I had no idea you were an attorney now. So am I! Though I think we only have that and a love of soccer in common, and not that whole part about being a professional soccer player. Anyway…great post. This case is pretty interesting, and hopefully you’ll come back and give us your thoughts on oral argument.

hasn’t the court already ruled that MLS can operate as a single entity. So would this ruling just determine how far they can go as a single entity? The currently have exclusive contrat with Adidas like the NFL dose with Reebok, So my guess is that the only impact would be around exclusive deals with sponsors.

Not necessarily, at least in my view. The district court’s ruling in the Fraser case on MLS’s single entity status was not the basis for the court of appeals’s judgment affirming a victory for MLS. The court of appeals affirmed the dismissal of the players’ claims on a different ground (not single entity), which related to the relevant market.

You’re right, though, that the Fraser case probably puts a damper on future litigation by MLS players against the league on antitrust grounds (they’d likely have to overcome that relevant market ruling, for one thing). And as long as there is a union and labor negotiations are proceeding, the question is moot because players can’t sue for antitrust when there is a union. So the immediate impact of the Amercian Needle case on MLS may relate mostly to issues not connected to player contracts, like the Adidas deal, etc. It’s also hard to say how broadly other parties would view the Fraser decision. The relevant market in the case was for the acquisition of players’ services, not necessarily for other things like licensing, etc.

Okay, you’ve confused me with some of your statements, so please forgive a question. You’ve stated above that MLS players cannot sue under anti-trust provisions when a union is present, and yet the premise of this essay is that current oral arguments in appellate court regarding exclusive deals with producers vis-a-vis licensed products somehow has relevance to the current labor challenge in MLS. How is this so given your statement about the presence of a union being a precluding, a prior factor which negates the ability to sue under anti-trust. In essence, I fail to connect the pending oral argument to the current MLS labor negotiations. Thank you for helping me to understand this better.

Robert:

Rich said the tie-in to MLS was whether the league could use the court’s ruling to feel more confident in entering into exclusive deals (like the adidas deal they’ve already entered into), without worrying about suits from competing apparel companies.

The players can’t sue because of the union, but somebody like Nike is still able to sue the league claiming antitrust violations because of the exclusive deal with adidas. There are, of course, significant differences between the set-up of MLS and the NFL, but the court’s ruling in this NFL case will provide a lot of insight into what the law for these situations is generally.

Thanks, I did not have an issue with the connection between this case and exclusive endorsement deals (like the Addidas deal), that was pretty clear. My question is how does this case have any bearing on the CBA. That is a different issue entirely. Richard mentions:

“No doubt the folks currently negotiating MLS’s new collective bargaining agreement (CBA), and those preparing to negotiate the NFL’s next CBA, will be eager for reports on the Court’s attitude at oral argument to the single-entity issue.”

However, he later makes it clear that anti-trust issues have no legal standing when there is a union. Both statements cannot be true…unless I am missing something.

Ad an MLS fan, the only dog I have in this hunt is the concern about a lockout, and a long back and forth legal fight. Although it seems unlikely to me given it is a world cup year and both sides stand to lose huge if they are not willing to negotiate, but of course anything is possible.

With respect to MLS, the single-entity question is highly overrated. Both the district and appellate courts in fraser found (obviously and correctly in my opinion) that the US domestic first division soccer labor market is not distinct. US players can play for USL, mexican teams, english, german, french, spanish, greek, leagues, scandinavian teams, etc. MLS does not have pricing power.

The players’ union is arguing fairness issues which are not legal issues. Company A can decide to pay its employees well below market and offer crappy benefits. That isn’t illegal, so long as potential employees are free to work for Companies B-F. In that case, better employees will gravitate to B-F, unless there is a strong reason to work for A (live next door to office, etc.).

Same thing here. As long as this holds true, MLS is not going to be guilty of antitrust violations.

Robert,

There are a number of ways that the Court’s decision could potentially impact labor negotiations, even though the MLS players have a union. For instance, a very pro-single-entity ruling could bolster the league’s credibility, and hence its bargaining power, in discussions it may have with the union over the league’s policy of dictating where players must play (i.e. with which team) and that players cannot negotiate between teams. A very unfavorable single-entity ruling (for the league) could have the opposite effect, giving credence to the players’ claims that they should have freedom to move between (and bargain with) different teams. Also, there may be other issues on the table at the negotations, like players’ group licensing rights, which could be affected. Finally, it is possible, I am told, for unions to decertify. So there is a chance, presumably, that the players would not always necessarily have a union in place.

I hope that answers your question.

Mike,

Just to clarify, you discuss the single-entity issue from the Fraser case as it relates to the market for players’ services.

There is a chance that in other markets, like the market for producing officially licensed league merchandise, the single-entity issue could still have significant impact for MLS, regardless of the Fraser case.

Rich -

I agree with you on that point. I think nearly all readers at this point are focused on the labor dispute though.

Great article. Thanks for the explanation of this issue.

Robert,

The union just decertifies if it feels an antitrust lawsuit is its best strategy. This is why the NFL wants a blanket antitrust exemption. I’m not sure what the big deal is though. MLB has an antitrust exemption and congress passed an act specifically exempting labor from the exemption. One would expect congress to step in in the highly unlikely event the SCOTUS wants to get seriously involved in major league sports.