A Useful Threat: the U.S. Government and Sports’ antitrust exemption
THE BOX SCORE
From 1973 to 2023, Congress introduced 129 bills and resolutions on antitrust and sports, but only three have become law.
There are a lot of reasons why a member of Congress might introduce a bill on sports’ antitrust exemptions. Some want to keep a team from moving, some want to get a team to move, and some want to settle a strike.
Perversely, sports’ antitrust exemption might actually give the government more power over sports. The threat to take it away is often enough to get sports to act.
THE COMPLETE GAME
In Curt Flood, we focused on how the Supreme Court carved out MLB’s antitrust exemption. Here, we’ll examine the congressional response from 1973 to 2023.
Antitrust Sports Bills in Congress
Here are a few of the takeaways from the interactive figure above.
Congress has introduced 129 bills and resolutions pertaining to antitrust and sports from 1973 to 2023.
Seventy-nine bills sought to modify or remove antitrust exemptions, 39 tried to expand or preserve that immunity, and 11 had some combination of modifying and expanding.
Most bills dealt with franchise relocation (43), followed by broadcasts (25) and labor (24).
Almost half the bills covered all sports (54), followed by baseball (47) and football (17)
Only three of the 129 bills introduced became law:
S. 12 Cable Television Consumer Protection and Competition Act of 1992. Mandated the Federal Communications Commission study sports antitrust immunity in television broadcasts, but did nothing of substance.
S. 53: Curt Flood Act of 1998. Subjected MLB to antitrust laws concerning labor, but as I argue in Curt Flood, it was largely symbolic.
H.R. 1625 Consolidated Appropriations Act, 2018. Exempted minor league teams from minimum wage laws.
What Prompted These Bills?
There are several reasons why members of Congress would introduce an antitrust bill on sports.
Relocation. Bills dealing with franchise location and relocation come in three varieties. (1) Members of Congress write bills to prevent a team from leaving their district or state. (2) Others use the threat of legislation to force a league to give them an expansion team. (3) Some bills seek a pound of flesh after a team has packed up and left.
Play Ball. Many antitrust bills are introduced in hopes of ending a strike or lockout. The spike in bills during 1994-95 was largely a response to MLB’s 233-day strike.
Television. Blackouts are maddening for everyone, even members of Congress. Most of the antitrust bills concerning broadcasts try to outlaw the practice.
Protecting a League or Team. Most bills that seek to expand the antitrust exemption are introduced to protect the league or a team. Rep. Brett Guthrie’s (R-KY) Save America’s Pastime Act was designed to protect minor league owners from paying huge payrolls and risking bankruptcy.
Responding to court rulings. Several bills responded to actions by the Courts. For instance, the Collegiate Athletics Reform Act of 1991 would have given back to the NCAA the antitrust immunity it lost in the NCAA v Board of Regents University of Oklahoma (1984) decision.
Righting a wrong. This includes many of the aforementioned categories, along with some idiosyncratic stuff. For instance, Rep. Neil Abercrombie (D-HI) introduced several bills banning the BCS after an undefeated Hawaii team was snubbed in 2007.
Lobbying. In a future article, we’ll see that sports leagues spend millions on lobbying Congress. Most of the time, they play defense, trying to prevent an injurious bill from passing. As discussed in “Five Lessons on the U.S. Congress,” playing defense is much easier than playing offense.
Who Introduces Antitrust Sports Legislation?
The figure above shows a clear geographic pattern to congressional sports antitrust bills. Most of the bills are introduced in states with a professional sports franchise.
States with the most bills are often those who felt the greatest pain and anger watching their team’s taillights head for greener pastures.
Ohio. 21 bills overall, eight specifically on the loss of the Browns to Baltimore in 1995.
Maryland. Eight bills overall, five in response to the Colt's 1984 midnight dash to Indianapolis.
California. There were 14 bills overall, six were from Bay Area Congressmen Pete Stark and Ron Dellums around the time the Oakland Raiders were moving to L.A.
What does the government get in the bargain?
Sports leagues’ antitrust exemption is a double-edged sword for the U.S. government. On the one hand, it allows sports leagues to act as a semi-legal monopoly and squeeze more money out of cities, networks, players, and fans. On the other hand, threats to take it away are some of the governments' best leverage over sports.
These threats come from all quarters:
The U.S. Congress. As we’ve seen in this article, Congress introduces many bills on sports’ antitrust exemption. But legislation is only the tip of the iceberg. Threats can also come in hearings, the media, or personal conversations.
Congressional threats are pretty effective. They are one reason baseball finally got serious about performance-enhancing drugs in the mid-2000s. In a statement to the House Committee on Government Reform in 2005, Hall of Fame pitcher Senator Jim Bunning (R-KY) laid out Congress’ power over MLB: “If baseball fails to fix this scandal, then there are a lot of things we can do to get their attention, by amending the labor laws, repealing the outdated antitrust exemption that baseball alone enjoys and shining the spotlight of public scrutiny.”
Federal Courts. The Court has a mixed record on sports antitrust cases. Sometimes they rule for the leagues (e.g., Federal Baseball, Toolson, and Flood), and sometimes they don’t (e.g., Radovich, NCAA v. Board of Regents, and Alston). But the mere threat of an adverse ruling is often enough to scare leagues into acting. In “MLB’s Antitrust Exemption,” we saw that fear of the Supreme Court led MLB to settle with the minor leagues out of court.
State Legislatures. Because of state legislation, the NCAA’s amateurism rules were on death’s door before the Supreme Court’s Alston (2021) ruling. California’s “Fair Pay to Play Act” (2019) was the first to allow its athletes to receive compensation for their name, image, and likeness (NIL). Other states soon followed, and it put the NCAA in a bind. If some states allowed players to make millions and others did not, the idea of competitive balance would be a joke. Even today, different state laws make the NIL system a confusing and unsustainable mess.
State Courts. In 1994, Florida’s attorney general filed suit in state court, alleging that MLB’s refusal to permit the San Francisco Giants to move to Tampa Bay violated state antitrust law. Not surprisingly, the case was settled when MLB found it in its heart to give Tampa Bay an expansion team in 1994 (see Zimbalist’s May the Best Team Win).
But Not the President of the United States. Sports antitrust exemption is not often a topic of interest to the White House. I only found three instances where a president mentioned sports antitrust exemption, and two of them were dodgy. When asked about Curt Flood’s antitrust case in 1972, Richard Nixon said, “As an old baseball fan, and the rest, I have no present thoughts on that.” Asked if he’d try to revoke MLB’s antitrust exemption during the 1994-95 strike, Bill Clinton remarked, “I don't want to give you a definite answer… The reason I don't want to give you a definite answer is that I have not had a chance to study that issue in detail or to get any kind of advice from the Justice Department.” The closest a president got to supporting the revocation of antitrust immunity was when Clinton signed the Curt Flood Act in 1998, calling the act “appropriate,” but taking pains to point out it only applied to labor.
The Bottom of the Ninth
Congress introduces a lot of bills on sports’ antitrust exemption. Some threaten to remove the exemptions, others want to strengthen it. The chance that any of these bills become law is exceedingly remote. But, the congressional bark is often worse than the bite.
Here, we come to the age-old question: “Doesn’t Congress have anything better to do?” Yep, they do. But problems in the sporting world—e.g., strikes, steroids, unfair pay, and relocating teams and grieving fans—also need addressing. And when sports leagues can’t or won’t address them, it’s time for Washington to get involved.
Getting rid of sports’ antitrust exemption would also rid Congress of one of its main sources of leverage. In many ways, the scenario is much like parents, kids, and screens. Parents often threaten to take away their kids’ phone if they misbehave. If they end up taking it away, what leverage is left? Perhaps that is why so many kids are on their screens.
