Amicus Curiae Brief — Tri-City ValleyCats, Inc., et al., Petitioners v. The Office of the Commissioner of Baseball

No. 23-283

In the Supreme Court

of the United States

_________________________________________________

TRI-CITY VALLEYCATS, INC.

AND ONEONTA ATHLETIC CORPORATION,

Petitioners,

v.

THE OFFICE OF THE COMMISSIONER

OF BASEBALL,

Respondent.

_________________________________________________

Petition for a Writ of Certiorari to the

United States Court of Appeals for the Second Circuit

_________________________________________________

BRIEF OF AMICUS CURIAE OPEN MARKETS

INSTITUTE IN SUPPORT OF PETITIONERS

_________________________________________________

SANDEEP VAHEESAN

OPEN MARKETS INSTITUTE

655 15th Street, NW,

Suite 310

Washington, DC 20005

JAY L. HIMES

Counsel of Record

50 East 89th Street,

Apt. 12F

New York, NY 10128

(646) 808-6135

jlhimes@gmail.com

i

QUESTION PRESENTED

Whether this Court should overrule Flood v. Kuhn,

407 U.S. 258 (1972), and its predecessors and revoke

the century-old, common-law antitrust immunity for

the business of baseball.

ii

TABLE OF CONTENTS

QUESTION PRESENTED ........................................... i

TABLE OF AUTHORITIES ....................................... iv

INTEREST OF AMICUS CURIAE ............................. 1

SUMMARY OF ARGUMENT ..................................... 1

ARGUMENT ................................................................ 3

I.

JUDGES AND COMMENTATORS HAVE

CONSISTENTLY CRITICIZED

BASEBALL’S ANTITRUST EXEMPTION ... 3

II.

PERPETUATING BASEBALL’S

ANTITRUST EXEMPTION ENABLES

MLB TO EXPLOIT MINOR LEAGUE

TEAMS, PLAYERS, AND LOCAL

COMMUNITIES ............................................. 9

A. What Happens in the Major Leagues

Stays in the Major Leagues....................... 9

B. MLB’s Antitrust Exemption Sustains

Patently Unreasonable Restraints ......... 12

III. WHATEVER FOUNDATION MLB’S

ANTITRUST EXEMPTION MAY HAVE

HAD IN 1922 HAS SINCE DISSOLVED .... 14

A. As the Flood Court Acknowledged, the

Business of Baseball Has Constituted

Interstate Commerce for a Long Time ... 14

B. Congress Has Not Exempted Baseball

from the Antitrust Laws ......................... 16

iii

C. Federal Preemption of State Antitrust

Laws Is Also Strongly Disfavored ........... 20

CONCLUSION .......................................................... 23

iv

TABLE OF AUTHORITIES

Cases

Am. Needle, Inc. v. Nat’l Football League,

560 U.S. 183 (2010) .............................................. 14

Bonito Boats, Inc. v. Thunder Craft Boats, Inc.,

489 U.S. 141 (1989) .............................................. 22

Bostock v. Clayton Cnty., Georgia,

140 S. Ct. 1731 (2020) .......................................... 18

Butterworth v. Nat’l League Pro. Baseball Clubs,

644 So.2d 1021 (Fla. Sup. Ct. 1994) ...................... 7

California v. ARC America Corp.,

490 U.S. 93 (1989) ................................................ 22

California v. Fed. Power Comm’n,

369 U.S. 482 (1962) .............................................. 19

Credit Suisse Securities (USA) LLC v. Billing,

551 U.S. 264 (2007) .............................................. 19

Exxon Corp. v. Governor of Maryland,

437 U.S. 117 (1978) .............................................. 22

Fed. Baseball Club of Baltimore v. Nat’l League of

Pro. Base Ball Clubs,

259 U.S. 200 (1922) ...................................... 1, 3, 15

Flood v. Kuhn,

407 U.S. 258 (1972) ....................................... passim

Garcia v. San Antonio Metropolitan Transit

Authority,

469 U.S. 528 (1985) .............................................. 21

Gardella v. Chandler,

172 F.2d 402 (2d Cir. 1949) ................................ 6, 7

v

Gregory v. Ashcroft,

501 U.S. 452 (1985) .............................................. 21

Halliburton v. Erica P. John Fund, Inc.,

573 U.S. 258 (2014) .............................................. 18

Hart v. B.F. Keith Vaudeville Exch.,

262 U.S. 271 (1923) .......................................... 4, 15

Haywood v. Nat’l Basketball Ass’n,

401 U.S. 1204 (1971) .............................................. 4

Helvering v. Hallock,

309 U.S. 106 (1940) .............................................. 18

Klor’s, Inc. v. Broadway-Hale Stores, Inc.,

359 U.S. 207 (1959) ........................................ 12, 13

Mandeville Island Farms, Inc. v. Am. Crystal

Sugar Co.,

334 U.S. 219 (1948) ........................................ 13, 19

Medtronic, Inc. v. Lohr,

518 U.S. 470 (1996) .............................................. 21

N. Pac. Ry. Co. v. United States,

356 U.S. 1 (1958) .................................................. 19

Nat’l Collegiate Athletic Ass’n v. Alston,

141 S. Ct. 2141 (2021) ........................................ 2, 4

Nat’l Collegiate Athletic Ass’n v. Bd. of Regents of

Univ. of Oklahoma,

468 U.S. 85 (1984) ................................................ 13

NLRB v. Jones & Laughlin Steel Corp.,

301 U.S. 1 (1937) .................................................. 15

Oneok, Inc. v. Learjet, Inc.,

575 U.S. 373 (2015) .............................................. 22

vi

Otter Tail Power Co. v. United States,

410 U.S. 366 (1973) .............................................. 19

Payne v. Tennessee,

501 U. S. 808 (1991) ............................................. 23

Radovich v. Nat’l Football League,

352 U.S. 445 (1957) ....................................... passim

Rice v. Santa Fe Elevator Corp.,

331 U.S. 218 (1947) .............................................. 20

Salerno v. Am. League of Pro. Baseball Clubs,

429 F.2d 1003 (2d Cir. 1970) .................................. 7

State v. Milwaukee Braves, Inc.,

31 Wis.2d 699 (1966) .............................................. 7

Todd v. Exxon Corp.,

275 F.3d 191 (2d Cir. 2001) .................................. 13

Toolson v. New York Yankees, Inc.,

346 U.S. 356 (1953) ...................................... 3, 6, 16

United States v. Am. Tobacco Co.,

221 U.S. 106 (1911) .............................................. 14

United States v. Borden Co.,

308 U.S. 188 (1939) .............................................. 19

United States v. Darby,

312 U.S. 100 (1941) .............................................. 15

United States v. Int’l Boxing Club of N.Y.,

348 U.S. 236 (1955) ............................................ 4, 5

United States v. Philadelphia Nat’l Bank,

374 U.S. 321 (1963) .............................................. 19

United States v. Shubert,

348 U.S. 222 (1955) ................................................ 4

vii

United States v. Socony-Vacuum Oil Co.,

310 U.S. 150 (1940) .............................................. 12

United States v. Topco Assocs., Inc.,

405 U.S. 596 (1972) .............................................. 19

Verizon Commc’ns Inc. v. Law Offs. of Curtis

V. Trinko, LLP,

540 U.S. 398 (2004) .............................................. 12

Wickard v. Filburn,

317 U.S. 111 (1942) .............................................. 15

Wyeth v. Levine,

555 U.S. 555 (2009) .............................................. 21

Statutes

7 U.S.C. §§ 291-92 ...................................................... 17

15 U.S.C. § 26b..................................................... 10, 17

15 U.S.C. §§ 1291-95 .................................................. 17

Curt Flood Act, Pub. L. No. 105-297, § 2,

112 Stat. 2824 (1998) ........................................... 17

Other Authorities

Antonin Scalia & Bryan A. Garner, Reading Law:

The Interpretation of Legal Texts (2012) ............ 19

Brittany Ghiroli, Cockroaches, Car Camping,

Poverty Wages: Why Are Minor-Leaguers

Living in Squalor?, Athletic (Aug. 5, 2021),

https://theathletic.com/2750280/2021/08/05/coc

kroaches-car-camping-poverty-wages-why-areminor-leaguers-living-in-squalor/ ........................ 11

Hans B. Thorelli, The Federal Antitrust Policy

(1955) .................................................................... 22

viii

Hon. Samuel A. Alito, Jr., The Origin of the

Baseball Antitrust Exemption: Federal

Baseball Club of Baltimore, Inc. v. National

League of Professional Baseball Clubs,

34 J. Sup. Ct. Hist. 183 (2009) ............................... 8

In re the Twelve Clubs, 66 Lab. Arb. (BNA) 101

(1975) ...................................................................... 9

J.J. Cooper, MLB, Minor League Players Reach

Deal on First MiLB CBA, Baseball Am. (Mar.

29, 2023), https://www.baseballamerica.com/

stories/mlb-minor-league-players-reach-dealon-first-milb-cba/ .................................................. 10

Laura Numeroff, If You Give a Mouse a Cookie

(1985) ...................................................................... 1

Left Stranded: How Major League Baseball Leaves

Minor League Players Behind, More Than

Baseball (2022), https://www.morethan

baseball.org/issue-report ...................................... 11

Letter from Members of Congress to

Commissioner Manfred (Nov. 19, 2019),

https://trahan.house.gov/uploadedfiles/

trahan_mckinleymlb_letter.pdf ........................... 12

Megan Young, Three Strikes, You’re Out:

Examining The Baseball Trilogy and the

Path to Removing Its Antitrust Exemption,

82 Md. L. Rev. Online 194 (2023) ........................ 10

Nathaniel Grow, The Curiously Confounding Curt

Flood Act, 90 Tul. L. Rev. 859 (2016) .................. 17

Nola Agha, The Economic Impact of Stadiums and

Teams: The Case of Minor League Baseball,

14 J. Sports Econ. 227 (2013) ............................... 12

ix

Oliver Wendell Holmes, The Path of the Law,

10 Harv. L. Rev. 457 (1897) ................................. 23

Robert A. McCormick, Baseball’s Third Strike:

The Triumph of Collective Bargaining in

Baseball, 35 Vand. L. Rev. 1131 (1982) ................. 9

Robert Pannullo, The Struggle for Labor Equality

in Minor League Baseball: Exploring

Unionization, 34 A.B.A. J. Lab. &

Emp. L. 443 (2020) .................................................. 9

Stephen D. Guschov, The Exemption of Baseball

from Federal Antitrust Laws: A Legal History,

23 Baseball Rsch. J. 69 (1994) ............................... 7

Stuart Banner, The Baseball Trust: A History

of Baseball’s Antitrust Exemption 83

(2013) ........................................................ 14, 15, 17

Study Shows MLB Average Salary Up 11%

YOY to $4.9 Million, ESPN (Apr. 4, 2023),

https://www.espn.com/mlb/story/_/id/36070487/

study-shows-mlb-average-salary-11-yoy-49million ................................................................... 10

William N. Eskridge, Jr., Interpreting Legislative

Inaction, 87 Mich. L. Rev. 67 (1988) .................... 18

William N. Eskridge, Jr., Overruling Statutory

Precedents, 76 Geo. L.J. 1361 (1988) ..................... 4

Treatises

Laurence H. Tribe, American Constitutional Law

(2d ed. 1988) ......................................................... 21

1

INTEREST OF AMICUS CURIAE 1

The Open Markets Institute (OMI) is a non-profit

organization dedicated to promoting fair and

competitive markets. It does not accept any funding

or donations from for-profit corporations. Its mission

is to safeguard our political economy from

concentrations of private power that undermine fair

competition and threaten liberty, democracy, and

prosperity. OMI regularly provides expertise on

antitrust law and competition policy to Congress,

federal agencies, courts, journalists, and members of

the public.

SUMMARY OF ARGUMENT

Children’s author Laura Numeroff wrote, “If you

give a mouse a cookie . . . , he’ll ask for a glass of

milk. . . . And chances are, if he asks for a glass of

milk, he’s going to want a cookie to go with it.” Laura

Numeroff, If You Give a Mouse a Cookie (1985). A

hundred years ago, this Court gave major league

baseball (MLB) an antitrust exemption in Fed.

Baseball Club of Baltimore v. Nat’l League of Pro.

Base Ball Clubs, 259 U.S. 200 (1922). And—while

now more elephant than mouse—MLB has been

asking the courts for milk and cookies ever since.

Although the Court’s “purely state affairs”

description of baseball games, and the then1 In accordance with this Court’s Rule 37.2, counsel for amicus

curiae certify that this brief was not authored in whole or in

part by counsel for any party and that no person or entity other

than amicus curiae, their members, or their counsel have made

a monetary contribution intended to fund the preparation or

submission of this brief. All parties were notified about the

intent of amicus curiae to file this brief as required by Rule 37.2.

2

prevailing judicial limitation on Congress’s interstate

commerce power, that the Federal Baseball decision

relied on are long gone, MLB still invokes Federal

Baseball’s exemption to conduct its lucrative business

affairs whenever it can. Here specifically, MLB has

championed the exemption to immunize its decision

to exploit minor league teams by reducing the

number of MLB-affiliated teams and boycotting those

non-affiliated teams struggling to exist—not to

mention collectively fixing the wages and nonnegotiable terms and conditions of employment that

all minor league players must endure. If any other

professional sport—indeed, any other industry not

subject to sectoral regulation—operated this way, its

cartel would have been broken up long ago, and its

executives could have faced criminal prosecution and

prison time. Cf. Nat’l Collegiate Athletic Ass’n v.

Alston , 141 S. Ct. 2141, 2169 (2021) (Kavanaugh, J.,

concurring) (“The NCAA is not above the law.”).

This Court should grant petitioners a writ of

certiorari to review and end the slippery slope that

Federal Baseball created. The baseball exemption

from the antitrust laws is indefensible. It lacks

support in statutory law and congressional intent and

flouts the canons of construction that implied

antitrust immunity and preemption of state law are

disfavored. As the exemption’s creator, this Court

may appropriately overrule Federal Baseball and its

progeny.

3

ARGUMENT

I. JUDGES AND COMMENTATORS HAVE

CONSISTENTLY CRITICIZED BASEBALL’S

ANTITRUST EXEMPTION

More than a century ago, the Supreme Court ruled

that Congress could not regulate baseball under its

commerce clause authority. In 1922, Justice Oliver

Wendell Holmes stated for a unanimous Court: “The

business is giving exhibitions of baseball, which are

purely state affairs, . . . and the transport [of players

and equipment between states] is a mere incident,

not the essential thing.” Fed. Baseball Club of

Baltimore v. Nat’l League of Pro. Base Ball Clubs, 259

U.S. 200, 208-09 (1922).

Ever since, however, judges and commentators

have tended to criticize baseball’s antitrust

exemptions. Revisiting the exemption in Toolson v.

New York Yankees, Inc., 346 U.S. 356 (1953), the

Court gave the Federal Baseball decision only tepid

approval by affirming per curiam “[w]ithout reexamination of the underlying issues . . . .” Id. at 357.

More recently, in Flood v. Kuhn, 407 U.S. 258

(1972), Justice Blackmun, writing for the Court’s fivejustice majority, said the exemption is “an aberration

confined to baseball”—one that others had called

“unrealistic, inconsistent, or illogical.” Id. at 282

(quoting Radovich v. Nat’l Football League, 352 U.S.

445, 452 (1957)). Yet, Justice Blackmun and the

majority did not eliminate the exemption. Justice

Douglas, dissenting, was harsh: The baseball

exemption was “a derelict in the stream of the law

that we, its creator, should remove.” Flood, 407 U.S.

at 286 (Douglas, J., dissenting).

4

Indeed, in the Court’s unanimous 2021 decision in

Nat’l Collegiate Athletic Ass’n v. Alston, 141 S. Ct.

2141 (2021), Justice Gorsuch gave Federal Baseball

an unmistakable back of the hand, writing that “this

Court once dallied with something that looks a bit

like an antitrust exemption for professional baseball.

Id. at 2159 (cleaned up). Justice Gorsuch also

repeated Justice Blackmun’s recognition that

baseball’s exemption is “unrealistic and inconsistent

and aberrational.” Id. (cleaned up).

The Court’s denial of any similar special

dispensation to other professional sports in the

century since Federal Baseball highlights that

assessment. E.g., Radovich, 352 U.S. at 445 (football);

Haywood v. Nat’l Basketball Ass’n, 401 U.S. 1204

(1971) (basketball); United States v. Int’l Boxing Club

of N.Y., 348 U.S. 236 (1955) (boxing).

Barely a year after Federal Baseball, Justice

Holmes—again writing for a unanimous Court—

himself declined to extend the Court’s earlier ruling

to vaudeville performances. Hart v. B.F. Keith

Vaudeville Exch., 262 U.S. 271, 273-74 (1923).

William Eskridge, a leading scholar on statutory

interpretation, is not far off the mark in describing

the Flood court’s failure to overturn MLB’s antitrust

exemption as “almost comical.” William N. Eskridge,

Jr., Overruling Statutory Precedents, 76 Geo. L.J.

1361, 1381 (1988). See also United States v. Shubert,

348 U.S. 222 (1955) (declining to extend Federal

Baseball to theatrical performances).

In many of these cases, several justices expressed

bewilderment at Federal Baseball’s “aberrational”

treatment of MLB, compared to other professional

sports:

5

•

Dissenting in International Boxing Club

and pointing out the inconsistency of

granting baseball a special exemption

while denying it to boxing, Justice

Frankfurter wrote: “It would baffle the

subtlest ingenuity to find a single

differentiating factor between other

sporting exhibitions, whether boxing or

football or tennis, and baseball insofar as

the conduct of the sport is relevant to the

criteria or considerations by which the

Sherman Law becomes applicable to a

‘trade or commerce.’” 348 U.S. at 248

(Frankfurter, J., dissenting).

•

Justice Minton, also dissenting in

International Boxing Club, wrote that the

players’ interstate travel “held in the

Federal Baseball case to be incident to the

exhibition now becomes more important

than the exhibition. This is as fine an

example of the tail wagging the dog as

can be conjured up.” Id. at 251 (Minton, J.

dissenting).

•

A few years later, in writing for the

majority in Radovich and denying

professional

football

an

antitrust

exemption, Justice Clark described

Federal Baseball as “at best of dubious

validity . . . . If this ruling [declining

antitrust immunity to pro football] is

unrealistic, inconsistent, or illogical, it is

sufficient to answer . . . were we

considering the question of baseball for

the first time upon a clean slate we would

have no doubts.” 352 U.S. at 450, 452.

6

•

Meanwhile,

Justice

Frankfurter’s

Radovich dissent reprised his comment in

International Boxing Club: “[T]he most

conscientious probing of the text and the

interstices of the Sherman Law fails to

disclose that Congress, whose will we are

enforcing

excluded

baseball—the

conditions under which that sport is

carried on—from the scope of the

Sherman Law but included football. . . . I

have yet to hear of any consideration that

led this Court to hold that ‘the business of

providing public baseball games for profit

between clubs of professional baseball

players was not within the scope of the

federal antitrust laws.’” Id. at 455

(Frankfurter, J., dissenting) (quoting

Toolson, 346 U.S. at 357).

•

Dissenting in Flood, Justice Marshall

described Federal Baseball and Toolson

as “totally at odds with more recent and

better reasoned cases. . . . Baseball

players cannot be denied the benefits of

competition merely because club owners

view other economic interests as being

more important, unless Congress says

so.” 407 U.S. at 290, 292 (Marshall, J.,

dissenting).

Among lower court federal and state judges,

Federal Baseball has fared no better. Judge Jerome

Frank called the case “an impotent zombi” [sic].

Gardella v. Chandler, 172 F.2d 402, 409 (2d Cir.

1949). Judge Learned Hand thought the expansion of

radio and television broadcasting of baseball games

sufficient to preclude dismissal based on Federal

7

Baseball. Id. at 407-08. 2 And Judge Henry Friendly

similarly called Federal Baseball “not one of Mr.

Justice Holmes’ happiest days . . . . [W]e should not

fall out of our chairs with surprise at the news that

Federal Baseball and Toolson had been overruled. . .

.” Salerno v. Am. League of Pro. Baseball Clubs, 429

F.2d 1003, 1005 (2d Cir. 1970); see also Butterworth v.

Nat’l League Pro. Baseball Clubs, 644 So.2d 1021,

1026 (Fla. Sup. Ct. 1994) (Overton, J., concurring)

(“why one professional sport would have a judicially

created antitrust exemption, but others do not, is a

question that defies legal logic and common sense.”);

State v. Milwaukee Braves, Inc., 31 Wis.2d 699, 725

(1966) (Fairchild, J.) (“[I]t appears that organized

baseball enjoys . . . an exemption from the federal

antitrust laws which no other organized sport enjoys

even where the structure and operation of the

organization may be similar.”); id. at 741-42

(Heffernan, Hallows, and Heilfuss, JJ., dissenting)

(“We are not convinced that for baseball to be

successful it must be unlawful. . . . We are unwilling

to ascribe to our legal system the impotency that the

representatives of baseball would confer upon it.”).

Delivering the Supreme Court Historical Society’s

2008 annual lecture, Justice Alito aptly captured the

depth of criticism of Federal Baseball:

Commentators have called it: “[b]aseball’s

most infamous opinion”; a “clearly wrong”

decision based on a “curious and narrow

2 Gardella settled before the viability of Federal Baseball could

be further tested on remand, however. See Stephen D. Guschov,

The Exemption of Baseball from Federal Antitrust Laws: A Legal

History, 23 Baseball Rsch. J. 69 (1994), https://sabr.org/

research/article/the-exemption-of-baseball-from-federal-antitrustlaws-a-legal-history.

8

misreading of the antitrust laws and/or [an]

utter misunderstanding of the nature of the

business of baseball”; a “remarkably myopic”

decision, “almost willfully ignorant of the

nature of [baseball]”; and a “simple and

simplistic” decision that forms “a source of

embarrassment for scholars of Holmes.” One

commentator speculated that the Court

simply “exempted baseball from the antitrust

laws because it was the national pastime.”

Hon. Samuel A. Alito, Jr., The Origin of the Baseball

Antitrust Exemption: Federal Baseball Club of

Baltimore, Inc. v. National League of Professional

Baseball Clubs, 34 J. Sup. Ct. Hist. 183, 192 (2009)

(footnotes omitted; alterations in original).

While baseball may be a national pastime, MLB’s

control over the minor leagues, unhindered by

antitrust law, is a national disgrace. MLB and its clubs

collude to cap minor league player salaries at poverty

levels and to arbitrarily terminate the affiliation of

minor league teams and rob many small towns of

cherished local institutions. Ending the exemption that

currently insulates MLB’s pernicious restraints on

minor league teams and their players from Sherman

Act scrutiny would not destroy MLB. The MLB teams

are independent and compete against each other on the

field, as well as for players, managers, coaches, fans,

and sponsorship support. Like all other professional

sports and the NCAA, MLB’s teams should be held

legally capable of conspiring with each other in

violation of the Sherman Act.

Thus born and grudgingly maintained, baseball’s

antitrust exemption is, by overwhelming consensus, a

pariah. To assert that the exemption cries out for

reconsideration is to belabor the obvious.

9

II. PERPETUATING BASEBALL’S ANTITRUST

EXEMPTION ENABLES MLB TO EXPLOIT

MINOR LEAGUE TEAMS, PLAYERS, AND

LOCAL COMMUNITIES

A. What Happens in the Major Leagues Stays

in the Major Leagues

The divergence between MLB and the minor leagues

is stark. “Whether one examines the wages, working

conditions, grievance procedure, or several other

issues, minor league players have been left behind

relative to their major league counterparts and even

relative to the average working person in the country.”

Robert Pannullo, The Struggle for Labor Equality in

Minor League Baseball: Exploring Unionization, 34

A.B.A. J. Lab. & Emp. L. 443, 453 (2020).

In the 1960s, MLB players built power through

unionization. They formed the Major League Baseball

Players

Association

and,

through

collective

bargaining, obtained “an avenue through which

[major league] players are able to address concerns

regarding their financial security, workplace

conditions, and more.” Id. at 450. Major leaguers

achieved “minimum salaries, an arbitration process

for grievances, and unrestricted free agency for

players.” Id. By 1975, arbitration ending the reserve

clause “reversed a century of baseball history and

fundamentally changed the relationship between the

owner and the player.” Robert A. McCormick,

Baseball’s Third Strike: The Triumph of Collective

Bargaining in Baseball, 35 Vand. L. Rev. 1131, 1157

(1982) (discussing In re the Twelve Clubs, 66 Lab.

Arb. (BNA) 101 (1975)). The Curt Flood Act, which

Congress enacted in 1998, further empowered major

leaguers to sue the league and teams under the

10

antitrust laws “to the same extent” as “persons in any

other professional sports . . . .” 15 U.S.C. § 26b. As

beneficiaries of rivalry for their services and a strong

labor union, major leaguers attained an average

salary of $4.9 million at the start of the 2023 season. 3

But the benefits that major league players have

achieved do not trickle down to the minor league

players, as MLB exploits the free rein of its antitrust

exemption. It collectively rules over the minor leagues

as if they were a colony. MLB exercises its power at

the expense of players, minor league team owners, and

the communities that back and sustain them.

Through collusion, MLB keeps minor league player

salaries at poverty levels. Instead of permitting minor

league teams to compete to attract and retain talent,

MLB offers all minor leaguers a non-negotiable,

standard seven-season contract. Uniform salaries are

tied to the minor league level of competition, with

players in triple-A receiving higher salaries than

those in single-A. Despite the unionization of players

in 2022 and a collective bargaining agreement earlier

this years, minor leaguers’ average salaries remain

capped at poverty levels. For instance, “Triple-A

salaries will increase from $17,500 to $35,800.” 4 A

3

Study Shows MLB Average Salary Up 11% YOY to $4.9

Million, ESPN (Apr. 4, 2023), https://www.espn.com/mlb/story/_/

id/36070487/study-shows-mlb-average-salary-11-yoy-49-million.

4 J.J. Cooper, MLB, Minor League Players Reach Deal on First

MiLB CBA, Baseball Am. (Mar. 29, 2023), https://www.baseball

america.com/stories/mlb-minor-league-players-reach-deal-on-firstmilb-cba/. See also Megan Young, Three Strikes, You’re Out:

Examining The Baseball Trilogy and the Path to Removing Its

Antitrust Exemption, 82 Md. L. Rev. Online 194, 223 (2023)

(“Throughout the history of baseball, minor league players have

suffered more than any other group under the antitrust

exemption.”).

11

recent survey found that many minor league players

struggle not only to find affordable housing for

themselves and their families, but indeed, simply to

purchase nutritious food. Predictably, many players

take on second or third jobs just to subsist.5 One former

player estimated that, during his minor league tenure,

he was “making about four bucks an hour.” Brittany

Ghiroli, Cockroaches, Car Camping, Poverty Wages:

Why Are Minor-Leaguers Living in Squalor?, Athletic

(Aug. 5, 2021), https://theathletic.com/2750280/2021/

08/05/cockroaches-car-camping-poverty-wages-why-areminor-leaguers-living-in-squalor/.

MLB also dominates minor league team owners

and the cities and towns hosting these teams through

the minor league “farm” system. And, as the

petitioners allege, in 2020 MLB collectively

terminated team affiliations with 40 minor league

teams. See J.A. 6a-7a. The petitioners and some of

the other expelled teams formally survive, but MLB

has banished them from the top minor league system.

Acting collectively, MLB decided that these expelled

teams could no longer field players who could be

promoted to the majors, nor compete against MLB’s

remaining minor league affiliates. Because of MLB’s

collective decision, the expelled teams suffered

substantial loss of fan interest, ticket sales, and

revenue opportunities generally.

The expelled teams were typically the only

professional baseball team, and in some cases, the

only professional sports team in their city or town.

Many teams had strong local followings. Their games

supported local businesses such as stadium vendors

5

Left Stranded: How Major League Baseball Leaves Minor

League Players Behind, More Than Baseball (2022),

https://www.morethanbaseball.org/issue-report.

12

and local print, radio, and television media and

significantly increased local per capita income. Nola

Agha, The Economic Impact of Stadiums and Teams:

The Case of Minor League Baseball, 14 J. Sports

Econ. 227, 249 (2013). Reduced attendance translated

to reduced economic activity and a loss of local

income, jobs, and tax revenues. Pet. 13. Thus, local

communities themselves suffered significant harm. 6

Minor league baseball remains under MLB’s thumb.

Those least able to protect themselves MLB exploits

the most.

B. MLB’s Antitrust Exemption Sustains

Patently Unreasonable Restraints

The Supreme Court has described collusion among

rivals as “the supreme evil of antitrust.” Verizon

Commc’ns Inc. v. Law Offs. of Curtis V. Trinko, LLP,

540 U.S. 398, 408 (2004). Therefore, but for its

antitrust exemption, MLB’s collectively-established

restraints and other practices targeting minor league

teams and its players would amount to input

reductions, horizontal price-fixing, and group

boycotts—conduct that the Sherman Act outlaws.

Specifically, MLB collectively reduced both the

number of affiliated minor league teams and the

number of players in MLB’s farm system. In any

other industry, this restraint would likely be per se

illegal, either as a collusive input reduction in, or

group boycott directed to, minor league teams and

players. See, e.g., United States v. Socony-Vacuum Oil

Co., 310 U.S. 150 (1940) (collective “buying program”

to reduce gasoline was a per se violation); Klor’s, Inc.

6 Letter from Members of Congress to Commissioner Manfred

(Nov. 19, 2019), https://trahan.house.gov/uploadedfiles/trahan_

mckinleymlb_letter.pdf.

13

v. Broadway-Hale Stores, Inc., 359 U.S. 207 (1959)

(collective refusal to deal by competitors was a per se

violation). Even if market power needs to be shown,

MLB could not plausibly dispute its domination of

professional baseball. Cf. Nat’l Collegiate Athletic

Ass’n v. Bd. of Regents of Univ. of Oklahoma, 468

U.S. 85, 111-12 (1984) (NCAA possessed market

power in market for college football broadcasts, citing

International Boxing Club, among other authorities);

Klor’s, 359 U.S. at 213 (since MLB’s collective action

“clearly has, by its nature and character, a

monopolistic tendency[,] . . . it is not to be tolerated

merely because the victim is just one merchant whose

business is so small that his destruction makes little

difference to the economy.”) (cleaned up).

Major league teams have also collectively

suppressed the salaries of minor league players as

well as the terms and conditions of their

employment—another per se violation absent MLB’s

antitrust exemption. As then-Judge Sotomayor wrote

in a case concerning collusive sharing of compensation

information among employers, “a horizontal conspiracy

among buyers to stifle competition is as unlawful as

one among sellers.” Todd v. Exxon Corp., 275 F.3d

191, 201 (2d Cir. 2001). See also Mandeville Island

Farms, Inc. v. Am. Crystal Sugar Co., 334 U.S. 219

(1948) (price-fixing by purchasers was a per se

violation).

The effects of MLB’s practices, summarized above,

are dire. Ending the exemption that currently

insulates its restraints on minor league teams and

their players from Sherman Act scrutiny will not

destroy MLB. The MLB teams are independent and

compete against each other not only on the field, but

also as profit-making businesses. Like all other

professional sports and the NCAA, MLB’s teams

14

should be held legally capable of conspiring with each

other in violation of the Sherman Act. Cf. Am. Needle,

Inc. v. Nat’l Football League, 560 U.S. 183, 191-92

(2010) (denying NFL teams antitrust immunity for

collective product licensing).

III. WHATEVER FOUNDATION MLB’S ANTITRUST EXEMPTION MAY HAVE HAD IN

1922 HAS SINCE DISSOLVED

A. As the Flood Court Acknowledged, the

Business of Baseball Has Constituted

Interstate Commerce for a Long Time

In 1922, baseball was already a national business.

Although baseball games were played at a particular

place, teams of course traveled across state lines to

play each other. See Federal Baseball, 259 U.S. at

208-09. Further, the national telegraph system

transmitted game scores across state lines. An

analogy to an industry that was prosecuted for

antitrust violations in the early 20th century is

instructive. Like tobacco smoking, baseball games

were a local activity; but their supply—like that of

cigars and cigarettes—was interstate activity. Stuart

Banner, The Baseball Trust: A History of Baseball’s

Antitrust Exemption 83 (2013). And the government

had broken up the American Tobacco Company in

1911. United States v. Am. Tobacco Co., 221 U.S. 106

(1911).

Nonetheless, in conferring baseball’s antitrust

exemption, the Federal Baseball Court relied on its

then-prevailing interpretation of Congress’s limited

constitutional power to regulate interstate commerce.

Baseball games, Justice Holmes said, were simply

local entertainment, and all the travel and

15

communications across state lines associated with

offering games was “a mere incident, not the

essential thing . . . . [P]ersonal effort, not related to

production, is not a subject of commerce.” Federal

Baseball, 259 U.S. at 209. According to the Court,

Congress simply lacked authority to pass legislation

that regulated baseball.

Even in 1922, this analytic foundation for MLB’s

antitrust exemption was “at best of dubious validity.”

Radovich, 352 U.S. at 450. A year later, Justice

Holmes, again writing for a unanimous Court,

declined to extend Federal Baseball and reversed

dismissal of an antitrust claim directed to local

vaudeville performances. Despite their obvious

similarity—both baseball and vaudeville involved

interstate travel to perform local entertainment—the

Court said there could be fact differences: “it may be

that what in general is incidental, in some instances

may rise to a magnitude that requires it to be

considered independently.” Hart, 262 U.S. 274. The

Court remanded the case to give the plaintiffs an

opportunity to show that vaudeville constituted

interstate commerce. Id. at 273-74.

The Court itself adopted a more expansive reading

of Congress’s commerce clause powers in the 1930s

and 1940s. See, e.g., NLRB v. Jones & Laughlin Steel

Corp., 301 U.S. 1 (1937); United States v. Darby, 312

U.S. 100 (1941); Wickard v. Filburn, 317 U.S. 111

(1942). The Court jettisoned earlier distinctions like

production and commerce and adopted a broader

construction of the activities constituting interstate

commerce subject to congressional authority.

Meanwhile, baseball also had grown dramatically

and become a major interstate business with

lucrative radio and television contracts to broadcast

games. Banner, supra, at 100. Accordingly, baseball

16

could not credibly disclaim the interstate character of

its business.

Despite judicial expansion of the Congress’s

commerce clause powers and the dramatic growth of

baseball as a business, the Toolson Court did not

subject baseball to the antitrust laws. Instead, the

Toolson majority re-affirmed Federal Baseball “so far

as that decision determines that Congress had no

intention of including the business of baseball within

the scope of the federal antitrust laws.” 346 U.S. at

357. MLB thus became the beneficiary of an implied

legislative antitrust exemption. Years later, although

the Flood majority declined to ignore reality—

“[p]rofessional baseball . . . is engaged in interstate

commerce,” 407 U.S. at 282—it also doubled down on

Toolson’s belated implied immunity rationale. Justice

Blackmun wrote: “If there is any inconsistency or

illogic in all this, it is an inconsistency and illogic of

long standing that is to be remedied by the Congress

and not by this Court.” Id. at 284.

B. Congress Has Not Exempted Baseball

from the Antitrust Laws

The rationale that Toolson and Flood adopted to

perpetuate

MLB’s

exemption—that

Congress

implicitly intended to exempt baseball from federal

antitrust law—runs headlong into not only the

absence of any mention of congressional intent to

provide an antitrust pass to baseball, but also this

Court’s strong hostility to implied immunity from the

antitrust laws.

When Congress enacted the Sherman Act in 1890,

by all accounts the drafters did not pay any special

heed to baseball, or even think about the matter. See

Radovich, 352 U.S. at 455 (Frankfurter, J., dissenting);

17

Banner, supra, at 120. Moreover, when Congress

exempted activities or actors from the antitrust laws,

it has spoken clearly and directly. For instance, in the

Capper-Volstead Act, Congress authorized the

formation of cooperatives among farmers and

ranchers, which might otherwise run afoul of Section

1 of the Sherman Act, and Congress established a

system of federal oversight for their activities. 7

U.S.C. §§ 291-92. Congress has never passed a

comparable broad exemption for baseball but offered

only a targeted exemption in the Sports Broadcasting

Act for joint negotiations of radio and television

contracts by teams in the four principal professional

sports leagues, not simply professional baseball. 15

U.S.C. §§ 1291-95.

Similarly, the Curt Flood Act of 1998, 15 U.S.C. §

26b, did not legislatively ratify baseball’s Courtcreated antitrust exemption. As part of the resolution

to the season-ending strike of 1994, MLB and the

Major League Baseball Players Association agreed to

petition Congress to withdraw the exemption with

respect to labor disputes involving major league

players. Congress did so in the Curt Flood Act. But

the Act’s text and legislative debates demonstrate

that Congress narrowly repealed the exemption

without taking a position on the exemption as a

whole or withdrawing it from the courts. One scholar

concluded that, “aside from allowing major league

baseball players to file lawsuits against MLB,

Congress clearly intended for the [Curt Flood Act] to

be read neutrally with regard to baseball’s historic

antitrust exemption in all other respects.” Nathaniel

Grow, The Curiously Confounding Curt Flood Act, 90

Tul. L. Rev. 859, 900 (2016). See also Curt Flood Act,

Pub. L. No. 105-297, § 2, 112 Stat. 2824 (1998) (The

Act’s purpose provides that “major league baseball

18

players will have the same rights under the antitrust

laws as do other professional athletes,” while

“mak[ing] it clear that the passage of this Act does

not change the application of the antitrust laws in

any other context or with respect to any other person

or entity.”).

Congressional inaction, such as that illustrated in

the Curt Flood Act, is at best ambiguous. It often

“lacks persuasive significance because it is

indeterminate; several equally tenable inferences

may be drawn from such inaction.” Halliburton v.

Erica P. John Fund, Inc., 573 U.S. 258, 300 (2014)

(Thomas, J., concurring) (cleaned up). In developing

and advancing legislative agendas, the two houses of

Congress and their committees cannot respond to

every issue of public importance. Congressional

inaction, even extended inaction, could be the product

of members’ focus on other priorities, a relevant

committee chair having different views on a topic

than a majority of committee’s members, or an

inability for the two houses to reach an agreement.

William N. Eskridge, Jr., Interpreting Legislative

Inaction, 87 Mich. L. Rev. 67, 98-99 (1988). Thus, the

Court

has

cautioned

against

interpreting

congressional inaction as somehow validating judicial

construction of statutory law: “[W]e walk on

quicksand when we try to find in the absence of

corrective legislation a controlling principle.”

Helvering v. Hallock, 309 U.S. 106, 121 (1940). See

also Bostock v. Clayton Cnty., Georgia, 140 S. Ct.

1731, 1747 (2020) (Gorsuch, J.) (“[S]peculation about

why a later Congress declined to adopt new

legislation offers a particularly dangerous basis on

which to rest an interpretation of an existing law a

different and earlier Congress did adopt.”) (cleaned

up).

19

The baseball exemption eludes the fundamental

importance of the federal antitrust laws and the

corollary judicial reluctance to recognize implied

immunities from these laws. The Sherman Act

sweeps broadly and protects multiple classes of

market participants, including consumers, competitors,

and suppliers. Mandeville Island Farms, 334 U.S. at

236. Justice Black thus described the Act as “a

comprehensive charter of economic liberty.” N. Pac.

Ry. Co. v. United States, 356 U.S. 1, 4 (1958), while

Justice Marshall characterized the antitrust laws in

general as “the Magna Carta of free enterprise.”

United States v. Topco Assocs., Inc., 405 U.S. 596, 610

(1972). Because of the antitrust laws’ foundational

nature, even when Congress adopts a sectoral

regulatory scheme, antitrust immunity “is not lightly

implied.” California v. Fed. Power Comm’n, 369 U.S.

482, 485 (1962). This canon “reflects the felt

indispensable role of antitrust policy in the

maintenance of a free economy. . . .” United States v.

Philadelphia Nat’l Bank, 374 U.S. 321, 348 (1963).

See also Antonin Scalia & Bryan A. Garner, Reading

Law: The Interpretation Of Legal Texts 327 (2012)

(“The essence of the presumption against implied

repeals is that if statutes are to be repealed, they

should be repealed with some specificity.”).

Accordingly, when challenged conduct is subject to

sectoral regulation, the Court’s test for implied

antitrust immunity is one of “clear repugnancy.”

Credit Suisse Securities (USA) LLC v. Billing, 551

U.S. 264, 274 (2007). The directive is clear: “When

there are two acts upon the same subject, the rule is

to give effect to both if possible.” United States v.

Borden Co., 308 U.S. 188, 198 (1939). See also Otter

Tail Power Co. v. United States, 410 U.S. 366, 372

(1973) (“Activities which come under the jurisdiction

20

of a regulatory agency nevertheless may be subject to

scrutiny under the antitrust laws.”).

The principles counseling against implied

immunity from antitrust law apply with strongest

force to MLB. Unlike, for example, electric power,

natural gas, and marketing and trading securities,

baseball is not subject to a comprehensive sectoral

regulatory scheme, such as the Federal Power Act,

the Natural Gas Act, or the Securities and Securities

Exchange Acts. Baseball has no equivalent of the

Federal Energy Regulatory Commission or the

Securities and Exchange Commission. Therefore,

there is no risk that MLB activity challenged as

antitrust-constrained might be in tension with

regulatory operations, obligations, or prohibitions.

C. Federal Preemption of State Antitrust

Laws Is Also Strongly Disfavored

In addition to affirming Toolson’s holding on

federal antitrust law, the Flood Court extended the

exemption’s scope to preempt state antitrust claims

as well. 407 U.S. at 284-85. This amounts to mischief

compounding

mischief.

Extending

baseball’s

judicially-created antitrust exemption to bar state

antitrust squarely contradicts a core principle of

federalism itself—the presumption against federal

preemption of state law. Flood’s extension further

ignores the specific protection against federal

preemption that state antitrust laws enjoy.

In considering federal preemption questions, a

longstanding canon of construction reminds that: “we

start with the assumption that the historic police

powers of the States were not to be superseded by the

Federal Act unless that was the clear and manifest

purpose of Congress.” Rice v. Santa Fe Elevator

21

Corp., 331 U.S. 218, 230 (1947) (emphases added).

See also Medtronic, Inc. v. Lohr, 518 U.S. 470, 485

(1996). Thus, the presumption against preemption

and the “purpose of Congress” are the “two

cornerstones” for preemption analysis. Wyeth v.

Levine, 555 U.S. 555, 565 (2009) (cleaned up).

And here, the Federal Baseball wrinkle reinforces

the presumption against preemption. There is no

federal statute whose congressional purpose this

Court must assess—only this Court’s own federal

antitrust exemption and subsequent congressional

inaction. In these circumstances, Garcia v. San

Antonio Metropolitan Transit Authority, 469 U.S.

528, 546 (1985), is instructive:

The essence of our federal system is that

within the realm of authority left open to

them under the Constitution, the States

must be equally free to engage in any

activity that their citizens choose for the

common weal, no matter how unorthodox or

unnecessary anyone else—including the

judiciary—deems state involvement to be.

Accordingly, “to give the state-displacing weight of

federal law to mere congressional ambiguity would

evade the very procedure for lawmaking on which

Garcia relied to protect states’ interests.” Gregory v.

Ashcroft, 501 U.S. 452, 464 (1985) (quoting Laurence

H. Tribe, American Constitutional Law § 6-25, p. 480

(2d ed. 1988) (cleaned up)).

These considerations alone establish that Flood’s

extension of antitrust immunity to state antitrust law

is unjustified. However, equally important, the

presumption against preemption applies with special

force for state antitrust laws. By 1890, when the

Sherman Act was passed, 21 States had enacted

22

either constitutional or statutory antitrust provisions,

and several had both. Hans B. Thorelli, The Federal

Antitrust Policy 155 (1955). State law enforcement

against the trusts was ongoing. See, e.g., id. at 15657, 259-65. Accordingly, “Congress intended the

federal antitrust laws to supplement, not displace,

state antitrust remedies.” California v. ARC America

Corp., 490 U.S. 93, 102 (1989). See, e.g., Exxon Corp.

v. Governor of Maryland, 437 U.S. 117, 133 (1978)

(declining to hold that the federal Robinson-Patman

Act preempts a Maryland antitrust law on the

marketing of gasoline).

Both federalism’s respect for state law and the

Sherman Act’s congressional intent converge to avoid

any state antitrust preemption. As the Court wrote in

a unanimous decision: “The case for federal

preemption is particularly weak where Congress has

indicated its awareness of the operation of state law

in a field of federal interest and has nonetheless

decided to stand by both concepts and to tolerate

whatever tension there [is] between them.” Bonito

Boats, Inc. v. Thunder Craft Boats, Inc., 489 U.S. 141,

166-67 (1989). See also Oneok, Inc. v. Learjet, Inc.,

575 U.S. 373, 387-88 (2015) (disfavoring federal

sector-specific regulation preemption of state laws of

general application, such as antitrust law).

Just as its perfunctory creation of an implied

immunity against federal antitrust law in Federal

Baseball and its progeny, the Court erred in Flood in

preempting state antitrust law. The Court pointed to

no statutory language nor regulatory measure that

would support preemption because there is none. The

strong presumption against preempting state

antitrust law accentuates the Flood Court’s mistake

in failing to apply the traditional presumption

23

against preemption of state antitrust laws to

baseball.

CONCLUSION

Whether based on constitutional or statutory

interpretation, “[s]tare decisis is not an inexorable

command,” but rather “a principle of policy.” Payne v.

Tennessee, 501 U. S. 808, 828 (1991) (cleaned up).

This Court created baseball’s antitrust exemption a

century ago, and it should acknowledge the

responsibility of that ownership, instead of again

looking to Congress to undo the unjustified and

unique dispensation baseball has received. Justice

Holmes himself pointed the way: “[I]t is revolting to

have no better reason for a rule of law than that it

was so laid down in the time of Henry IV. It is still

more revolting if the grounds upon which it was laid

down have vanished long since and the rule simply

persists from the blind imitation of the past.” Oliver

Wendell Holmes, The Path of the Law, 10 Harv. L.

Rev. 457, 469 (1897). Justice Marshall was correct in

Flood: “[W]e must admit our error and correct it. We

have done so before and we should do so again here.”

Flood, 407 U.S. at 293 (Marshall, J., dissenting).

The Sherman Act’s existing analytics—per se,

quick look, and rule of reason scrutiny—are

sufficiently robust to address whatever need MLB

teams may have to collaborate in some areas to

ensure the business’s success under conditions of

competition. This Court should end the antitrust

immunity milk and cookies that no other professional

sport enjoys.

The Court should grant certiorari review.

24

Dated: October 20, 2023

Repectfully submitted,

JAY L. HIMES

Counsel of Record

50 East 89th Street, Apt. 12F

New York, NY 10128

(646) 808-6135

jlhimes@gmail.com

SANDEEP VAHEESAN

OPEN MARKETS INSTITUTE

655 15th Street, NW, Suite 310

Washington, DC 20005