Case Study

CASE NAME ANDCITATION: American Football League v. National FootballLeague, 205 F. Supp. 60, 1962 U.S. Dist. LEXIS 4882, 1962 Trade Cas.

(CCH)P70,334 (D. Md. May 21, 1962). PARTIES:  American Football League and its Owners, Plaintiff/Appellees      National Football League and its Owners,Defendants/Appellants FACTS: The American Football League (plaintiff) filed a lawsuitagainst the National Football League (defendant) under the assumption that theNational Football League was violating the Sherman Act. The plaintiff and itsowners felt as though the defendant and its owners were attempting tomonopolize the league by offering expansion franchises in Dallas, Texas andMinneapolis, Minnesota in order to disrupt the American Football Leagues planto create and establish their own franchises within those same cities.

Thedistrict court dismissed the lawsuit and the American Football League appealedand lost.  PROCEDURAL HISTORY:  Who is asking the court to do what?  How did thecase procedurally get before this court? ISSUE(S): Determining whether or not theNational Football League was in violation of the Sherman Act, and whether thereis a relevant market for an additional professional football league within thenation. HOLDING: In the question of determining whether or not there is arelevant market for both leagues, the district court properly recognized thatthe relevant market may not be the same for all aspects of each league’senterprise. A relevant market for recruiting players may be different from themarket for television coverage.  Which way did the court answer thequestions posed in the issues?  What did they decide? REASONING:  For a plaintiff to claim that a defendant is monopolizinga particular market, it is appropriate to limit the geographic market to thearea which the defendant sought to immerse itself.

Equally, if monopoly powerhas been acquired in a seperately identifiable and normally competitive market,it is immaterial that the defendant did not possess the same monopoly power inan unrelated market elsewhere. The American Football League essentiallycontends that the relevant market is a broken-up market attributable to thecities in which house National Football League teams or prospective cities.Each league has teams across the country in which each of the teams travel backand forth to play games. In locating franchises, neither league restricteditself to any geographic section of the country or limited itself to selectcities. The National Football League did not have the power to monopolize therelevant market.

The National Football League’s occupation in some cities, suchas New York, was not exclusive. Those cities can support more than one team.The fact that many of the National Football League’s teams that had been in desirablecities were in place prior to the American Football Leagues formation does notmean that it is an illegal monopoly. Unless the National Football League’snatural monopoly power is misled to gain a competitive advantage for teamslocated in other cities, there is no antitrust violation. It often happens thatthe first competitor acquires a desirable site which a latecomer also findsdesirable. However, the first competitor is not required to relinquish any ofthose sites in order to allow the latecomer a competitive advantage.

Why didthe court decide the case the way it did?  What legal standard did theyuse or establish?  What prior cases did the Court rely upon and why? DECISION: The judgement that the defendant’s league and owners did nothave the power to monopolize the relevant market was affirmed. The plaintiffshad no evidence of monopolization by the defendants within the relevant marketand no attempts or conspiracy by the defendants to monopolize the league.  COMMENTS: Is there anything else that should be mentioned about thiscase? Is it a “landmark” case? Was the court “divided”? Were there anyweaknesses/discrepancies in the court’s opinions? What were your personalthoughts on the case? 

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