Thursday, January 14, 2010

There Is No Competition Between Teams In The NFL?

by Dick Mac

A couple years ago, the NFL signed an exclusive agreement with Reebok to manufacture all apparel for all thirty-two NFL teams.

American Needle, a small company that had been manufacturing products for some teams cried foul and now charges that the NFL/Reebok contract violates anti-trust laws because it does not allow each business (team) to negotiate its own deal with manufacturers, thereby stunting competition.

The NFL argues that since the league is a single-entity, the 32 teams do not compete against one another.

Well, that's news to me! I thought that competition was the entire point of the NFL, but I guess the point is television ad sales and merchandising, after all.

Oral arguments were heard in the Supreme Court yesterday, and I suspect that things will not go well for the NFL. We'll see.

Supreme Court Notice (PDF)

Los Angeles Times: Supreme Court justices skeptical of NFL's effort to quash antitrust suit

Denver Post: Analysis: Supreme Court site of NFL battleground

American Needle v. NFL and the future of professional sports

Supreme Court justices skeptical of NFL's effort to quash antitrust suit

Oral arguments begin in American Needle vs. NFL

1 comment:

Chris Huff said...

On one hand, the argument that it is a single business with 32 franchises is true - the teams are not designed to compete for market share against each other, just play on the football field. There's no market push to make the Jets the #1 team in NY as opposed to the Giants. Selling more Jets merchandise just goes back into the general revenue pool - as there is extensive revenue sharing in the NFL.

On the other hand, if the NFL wins the case, it could mean all games become pay-per-view. If they are exempt from anti-trust laws, then the door might be open for them to screw over the retired players with health problems even more.

I hate when leagues make exclusive agreements. MLB pulled their endorsement from EA to make an exclusive agreement and thus the MVP Baseball franchise collapsed (the best and most sophisticated baseball simulation ever). NFL's exclusive agreement with DirecTV means I listen to most Giants games on my phone (thank you Sprint).

Maurice Clarett tried to challenge the NFL on antitrust laws when they excluded him from the draft to no avail. We shall see how this works. Thanks for posting!