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NFL Licensing Issue to be decided by the United States Supreme Court

June 30, 2009 No Comments »
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It is relatively rare for the U.S. Supreme Court to accept a petition to hear a case, so it is noteworthy that the highest court in the land will decide whether the NFL and the 32 teams in the league can enter into exclusive licensing deals without violating antitrust laws.   The dispute goes back to an exclusive deal that the NFL made with Reebok for manufacture of headwear. Prior to that deal in 2001, the NFL had allowed a company called American Needle to make headwear as well.   The NFL prevailed at the appellate level, and American Needle was successful in petitioning the Supreme Court to issue a final ruling on the matter.  Reportedly, the gist of the suit hinges on whether the NFL is a single entity or in fact thirty-two separate businesses (each of the teams in the league).  If it is determined to be separate businesses, the issue becomes whether exclusive licenses like with Reebok violate antitrust laws because the league and those “separate businesses” are working too closely together.  Other leagues will be paying attention to the outcome of this matter.  The notable exception is MLB, which has an antitrust exemption already in place.  Presumably, other professional leagues will issue amicus briefs in support of the NFL’s position that the teams do not constitute separate businesses for purposes of antitrust laws.

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