# Appendix — Mid-South Grizzlies v. National Football League > Briefs, arguments, decisions, and more. URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385011_1255%3A3 ## Record - **Collection:** Supreme Court brief - **Document type:** Appendix - **Published:** January 1, 1984 - **Citation:** 467 U.S. 1215 ## Text Office - Supreme Court, U.S, 3 33-1470 FILED MAR & 19 ALEXANDER L. STEVAS. | CLERK IN THE SUPREME COURT OF THE UNITED STATES October Term, 1983 THE MID-SOUTH GRIZZLIES (A Joint Venture); et al., Petitioners* v. THE NATIONAL FOOTBALL LEAGUE, An Unincorporated Association; et al., Respondents* APPENDIX TO PETITION FOR A WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE THIRD CIRCUIT RICHARD A. SPRAGUE GARY GREEN EDWARD H. RUBENSTONE NEIL A. MORRIS STEVE ALEXANDER Of Counsel: Of Counsel: SPRAGUE & RUBENSTONE SIDKOFF, PINCUS, Suite 400, Wellington Bldg. GREENBERG & GREEN 135 South 19th St. 12th Floor, 530 Walnut St. Philadelphia, PA 19103 Philadelphia, PA 19106 (215) 561-7681 (215) 574-0600 Of Counsel: LOUIS B. SCHWARTZ, Esquire San Francisco, CA Counsel for PETITIONERS PACKARD PRESS / LEGAL DIVISION, 10th & SPRING GARDEN STREETS, PHILA, PA. 19123 (215) 236-2000 * Petitioners are: The Mid-South Grizzlies (A Joint Venture); John Ed- ward Bosacco; Mid-South Grizzlies (A Limited Partner- ship); and Consolidated Industries, Inc. Respondents are: The National Football League, An Unincorporated As- sociation; Baltimore Football Club, Inc.; Buffalo Bills, Inc.; Chargers Football Company; Chicago Bears Football Club, Inc.; Cincinnati Bengals, Inc.; Cleveland Browns, Inc.; Dallas Cowboys Football Club, Inc.; Detroit Lions, Inc.; Five Smiths, Inc.; Green Bay Packers, Inc.; Houston Oil- ers, Inc.; Kansas City Chiefs Football Club, Inc.; Los Angeles Rams Football Company; Miami Dolphins, Ltd.; Minnesota Vikings Football Club, Inc.; New England Pa- triots Football Club, Inc.; New York Football Giants, Inc.; New York Jets Football Club, Inc.; New Orleans Saints Louisiana Partnership; Oakland Raiders, Ltd.; Philadel- phia Eagles Football Club, Inc.; Pittsburgh Steelers Sports, Inc.; Pro-Football, Inc.; Rocky Mountain Empire Sports, Inc.; San Francisco Forty Niners; Seattle Profes- sional Football, A General Partnership; St. Louis Football Cardinals Company; Tampa Bay Area NFL Football, Inc.; and Pete Rozelle. INDEX TO THE APPENDIX Opinion of the Third Circuit Panel ......... A-1 Order of the District Court, 11/5/82 ......... A-32 Opinion of the District Court .............. A-33 Memorandum Order of District Court, 8/13/81 A-63 Judgment issued in lieu of formal mandate by po eee A-67 Order Sur Petition for Rehearing, 12/5/83 .... A-69 Order staying issuance of the mandate, dated _ ES. aaa ES oe hk 00 a 8s WM 0 8 A-71 Order staying issuance of the mandate, dated eee ra lo pac eco ha bad ae 844 A-73 Order recalling certified judgment issued 2/7/84 A-75 Order staying issuance of mandate, dated I cc aa k's Oak G6. w bale wa Hie 60% A-78 is bs 4:40 OK Se SANK ROR OO A-79 Judgment of the Third Circuit, entered 11/4/83 A-83 GX hie Ge Was 5.8% Gkale SE be A-84 GA A a ae RES aA A-84 SCR aS Ace ee A-85 EE AC, Glace aw EN «x alan owas eee A-85 I Sha. ig MS's a hod ee Wale A-86 i a ig Sa) hil Sh Ae A-86 iS os ys o's Sale a Rare we ut ews A-87 I Tcl 5a 4-6 ke we 0 o.0 ace Ws a A-87 Fed. R. Civ. P. Rule 56 (b), (c), (f) ......... A-88 LE Oe Wha seg Ba hosel elkcce ee ok A-89 TE a> 5 SCA vie a alk 4.0 5 Wese 4 Wem be Shad Re A-111 INDEX TO THE APPENDIX— Continued) Letter dated 8/20/81 from Mr. Alexander to gg ERE CRORE eee Letter dated 9/10/81 from Mr. Alexander to er ee eee eee Letter dated 9/16/81 from Mr. Rubenstone to es cia p o0' és oe Os Letter dated 9/18/81 from Judge McGlynn to Mr. I 8 ek os ck ok hore bbe ob Oa Letter dated 9/23/81 from Mr. Weisberg to Judge o's Soaae bac} 6 aces 6h beh ee er Letter dated 12/4/81 from Mr. Alexander to I Satoh irae ysis ob ie ae as Letter dated 12/10/81 from Mr. Rome to Judge I eo, cucu Nek waa Letter dated 12/15/81 from Mr. Green to Judge NN toe die sae Wea ees eee ee es Letter dated 12/17/81 from Judge McGlynn to Messrs. Alexander and Green .......... The MID-SOUTH GRIZZLIES (a Joint Venture); John Edward Bosacco; Mid-South Grizzlies (a Limited Part- nership); and Consolidated Industries, Inc., Appel- lants v. The NATIONAL FOOTBALL LEAGUE, §$an unincorporated association; Baltimore Football Club, Inc.; Buffalo Bills, Inc.; Chargers Football Company; Chicago Bears Football Club, Inc.; Cincinnati Ben- gals, Inc.; Cleveland Browns, Inc.; Dallas Cowboys Football Club, Inc.; Detroit Lions, Inc.; Five Smiths, Inc.; Green Bay Packers, Inc.; Houston Oilers, Inc.; Kansas City Chiefs Football Club, Inc.; Los Angeles Rams Football Company; Miami Dolphins, Ltd.; Min- nesota Vikings Football Club, Inc.; New England Pa- triots Football Club, Inc.; New York Football Giants, Inc.; New York Jets Football Club, Inc.; New Orleans Saints Louisiana Partnership; Oakland Raiders, Ltd.; Philadelphia Eagles Football Club, Inc.; Pittsburgh Steelers Sports, Inc.; Pro-Football, Inc.; Rocky Moun- tain Empire Sports, Inc.; San Francisco Forty Niners; Seattle Professional Football, A General Partnership; St. Louis Football Cardinals Company; Tampa Bay Area NFL Football, Inc. and Pete Rozelle. No. 82-1793. United States Court of Appeals, Third Circuit. Argued Sept. 13, 1983. Decided Nov. 4, 1983. Rehearing Denied Dec. 5, 1983. Member of now defunct professional football league sued existing league, its members and commissioner complaining that refusal to grant application for mem- bership in defendant league violated the antitrust laws. The United States District Court for the Eastern District of Pennsylvania, Joseph L. McGlynn, Jr., J., 550 F.Supp. 558, rendered summary judgment for defendants, and applicant appealed. The Court of Appeals, Gibbons, Cir- A-1 A-2 cuit Judge, held that: (1) summary judgment motion was ripe for decision without additional discovery; (2) statute which insulated from antitrust liability merger of two competing professional football leagues, resulting in creation of defendant league, was not directed at pre- serving competition in the market for professional foot- ball and did not oblige existing league to permit entry by a particular applicant to its monopoly power; and (3) as regards Sherman Act claim, applicant failed to show any actual or potential injury to competition or that its ad- mission would be contracompetitive. Affirmed. 1. Federal Civil Procedure |KEyY) 2553 Where affidavits are filed setting forth specific rea- sons why movant’s affidavits in support of summary judgment cannot be responded to and the facts are in possession of the movant, a continuance of the motion for discovery purposes should be granted almost as a matter of course. Fed.Rules Civ.Proc.Rule 56(f), 28 U.S.C.A. 2. Federal Civil Procedure (key) 1269 Additional discovery on issue whether member teams of defendant professional football league were competitors was not warranted in antitrust action by re- jected applicant for admission to league membership where not only did applicant fail to file required affidavit but its response to league's reply brief raised no more than a merely colorable claim that actual or potential competition for revenue other than from ticket sales and sales of television rights could be shown between a pro- fessional team based in applicant's hometown and other league members and adequate discovery had been had on agreed issue whether application was rejected on ba- sis of objective criteria. Fed.Rules Civ.Proc.Rule 56(f), 28 U.S.C.A.; Sherman Anti-Trust Act, §§1, 2, 15 U.S.C.A. §§1, 2. A-3 3. Monopolies (KEY) 12.(1.10) Under rule of reason analysis, a Sherman Act re- straint of trade claim can be established by proof that de- fendants contracted, combined or conspired among themselves, that the combination or conspiracy pro- duced adverse, anticompetitive effects within relevant product and geographic markets, that objects of and conduct pursuant to the contract or conspiracy were il- legal and that plaintiff was injured as a proximate result of that conspiracy. Sherman Anti-Trust Act, §1, 15 U.S.C.A. §1; Clayton Act §4, 15 U.S.C.A. §15. 4. Monopolies {KEY 28(7.3) For purpose of rule-of-reason analysis in Sherman Act challenge to professional football league’s rejection of application for league membership by former member of now defunct competing football league it was irrele- vant that when one member of present league, which was result of statute insulating merger of leagues from antitrust liablity, was seeking legislation concerning television revenue-sharing practices it admitted a new team in home state of chairman of committee consider- ing the bill and that when the leagues were seeking stat- utory exemption permitting their merger a team was added in home state of powerful senator and congress- man who supported the legislation and that postmerger addition of two other teams was prompted by desire to limit term of proposed legislation prohibiting home teams from blacking out televised games. Sherman Anti- Trust Act, §1, 15 U.S.C.A. §1; 15 U.S.C.A. §1291. 5. Monopolies |KEY| 12(6) Provision of 1966 legislation immunizing from antitrust liability merger of two or more football leagues into an expanded single league that “such agreement in- creases rather than decreases the number of profes- sional football clubs so operating,” could not reasonably be construed as addressing competition, and reference to increase in number of teams “so operating” was to A-4 professional teams operating under antitrust exemption for television revenue sharing provided in 1961 statute and what 1966 statute suggested was that more home team territories would be added rather than to increase competition and statute permitted geographic enlarge- ment of the resulting league’s market power. 15 U.S.C.A. §§1291, 1294. See publication Words and Phrases for other judicial constructions and definitions. 6. Monopolies (KEY) 12(6) The 1966 legislation permitting combination of members of two or more competing professional football leagues into one league did not obligate league which re- sulted from merger of two competing leagues to permit entry by any particular applicant to its shared market power and statute did not require the league to admit to membership an applicant from an area not presently served by existing league member. 15 U.S.C.A. §1294. 7. Monopolies (KEY) 28(1.4) Where member of defunct professional football team showed no actual or potential injury to competition from rejection of its application for franchise in existing professional football league which, by statute, had been granted monopoly power, the applicant could not suc- ceed on Sherman Act claim of conspiracy to restrain trade, especially as applicant was not seeking recovery as a potential competitor outside the league but identi- fied as the antitrust violation the league’s negative vote on its application and statutory arrangement under which league functioned eliminated competition among its members and there was no showing that football teams located in applicant’s territory and that of the nearest existing league member would complete for the same ticket purchases, etc. Sherman Anti-Trust Act, §1, 15 U.S.C.A. §1; 15 U.S.C.A. §1291. A-5 8. Monopolies (KEY) 28(6) ; Regardless of whether members of existing profes- sional football league, which had been granted statutory monopoly, competed in a so-called “raw material mar- ket” for players and coaching personnel, rejection of ap- plication for admission to league, an act charged as vio- lating antitrust laws, did not restrain applicant from competing for players by forming competitive league and applicant failed to show how, if its exclusion re- duced competition for team personnel, that reduction caused an injury to its business or property. Sherman Anti-Trust Act, §1, 15 U.S.C.A. §1; 15 U.S.C.A. §1291. 9. Monopolies (KEY 12(1.6) The “essential facilities doctrine,” as applied to Sherman Act challenge to rejection of application for ad- mission to membership in professional football league having a statutory monopoly would result in additional competition in an’economic rather than athletic sense and no recovery could be had on such theory where ap- plicant failed to show how competition in any arguably relevant market would be improved if it were given a share of existing league’s monopoly power. 15 U.S.C.A. §§1291, 1294; Sherman Anti-Trust Act, §1, 15 U.S.C.A. §1. 10. Monopolies (KEY) 12(b) Rejection of application by member of now defunct professional football league for admission to member- ship in existing league did not violate Sherman Act’s prohibition on attempts to monopolize as not only did Congress authorize existing league’s acquisition of its present market power by way of merger but rejected ap- plicant failed to show that its admission would be contracompetive in any way and area in which it would operate had been left by existing league for potential competitors. 15 U.S.C.A. §§1291, 1294; Sherman Anti- Trust Act, §1, 15 U.S.C.A. §1. A-6 Richard A. Sprague, Edward H. Rubenstone, Steve Alexander, Sprague & Rubenstone, Philadelphia, Pa., Gary Green (argued), Neil A. Morris, Sidkoff, Pincus, Greenberg & Green, Philadelphia, Pa., for appellants; Louis B. Schwartz, Philadelphia, Pa., of counsel. Morris L. Weisberg, Blank, Rome, Comisky & McCauley, Philadelphia, Pa., James C. McKay, Paul J. Tagliabue (argued), Covington & Burling, Washington, D.C., for appellees. Before SEITZ, Chief Judge, and GIBBONS and ROSENN, Circuit Judges. OPINION OF THE COURT GIBBONS, Circuit Judge. Mid-South Grizzlies, a joint venture, and its mem- bers (the Grizzlies) appeal from a summary judgment in favor of the defendants in their suit against the National Football League (NFL), the league members, and League Commissioner Pete Rozelle, seeking damages under Section 4 of the Clayton Act, 15 U.S.C. §15 (1973). The suit concerns the defendants’ refusal to grant the plaintiffs a football franchise. On appeal the Grizzlies contend that the district court erred: (1) in granting summary judgment while the Grizzlies’ discov- ery requests were outstanding; and (2) in granting sum- mary judgment when there were disputed issues of ma- terial fact.'! We affirm. Background The NFL is a not-for-profit business league, quali- fied for exemption from federal income tax under sec- tion 501(c)6 of the Internal Revenue Code, 26 U.S.C. §501(c)(6)( 1967). The league has 28 members, each of 1. The court's decision is reported. Mid-South Grizzlies v. Na- tional Football League, 550 F.Supp. 558 (E.D.Pa. 1982). A-7 which is an entity organized for profit, engaged in the business of fielding a professional football team. The NFL was formed by the merger of two predecessor foot- ball leagues. That merger took place following the enact- ment, in 1966, of Pub.L. 89-800, §6(b)( 1), 80 Stat. 1515, which amended Pub.L. 87-331, §1, 75 Stat. 732 (1961), 15 U.S.C. §1291. Section 1291, enacted in 1961, granted to certain professional sports leagues a limited exemption from the antitrust laws with respect to the joint sale of television broadcast rights for league games, and the 1966 amendment permitted “a joint agreement by which the members of two or more football leagues combine their operations in expanded single leagues . . . if such agreement increases rather than decreases the number of professional football clubs so operating.” The 1961 exemption with respect to joint sale of televi- sion broadcasting rights, intended to overrule the judg- ment in United States v. National Football League, 116 F.Supp. 319 (E.D.Pa.1953), does not “otherwise affect the applicability or nonapplicability of the antitrust laws” to any other activities of persons engaged in professional team sports. 15 U.S.C. §1294. The 1966 exemption does no more than permit the combination of members of two or more leagues into one. Under the 1974 constitution and by-laws of the NFL each member obliges itself to operate a professional football club which is a member of the league. Each member has a designated “home territory” within which it has “the exclusive right. . . to exhibit professional football games played by teams of the League,” and “|njo club in the League shall be permitted to play games within the home territory of any other club unless a home club is a participant.” Home territory is defined as a designated city and “the surrounding territory to the extent of 75 miles in every direction from the exterior corporate limits of such city.”? Constitution and By- 2. There are special provisions for the New York and San Francisco Metropolitan areas and for Green Bay, Wisconsin. A-8 Laws, Article IV, Appendix at 1129a, 1138a. The addi- tion of a new league member within the home territory of any member requires unanimous consent of the league members. Id. Article 3.1(b). Elsewhere, appli- cants for membership may be admitted by the affirma- tive vote of not less than three-fourths or 20 members, whichever is greater. Id. Article 3.3(c). No league mem- ber may have a financial interest, direct or indirect, in any other league member. Id., Article 9.1(B)(1). The combined league began functioning in 1970 with 26 members. Thereafter new home territories were designated for Tampa, Florida, and Seattle, Washington, and member teams with franchises for those home terri- tories began participating in league play in 1976. The uncontradicted affidavit of Commissioner Rozelle estab- lishes that the initiative for establishing those franchises came from the NFL, which negotiated for a stadium lo- cation, determined methods of providing the franchise with players, and only then evaluated and selected own- ers. See, e.g., Rozelle Deposition, Appendix at 1290a, 1431a-1440a. As authorized by 15 U.S.C. §1291, the NFL has made a joint sale to three major television networks of the regular season and post-season television rights. Television revenues are divided equally among all mem- bers. Receipts from the sale of tickets are shared be- tween the home team, 60% and the visiting team, 40%. Each home team retains other revenues, derived from its local operations.* On average, however, more than 70% of each team’s revenue is derived from sources other than its operations at the home location. See Defendants’ Motion for Summary Judgment, Affidavit of Pete Rozelle, Appendix at 188a. 3. These include revenue from non-network coverage of pre- season games, and revenue from food and beverage concessions, parking, and sale of team paraphernalia. Such revenue varies both with attendance and depending on the terms of stadium leases. A-9 In 1974 and 1975 the Grizzlies participated in the World Football League from a home team location in Memphis, Tennessee. The members of that league could be found to have been competitors of the members of the NFL in the national market for network television revenue. The World Football League disbanded, how- ever, halfway through the 1975 football season. The NFL had no franchise at Memphis, and a home team designation for that location would not infringe upon the home territory of any NFL member. Upon the demise of the World Football League the Grizzlies applied to the NFL for admission to the league with a designated home territory at Memphis. At meetings with the NFL Expansion Committee, and with the full NFL membership, the Grizzlies urged that it had in place at Memphis an established, function- ing professional football enterprise. The application was rejected. This lawsuit followed. Il. The Complaint The Grizzlies’ complaint, filed on December 3, 1979, does not charge that the provisions of the NFL's Constitution and By-Laws reserving to its members franchise exclusivity for designated home territories vio- lates the antitrust laws. Indeed, the Grizzlies sought such an exclusive franchise for themselves. Thus this case does not present any issue of possible antitrust vio- lation from the exclusion of potential competitors in the designated exclusive home territories. Nor do the Grizzlies complain that the NFL's 60-40 home team-visitor revenue sharing arrangement, which is not exempted from antitrust scrutiny by 15 U.S.C. §1291, caused any injury to their business or property. Indeed, the Grizzlies sought to participate in that ar- rangement. Moreover, the Grizzlies make no complaint about the operation of the NFL arrangements for joint A-10 sale of television rights. They do not charge, for exam- ple, that the demise of the World Football League was caused by the NFL's television marketing practices. Nor do they charge that if they had been admitted those practices should have been changed. Rather, as with the 60-40 split of ticket sale revenue, they sought to partici- pate. Determining what the Grizzlies do not charge as antitrust violations is somewhat easier than determining what is charged. The complaint alleges that Memphis is a highly desirable submarket for major league profes- sional football, that the refusal to consider it as a home territory for a franchise was made pursuant to an agree- ment or understanding or conspiracy among NFL mem- bers, the NFL and the Commissioner, that no valid basis for rejection of the Grizzlies was articulated for formu- lated by the defendants, and that the rejection amounted to an unreasonable restraint of trade, or a group boycott. One motive for that conspiracy is alleged to have been a desire to punish, intimidate and restrain plaintiffs from participation in major league professional football be- cause they had entered into competition with NFL members by participating in the World Football League. The exclusion, so motivated, and having the effects al- leged, is said to be a violation of Section 1 of the Sher- man Act, and an attempt to monopolize interstate trade and commerce in professional football in violation of Section 2 of that Act. Ill. The Summary Judgment Record The defendants moved for summary judgment on March 2, 1981, supporting their motion with affidavits by Commissioner Peter Rozelle and by Daniel M. Rooney, Chairman of the NFL Expansion Committee, to which defendants attached 12 supporting exhibits. At the time of the motion there was outstanding a motion by the Grizzlies to compel answers to certain A-11 interrogatories, and to compel production of documents. In opposition to the summary judgment motion the Grizzlies filed an extensive brief addressing the merits, and the affidavits of William R. Tathan, I.B. Rowe and Steve Alexander, Esq. The Grizzlies contended that the summary judgment motion should not be considered until the completion of discovery. On August 13, 1981 the trial court filed a memoran- dum and order declining to consider the motion for sum- mary judgment until the completion of the Grizzlies’ dis- covery, but restricted the scope of discovery to “matters relating to the NFL’s decision not to grant the plaintiffs an NFL franchise at Memphis, Tennessee, and to the NFL’s prior practices and standards with respect to the admission of new franchises into the league since the merger of the NFL and the American Football League.” 4 App. at 894. The Grizzlies were permitted to depose Mr. Rozelle, Mr. Rooney, and the other members of the NFL Expansion Committee; but solely with respect to the designated subject matter. The order fixed a sched- ule for renewal of the motion for summary judgment, for filing opposition to it, and for briefing. Id. at 895. On September 16, 1981 counsel for the Grizzlies wrote to the trial judge asking for clarification of the dis- covery order. The court was asked if the order was in- tended to focus the parties’ attention . . . solely upon the is- sue of whether fair, objective, and articulated stand- ards were applied by the defendants in passing upon plaintiffs’ application for membership in the NFL, whether such standards existed at the time, and whether any substantive consideration, . . . was ever given to plaintiffs’ application by the defen- dants. If, in fact, it was the Court's intention to focus only on the objective criteria question at this time, and to accept the remaining criteria in the plaintiffs’ Nel A-12 Complaint as true for the purpose of this motion proceeding, the scope of discovery can be substan- tially limited without waiving our position, many of the pending discovery requests can be withdrawn, subject to renewal... , and more specific discovery ... can surely proceed... . Letter of Edward H. Rubenstone, Esq. to Hon. Joseph L. McGlynn, Sept. 16, 1981, 4 App. at 1083-1084. The court replied two days later that “[y]our assumptions concerning the rationale underlying my order dated Au- gust 13, 1981 are correct.” The court noted the Grizzlies’ concession in open court on August 12, 1981 “that un- der some circumstances, and applying objective, ra- tional and fair decisional criteria, defendants might le- gitimately, collectively refuse to deal with a potential competitor demanding entry into the professional foot- ball market place.” The court explained further: In an effort to spare all parties the time and expense of what may prove to be unnecessary discovery pro- ceedings, I entered my order of August 13th, which limited discovery “solely to matters relating to the NFL’s decision not to grant the plaintiffs an NFL franchise at Memphis, Tennessee, and to the NFL's prior practices and standards with respect to the ad- mission of new franchises into the league since the merger of the NFL and American Football League”. If discovery in this discrete area should reveal that the NFL applied objective standards to the plain- tiffs’ application, there may not be a need to conduct further discovery. 4 App. at 1085. The trial judge also stated his assump- tion that there was no need to rule on outstanding dis- covery requests, since counsel's letter stated that he would be able to reach an accord with defense counsel regarding them. He warned, however, that all discovery must be complete by October 31, 1981, Id. at 1086. Fur- A-13 ther correspondence between the parties and the court took place respecting the issues posed by the NFL’s mo- tion for summary judgment, and on December 17, 1981 the trial judge by letter reiterated his intention to con- sider the NFL motion “because if it is undisputed that the defendants used ‘objective, rational and fair decisional criteria’ in rejecting plaintiffs application, then that may well be the end of the litigation ball game.” 4 App. at 1099. On December 21, 1981 the defendants filed a re- newed motion for summary judgment, relying on the pleadings, depositions, answers to interrogatories, ad- missions on file, and the Rozelle and Rooney affidavits accompanying their initial motion. 4 App. at 901. The brief in support of the renewed motion is not restricted to the question of whether the decision to reject the Grizzlies’ application was based on “objective, rational and fair decisional criteria.” Rather it relies on the “undisputed facts” in the record made to date with re- spect to the nature of the professional football business, and asserts that those facts warrant summary judgment for defendants as a matter of law. Thus the renewed mo- tion put the Grizzlies on notice that the defendants were relying upon the summary judgment record as then comprised, and of the obligation to set forth in affidavits the reasons why additional discovery would be necessary in order to oppose it. Fed.R.Civ.P. 56(f). On March 10, 1982 the Grizzlies filed a 107 page brief in opposition to the renewed motion for summary judg- ment. 4 App. at 963 et seq. That brief is not limited to the question whether the Grizzlies’ application was rejected on the basis of objective rational and fair decisional crite- ria. It addresses the full range of issues discussed in the defendants’ brief in support of the motion. Although the correspondence between counsel and the court was in- cluded in an appendix to the Grizzlies’ brief, no affidavit was filed setting forth any reason why additional discov- ery should be afforded before the court ruled on the mo- A-14 tion. Nor was that subject addressed in the brief in oppo- sition to the renewed motion. It surfaced, however, in a Grizzlies’ brief in response to defendant's reply brief. Re- sponding to the defendants’ contention that the mem- bers of the NFL are not competitors, but are engaged in a joint venture in the promotion of an entertainment spectacle, the Grizzlies argued: Nevertheless, despite Defendants’ heavy reli- ance on this argument, the “single entity” issue was not the subject of discovery. Indeed, in order to de- termine whether there is any merit to Defendants’ “single entity” contention, the starting point in dis- covery would be necessarily an examination of the business and financial records of the individual teams. These records would show what part of each team’s revenue is not shared by any other team, what activities generated that revenue, and how the revenue was treated on the team’s books. Based on these records, Plaintiffs could prove that the teams are not a “single entity.” In addition, other factors or economic competi- tion between the teams would have to be discov- ered, along with the views of each team about that economic competition. This would entail, (a) a study of the league’s operations; (b) an inquiry into the existence of factionalism and voting blocks in league deliberations and at meetings; (c) deposi- tions from representatives of each team; and discov- ery of a host of other categories of facts which need not be listed here. All of this information would be needed before the Court would have an adequate record on which to make a ruling on Defendants’ contentions that the separate teams must be viewed as a single entity for antitrust purposes. It suffices to note that depositions were limited by Court Order to the four members of the 1973 NFL “Expansion Committee”, and Pete Rozelle, and that the written A-15 discovery was confined to the issue of “objective standards”. Perhaps it should be noted as well that before the Court entered its August 31, 1981 Order, Plaintiffs had, in fact, filed discovery requests seek- ing information which would have shed light on De- fendants’ “single entity” contention, but Defen- dants objected to all of this discovery. Therefore, the record does not contain evidence for the Court to rule on Defendants’ “single entity” contention. 5 App. at 1217-18. This brief made no reference to spe- cific discovery requests addressed to what the Grizzlies characterize as defendants’ “single entity” contention. There is no suggestion that there are sources of revenue other than sales of tickets, sales of television rights, and revenues derived from food and beverage concessions, parking, and sales of team paraphernalia. There is no in- dication that a professional football business located at Memphis, Tennessee would compete with any NFL member for these perpheral sources of revenue. The Grizzlies do not contend that the league members (or the Grizzlies themselves if they were admitted to the league) compete for rather than share in network televi- sion and ticket sale revenues. {1, 2] The trial court addressed the Grizzlies’ unfocused contention that there should be additional discovery, noting: Plaintiffs have had more than sufficient discovery to fully develop their case. All of the outstanding re- quests to which defendants have refused to respond are not calculated to lead to relevant evidence nec- essary to resolving this matter. As a result I find that this case is now ripe for a decision on the merits. 550 F.Supp. at 565. The Grizzlies contend that this ruling was error, be- cause with additional discovery they could have discov- ered facts which would suggest the existence of actual A-16 or potential competition between their Memphis based team and members of the NFL in some relevant product market. Where Rule 56(f) affidavits have been filed, setting forth specific reasons why the moving party’s affidavits in support of a motion for summary judgment cannot be responded to, and the facts are in the possession of the moving party, we have held that a continuance of the motion for purposes of discovery should be granted al- most as a matter of course. Costlow v. United States, 552 F.2d 560, 564 (3d Cir.1977); Ward v. United States, 471 F.2d 667, 672 (3d Cir.1973). But as Judge Friedman so aptly observed: It is true that Rule 56(f) also authorizes the court in appropriate cases to refuse to enter summary judg- ment where the party opposing the motion shows a legitimate basis for his inability to present by affida- vit the facts essential to justify his opposition, but to take advantage of this provision he must state by af- fidavit the reasons for his inability to do so and these reasons must be genuine and convincing to the court rather than merely colorable. It is not enough to rest upon the uncertainty which broods over all human affairs or to pose philosophic doubts regard- ing the conclusiveness of evidentiary facts. In the world of speculation such doubts have an honored place, but in the daily affairs of mankind and the in- tensely practical business of litigation they are put aside as conjectural. Robin Construction Company v. United States, 345 F.2d 610, 614 (3d Cir. 1965). Judge Friedman's observa- tions are relevant here in two respects. First, the Grizzlies filed no Rule 56(f) affidavit.* Second, treating 4. Most courts which have considered the issue agree that fil- ing an affidavit is necessary for the preservation of a Rule 56(f) con- tention that summary judgment should be delaved pending further discovery. See, e¢.g., Gray v. Udevitz, 656 F.2d 588 ( 10th Cir. 1981); A-17 their response to the defendants’ reply brief as if it were such an affidavit, it raises no more than a merely colorable claim that actual or potential competition for revenue other than from ticket sales and sales of televi- sion rights could be shown between a professional team based in Memphis and the other members of the NFL. Just how speculative the Grizzlies’ Rule 56(f) showing was, even assuming that it should be considered absent an affidavit, can be appreciated from the analysis, in the margin, of the outstanding discovery requests, the de- fendants’ objections, and this court’s conclusion as to their relevance to the issue of competition.® NOTE — (Continued) Thi-Hawaii v. First American Financial Corp., 627 F.2d 991 (9th Cir. 1980); Over the Road Drivers v. Transport Insurance Co., 637 F.2d 816 (1st Cir.1980); British Airways Board v. Boeing Com- pany, 585 F.2d 946 (9th Cir.1978), cert. denied, 440 U.S. 981, 99 S.Ct. 1790, 60 L.Ed.2d 241 (1979); Altemose Construction Com- pany v. Building and Construction Trades Council of Philadelphia, 443 F.Supp. 492, 498 (E.D.Pa.1977); Mayerson v. Washington Mfg. Co., 58 F.R.D. 377 (E.D.Pa.1972). But see Littlejohn v. Shell Oil Co., 483 F.2d 1140, 1146 (Sth Cir. 1973), cert. denied, 414 U.S. 1116, 94 S.Ct. 849, 38 L.Ed.2d 743 (1974) (continuance granted “[ojut of an abundance of caution and to prevent a possible injus- tice” despite absence of affidavit); Murrell v. Bennett, 615 F.2d 306 (5th Cir.1980) (absence of affidavit excused in prisoner's pro se case). 5. Appellees’ Relevance to Request Objection Competition Issue I: #2—4, 6 Beyond Scope of Irrelevant to competi- All documents relat- issue tion issue — only rel- ing to formal meet- evant to “objective ings at which appel- standards” issue. lants’ application was discussed. I: #10 Imposs‘hie to Relevant to establish- Informal meetings of produce ing motive for exclu- NFL Expansion Com- sion, not to competi- mittee and Sub-com- tion. cussed. A-18 Considering the already large record compiled prior to its consideration of the summary judgment record, the absence of a Rule 56(f) affidavit, the irrelevance of NOTE — (Continued) I: #8(d) All documents relat- ing to possible trans- fer of NFL teams. II: #5 Identify “specifically provisions in NFL Constitution and By- Laws governing vot- ing procedures for making business de- cisions.” I: 8(m) Identify all docu- ments relating to the World Football League. Il: #3 Identify players and coaches in the WFL who subsequently joined the NFL. Il: #4 State with specificity each administrative and promotional func- tion performed by the NFL. amounts of assessments against individual members and expen- ditures against which such assessments were applied. Irrelevant Contained in by- laws Involves enormous amounts of infor- mation. Not rea- sonably calculated to lead to admissi- ble evidence. Overly burden- some They are broadly stated in the by- laws. Specific functions are be- yond enumeration. 1) Unduly densorne. 2) Might lead to disclosure of confi- dential informa- tion. 3) Not reasonably calculated to lead to discovery of ad- missible evidence. bur- Arguaviy relevant, but extremely broad and cumulative of materials in sum- mary judgment re- cord. Provisions are easily identified in sum- mary judgment re- cord. Irrelevant to competi- tion issue. Related only to the retaliation claim. Irrelevant to competi- tion issue. Relates to retaliation and objec- tive standards issues. Irrelevant to competi- tion issue. Irrelevant to competi- tion issue. A-19 most of the pending discovery requests, and the conjec- tural nature of the Grizzlies’ contentions as to the possi- bility of establishment of actual or potential competition NOTE — (Continued ) Il: #8(c),(d) Amount of disburse- ment of expansion fees from 1966 to present; amount of “assets” contributed to new franchises. II: #29-30 Specify how plain- tiffs’ expansion into the NFL would di- minish the league's joint assets; identify all specific docu- ments. Ill: #1-7 Financial statements and tax returns of each defendant for 1976-1979: all docu- ments revealing terms of operating agreements between defendants and NFL Properties, Inc.; all contracts by defen- dants or by NFL Properties, Inc. con- cerning broadcast rights and stadium leases. 1) Unduly _ bur- densome. 2) No bearing on issues of suit. 1) [General dis- cussion of joint revenue producing assets of NFL: goodwill, League trademarks, etc.| 2) Exact diminu- tion can't be fore- cast 3) Documents are confidential, bur- densome to produce, not rel- evant. 1) Irrelevant. 2) Documents are confidential. Pro- duction not justi- fied by any com- pelling necessity. Irrelevant to competi- tion issue. Irrelevant to competi- tion issue. Plaintiffs advance five reasons for re- questing these docu- ments. See Motion to Compel, App. at 125a. Only one of these reasons is rel- evant: the financial data is relevant to plaintiffs’ allegation that the defendants are engaged in con- spiratorial, anti-com- petitive activities. However, the request is otherwise unnec- essarily broad, and the information could be obtained in other ways. A-20 in any arguably relevant market, we conclude that the court did not err in considering the motion for summary judgment on the present record. IV. The Merits A. Sherman Act Section 1 Public Law 89-800 establishes as a matter of law that the merger which produced the NFL from two for- NOTE — (Continued) Il: #6 State with particular- ity all facts relating to use of voting proce- dures in context of plaintiffs’ application. Il: #12 Identify all docu- ments that relate to any interest or con- cern of defendant in locating or relocating a franchise in Mid- South/Memphis area. Il: #33 Whether any suits have been filed relat- ing to the Tampa ex- pansion. Il: #34 Give all information relating to transfers of ownership inter- ests from 1959 to present. Information is in documents _relat- ing to plaintiffs’ application. NFL has already produced this. Doesn't relate to appellants’ appli- cation. Beyond scope of suit. Irrelevant to competi- tion issue. Related to “Objective stand- ards” issue. Relevant, since this would establish ele- ment of competition between plaintiff and defendant for geographical market. But all that the plain- tiffs ask for in their motion to compel is that the NFL deny the existence of any more documents un- der oath. This is not hikely to lead to mate- rial facts. See Motion to Compel, App. at 108a. Irrelevant to competi- tion issue. Goes to ob- jective criteria ques- tion. Irrelevant to competi- tion issue. Goes to ob- jective criteria ques- tion. A-21 merly competing leagues did not violate the antitrust laws. Public Law 87-331 establishes as a matter of law that the members may lawfully pool revenues from the sale of television rights. The parties agree that in other NOTE — (Continued) IV: #1-9, 15-22 This set includes re- quests for all recent opinion polls and market surveys for each NFL team, all documents concern- ing correspondence between a member and a fan, season ticket holder mailing lists for 15 teams, all documents _ relating to trademark licens- ing, all documents relating to local broadcast rights, “any document con- cerning the identifi- cation of a statistic regarding to number of players from any given team defendant who played in the Pro- Bowl. . .”, etc. V: #2,3,6,12,13 All documents relat- ing to expansion de- cisions, including all documents _ relating to designation of Paul Brown as operator of the Cincinnati Ben- gals. “ . , a ‘fishing ex- pedition’ of the worst kind... .” Defendants’ Ob- jections to Plain- tiffs’ Requests for Production of Doc- uments Set No. 4 at 3. [Not in ap- pendix]. There may be docu- ments in this request that would tend to suggest the possibil- ity of competition for the Memphis home team market. How- ever, the request is extraordinarily broad, and no showing was made that anything would be likely to im- peach the provision in Art. 9.1(B)(1) of the Constitution and By-Laws of the NFL prohibiting a mem- ber club from having a financial interest, directly or indirectly, in any other league member. Irrelevant to competi- tion issue. A-22 respects a rule of reason analysis is appropriate.° The Grizzlies, moreover, make no contention that the 60-40 sharing of ticket sale revenue is an unreasonable re- straint of trade. [3] Under a rule of reason analysis a Section 1 vio- lation and a right to recover under Section 4 of the Clay- ton Act can be established by proof: (1) that the defendants contracted, combined, or conspired among each other; (2) that the combina- tion or conspiracy produced adverse, anticompeti- tive effects within relevant product and geographic markets; (3) that the objects of and conduct pursu- ant to that contract or conspiracy were illegal; and (4) that the plaintiff was injured as a proximate re- sult of that conspiracy. Request Appellees’ Relevance to VI: #2(a), (b), (c), 8, Objection Competition Issue 13-15, 24 Irrelevant to competi- All minutes and tion issue. notes of each partici- pant at any meeting concerning expan- sion, labor unrest, antitrust problems, etc.; all studies of the college draft; all stud- ies of effect of further expansion; all docu- ments “reflecting any TV rating concerning any defendant ...”, all documents _re- flecting amount of gate receipts; sta- dium leases for each defendant between 1972 and 1979. 6. In the complaint the Grizzlies alleged that their excluison was the result of a group boycott, which was a per se violation of Section 1 of the Sherman Act. The per se violation contention is not made in this court. A-22.1 Fleer Corp. v. Topps Chewing Gum, Inc., 658 F.2d 139, 147 (3d Cir. 1981), cert denied, 455 U.S. 1019, 102 S.Ct. 1715, 72 L.Ed.2d 137 (1982), quoting Martin B. Glauser Dodge Co. v. Chrysler Corp.;570 F.2d 72, 81 (3d Cir. 1977), cert. denied, 436 U.S. 913, 98 S.Ct. 2253, 56 L.Ed.2d 413 (1978). In this case there is no dispute about the requisite concert of action among the defend- ants. The defendants do deny injury to competition in any relevant market from their rejection of the Grizzlies’ application. They urge that any limitations on actual or potential competition in any relevant market were insu- lated from antitrust scrutiny by the 1961 and 1966 stat- utes referred to, or, are reasonable as a matter of law. They also urge that as a matter of law there was no com- petition among league members or between league members and non-members in other markets to which the Grizzlies point. The Grizzlies identify as the relevant product mar- ket major-league professional football, and as the rel- evant geographic market the United States. The trial court found these markets to be relevant. 550 F.Supp. at 571 n. 33. The court observed as well that “|there is no doubt that the NFL currently has a monopoly in the United States in major league football.” 550 F.Supp. at 571. The Grizzlies pose as the question on this appeal “whether it can be said as a matter of law that defend- ants neither acquired nor maintained monopoly power over any relevant market in an unlawful manner.” Ap- pellants’ Brief at 27. A-23 As to the acquisition of dominant position and mo- nopoly power, the facts are undisputed. Long before the Grizzlies and the World Football League came into exist- ence, Congress authorized the merger of the two major football leagues extant in 1966, and granted to the merged league the power to pool television revenues. That congressional decision conferred on the NFL the market power which it holds in the market for profes- sional football. Congress could not have been unaware that necessary effect of the television revenue sharing scheme which it approved for the NFL would be that all members of that league would be strengthened in their ability to bid for the best available playing and coaching personnel, to the potential disadvantage of new entrants. [4] In an effort to bolster its “unlawful acquisition of monopoly power” contention, however, the Grizzlies point to certain activities of the NFL and its predeces- sors which occurred prior to the 1966 legislation author- izing its formation. They point out that in 1961, when the old NFL was seeking legislation which would over- rule United States v. National Football League, 116 F.Supp. 319 (E.D.Pa. 1953), which prohibited certain television revenue sharing practices, it admitted a new team in Minnesota, the home state of the Senate Major- ity Leader and Chairman of the Committee which con- sidered the bill; that in 1966 when the old NFL and AFL leagues were seeking a statutory exemption which would permit their merger, a team was added in New Orleans, the home state of a powerful senator and pow- erful congressman who supported the legislation. Even the post merger addition of Seattle and Tampa Bay, ac- cording to the Grizzlies, was prompted by a desire to limit the term of proposed legislation prohibiting home teams from blacking out televised games when they were playing. See Pub.L. 93-107, §1, 87 Stat. 350, re- pealed by Pub.L. 93-107, §2, 87 Stat. 351 (1973). If these allegations are true, as we must assume for pur- poses of a summary judgment motion, they are, perhaps, A-24 instructive on the nature of the federal legislative proc- ess. For purposes of rule of reason analysis, however, they are irrelevant. It would take a court bolder than this to claim that the congressionally authorized acquisition of market power, even market power amounting to mo- nopoly power, was unlawful under Section 1 of the Sher- man Act. But, the Grizzlies urge, the 1966 statute did not confer the authority to abuse the market power, even though it may have authorized its acquisition. Rather, the merger was approved only “if such agreement in- creases rather than decreases the number of profes- sional clubs so operating.” 15 U.S.C. §1291. Paraphras- ing their argument, it is the Grizzlies’ contention that the statute which authorized NFL acquisition of monop- oly power in the professional football market required not only that the league members refrain from abusing that power against potential competitors, but that it take affirmative steps to shre its market power with others. This reading of the 1966 legislation is at least plau- sible. It poses two separate issues. One is the issue of abuse uf monopoly power against potential rivals of the NFL in the business of promoting professional football as a spectator spectacle. The other is the issue of admit- ting others to a share in the NFL’s dominant market po- sition. Although the Grizzlies’ briefs, both here and in the district court, tend to blur the distinction between those issues, the complaint makes clear that only the second is presented in this case. The only basis on which the Grizzlies seek recovery under Section 4 of the Clay- ton Act is that they were denied admission to the monop- oly, and thus were deprived of a share of the NFL's mo- nopoly power. No claim is made that abuse of NFL market power led to the demise of the World Football League, and no issue is before us concerning activities of the NFL, since that demise, which may have inhib- ited the development of competition by another football league. The NFL structure as a barrier to entry to the A-25 market by another football league is relevant in this case only to the extent that it bears on the obligation to permit entry to the NFL.’ There are two possible sources of any NFL obliga- tion to permit entry to its shared market power: the 1966 statute, and the Sherrnan Act. Each will be considered separately. [5] The provision in the 1966 statute that “such agreement increases rather than decreases the number of professional football clubs so operating” cannot rea- sonably be construed as addressing competition, the preservation of which is the object of the Sherman Act. The basic thrust of the 1966 statute is to authorize an arrangement which eliminated competition among the only two viable competitors then in the professional foot- ball market. The reference to an increase in the number of professional football teams “so operating” is a refer- ence to professional teams operating under the antitrust exemption for television revenue sharing provided in the 1961 statute. Thus what the 1966 statute suggests is that more home team territories would be added, not to increase competition in professional football, but to per- mit geographic enlargement of the NFL’s market power. The Grizzlies urge that home team regions derive important economic benefits from the presence of a pro- fessional football team, in the form of hotel, restaurant and travel business, stadium employment, and the like. Undoubtedly that is so, and probably such derivative economic benefits were in the minds of those Senators and Congressmen interested in NFL expansion. Those benefits, however, do not result from competition with the NFL or even from competition, other than athletic, 7. There is no doubt that the NFL structure authorized by the 1961 and 1966 legislation in itself presents a formidable barrier to entry by a competitive football league. That legally countenanced barrier might well, if abused against extra-league competitors, re- sult in anti-trust liability. But the issue of competition by another league is not presented here, except to the limited extent noted. A-26 among its members. Rather they result from the pres- ence of a franchisee which shares the NFL market power over professional football. Moreover, even if one assumes that Congress intended in the 1966 statute to extend incidental economic benefits on businesses in new home territory areas, it is difficult to see what stand- ing the Grizzlies have to rely on that intent with respect to their claim for league membership. Finally, even if there was a congressional intent to confer economic benefits in some new home territories, nothing in the 1966 statute or its square legislation history suggests a basis for concluding that businesses in Memphis, Ten- nessee, rather than in other metropolitan areas were to receive them. [6] Since the 1966 statute is not directed at preser- vation of competition in the market for professional toot- ball, and cannot be construed as conferring any eco- nomic benefit on the class to which the Grizzlies belong, we conclude that it does not oblige the NFL to permit entry by any particular applicant to the NFL shared mar- ket power. We turn, therefore, to the Sherman Act. As noted above, Sherman Act liability requires an injury to com- petition. In this case the competition inquiry is a narrow one, because the Grizzlies are not seeking recovery as potential competitors outside the NFL. They identify as the antitrust violation the league’s negative vote on their application for membership. From affidavits, pleadings, and discovery materials which comprise the summary judgment record it could be found, and the trial court assumed, that the Grizzlies met all the qualifications for membership specified in the NFL Constitution and By-Laws. 550 F.Supp at 568. It is undisputed that in 1974 expansion teams were lo- cated at Tampa, Florida and at Seattle, Washington, raising to 28 the number of league competitors for the 1976 season. Ii is also undisputed that in deciding on ex- pansion the NFL Expansion Committee considered a so- A-27 cioeconomic study prepared for it by the Stanford Re- search Institute in December of 1978, which identified fourteen potential locations for new franchises, includ- ing Memphis® The Expansion Committee met with rep- resentatives of the Grizzlies, but made a negative recom- mendation on expansion, as of 1975, . eyond 28 teams. The full membership of the league accepted the recom- mendation of the expansion committee. The NFL’s stated reasons for rejecting the Grizzlies’ application included scheduling difficulties created by the presence of an odd number of teams, a long-running collective bargaining dispute with league players, sev- eral pending antitrust lawsuits, and league concern over legislation prohibiting television blackouts in home team territories, all of which allegedly made consideration of expansion unpropitious. The Grizzlies contend that there are material issues of disputed fact as to the accu- racy of these reasons. They contend that at trial they could prove that the motivation for their rejection was to punish them for having attempted in the past to compete with the NFL in the World Football League, or to re- serve the Memphis location for friends of present league team owners. [7-9] Assuming, without deciding, that the sum- mary judgment record presents disputed fact issues with respect to the actual motivation of the NFL mem- bers, those disputed facts are not material, under Sec- tion 1 of the Sherman Act, if the action complained of produced no injury to competition. As to competition with NFL members in the profes- sional football market, including the market for sale of television rights, the exclusion was patently pro-com- 8. The other areas are Mexico City, Birmingham, Alabama, Se- attle, Washington, Nassau County, New York, Anaheim, California, Chicago, Illinois, Phoenix, Arizona, Honolulu, Hawaii, Tampa, Flor- ida, the Tidewater area of Virginia, Charlotte-Greensboro, North Carolina, Indianapolis, Indiana, and Orlando, Florida. A-28 petitive, since it left the Memphis area, with a large sta- dium and a significant metropolitan area population, available as a site for another league’s franchise, and it left the Grizzlies’ organization as a potential competitor in such a league. If there was any injury to competiton, actual or potential, therefore, it must have been to intra- league competition. The NFL defendants’ position is that the summary judgment record establishes conclusively the absence of competition, actual or potential, among league mem- bers. Rather, they urge, the league is a single entity, a joint venture in the presentation of the professional foot- ball spectacle. For the most part the congressionally authorized ar- rangements under which the NFL functions eliminate competition among the league members. Indeed it is undisputed that on average more than 70% of each member club’s revenue is shared revenue derived from sources other than operations at its home location. The Grizzlies do not challenge the legality of the NFL’s rev- enue sharing arrangements, and seek to participate in them. The Grizzlies emphasize that there nevertheless remains a not insignificant amount of intra-league non- athletic competition. We need not, in order to affirm the summary judgment, accept entirely the NFL’s position that there is no intra-league competition. Conceivably within certain geographic submarkets two league mem- bers compete with one another for ticket buyers, for local broadcast revenue, and for sale of the concession items like food and beverages and team paraphernalia.? Thus rejection of a franchise application in the New York met- ropolitan area, for example, might require a different antitrust analysis than is suggested by this record. But the Grizzlies were obliged, when faced with the NFL de- 9. Thus we need not, in order to affirm, approve the suggestion in Levin v. National Basketball Ass’n., 385 F.Supp. 149, 152 (S.D.N.Y.1974), that there can never be competition among league members. A-29 nial of the existence of competition among NFL mem- bers and a potential franchisee at Memphis, to show some more than minimal level of potential competition, in the product markets in which league members might compete. They made no such showing. The record es- tablishes that the NFL franchise nearest to Memphis is at St. Louis, Mo., over 280 miles away. There is no rec- ord evidence that professional football teams located in Memphis and in St. Louis would compete for the same ticket purchasers, for the same loca! broadcast outlets, in the sale of team paraphernalia, or in any other manner. The Grizzlies contend on appeal, although they did not so contend in the trial court, that league members compete in what they call the “raw material market” for players and coaching personnel. Entirely apart from the propriety of considering a legal theory not presented in the trial court,!° there are major defects in this Grizzlies’ argument. First, the Grizzlies exclusion from the league in no way restrained them from competing for players by forming a competitive league. Second, they fail to ex- plain how, if their exclusion from the league reduced competition for team personnel, that reduction caused an injury to the Grizzlies’ business or property. See Van Dyk Research Corp. v. Zerox Corp., 631 F.2d 251, 255 (3d Cir. 1980), cert. denied, 452 U.S. 905, 101 S.Ct. 3029, 69 L.Ed.2d 405 (1981). (Section 4 plaintiff has burden of proving that injury was caused by illegality re- lied on). One final Grizzlies’ argument in support of their section 1 Sherman Act claim bears mentioning. Relying on the essential facilities doctrine developed in cases 10. See Halderman v. Pennhurst State School & Hospital, 673 F.2d 628, 639 (3d Cir.) (in banc), cert. granted, 457 U.S. 1131, 102 S.Ct. 2956, 73 L.Ed.2d 1348 (1982); Caisson Corp. v. Ingersoll Rand Co., 622 F.2d 672, 680 (3d Cir. 1980); Teen-Ed, Inc. v. Kimball International, Inc., 620 F.2d 399, 401 (3d Cir. 1980); Toyota Industrial Trucks U.S.A., Inc. v. Citizens Nat'l Bank of Ev- ans City, 611 F.2d 465 (3d Cir. 1979). A-30 such as Silver v. New York Stock Exchange, 373 U.S. 341, 83 S.Ct. 1246, 10 L.Ed.2d 389 (1963); Associated Press v. United States, 326 U.S. 1, 65 S.Ct. 1416, 89 L.Ed. 2013 (1945), and Gamco, Inc. v. Providence Fruit & Produce Bldg., 194 F.2d 484 (lst Cir.), cert. denied, 344 U.S. 817, 73 S.Ct. 11, 97 L.Ed. 636 (1952), they urge that because the NFL is a practical monopoly it had an obligation to admit members on fair, reasonable, and equal terms, absent some procompetitive justification for their exclusion. This Grizzlies argument suffers from the same defect as the others. The essential facilities doctrine is predicated on the assumption that admission of the excluded applicant would result in additional com- petition, in an economic rather than athletic sense. The Grizzlies have simply failed to show how competition in any arguably relevant market would be improved if they were given a share of the NFL’s monopoly power. Since on the record before us the Grizzlies have shown no actual or potential injury to competition re- sulting from the rejection of their application for an NFL franchise, they cannot succeed on their section 1 Sher- man Act claim. B. Sherman Act Section 2. The Grizzlies also plead a violation of Section 2 of the Sherman Act, 15 U.S.C. §2 (1973). That section pro- hibits attempts to monopolize. In section 2 cases the al- leged monopolist is prohibited from acting “in an unrea- sonably exclusionary manner vis-a-vis rivals or potential rivals... .” Byars v. Bluff City News Co., Inc., 609 F.2d 843, 853 (6th Cir. 1979). See also Official Airline Guides, Inc. v. FTC, 630 F.2d 920, 926-28 (2d Cir. 1980), cert. denied, 450 U.S. 917, 101 S.Ct. 1962, 67 L.Ed.2d 343 (1981) (Federal Trade Commission Act §5 claim); Mid Texas Communications v. American Tele- phone & Telegraph Co., 615 F.2d 1372, 1387 (5th Cir. 1980), cert. denied, 449 U.S. 912, 101 S.Ct. 286, 66 L.Ed.2d 140 (1981). : A-31 [10] Our analysis of the section 1 Sherman Act claim applies equally to the Grizzlies’ section 2 claim. Congress by legislation in 1961 and 1966 authorized the NFL acquisition of the market power which it holds, and the Grizzlies cannot challenge that acquisition. The only action they complain of is their exclusion from the shared monopoly, but they have failed to show that their admission would be contra-competitive in any way. In- deed the Memphis home team market has been left by the NFL for potential competitors. Thus on this record summary judgment on the section 2 Sherman Act claim was also proper. Conclusion The court did not err in considering the defendants’ summary judgment motion on the present record. There are no disputed fact issues material to the legal issues presented. The trial court did not err in applying the Sherman Act. Thus the judgment appealed from will be affirmed. A-32 IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF PENNSYLVANIA MID-SOUTH GRIZZLIES, et al. : CIVIL ACTION Vv. - NATIONAL FOOTBALL LEAGUE, etal. : No. 79-4373 ORDER AND NOW, this 5 day of NOVEMBER, 1982, upon consideration of Defendants’ Motion for Summary Judg- ment pursuant to Rule 56 of the Federal Rules of Civil Procedure, it is hereby ORDERED that the motion is GRANTED and judgment is entered in favor of the defendants and against the plaintiffs. BY THE COURT JOSEPH L. McGLYNN, Jr. J. A-33 MID-SOUTH GRIZZLIES, et al. v. NATIONAL FOOTBALL LEAGUE, et. al. Civ. A. No. 79-4373. United States District Court, E.D. Pennsylvania, Civil Division. Nov. 5, 1982. Unsuccessful applicants for a National Football League franchise for the Memphis, Tennessee area brought Sherman Act suit against the League. The League moved for summary judgment. The District Court, McGlynn, J., held that: (1) rule-of-reason test ap- plied; (2) neither essential-facility doctrine nor the trade association cases were applicable; (3) a Section 1 viola- tion had not been made out; and (4) although the League currently has a monopoly in the United States in major league football it had not used that power to pre- vent formation of the rival league or fielding of a team in Memphis. Motion granted. 1. Federal Civil Procedure (key) 2543 Summary judgment is a drastic remedy and a court must resolve all doubts as to existence of genuine issues of fact against the movant and must view all inferences from the facts in the light most favorable to the opposing party. Fed.Rules Civ.Proc. Rules 56, 56(c), 28 U.S.C.A. 2. Federal Civil Procedure |KEyY| 2484 Summary judgment should be used sparingly in antitrust cases. Sherman Anti-Trust Act, §§1, 2, 15 U.S.C.A. §§1, 2; Fed. Rules Civ.Proc. Rules 56, 56(c), 28 U.S.C.A. 3. Federal Civil Procedure |KEy| 2484 Although a party’s right to trial should be carefully guarded, filing of an antitrust complaint cannot insure a right to trial, i.e., defeat a summary judgment motion, A-34 absent any significant probative evidence supporting the party’s claims and such a party should not be permitted to proceed to trial in the hope of developing evidence to support his claims. Sherman Anti-Trust Act, §§1, 2, 15 U.S.C.A. §§1, 2; Fed.Rules Civ. Proc. Rules 56, 56(c), 28 U.S.C.A. 4. Federal Civil Procedure (key) 2484 Summary disposition of antitrust cases is proper even when employing the rule of reason. Sherman Anti- Trust Act, §§1, 2, 15 U.S.C.A. §§1, 2; Fed.Rules Civ. Proc. Rules 56, 56(c), 28 U.S.C.A. 5. Federal Civil Procedure |KEY| 1267 District court has discretion in controlling the dis- covery process. 6. Federal Civil Procedure {kEy| 1272 Where appropriate, a district court may limit a par- ty’s discovery as long as he is able to fully develop his case. 7. Monopolies (KEY) 12(6) Unlike professional baseball, professional football is not totally exempt from the antitrust laws and in two areas only does football escape the antitrust laws’ watch- ful eye: joint agreement concerning the telecasting of games and the 1966 merger of the AFL with the NFL. Sherman Anti-Trust Act, §§1, 2, 15 U.S.C.A. §§1, 2; 15 U.S.C.A. §§1291—1295. 8. Monopolies (KEY) 12(1.2) Not all group decisions refusing to do business with someone should be measured against the strict per se criteria and per se violations should be found only where the involved agreements are so clearly anticompetitive and lacking in any redeeming quality that they can be conclusively presumed illegal without further inquiry. Sherman Anti-Trust Act, §§1, 2, 15 U.S.C.A. §§1, 2. A-35 9. Monopolies (KEY) 12(6) Because of the unique character of professional sports courts have rejected the per se test and have rou- tinely applied the Rule of Reason in deciding antitrust suits concerning league practices. Sherman Anti-Trust Act, §§1, 2, 15 U.S.C.A. §§1, 2. 10. Monopolies (KEY) 12(1.10) The “Rule of Reason test” mandates that a court de- termine whether the restraint imposed merely regulates and thereby promotes competition or is one that may suppress or destroy competition. Sherman Anti-Trust Act, §§1, 2, 15 U.S.C.A. §§1, 2. See publication Words and Phrases for other judi- cial construction and definitions. 11. Monopolies |KEy| 12(1.10) Crucial to proving an antitrust violation under the rule-of-reason test is a showing of anticompetitive intent or effect. Sherman Anti-Trust Act, §§1, 2, 15 U.S.C.A. §§1, 2. 12. Monopolies (KEY) 28(8) Even where state of mind is material in an antitrust case, there must be some demonstration that there is a sufficient quantum of evidence to permit a party to go to the jury. Sherman Anti-Trust Act, §§1, 2, 15 U.S.C.A. §§1, 2. 13. Monopolies (KEY) 12(1.2) The essential-facility doctrine is applicable in an antitrust case only where a party is being denied access to something necessary for that party to engage in busi- ness which is controlled by his competitors. Sherman Anti-Trusi Act, §§1, 2, 15 U.S.C.A. §§1, 2. 14. Monopolies (KEY) 12(6) The essential-facility doctrine was not applicable in antitrust suit challenging professional football league’s refusal to accept application for a new franchise. Sher- man Anti-Trust Act, §§1, 2, 15 U.S.C.A. §§1, 2. A-36 15. Federal Civil Procedure |key) 2542 Judicial notice may be used in resolving a motion for summary judgment. Fed.Rules Civ.Proc. Rules 56, 56(c), 28 U.S.C.A. 16. Monopolies (Key; 12(18) Because the potential harm to outsiders is so great when their competitors are brought together through a trade association the law requires access to the group be available to anyone who meets fair criteria. Sherman Anti-Trust Act, §§1, 2, 15 U.S.C.A. §§1, 2. 17. Monopolies (KEY) 12(6) Trade association antitrust cases were inappropriate in determining antitrust violation by refusal of profes- sional football league to accept franchise application in that production of professional sports necessarily re- quires joint planning and decision making and unlike normal business competitors the teams are interdepend- ent and while economic success of one team does not necessarily mean the success of another member the stability which is derived from membership in a league produces a better product which is to the benefit of the public at large and the teams do not compete in the same manner as the independent businesses in the trade asso- ciation. Sherman Anti-Trust Act, §§1, 2, 15 U.S.C.A. §§1, 2. 18. Monopolies (KEY) 12(6) Refusal of professional football league to grant fran- chise for the Memphis, Tennessee area did not consti- tute unreasonable restraint of trade in violation of Sher- man Act. Sherman Anti-Trust Act, §1, 15 U.S.C.A. §1. 19. Monopolies {Key} 12(1.3) Possession of monopoly power in a relevant market alone is not enough to establish an antitrust violation. Sherman Anti-Trust Act, §2, 15 U.S.C.A. §2 A-37 20. Monopolies (ki y} 12(1.3) Antitrust laws were not intented to punish a busi- ness that has become a monopoly because of a superior product, business acumen or historic accident but the law does require that a monopoly not abuse its power and where business possessing monopoly power wilfully acquires or maintains such power it will incur a penalty. Sherman Anti-Trust Act, §2, 15 U.S.C.A §2. 21. Monopolies (Key; 12(1.2) To avoid a Sherman Act violation, a monopoly must refrain at all times from conduct directed at smothering competition and, put another way, a monopoly abuses its power when it behaves in an unreasonably exclusionary mannor vis-a-vis rivals or potential rivals. 22. Monopolies (KEY; 12(6) Although National Football League currently has a monopoly in the United States in major league football, its refusal to accept application for franchise for Mem- phis, Tennessee area did not violate Sherman Act as franchise applicants were still free to promote a rival league and NFL's actions did not prevent formation of the rival league or the feilding of a team in Memphis. Sherman Anti-Trust Act, §2, 15 U.S.C.A §2. Richard A. Sprague, Edward H. Rubenstone Sprague, Goldberg & Rubenstone, Gary Green, Robert A. Davitch, Sidkoff, Pincus, Greenberg & Green, Phila- delphia, Pa., for plaintiffs. Edwin P. Rome, Morris L. Weisberg, Blank, Rome, Comisky & McCauley, Philadelphia, Pa., Hamilton Carothers, James C. McKay, Washington, D.C., for de- fendants. A-38 MEMORANDUM OF DECISION McGLYNN, District Judge. Pending before the court is Defendants’ Motion for Summary Judgment. Although the submissions regard- ing the motion are voluminous, they in essence address one issue: does a professional sport league’s refusal to accept for membership a qualified applicant for a fran- chise in an area where no current league team is located violate Sections 1 or 2 of the Sherman Act? Based on the undisputed material facts and the reasons set forth be- low, I believe not. Therefore, Defendants’ Motion for Summary Judgment is granted. The Team Rosters The offensive team (plaintiffs) is the Mid-South Grizzlies, a joint venture established on November 1, 1975 consisting of the Mid-South Grizzlies, a Tennessee limited partnership,' Consolidated Industries, Inc., a California corporation, and John Edward Bosacco, an in- dividual. The defensive lineup (defendants) is composed of the National Football League (“NFL”), the twenty- eight individual NFL football teams, and calling the sig- nals, Pete Rozelle, the NFL Commisioner. Plaintiffs’ Game Plan In the fall of 1975, plaintiffs applied to the NFL in the hope of obtaining a franchise for the Memphis, Ten- nessee area. Along with their application, they submit- ted an application fee as required by the NFL Constitu- tion and By-Laws. This fee was returned to the plaintiffs a few weeks later. In December 1975, plaintiffs met with the NFL Expansion Committee. This committee was re- sponsible for the investigation and planning for the addi- tion of new NFL teams. Its members at the time of plain- tiffs’ application were Daniel M. Rooney, President of the Pittsburgh Steelers, Gerald H. Phipps of the Denver 1. The partnership's Chief Executive Officer is John F. Bassett. A-39 Broncos, Louis Spadia of the San Francisco '49ers and Texas Schramm of the Dallas C Uwboys. At this meeting ' plaintiffs were told that further expansion of the NFL at that time was in their opinion unwise and that they would recommend to the full NFL membership that no further expansion be considered for the moment. Plaintiffs met with defendants on at least two more occasions. One of these meetings was with the entire NFL membership. A few months after their presentation to the full membership, the NFL passed on March 17, 1976 the following resolution: RESOLVED, after thorough review of the major problems presently confronting the NFL, that the member clubs do not believe they can formally com- mit to specific expansion arrangements at this time. The clubs do, however, reaffirm their desire to bring total League membership to thirty teams as soon as possible after resolution of current problems and as- similation of the new Tampa Bay and Seattle teams. At that time, Memphis and Birmingham, which have most actively sought admission in recent months, will be among the cities receiving strongest consideration for NFL franchises. The problems referred to in the resolution were many. Around the time of plaintiffs’ application, no collective bargaining agreement with the Players Associ- ation had been in effect for two seasons. In addition a district court in California had held several player re- strictions to be unlawful.? A few months later another district court in California enjoined application of the “Rozelle rule” by the NFL. Pending in a third district 2. The court found the “Rozelle rule,” the “draft rule,” the “one-man rule” and the “tampering rule” violative of the Sherman Act. Kapp v. National Football League, 390 F.Supp. 73 (N.D. Cal. 1974), aff'd, 586 F.2d 644 (Sth Cir. 1978), cert. denied, 441 U.S. 907, 99 S.Ct. 1996, 60 L.Ed. 2d 375 (1979). A-40 court was a case attacking the NFL college draft.* Near the end of 1975, another district court found the “Rozelle rule” unlawful.* Also during this time period ef- forts were afoot to make permanent legislation which prevented the practice of blacking out television cover- age of sold out home games in the area surrounding the home team’s stadium. In addition, the NFL Players As- sociation threatened to challenge the procedures the NFL implemented to man the new Tampa Bay and Seat- tle teams.° The players filed suit in March 1976.® Because defendants had already decided expansion anywhere at the time of plaintiffs’ application was not prudent, they never fully considered plaintiffs’ applica- tion on the merits.’ Defendants did, however, tell plain- 3. Smith v. Pro-Football, Inc., 420 F.Supp. 738 (D.D.C.1976), affd in part and rev'd in part, 593 F.2d 1173 (D.C.Cir. 1978). 4. Mackey v. National Football League, 407 F.Supp. 1000 (D.Minn.1975), affd in part and rev'd in part, 543 F.2d 606 (8th Cir. 1976), cert. dismissed, 434 U.S. 801, 98 S.Ct. 28, 54 L.Ed.2d 59 (1977). 5. These franchises were awarded in 1974. They did not begin actual play, however, until 1976. In order to man these new teams, each one was permitted to draft up to three men from each existing team except a minimum of thirty-two men placed on a protected list. They were also given preferential selection rights in the NFL college draft. Exhibit 4F to Rooney Affidavit, Motion of Defendants for Summary Judgment and Addenda. 6. The NFL's litigation problems have continued. Recently. the Second Circuit affirmed a district court's finding that the NFL cross ownership ban preventing NFL owners from owning any other major professional sports team violated the Sherman Act. North American Soccer League v. National Football League, 670 F.2d 1249 (2d Cir.1982), cert. denied, _ U.S. __, 103 S.Ct 499 (1982). In May 1982, the NFL also lost a fight to prevent the owner of the Oakland Raiders from moving his team to the Los Angeles area. Los Angeles Memorial Coliseum Commission v. National Foot- ball League, Civ. No. 78-3523-HP (C.D.Cal.). And of serious conse- quence to the owners, players’ strike which began in September 1982. 7. As a result of this lawsuit, defendants have since examined the merits of plaintiffs’ application and have found it, in their eves. SS ae A-41 tiffs they would receive serious consideration in the fu- ture when definite expansion plans were formulated. Plaintiffs finally filed this lawsuit in December 1979. In their Complaint, plaintiffs allege that part of de- fendants’ motive in rejecting plaintiffs’ application was to retaliate against plaintiffs for their past involvement in the now defunct rival of the NFL, the World Football League (“WFL”).® The WFL was formed in 1973 and played games in the entire 1974 football season and in the 1975 season until October 1975. Several of its teams had competed directly with NFL teams for fan support and revenue. In any event plaintiffs assert that defendants’ ac- tions constitute an unlawful group boycott and an un- reasonable restraint of trade in violation of Section 1 of the Sherman Act.® Moreover, they allege that defen- dants’ behavior constitutes monopolization violative of Section 2 of the Sherman Act.!° The Defensive Strategy Defendants respond with several defenses. First they deny their actions were motivated by animus to- wards plaintiffs because of their WFL involvement. De- NOTE — (Continued) wanting. Because I am assuming plaintiffs were qualified for a fran- chise in deciding this motion, I make no finding regarding this par- ticular contention of defendants. 8. Mr. Bosacco owned and operated the Philadelphia Bell; the limited partnership owned and operated the Memphis Southmen, also known as the Memphis Grizzlies; and Consolidated owned and operated the Portland Storm. 9. Section 1 reads in part: “Every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several States, ... is declared to be il- legal... .” 10. Section 2 provides: “Every person who shall monopolize, or attempt to monopolize, or combine or conspire with any other per- son or persons, to monopolize any part of the trade or commerce among the several States, ... shall be deemed guilty of a fel- Ws..." A-42 fendants also contend that their behavior was neither a group boycott nor an unreasonable restraint of trade. In addition they assert there was no contract, combination or conspiracy as required by Section 1 because the NFL, in this case, acted as a single entity. Moreover, they as- sert they have performed no act of monopolization pro- scribed by Section 2. Lastly, they contend that plaintiffs Bosacco, Consolidated and the joint venture are not real parties in interest and thus lack standing to sue. Be- cause I find that defendants’ conduct is neither an un- lawful group boycott, an unreasonable restraint of trade nor an act of monopolization, I will not make a call on defendants’ remaining contentions. !! The Pregame Show The NFL is well known to any football fan. It is an unincorporated association comprised of twenty-eight teams located throughout the United States. All but one team are privately owned and operated. Although these teams “compete” with one another on the playing field and for the top players, they act jointly in many aspects of their enterprise as the term league necessarily im- plies. For example, they set rules for the games, sched- ule contests, provide for joint marketing of national broadcast rights and, of importance here, decide the lo- cations and owners of new franchises.'2 The rules which govern the awarding of new franchises are contained in the NFL's Constitution and By-Laws. !* 11. The Second Circuit on facts different from this case re- cently rejected the single entity theory in North American Soccer League v. National Football League, 670 F.2d 1249 (2d Cir. 1982), cert. denied, _U.S. __., 103 S.Ct. 499 (1982). 12. An award of a new franchise requires three-quarters ap- proval of the then existing franchises. Constitution and By-Laws for the National Football League for 1975, €3.3(C). 13. The Constitution and By-Laws for the National Football League at the time of plaintiffs’ application contained the following provisions governing the awarding of a franchise: A-43 Each team derives a great deal of its revenue through jointly generated income. For example, money resulting from national broadcasting contracts is shared among league members on agreed upon formulae. Other rev- enue, such as the sale of team paraphernalia and local NOTE — (Continued) 3.1(a) Membership in the League shall be limited to the twenty six (26) member clubs specified in Section 4.3(A) hereof and such new members as may be thereafter duly elected. (b) The admission of a new member within the home terri- tory of a club is prohibited unless approved by the unanimous consent of all members of the League. 3.2 Any person, association, partnership, corporation, or other entity of good repute organized for the purpose of operat- ing a professional football club shall be eligible for membership except: (a) No corporation, association, partnership or other entity not operated for profit nor any charitable organization or entity not presently a member of the League shall be eligible for membership. 3.3(A) Each applicant for membership shall make a writ- ten application to the Commissioner. Such application shall de- scribe the type of organization and shall designate the city in which the franchise of the applicant shall be located; such ap- plication shall further describe and contain the following infor- mation: (1) The names and addresses of all persons who do or shall own any interest or stock in the applicant, together with a state- ment that such persons will not own or hold such interest or stock for the benefit of any undisclosed person or organization. (2) A detailed balance sheet of such company as of the date of organization and a pro forma statement as of the time it shall commence actual operation. A written financial statement shall be required from the applicant and from anyone owning an in- terest in any applicant, including stockholders and partners. (3) If applicant is a corporation, a certified copy of the Arti- cles of Incorporation, By-Laws and share certificate shall ac- company such application provided, however. if the organiza- tion of such corporation has not been commenced or completed a detailed statement summarizing the proposed plan of opera- tion and the capital structure thereof shall be furnished. A-44 advertising, is individually generated and not shared with other NFL members. The NFL has its roots early in this century. Throughout the years several other leagues appeared usually only for a short time and without much success. One entry, however, did succeed. In the early 1960’s the American Football League (“AFL”) was formed with eight teams. The two leagues were run separately until 1966 when the two agreed to a merger to be fully imple- NOTE — (Continued) (4) If applicant is partnership [sic], unincorporated associ- ation or other entity, certified copy of the Articles of Co-Partner- ship or organization government agreement shall accompany such application. (5) The names and addresses of all officers and directors. (6) All applications shall contain a representation that upon acceptance, the applicant will subscribe to and agree to be bound by the Constitution, By-Laws, Rules and Regulations of the League and any amendments or modifications thereof. (B) Each application for membership shall be accompa- nied by a certified check for Twenty-Five Thousand Dollars ($25,000.00). Upon approval of any application for member- ship, an additional Twenty-Five Thousand Dollars ($25,000.00) shall be paid to the League. If any application for admission is rejected, the League shall repay to the applicant the sum of Twenty-Five Thousand Dollars ($25,000.00) paid by the appli- cant at the time of such application, less all expenses reason- ably incurred in connection with the consideration and investi- gation of such application. (C) Upon receipt of any application for membership in the League, the Commissioner shall conduct such investigation thereof as he deems appropriate. Following the completion of such investigation, the Commissioner shall submit the applica- tion to the members for approval together with his recommen- dation thereon, and such information thereon that the Com- missioner deems pertinent. Each proposed owner or holder of any interest in a membership, including stockholders in any corporation, members of a partnership and all other persons holding any interest in the applicant must be individually ap- proved by the affirmative vote of not less than three-fourths or 20, whichever is greater. of the members of the League. A-45 mented by 1970.'4 At the time they entered the merger -- agreement, the NFL had fifteen teams and the AFL had nine. Expansion beyond these twenty-four teams has been sporadic. In 1967, the NFL awarded a franchise to New Orleans. A year later, the AFL added Cincinnati. By the time the merger was completed, the NFL consisted of twenty-six teams and stayed at that number for sev- eral years. In 1974, a year before plaintiffs’ application, plans were made to add to two more franchises in Tampa Bay and Seattle. These two teams first became active in 1976, shortly after plaintiffs’ application. Each new team was manned by taking a maximum of three players from each previously established team. No new NFL fran- chise has been awarded to anyone since the time of plaintiffs’ application. Although the NFL does expect to award two more franchises in the foreseeable future, they have not decided when, where or to whom. No current NFL franchise operates in the Memphis area. The closest NFL team location is St. Louis, Mis- souri which is two hundred and eighty-one miles from Memphis. !* The Rules of the Game [1] Rule 56 of the Federal Rules of Civil Procedure authorizes a district court to enter summary judgment where “the peladings, depositions, answers to interrog- atories, and the admissions on file, together with the affi- davits, if any, show there is no genuine issue as to any material fact.” Fed.R.Civ.P. 56(c). Only those facts which “tend to prove or disprove elements of the disputed claim for relief’ need be examined before a de- 14. Congress exempted the merger from the antitrust laws. Pub.L. No. 89-800, 80 Stat. 1515 (codified at 15 U.S.C. §1291 (1976)). 15. Mileage was provided by the American Automobile Associ- ation. A-46 cision is rendered. Chuy v. Philadelphia Eagles, 407 F.Supp. 717, 723 n. 9 (E.D.Pa. 1976), citing McCormick on Evidence §185, at 434-35 (2d ed. E. Cleary 1972). The court must recognize, however, that summary judg- ment is a drastic remedy, resolve all doubts as to the ex- istence of genuine issues of fact against the moving party, and view all inferences from the facts in the light most favorable to the parties opposing the motion. Conti- nental Insurance Co. v. Bodie, 682 F.2d 436 (3d Cir. 1982). [2-4] The Supreme Court has cautioned that sum- mary judgment should be used sparingly in antitrust cases. Poller v. Columbia Broadcasting System, Inc., 368 U.S. 464, 82 S.Ct. 486, 7 L.Ed.2d 458 (1962). However as my former colleague then District Judge, now Circuit Judge, Becker noted, a legion of cases granting either partial or total summary judgment in antitrust cases have been upheld by the Supreme Court and the Third Circuit since Poller.'© Zenith Radio Corp. v. Matsushita Electric Industrial Co., Ltd., 513 F.Supp. 1100, 1140 & n. 53 (E.D.Pa. 1981), appeal docketed, Nos. 81-2331, 81-2331, 81-2332 and 81-2333 (3d Cir. Aug. 24, 1981). In fact courts have since recognized that summary judg- ment is particularly apropos in antitrust cases: [T]he very nature of antitrust litigation wouid en- courage summary disposition of such cases when permissible. Not only do antitrust trials often en- compass a great deal of expensive and time con- suming discovery and trial work, but also, ... the statutory private antitrust remedy of treble damages affords a special temptation for the institution of vexatious litigation. . . . If a trial would serve no use- ful purpose, summary judgment is proper. 16. One court has stated that the Poller case has become the “magic wand waved indiscriminately by those opposing summary judgment motions in antitrust actions.” Mutual Fund Investors, Inc. v. Putnam Management Co., 553 F.2d 620, 624 (9th Cir. 1977). A-47 Lupia v. Stella D’Oro Biscuit Co., Inc., 586 F.2d 1163, 1167 (7th Cir. 1978), cert. denied, 440 US. 982, 99 S.Ct. 1791, 60 L.Ed.2d 242 (1979). See In Re Municipal Bond Reporting Antitrust Litigation, 672 F.2d 436 (5th Cir. 1982); Solomon v. Houston Corrugated Box Co., Inc., 526 F.2d 389 (5th Cir. 1976). Although a party’s right to trial should be carefully guarded, it is nonetheless clear that the filing of an antitrust complaint cannot insure a right to trial absent any significant probative evidence supporting the party’s claims. Harold Friedman, Inc. v. Kroger, 581 F.2d 1068 (3d Cir. 1978), citing First Na- tional Bank v. Cities Service Co., 391 U.S. 253, 88 S.Ct. 1575, 20 L.Ed.2d 569 (1968). Such a party should not be permitted to proceed to trial in the hope of developing evidence to support his claims. Parsons v. Ford Motor Co., 669 F.2d 308 (5th Cir. 1982), cert. denied, ____ U.S. —____, 103 S.Ct. 73, 74 L.Ed.2d 72 (1982). Moreover, summary disposition of antitrust cases is proper even when employing the Rule of Reason. See Evans v. S:S. Kresge Co., 544 F.2d 1184 (3d Cir. 1976), cert. denied, 433 U.S. 908, 97 S.Ct. 2973, 53 L.Ed.2d 1092 (1977). Thus summary judgment is an appropriate vehicle for disposing of this matter. Under the special rules of this match-up if the of- fensive team does not score, the defendants win. The Kickoff Defendants first filed their motion for summary judgment in March of 1981. In their initial response and again at oral argument, plaintiffs contended that defen- dants’ motion was premature as plaintiffs had not had the opportunity for adequate discovery.'’ See Mannington Mills, Inc. v. Congoleum Industries, Inc., 610 F.2d 1059 (3d Cir. 1979). Agreeing that defendants were “offsides”, I entered a Memorandum Order 17. At that time plaintiffs had several outstanding discovery re- quests and had not yet deposed any of the defendants. 7 oe A-48 permitting plaintiffs to pursue their discovery inquiry but limiting the scope solely to matters relating to the NFL’s decision not to grant plaintiffs an NFL franchise in Memphis and to the NFL’s prior practices and stand- ards concerning the awarding of new franchises since the NFL-AFL merger.'® Plaintiffs subsequently re- ceived additional material and deposed at length the four members of the expansion committee and Mr. Rozelle. [5, 6] Defendants renewed their motion for sum- mary judgment in December 1981. Again plaintiffs as- serted that still they had not had sufficient discovery. It is well settled that the district court has discretion in controlling the discovery process. Montecatini Edison S.p.A. v. E.1. du Pont de Nemours & Co., 434 F.2d 70 (3d Cir 1970). Where appropriate, a district court may limit a party’s discovery as long as they are able to fully develop their case. Staffin v. Greenberg, 672 F.2d 1196 (3d Cir. 1982). See First National Bank of Arizona v. Cities Ser- vice Co., 391 U.S. 253, 88 S.Ct. 1575, 20 L.Ed.2d 569 (1968) (summary judgment in antitrust suit affirmed despite petitioner’s claim it had been unduly restricted in its discovery). Plaintiffs have had more than sufficient discovery to fully develop *w%r ease. All of the outstanding requests to which defendants have refused to respond are not cal- culated to lead to relevant evidence necessary to resolv- ing this matter. As a result, I find that this case is now ripe for a decision on the merits. The First Half (7, 8) I will first address plaintiffs’ Section 1 claim.'? In the development of antitrust law some cases 18. Plaintiffs had sought and received a volume of other mate- rial from defendants as a result of earlier discovery requests. 19. Unlike professional baseball, professional football does not enjoy the good fortune of being totally exempt from the antitrust laws. Flood v. Kuhn, 407 U.S. 258, 92 S.Ct. 2099, 32 L.Ed.2d 728 (1972). In two areas only does football escape the antitrust laws’ A-49 viewed group boycotts as per se violations. See, e.g., Fashion Originators’ Guild of America v. Federal Trade Commission, 312 U.S. 457, 61 S.Ct. 703, 85 L.Ed. 949 (1941); Klors, Inc. v. Broadway-Hale Stores, Inc., 359 U.S. 207, 79 S.Ct. 705, 3 L.Ed.2d 741 (1959). However it became apparent that not all group decisions refusing to do business with someone should be measured against the strict per se criteria enunciated in these ear- lier cases. See Silver v. New York Stock Exchange, 373 U.S. 341, 83 S.Ct. 1246, 10 L.Ed.2d 389 (1963). See also L. Sullivan, Handbook of the Law of Antitrust §90 (1977). Per se violations should be found only where the involved agreements are so clearly anticompetitive and lacking in any redeeming quality that they can be con- clusively presumed illegal without any further inquiry. Broadcast Music, Inc. v. Columbia Broadcasting Sys- tem, Inc., 441 U.S. 1, 99 S.Ct. 1551, 60 L.Ed.2d 1 (1979); National Society of Professional Engineers v. United States, 435 U.S. 679, 98 S.Ct. 1355, 55 L.Ed.2d 637 (1978). A threshold question here then is whether the decision of a professional sports league to deny an assertedly qualified applicant a franchise is unques- tionably anticompetitive. [9] Almost twenty years ago, Judge Grim of this court was called upon to decide the legality of the televi- sion policies of the NFL in United States v. National Football League, 116 F.Supp. 319 (E.D.Pa. 1953).?° There he pointed out the differences between the pro- duction of professional sporting contests and normal business activity: NOTE — (Continued) watchful eye: joint agreements concerning the telecasting of games; and the merger in 1966 of the AFL with the NFL, 15 U.S.C. §1291 (1976). 20. Group decisions by the NFL concerning the telecasting of their games is now covered by statute. See 15 U.S.C. §§1291-95 (1976). A-50 Professional football is a unique type of busi- ness. Like other professional sports which are or- ganized on a league basis it has problems which no other business has. The ordinary business makes every effort to sell as much of its product or services as it can. In the course of doing this it may and often does put many of its competitors out of business. The ordinary businessman is not troubled by the knowledge that he is doing so well that his competi- tors are being driven out of business. Professional teams in a league, however, must not compete too well with each other in a business way. On the playing field, of course, they must com- pete as hard as they can all the time. But it is not necessary and indeed it is unwise for all the teams to compete as hard as they can against each other in a business way. If all the teams should compete as hard as they can in a business way, the stronger teams would be likeiy to drive the weaker ones into financial failure. If this should happen not only would the weaker teams fail, but eventually the whole league, both the weaker and the stronger teams, would fail, because without a league no team can operate profitably. It is particularly true in the National Football League that the teams should not compete too strongly with each other in a business way. The evi- dence shows that in the National Football League less than half the clubs over a period of years are likely to be financially successful. There are always teams in the League which are close to financial failure. Under these circumstances it is both wise and essential that rules be passed to help the weaker clubs in their competition with the stronger ones and to keep the League in fairly even balance. Id. at 323. See Philadelphia World Hockey Club, Inc. v. Philadelphia Hockey Club, Inc., 351 F.Supp. 462 A-51 (E.D.Pa. 1972). The view that the production of profes- sional sports requires joint decisions of the different teams in order to insure their continued existence has become widely recognized. 16F J. von Kalinowski, Antitrust Laws and Trade Regulation §50.01 (1982); R. Bork, The Antitrust Paradox, Ch. 17, at 332 & 337-38 (1978). The Second Circuit recently reaffirmed this view in North American Soccer League v. National Football League, 670 F.2d 1249 (2d Cir. 1982), cert. denied, __ U.S. ___, 103 S.Ct. 499 (1982). Although rejecting the NFL’s position that there was no Section 1 “contract, combination . . . or conspiracy” because they were a sin- gle entity, the court nevertheless recognized the need for joint activity: [T]he economic success of each franchise is de- pendent on the quality of sports competition throughout the league and the economic strength and stability of other league members. Damage to or losses by any league member can adversely affect the stability, success and operations of other mem- bers... . In view of this business interdependence team owners, through their leagues, invariably re- quire that the sale of a franchise be approved by a majority of team owners rather than by the selling owner alone. Id. at 1253. Because of the unique character of profes- sional sports, then, courts have rejected the per se test and have routinely applied the Rule of Reason in decid- ing antitrust suits concerning league practices. See, e.g., Brenner v. World Boxing Council, 675 F.2d 445 (2d Cir. 1982), cert. denied ___._ US. 103 S.Ct. 79, 74 L.Ed.2d 76 (1982); North American Soccer League v. National Football League, supra; United States Trot- ting Association v. Chicago Downs Association, 665 F.2d 781 (7th Cir. 1981); Neeld v. National Hockey League, 594 F.2d 1297 (9th Cir. 1979); Smith v. Pro- Football, Inc. 593 F.2d 1173 (D.C.Cir. 1979); Mackey v. A-52 National Football League, 543 F.2d 606, 609 (8th Cir. 1976), cert. dismissed, 434 U.S. 801, 98 S.Ct. 28, 54 L.Ed.2d 59 (1977). [10, 11] The Rule of Reason test as enunciated in the landmark case of Chicago Board of Trade v. United States, 246 U.S. 231, 38 S.Ct. 242, 62 L.Ed. 683 (1918), mandates that a court determine whether the restraint imposed merely regulates and thereby promotes compe- tition or is one that may suppress or destroy competition. In order to do this, the court: must ordinarily consider the facts peculiar to the business to which the restraint is applied; its condi- tion before and after the restraint was imposed; the nature of the restraint, and its effect, actual or prob- able. The history of the restraint, the evil believed to exist, the reason for adopting the particular remedy, the purpose or end sought to be attained, are all rel- evant facts. Id. at 238, 38 S.Ct. at 244.2! Crucial to proving an antitrust violation under the Rule of Reason is a showing of anticompetitive intent or effect. Phil Tolkan Datsun, Inc. v. Greater Milwaukee Datsun Dealers’ Advertising Association, 672 F.2d 1280 (7th Cir. 1982); Tose v. First 21. Plaintiffs ask that this court apply the test announced by the court in Denver Rockets v. All-Pro Management, Inc., 325 F.Supp. 1049 (C.D.Cal. 1971). That court viewed the Silver case as (2) the group action is intended (a) to reach a result consistent with the policy justifying self-regulation; (b) is reasonably related to that goal; and (c) is no more expansive than necessary; and (3) there are safeguards assuring the restraint is not arbitrary and which provides a basis for judicial review. Id. at 1064-65. This test not been applied by the Third Circuit. Thus I will use instead traditional Rule of Reason test, this test having been recently reaffirmed by the Third Circuit in Fleer Corp. v. Topps Chewing ., 658 F.2d 139 (3d 1981), cert. denied, .§.: U.S. __, 102 Ct 1715, 17 L.Ed.2d 137 (1982) A-53 Pennsylvania Bank, N.A., 648 F.2d 879, 892 & n. 17 (3d Cir.), cert. denied, 454 U.S. 893, 102 S.Ct. 390, 70 L.Ed.2d 208 (1981); Associated Radio Service Co. v. Page Airways, Inc., 624 F.2d 1342 (5th Cir. 1980), cert. denied, 450 U.S. 1030, 101 S.Ct. 1740, 68 L.Ed.2d 226 (1981). In this regard, the case of Levin v. National Bas- ketball Association, 385 F.Supp. 149 (S.D.N.Y.1974) is instructive. In Levin, the plaintiffs were two businessmen who had an agreement to buy the Boston Celtics basketball team. Before this deal could be consummated, it had to be approved by three-fourths of the members of the Na- tional Basketball Association (“NBA”), a league compa- rable to the NFL. The NBA failed to approve the sale. The reasons for the disapproval were disputed by the parties. Plaintiffs alleged they were rejected only be- cause they were friendly with an obstreperous and disliked member of the NBA. Defendants on the other hand claimed that to permit the transfer would result in a violation of a conflict of interest provision of the NBA constitution. The court decided, however, that the rea- son for the disapproval was irrelevant because whatever the reason, it was not anticompetitive. Here the plaintiffs wanted to join with those unwill- ing to accept them, not to compete with them, but to be partners in the operation of a sports league for plaintiffs’ profit. Further, no matter which reason one credits for the rejection, it was not an anti-com- petitive reason. Finally, regardless of the financial impact of this rejection upon plaintiffs, if any, the exclusion of the plaintiffs from membership in the league did not have an anti-competive effect nor an effect upon the public interest. Id. at 152 (footnote omitted) (emphasis in original). Be- cause defendants’ actions were not prompted by any A-54 anticompetitive intent or effect, the court granted sum- mary judgment in defendants’ favor. ? The reasoning in the Levin case is applicable to plaintiffs here. They do not want to compete with the NFL. They tried that and failed. Now they seek to join the asserted antitrust violaters and share all the advan- tages of an established organization. Plaintiffs try to es- chew this obvious conclusion by emphasizing that a franchise’s revenue does not come solely from jointly earned profits; some money is earned by individual pro- motion, for example, of team paraphernalia and from local broadcast revenues. This does not change the obvi- ous fact that the ability to earn these individual profits is an indirect benefit of being a member of the league. A franchise's popularity is inextricably bound up with the quality of its competition on the playing field and the re- sulting excitement and sense of team loyalty. If the Mid- South Grizzlies played inept teams, their revenue gener- ating potential would no doubt drop. Plaintiffs simply are 22. Two commentators on the law of sports have expressed the following view concerning the awarding of sports franchises: The admission practices of sports leagues present a different concern. An analysis of the relationship between clubs within a league suggests that the various league members do not com- pete with one another in an economic sense. Rather, a league is more like a partnership. While each club initially contributes its own capital, the various participants to a large extent share in the joint profits of the venture . This participation in profits is achieved through various arrangements, such as the pooling of television receipts and the division of gate receipts between home and visiting clubs. Thus, a decision on access to member- ship is basically a decision as to whether particular individuals (or their business entities) will be allowed to participate in the partnership venture. Since the various members pool their ef- forts and do not engage in economic competition with one an- other, an adverse decision on membership in the usual case has no appreciable impact on the level of competition which will take place. J. Weistart & C. Lowell, The Law of Sports §3.16, at 315 (1979) (footnotes omitted ). A-55 not competitors of defendants who have been injured by any anticompetitive behavior of defendants. In fact, were plaintiffs to prevail, the receipt of a franchise would be more anticompetitive than their fail- ing to obtain one. Were plaintiffs’ premise embraced by this court — that all acceptable applicants for franchises be given one—then motivation to form a rival league would be substantially dampened. See J. Weistart & C. Lowell, The Law of Sports §5.11, at 751 (1979). Moreover, defendants acted fairly and objectively in deciding to reject plaintiffs’ application. They met with plaintiffs at least three times over the course of four months to hear plaintiffs out and to explain the reasons why neither plaintiffs’ nor any other application would be considered on the merits.?* Rozelle and the Expan- sion Committee arranged a meeting between plaintiffs and the entire league membership despite their own be- lief and recommendation that further expansion not be initiated at that time. Plaintiffs’ were thus afforded an opportunity to dissuade the membership from following the Committee’s recommendation. Furthermore, Rozelle again reiterated the reasons for refusing plain- tiffs application in a letter dated December 29, 1975. Exhibit 3B, Motion of Defendants for Summary Judg- ment and Addenda. There is no evidence that plaintiffs were treated in a manner less favorably than any other party expressing an interest in obtaining a franchise. The fact defendants failed to fully consider plain- tiffs’ application on its merits does not suggest a contrary result. Defendants had substantial business reasons to justify their decision not to plan any further expansion at the time of plaintiffs’ application. They were in the mid- dle of assimilating the first two new teams in several 23. In addition Mr. Bassett testified that he met with Mr. Rozelle another three or four times as well as talked with him on the on three or four occasions. Bassett Deposition, January 21, 1981, at 103. A-56 years each of which took three players from each exist- ing team. Moreover, the NFL had several lawsuits against it which were creating a great deal of uncer- tainty as to the future of several NFL rules and policies. Given these factors, it was a business judgment that fur- ther expansion at that time would be foolhardy. Thus, an in depth inquiry into plaintiffs’ application would have been a waste of defendants’ and plaintiffs’ time. To re- quire such busywork for each application which was submitted to the defendants when it was already decided not to expand would simply be bad business.?* It just does not make sense to pass judgment on a potential franchisee when no franchise is available and it would be equally as foolish to commit a future franchise to an entity which may not even be in existence or otherwise fail to qualify on the date the franchise becomes avail- able. [12] Recognizing the irrelevance of their game plan plaintiffs try an end run based upon their allegation that the defendants’ sole motivation for rejecting them as a franchisee was their past involvement with the WFL. See J. Weistart & C. Lowell, supra §5.11, at 756-57. Plaintiffs fail, however, to muster any substantial evi- dence to support this assertion. Even where a state of mind is material in an antitrust case, there must be some demonstration that there is a sufficient quantum of evi- dence to permit a party to go to the jury. White v. Hearst Corp., 669 F.2d 14, 17 (1st Cir. 1982). The only evidence to support plaintiffs’ allegation comes from the testimony of Mr. Bassett. At his deposi- tion Mr. Bassett stated that some people had expressed the opinion that his past WFL affiliation would hurt his 24. Mr. Rozelle testified that he has received inquiries from twenty to thirty cities about obtaining an NFL franchise since he became Commissioner in 1960. It is not clear how many of these submitted a formal application. Rozelle Deposition, November 12. 1981, at 28. A-57 chances at obtaining an NFL franchise.?° Some of this is speculation and some is hearsay. This is hardly the kind of play upon which to rely for an antitrust score.2© Of particular importance, however, is that Bassett admitted these views were personal to the speakers and did not represent the NFL’s position. Bassett Deposition, Janu- ary 21, 1981, at 111-21. Notably, Bassett did not testify that similar statements were voiced by Rozelle?’ or any member of the Expansion Committee, all of whom al- ready had decided further expansion would be unwise and recommended this course to the NFL membership. It is clear that if any mind-set existed, it was against im- mediate expansion and not against plaintiffs as fran- chise applicants. [13] In plaintiffs’ next series of downs they concen- trate on the essential facility doctrine.?® See, e.g., Otter Tail Power Co. v. United States, 410 U.S. 366, 93 S.Ct. 1022, 35 L.Ed.2d 359 (1973); Hecht v. Pro-Football, 25. These people are Mr. Lynn, then General Manager of the Minnesota Vikings; Mr. Robbey, the owner of the Miami Dolphins; Mr. Thomas, then General Manager of the Baltimore Colts; and pos- sibly Mr. Finks of the Chicago Bears. In addition, Mr. Keating, an NFL player representative, and Mr. Czonka, a former NFL and WFL player, stated they had heard Mr. Robbey express disfavor of Mr. Bassett’s WFL activities. Lastly, a Mr. Mix, a former player and player representive said he had heard similar thoughts expressed by some NFL people. Bassett Deposition, January 21, 1981, at 111-21. 26. Indeed, it seems to me that for this play to have any chance at all it should be made in the context of the Memphis franchise having been awarded to another applicant. 27. In fact, Mr. Bassett testified Mr. Rozelle assured him his WFEL past would not be held against him. Bassett Deposition, Janu- ary 21, 1981, at 116 & 121. 28. The essential facility doctrine applies in the following situ- ation: “|I)f a group of competitors, acting in concert, operate a com- mon facility and if due to natural advantage, custom or restrictions of scale, it is not feasible for excluded competitors to duplicate the facility, the competitors who operate the facility must give access to the excluded competitors on reasonable non-discriminatory terms.” L. Sullivan, Handbook of the Law of Antitrust §48, at 131 (1977). A-58 Inc., 570 F.2d 982 (D.C.Cir.1977), cert. denied, 436 U.S. 956, 98 S.Ct. 3069, 57 L.Ed.2d 1121 (1978). Plain- tiffs’ reliance on this doctrine is misplaced. The doctrine is applicable only where a party is being denied access to something necessary for that party to engage in business which is controlled by his competitors. The Hecht case is illustrative. In Hecht, plaintiffs were a group of promoters who had tried and failed to obtain an AFL franchise in Wash- ington, D.C.2° The apparent reason for this failure was the plaintiffs’ inability to procure a contract with the only stadium suitable for professional football play due to a clause in the contract the stadium owner had with the NFL franchisee in the area which prohibited the sta- dium being leased for use by any other professional foot- ball team. The Hecht court held that the trial court erred in failing to instruct the jury concerning the essential fa- cility doctrine. [14, 15] In Hecht it was clear that a competitor was being denied access to an essential facility by a rival team in a different league. Such is not the case here. As previously stated, plaintiffs wish to join with defendants not compete with them. Nor are the defendants denying the Mid-South Grizzlies access to any stadium. More- over, it is not economically infeasible for plaintiffs to en- gage in professional football. Hecht v. Pro-Football, Inc., supra, at 992. Although not an easy task, plaintiffs are free to again attempt to form a rival football league.*° 29. Plaintiffs’ attempt took place prior to the AFL's merger with the NFL in 1966. 30. In Fleer Corp. v. Topps Chewing Gum, Inc., 658 F.2d 139 (3d Cir. 1981), cert. denied, U.S. 102 S.Ct. 1715, 72 L.Ed.2d 137 (1982), a manufacturer of bubble gum sued a rival bubble gum manufacturer and the Major League Baseball Players Association claiming the defendants had excluded effective compe- tition in the sale of baseball cards because of their exclusive licens- ing contracts. The Third Circuit held that these contracts did not foreclose competition in part because Fleer could still compete for A-59 Plaintiffs concede a history of a number of leagues ap- pearing over the years. See Plaintiffs’ Brief in Opposition to Defendant's Motion for Summary Judgment at 4-9. The AFL proved the task of forming a rival league is not impossible. Indeed, a new football league, the United States Football League (“USFL”), is currently being or- ganized and John Bassett, the chief executive officer of the plaintiff Mid-South Grizzlies partnership, is the owner of the Tampa franchise in that league.*! See The Philadelphia Inquirer, May 16, 1982, Section E, at 1.%? [16] For similar reasons, plaintiffs’ reliance on sev- eral trade association cases is also inappropriate. See, e.g., United States v. Realty Multi-List, Inc., 629 F.2d NOTE — (Continued ) licensing contacts with minor league players which, in time, may become major league players. The fact this process may take several years to become profitable, the court found, did not make the defen- dants’ agreements anticompetitive. 31. Judicial notice may be used in resolving a motion for sum- mary judgment. 10 C. Wright & A. Miller, Federal Practice and Pro- cedure §2723 (1973). 32. Even were plaintiffs true competitors with defendants, I have serious doubts the essential facility doctrine would apply. The cases applying the doctrine involved the denial of access to physical structures or discreet services. See, e.g., Otter Tail Power Co. v. United States, 410 U.S. 366, 93 S.Ct. 1022, 35 L.Ed.2d 359 (1973) (electrical transmission lines); Silver v. New York Stock Exchange, 373 U.S. 341, 83 S.Ct. 1246, 10 L.Ed.2d 389 (1963) (direct tele- phone access to stock exchange for instantaneous communication); United States v. Terminal R.R. Ass'n, 224 U.S. 383, 32 S.Ct. 507, 56 L.Ed. 810 (1912) (railroad switching facilities); Hecht v. Pro- Football, Inc., 570 F.2d 982 (D.C.Cir. 1977), cert. denied, 436 U.S. 956, 98 S.Ct. 3069, 57 L.Ed.2d 1121 (1978) (football stadium); He- lix Milling Co. v. Terminal Flour Mills Co., 523 F.2d 1317 (9th Cir. 1975), cert. denied, 423 U.S. 1053, 96 S.Ct. 782, 46 L.Ed.2d 642 (1976) (flour mill); United States v. Standard Oil Co., 362 F.Supp. 1331 (N.D.Cal. 1972), affd, 412 U.S. 924, 93 S.Ct. 2750, 37 L.Ed.2d 152 (1973) (fuel storage facilities). In contrast, plaintiffs seek to participate in an entire business organization. Thus, the principles enunciated in these cases seem inapposite. : i) ¥ . p< a . +. wv. He A-60 1351 (5th Cir. 1980). In such cases, the courts have re- quired that the association’s membership criteria be fair, reasonable and the least restrictive as possible. The philosophical foundation for this rule is stated in the Re- alty case: When a group of competitors like the member- ship of RML [the trade association] join together to cooperate in the conduct of their business, there naturally arise antitrust suspicions. As Adam Smith, the archangel of the free enterprise system, ob- served, “People of the same trade seldom meet, even for merriment or diversion, but the conversation ends in a conspiracy against the public. .. .” Id. at 1370 (citation omitted). Because the potential harm to outsiders is so great when their competitors are brought together through a trade association, the law re- quires access to the group be available to anyone who meets fair criteria. Id. at 1371-72; Associated Press v. United States, 326 U.S. 1,65 S.Ct. 1416, 89 L. Ed. 2013 (1945). {17] The evil that this rule is designed to thwart is absent in the case at bar. As stated earlier, the produc- tion of professional sports necessarily requires joint planning and decision making. Unlike normal business competitors, the teams are interdependent, North American Soccer League v. National Football League, 670 F.2d at 1251, and while the economic success of one team does not necessarily mean the success of another member, the stability which is derived from membership in a league produces a better product which is to the benefit of the public at large. They do not compete in the same manner as the independent businesses in these trade association cases. Thus, these cases are inapposite. [18] Based upon the undisputed material facts | conclude as a matter of law that a Section 1 violation has not been made out. Thus, plaintiffs are scoreless at halftime. A-61 The Second Half Finding no Section 1 violation is not the end of the ball game. Plaintiffs also assert that defendants’ behavior constitutes an unlawful act of monopolization proscribed by Section 2 of the Sherman Act. This effort also fails to penetrate the NFL's defensive line. [19-21] There is no doubt that the NFL currently has a monopoly in the United States in major league football.** However, the possession of monopoly power in a relevant market alone is not enough to establish an antitrust violation. Berkey Photo, Inc. v. Eastman Kodak Co., 603 F.2d 263 (2d Cir. 1979), cert. denied, 444 U.S. 1093, 100 S.Ct. 1061, 62 L.Ed.2d 783 (1980). The antitrust laws were not intended to punish a business that has become a monopoly because of a “superior prod- uct, business acumen, or historic accident.” United States v. Grinnell, 384 U.S. 563, 571, 86 S.Ct. 1698, 1704, 16 L.Ed.2d 778 (1966).** The law does require that a monopoly not abuse its power. Thus where a busi- ness possessing monopoly power willfully acquires or maintains such power, it will incur a penalty. Id. To avoid a Section 2 violation, then, a monopoly must “re- frain at all times from conduct directed at smothering competition.” Berkey Photo, Inc. v. Eastman Kodak Co., 603 F.2d at 275. Put another way, a monopoly abuses its power when it behaves in an “unreasonably exclusion- 33. Judge Learned Hand in United States v. Aluminum Co. of America, 148 F.2d 416 (2d Cir. 1945), found a 90% share of a rel- evant market conclusive evidence of monopoly power. Plaintiffs al- lege that the relevant product market is major league professional football; the relevant geographic market is the United States, with a submarket in the “Mid-South” area comprised of Tennessee, Mis- sissippi and Arkansas. Defendants do not dispute these contentions and | find them to be acceptable. 34. Judge Hand phrased it in this manner: “The successful competitor, having been urged to compete, must not be turned upon when he wins.” United States v Aluminum Co. of America, 148 F.2d at 430. A-62 ary manner vis-a-vis rivals or potential rivals. .. .” Byars v. Bluff City News Co., Inc., 609 F.2d 843, 853 (6th Cir. 1979); Borden, Inc. v. Federal Trade Commission, 674 F.2d 498, 513 (6th Cir. 1982). [22] Once again plaintiffs fail to get the necessary yardage. Plaintiffs simply are not rivals or potential rivals of defendants except on the playing field. Moreover, de- spite plaintiffs’ failure to obtain a franchise, they are still free to promote a rival league. The actions plaintiffs com- plain of here have do [Text truncated at 120,000 characters. The full text is on the page linked above.] --- Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385011_1255%3A3. Public record. Not legal advice.