief look at subsequent developments in baseball and in antitrust law clearly demonstrates that the situation has changed. Read in its full context, rather than mechanically, the majority opinion in Flood applies a fact-based legisprudential standard to questions of stare decisis, not the formalistic approach that some have attributed to it.' Flood represents neither an un-
6. Compare Robert G. Berger, After the Strikes: A Reexamination of Professional
Baseball's Exemption from the Antitrust Laws, 45 U. PIr. L. REV. 209 (1983), with Brooks
Hearings, supra note *, at 77 (Statement of Prof. Gary Roberts). See also Gary R. Roberts,
Sports League Restraints on the Labor Market: The Failure of Stare Decisis, 47 U. PITT. L.
REV.
337, 340 n.7 (1986) ("for all practical purposes, baseball is constrained in essentially the same way as all sports leagues would be if properly treated as single firms for section 1 purposes"). 7. Compare Lawrence A. Marshall, "Let Congress Do It": The Case for an Absolute
Rule of Statutory Stare Decisis, 88 MICH. L. REV. 177, 229 (1989), with William N. Eskridge,
Jr., Overruling Statutory Precedents, 76 GEO. L.J. 1361 (1988); and William N. Eskridge,
Jr., Interpreting Legislative Inaction, 87 MICH. L. REV. 67, 106 (1987). See also
Berger, supra note 6, at 209; and C. Paul Rogers III, Judicial Reinterpretation of Statutes:
The Example of Baseball and the Antitrust Laws, 14 HouSTON L. REV. 611, 622 (1977).
8. A host of commentators have read Flood as refusing to overturn prior precedent because of stare decisis, or simply because Congress had failed to pass corrective legislation.
See, e.g., Martin H. Redish & Shane V. Nugent, The Dormant Commerce Clause and the
Constitutional Balance of Federalism, 1987 DuKE L.J. 569, 589 n.112; Robert A. McCormick,
Baseball's Third Strike: The Triumph of Collective Bargaining in Professional Baseball,
35 VAND. L. REV. 1131, 1149 (1982); Lee Goldman, Sports, Antitrust, and the
Single
1995]
ENTERTAINMENT & SPORTS LAW REVIEW thinking invocation of the dead weight of precedent, nor an unsophisticated and unwarranted deference to a congressional failure to overturn the Court's prior decisions. Rather, its holding is much more limited. Flood reveals that the Court will adhere to a precedent where it perceives that reliance interests are strong and that the public interest is better served by preserving the precedent.
Under this reconsidered view of Flood, the Supreme Court today should reach the opposite result and subject baseball to antitrust scrutiny. This Article is not intended to persuade critics of Flood v.
Kuhn that Justice Blackmun's opinion was the only correct resolution of the case; the Court could have used the opportunity to subject baseball to the rule of reason standard ultimately applied to sports organizations in 1984.' Nor is it intended to persuade
Flood's supporters that Major League Baseball is an abusive monopolist that should be subject to the antitrust laws, since that topic has been addressed in detail elsewhere. 10 Rather, it is intended to demonstrate that Justice Blackmun's opinion may have been misunderstood.
Flood was written during Justice Blackmun's second full term on the Supreme Court. At the time, some referred to him as the
"Minnesota Twin," a moniker that accurately described his love of his hometown baseball team but, as history proved, incorrectly suggested his identification with the more conservative jurisprudence of his fellow Minnesotan, Chief Justice Warren Burger. Over twenty years of hindsight have led to the recognition that, instead of basing his decisions on arid legalities, Blackmun was a jurist committed to deciding cases in their real context and interpreting statutes with an appreciation of the evolving and dynamic quality of law." Viewed as an example of dynamic and contextual statutory interpretation, Flood was a justifiable response by a Court concerned that inflexible application of an 1890 statute would ruin a great American institution. However, courts have since demonstrated that they are able and willing to apply the antitrust laws