Lockout should be the final straw for baseball’s antitrust exemption
By Ken Reed
Originally published by Troy Media
“Every other sport – like virtually every sort of business – is governed by the antitrust laws.”
– Stuart Banner, author of The Baseball Trust: A History of Baseball’s Antitrust Exemption
The fact that the Supreme Court of the United States gave Major League Baseball an antitrust exemption in 1922 was absurd and is even more so now. And it certainly isn’t in the best interests of baseball or its stakeholders.
As Sen. Bernie Sanders said recently:
“It should be clear to all that these baseball oligarchs have shown that they are far more concerned about increasing their wealth and profits than in strengthening our national pastime.”
In essence, collusion in baseball is completely legal. It was sanctioned by the Supreme Court in Federal Baseball Club of Baltimore v. National League et al. in 1922 and continually upheld since then.
Gerald W. Scully wrote in his book The Business of Major League Baseball (1989) that if baseball was subject to the Sherman Antitrust Act like other businesses, “the methods of transacting with players” would be an area impacting MLB’s business operations.
After imposing a lockout on the players, the owners proceeded to negotiate in bad faith by not even attempting to contact the players’ union for 42 days.
The antitrust exemption allows franchises to squeeze “exorbitant benefits” out of current and potential league cities. For example, free land for stadiums, taxpayer-funded stadiums, and tax breaks that no other business receives. In essence, it allows baseball owners to exploit fans and taxpayers.
In the last couple of years, MLB owners have eliminated over 40 minor league teams, costing hundreds of players their jobs and taking baseball from fans – young and old – in small towns.
In the infamous 1922 Supreme Court case, Justice Oliver Wendell Holmes wrote that MLB was not subject to the antitrust statutes because Major League Baseball was not interstate commerce.
Although there was heavy disagreement in the legal community at the time, the ruling has never been overturned in the courts or by Congress.
Some believe the antitrust exemption issue is for the courts to decide, not Congress. The courts, for their part, apparently feel the burden is not on them but on the nation’s legislators. Ultimately, both the Supreme Court and Congress historically have refused to take responsibility for deciding MLB’s long-standing antitrust exemption.
The special treatment MLB receives in its antitrust exemption allows a small group of wealthy owners, who may or may not care about baseball beyond an economic perspective, to control a major cultural practice (indeed one historically called “the national pastime”) as they see fit.
The game’s best interests won’t be the top priority of baseball owners as long as their government-sanctioned cartel is allowed to continue. For businesses owners in other industries, neglecting stakeholder groups’ needs, wants and expectations means eventual death – usually sooner rather than later.
In 1972, the Supreme Court took on the Curt Flood case (Flood v. Kuhn). The court stated what was obvious to so many legal and business observers, specifically that “professional baseball is a business, and it is engaged in interstate commerce.” Nevertheless, the court ultimately upheld baseball’s antitrust exemption.
Ironically, a recent college athletics case might be the impetus for eliminating MLB’s antitrust exemption. In NCAA versus Alston, the Supreme Court reached a 9-0 decision to uphold a ruling by the U.S. Court of Appeals for the Ninth Circuit that struck down NCAA caps on student-athlete academic benefits on antitrust grounds.
In Alston, Justice Neil Gorsuch, writing for the court, addressed MLB’s exemption. He called it “unrealistic, inconsistent, and aberrational.” Gorsuch suggested legislators address the problem with MLB’s antitrust exemption. But he also hinted that the court could decide to abolish its MLB antitrust exemption if legislators continue to pass on the issue.
It sounds like Sanders is ready to take the lead on this.
“We must prevent the greed of baseball’s oligarchs from destroying the game. The best way to do that is to end Major League Baseball’s antitrust exemption and I will be introducing legislation to do just that.”
This year marks the 100th anniversary of baseball’s antitrust exemption. This colossal mistake needs to be fixed. After watching how the owners operated in the recent lockout, the fix can’t come soon enough.
— Ken Reed is sports policy director for League of Fans, a sports reform project. He is the author of The Sports Reformers, Ego vs. Soul in Sports, and How We Can Save Sports.
Sports Forum Podcast
Episode #29 – League of Fans’ Sports Forum podcast: The Honorable Tom McMillen Visits League of Fans’ Sports Forum – McMillen is a former All-American basketball player, Olympian, Rhodes Scholar and U.S. Congressman, and has a long involvement with the President’s Council on Physical Fitness and Sport (now called the President’s Council on Fitness, Sports and Nutrition). We discuss the state of college athletics today, given the pressures of NIL, the transfer portal, sports gambling and huge media contracts. McMillen then provides great perspective on the poor state of physical fitness our young people are experiencing today.
Listen on Listen on Apple Podcasts, Spotify, Google Podcasts, Anchor and others.
Follow on Facebook: @SportsForumPodcast
More Episodes on Apple Podcasts; Spotify; Google Podcasts; PocketCasts; & Anchor
Episode #28 – League of Fans’ Sports Forum podcast: A Chat With Mano Watsa, a Leading Basketball and Life Educator – Watsa is President of PGC Basketball, the largest education basketball camp in the world. We discuss problems in youth sports today.
Episode #27 – League of Fans’ Sports Forum podcast: Kids’ Sports: How We Can Take Back the Game and Restore Quality Family Time In the Process – Linda Flanagan is author of “Take Back the Game: How Money and Mania Are Ruining Kids’ Sports and Why It Matters.” We discuss how commercialized and professionalized youth sports are hurting kids and their families.
Episode #26 – League of Fans’ Sports Forum podcast: How Can We Fix Youth Sports? – John O’Sullivan is Founder and CEO of Changing the Game Project and author of “Changing the Game: The Parents Guide to Raising Happy, High Performing Athletes and Giving Youth Sports Back to Our Kids.”
Episode #25 – League of Fans’ Sports Forum podcast: Physical Education Should Be a Critical Component of K-12 School Design – Michael Horn is co-founder of the Clayton Christensen Institute for Disruptive Innovation.
Episode #24 – League of Fans’ Sports Forum podcast: Mental Health and Athletes: Ending the Stigma – Nathan Braaten and Taylor Ricci are the founders of Dam Worth It, a non-profit created to end the stigma around mental health at colleges and universities through sport, storytelling, and community creation.
Media"How We Can Save Sports" author Ken Reed appears on Fox & Friends to explain how there's "too much adult in youth sports."
Ken Reed appears on Mornings with Gail from KFKA Radio in Colorado to discuss bad parenting in youth athletics.
“Should College Athletes Be Paid?” Ken Reed on The Morning Show from Wisconsin Public Radio
Ken Reed appears on KGNU Community Radio in Colorado (at 02:30) to discuss equality in sports and Title IX.
Ken Reed appears on the Ralph Nader Radio Hour (at 38:35) to discuss his book The Sports Reformers: Working to Make the World of Sports a Better Place, and to talk about some current sports issues.
- Reed Appears on Ralph Nader Radio Hour League of Fans’ sports policy director, Ken Reed, Ralph Nader and the New York Times’ Tyler Kepner discussed a variety of sports issues on Nader’s radio show as well as Reed’s updated book, How We Can Save Sports: A Game Plan. Reed's book was released in paperback in February, and has a new introduction and several updated sections.
League of Fans is a sports reform project founded by Ralph Nader to fight for the higher principles of justice, fair play, equal opportunity and civil rights in sports; and to encourage safety and civic responsibility in sports industry and culture.
Vanderbilt Sport & Society - On The Ball with Andrew Maraniss with guest Ken Reed, Sports Policy Director for League of Fans and author of How We Can Save Sports: A Game Plan
Sports & Torts – Ken Reed, Sports Policy Director, League of Fans – at the American Museum of Tort Law
Order from Amazon
Order from Amazon
Order from Amazon
Ken Reed’s Author Page on Amazon