Ninth Circuit Upholds Baseball's Antitrust Exemption

On Thursday, the Ninth Circuit Court of Appeals affirmed the district court's dismissal of the antitrust lawsuit brought against Major League Baseball by the city of San Jose, California.  San Jose filed the suit back in June 2013, alleging that MLB's refusal to approve the relocation of the Oakland Athletics to the city violated the Sherman Act.  MLB has had the proposed relocation under consideration for nearly six years, but has failed to act in large part because the San Jose territory is currently assigned to the San Francisco Giants, who have refused to allow the move.  In October 2013, district court Ronald M. Whyte dismissed San Jose's case, finding that it's antitrust claims were covered by baseball's antitrust exemption. 

A unanimous, three-judge panel of the Ninth Circuit affirmed this ruling on Thursday.  In the court's opinion (available here), Judge Alex Kozinski held that baseball's antitrust exemption clearly applies to its relocation policies, since those policies are central to the baseball business.  Moreover, the court also determined that the Curt Flood Act of 1998 - the act giving major league players the right to file antitrust suits against MLB - forecloses San Jose's suit.  In particular, the Ninth Circuit highlighted a provision in the act stating that it "does not create, permit or imply a cause of action by which to challenge under the antitrust laws . . . franchise . . . relocation."  The court held that this language confirmed that Congress did not intend for the Sherman Act to apply to MLB's relocation policy.

For more on the Ninth Circuit's decision, fellow Sports Law Blog contributor Ed Edmonds and I discussed the case on Friday on Bloomberg Radio.  Our discussion is available here.

Meanwhile, on a related note, I discussed this month's 100th anniversary of MLB's first antitrust challenge - the Federal League's 1915 lawsuit against the American and National Leagues argued before Judge Kenesaw Mountain Landis in Chicago - on the NPR program Only a Game this weekend.  That interview is available here.