Could baseball cards lead to the end of the antitrust exemption?

AmLaw Daily is talking about that MLB-Topps baseball card deal from last week and raises the notion that Upper Deck could file an antitrust suit. Countering that is the assertion in the article that “In 1922, the U.S. Supreme Court established a common-law exemption for Major League Baseball in cases involving antitrust laws, a decision most recently affirmed in 1972.”

Well, sorta. Given the rather fluky basis of the exemption itself, the scope of baseball’s exemption is rather murky. Yes, the Flood court said in 1972 that it’s up to Congress to fix the original 1922 ruling, but many courts have hacked into it over the years and there really is no clear consensus as to how broad it is. I’ve long argued that a well-conceived challenge to the exemption could pass muster with the courts, mostly because, the Supreme Court’s comments in the Flood case notwithstanding, there is nothing stopping it from changing its mind and overturning the Federal Baseball Club of Baltimore case. I don’t know if baseball cards can form the basis of a well-conceived challenge, but I’m guessing that Upper Deck is going to seriously consider the issue.

As a childhood baseball card dude I’d rather like, on sentimental grounds, to see order and brand scarcity injected back into the card market if at all possible. Indeed, I blame Upper Deck for kind of ruining much of what I liked about cards back in the day. But I’d much rather see baseball’s antitrust exemption disappear than a small part of my childhood restored, so I’m rooting for Upper Deck in this one.

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Comments

  1. Detroit Michael said...

    Didn’t Congress pass a law after the 1994-95 work stoppage that said that baseball’s anti-trust exemption did not apply to collective bargaining matters any longer?  If so, then it implicitly endorsed the rest of baseball’s anti-trust exemption, making it more unlikely that the U.S. Supreme Court would change it now.

    Of course, my recollection may be wrong.

    The most likely outcome is to threaten to challenge baseball’s anti-trust exemption merely as a litigation strategy.  The chances that the suit exhausts all appeals are remote.

  2. Matt Mitchell said...

    Shyster,

    Could the American Needle v. NFL case that is pending a hearing in the Supreme Court have something to do with this move by MLB? I believe a pact like this could be bulletproof if the NFL prevails in that case.

  3. Craig Calcaterra said...

    I think that’s right, Matt, but even if the Needle case loses, it doesn’t mean that this pact looses, because baseball—unlike football—still believes if has the antitrust exemption on its side.  The Needle case is going to live or die based on whether it passes actual antitrust muster.

  4. 3LT said...

    Craig, while this is clearly anti-competitive behavior, its not of the per se illegal type (hell, I’m pretty sure the per se rule is dead, at least after the series of decisions handed down in ‘06).  Correct me if I’m wrong, but, baseball owns the rights to the cards, team logos, etc.  As such, the only way to prove concerted refusal to deal would be to find some smoking gun doc from a topps exec asking mlb not to deal with fleer, et al (obv. you’re not going to find this).  Furthermore, the devolution of the per se rule has lead to increased procedural steps that, as you know, prolong litigation and virtually make it impossible to impose liability upon a putative wrong-doer.  I think something like 96% of all anti-trust plaintiffs end up losing.

    Also, I’m rather sure the issue in american needle is whether the NFL can be considered a singular entity (and thus not able to collude with itself, or engage in monsanto-type conspiratorial behavior).

  5. tadthebad said...

    Excuse the ignorance, but what exactly does the anit-trust exemption provide for MLB?  I’ve heard it mentioned as the reason for a variety of things, but never quite gleened its true meaning or implications.

  6. kendynamo said...

    i would love to see the sherman anti-trust exemption get completely thrown out, because i dont think one single thing will change except that no one (especially congress) will be able to bring up that stupid exemption anymore.

  7. Motherscratcher said...

    Please excuse my ignorance (I’m neither a lawyer nor very bright), but didn’t Fleer sue topps about 30 years ago for the right to print cards with logos?  That cleared the way for Fleer and Donruss.

    Why is that no longer in effect?  Why doesn’t this apply to that already established ruling?

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