(Reuters) – Three minor league baseball teams on Monday assailed Major League Baseball’s historic immunity from US antitrust law, urging a New York federal appeals court to support their effort to defeat the century-old exemption at the US Supreme Court.
In a court filing, the clubs said they want the 2nd US Circuit Court of Appeals to revive allegations that MLB abused its power in 2020 when it terminated their affiliation with professional baseball teams. The plaintiffs, including Nostalgic Partners LLC, which does business as The Staten Island Yankees, acknowledged the long-standing pro baseball shield stands in the court’s way.
The Supreme Court created the exemption in a 1922 ruling that said baseball games were “purely state affairs” outside the reach of US competition law. The litigation set to unfold in the 2nd Circuit will give the justices a new chance to scrutinize the exemption.
“This court must, of course, apply controlling precedent even when it is wrong. But the court should, if it sees fit, dispatch this case to the Supreme Court with a message attached: Enough already,” Gregory Silbert, co-head of the appeals practice at Weil, Gotshal & Manges, wrote for the plaintiff teams.
In 2015, the US Supreme Court turned down a challenge to MLB’s antitrust exemption. The court upheld a ruling against the city of San Jose in its quest to be the new home of Oakland Athletics.
Silbert and other lawyers for the plaintiffs called the exemption a “get-out-of-antitrust-jail-free card.”
In a statement on Tuesday, Silbert said MLB should not enjoy a shield that other pro sports leagues do not have. “We’ll be asking the Supreme Court to hold that MLB has to play by the same rules as everyone else,” he said.
A spokesperson for MLB and a lawyer for the league at Sullivan & Cromwell did not immediately respond to messages on Tuesday seeking comment.
In 2020, MLB implemented a new system capping big league teams to four affiliated minor league clubs. The switch meant that 40 minor league teams “lost their existing affiliations and their ability to compete for new ones,” according to the plaintiffs.
Lawyers for MLB in Manhattan district court called the plaintiffs’ antitrust claims “patently frivolous.” The league said the litigation was a “futile quest to impose liability on MLB for not renewing plaintiffs’ contracts.”
US District Judge Andrew Carter in October found a “plausible” antitrust claim, but concluded that “until the Supreme Court or Congress takes action, the exemption survives.”
The US Justice Department is expected later this month to submit its views.
At the district court, the DOJ said in a filing the baseball exemption “does not rest on any substantive policy interests that justify players and fans losing out on the benefits of competition.”
The case is Nostalgic Partners LLC, et al v. The Office of the Commissioner of Baseball, 2nd US Circuit Court of Appeals, No. 22-2859.
For plaintiffs: David Lender and Gregory Silbert of Weil, Gotshal & Manges
For defendant: Jeffrey Wall of Sullivan & Cromwell
(NOTE: This report was updated with comment from a lawyer for the minor league baseball teams.)
Read more:
US Supreme Court punts Oakland appeal over Las Vegas move by NFL’s Raiders
Law firm Winston wants $6.6 million after US women’s soccer equal-pay deal
Plaintiffs’ lawyers in NCAA case pick up $3.5 million more in fees
Supreme court won’t hear challenge to baseball antitrust immunity
Our Standards: The Thomson Reuters Trust Principles.
.