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We refer here from time to time to the NFL’s antitrust exemption. And yet the NFL has been sued for antitrust in the past by the USFL and by the NFL’s players.
A reader asked us to explain the difference, and we didn’t know. So we asked.
NFL spokesman Greg Aiello helped clear things up for us.
“There are antitrust exemptions contained in two pieces of federal legislation passed by Congress in the 1960s,” Aiello said via e-mail. “One allows the NFL to negotiate national television contracts for all 32 teams and to regionalize broadcasts. The other protects the league from antitrust lawsuits related to the NFL-AFL merger of 1970.”
There’s a separate set of antitrust protections under the Collective Bargaining Agreement, for as long as the CBA is in effect. Upon expiration of the CBA, there’s a chance that trouble will arise in that regard, as it did when a group of players led by Reggie White sued after the 1987 strike, culminating in the current free agency and salary cap system.
“Regarding the federal legislation, the 1961 Sports Broadcasting Act allows sports leagues to package their games into one or more TV packages and to regionalize telecasts,” Aiello added. “In 1966, Congress approved the NFL-AFL merger — shielding it from being challenged in court on antitrust grounds — because it was in the public interest in terms of maintaining franchise stability and because the merged league also was committed to expansion.”
So there you have it. There are three antitrust exemptions, only one of which currently has any relevance.
It’s actually kind of simple.
June 25th, 2008 at 7:36 pm
“only one of which currently has any relevance.”
I assume you are talking about this one.
“There’s a separate set of antitrust protections under the Collective Bargaining Agreement, for as long as the CBA is in effect. Upon expiration of the CBA, there’s a chance that trouble will arise in that regard, as it did when a group of players led by Reggie White sued after the 1987 strike, culminating in the current free agency and salary cap system.”
So……………….
What happens when the CBA expires?
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June 25th, 2008 at 7:50 pm
I’m very curious on how the antitrust exemptions would be affected if the NFl had a team move to another country? Bills to Toronto?? This is right up your alley Mike. Put your lawyer skills to work for us common folk in Buffalo, that is if you can pull yourself away from your Xbox!Love your site dude!
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June 26th, 2008 at 2:48 am
Skew - Not sure if this will have been answered by now, but IMO the exemption provided by the Sports Broadcasting Act is the most important one. Without that exemption, all of the NFL’s national contracts with CBS, FOX, ESPN, DirectTV, Sirius Radio, etc become illegal. Each team could negotiate their own deal for themselves and I would guess that 80-90% of the revenue that is evenly split between the teams would go away. Now think of how much money a team like Dallas could make from selling TV rights to their games as opposed to a team like Arizona. Dallas would be on Fox while Arizona would be lucky to be F/X. The league would be fundamentally changed (if not destroyed) by the loss of the Sports Broadcasting Act exemption.
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June 26th, 2008 at 8:58 am
@MattR.
I doubt the league would be destroyed. Baseball does not have the TV deal that the NFL has and that is why the Yanks, and the Sox make much more money than the Royals or Brewers.
If it existed like that today, you’d only see the local team on TV (much like baseball, it would probably be on cable) and the major teams (Dallas, New York, New England) would have their own networks comprable to that of the Yankee’s.
You’d still get to see Arizona, but only if you live there.
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June 26th, 2008 at 9:04 am
It seems like Congress granted antitrust protection just so they can rattle it to make noise because no matter what provisions the NFL violates when needed, the laws will stay in place and be expanded as needed (that’s why so many). The laws won’t even expire when they expire.
Given this, we really don’t need to know more about.
Isn’t the ban on broadcasting NFL games on Saturdays during the college football season a provision of the antitrust law? Well the NFL violated those terms when needed and nothing happened.
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June 26th, 2008 at 10:18 pm
Cool beans.
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