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Lawmakers Spar with NFL Officials, Players on Antitrust

Posted By Aruna Viswanatha On January 20, 2022 @ 6:14 pm In Antitrust, News | Comments Disabled

Lawmakers sparred with National Football League officials and player representatives today at a hearing in the House Judiciary panel’s Courts and Competition Policy Subcommittee about the implications of a Supreme Court case that will assess how antitrust laws apply to the NFL.

The Supreme Court heard arguments [1]last week in American Needle v. NFL, a case that poses the question of whether the NFL is a collection of 32 teams or is a single entity for the purposes of antitrust regulation.

Clothing manufacturer American Needle sued the NFL after the league signed an exclusive deal with Reebok  to produce hats and other merchandise with team logos. The company argued that the NFL violated antitrust laws, and that each team needed to independently negotiate such a contract.

Players have been concerned that a broad ruling in favor of the NFL could lead teams to restrict players’ salaries and reverse gains they’ve made as free agents since the 1990s.

A dozen current and former NFL players, including Nolan Harrison, who retired after a 10-year career, and Deshea Townsend, who plays for the Pittsburgh Steelers, attended the hearing today, and others were on the Hill to lobby Congress on antitrust and other issues.

“Why else would the NFL seek to review a case it won not once but twice?” NFL Players’ Union president, Kevin Mawae, asked at the hearing. The NFL won in the lower courts but joined American Needle in urging the Supreme Court to hear the case. Mawae described the NFL’s strategy as the latest attempt for the league to obtain “the whole grail” of antitrust immunity.

Democrats on the committee echoed the players’ concerns. The case “could affect the free agency concept,” said Rep. John Conyers Jr. (D-Mich.) who chairs the full Judiciary Committee. “The only option would be a players strike.”

The league tried to downplay any impact the case might have on the players. “This case is not about labor relations,” said Gary Gertzog, a senior VP at the NFL, in his opening statement.

The league also argued that the teams could act as a single entity because they competed with other sports and other forms of entertainment for fans.

“The consumer has the ultimate vote,” Gertzog said, arguing that a fan might switch to a different sport if an NFL cap was too expensive.

Other sports leagues backed him up. “It defies economic reality,” said William Daly, a National Hockey League deputy commissioner. ”Sports leagues can’t willy-nilly make decisions that aren’t responsive to the marketplace,” he said.

Republicans on the committee followed the league’s line of reasoning. The subcommittee’s ranking member, Rep. Howard Coble (R-N.C.), said that manufacturers would be harmed if they had to spend time negotiating license agreements with each team separately.

“This is a case of manufacturer’s remorse: American Needle tried to obtain through litigation what it could not get through negotiation,” Coble said, in a reverse echo of Justice Sonia Sotomayor’s comments during the arguments at the high court.

“You are seeking through this ruling what you haven’t gotten from Congress,” Justice Sonia Sotomayor said to the NFL’s lawyer during oral arguments. “An absolute bar to an antitrust claim.”

Even if the Supreme Court grants the league partial immunity that shields it from players’ antitrust suits, it  might not hurt the players all that much, said Rep. Lamar Smith (R-Texas), the Judiciary Committee’s ranking member. Given that “professional sports unions are the wealthiest labor unions around; one wonders whether they need any extra leverage,” he said.

Smith suggested the committee had already given the NFL a lot of attention  — three hearings in three months — and said the panel should instead hold hearings on the Justice Department’s decision to drop charges against the New Black Panther Party [2], and on the question of whether to close the Guantánamo Bay detention center.


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