Will Major League Baseball Soon Strike Out on its Antitrust Exemption?

Updated: Dec 21, 2021

Since 1922, Major League Baseball (“MLB”) alone among U.S. professional sports leagues has enjoyed a judicially created antitrust exemption.[1] The Supreme Court reaffirmed that exemption as recently as the 1972 Flood v. Kuhn decision.[2] Through 1998, that exemption remained unchanged and afforded MLB a pass from all antitrust scrutiny.[3] Pursuant to the 1996 MLB-MLBPA Collective Bargaining Agreement, both the league and the players jointly lobbied Congress to narrow the scope of the exemption.[4] This resulted in the enactment of the Curt Flood Act of 1998, which reinstated baseball players antitrust rights and limited MLB’s exemption to immunize only “the business of organized professional baseball.”[5]


Despite the Flood Act’s codification of MLB’s antitrust exemption, the league continues to face antitrust challenges.[6] Nonetheless, the circuit courts have consistently reaffirmed the exemption and the Supreme Court has declined to review those rulings.[7] As recently as 2018, the Supreme Court denied certiorari in two cases, Wyckoff v. Office of Commissioner of Baseball (Second Circuit)[8] and Right Field Rooftops, LLC v. Chicago Cubs Baseball Club, LLC (Seventh Circuit).[9]


The most recent challenge was filed in the Southern District of New York on Monday, December 20, 2021.[10] In the complaint of The Staten Island Yankees v. Major League Baseball, the plaintiffs allege that the MLB Clubs’ horizontal agreement eliminating their affiliations with 40 Minor League Baseball Teams is an unreasonable restraint of trade, in violation of Section 1 of the Sherman Antitrust Act.[11] In arguing that “MLB should not be permitted to shield itself [from antitrust challenges] with an anachronistic baseball exemption…,” they are asking the court to not only enjoin and declare illegal the anticompetitive agreement, but also to entirely eliminate MLB’s antitrust exemption.[12]


Based on precedent alone, this new challenge is likely to fail. But there have been two recent developments which seem to threaten what is left of MLB’s exemption, further bolstering the Staten Island Yankees’ claim and breathing new hope into the suit. Is MLB at risk of losing its antitrust exemption altogether?


1. The Supreme Court’s Decision in National Collegiate Athletic Association v. Alston[13] in June 2021

Dicta in the unanimous Supreme Court decision in NCAA v. Alston seems to invite challenge to MLB's exemption.[14] In rejecting similar antitrust immunity for the NCAA, Justice Gorsuch writing for the Court referred to MLB's antitrust exemption as “unrealistic,” “inconsistent,” and “aberrational.”[15] He explained that the Court has previously refused to extend the exemption to other sports leagues, and that the way for the NCAA to acquire similar antitrust privileges is "by legislation and not by court decision."[16] But earlier in the Alston opinion, Justice Gorsuch stated "[w]hether an antitrust violation exists necessarily depends on a careful analysis of market realities… if those market realities change, so may the legal analysis."[17]


This language suggests two possible threats to MLB's antitrust exemption. First, the Court is once again inviting legislators to fix the problem (as Congress did after the Flood decision with the Flood Act). But, if legislators don't act and the Court believes "realities have changed" sufficiently, the Court may decide to revisit and change, or even abolish, the judicially created exemption. The Alston decision itself revisited Court precedent from National Collegiate Athletic Association v. Board of Regents of the University of Oklahoma[18] and decided “realities changed” so as not to protect NCAA amateurism rules from antitrust challenge.[19]


As it turns out, the Supreme Court may not need to intervene due to an entirely different development.


2. Congressional Bills Have Been Introduced in Response to MLB’s Decision to Move the 2021 All-Star Game

In April 2021, MLB announced its decision to move the 2021 All-Star Game from Atlanta to Colorado, in response to Georgia’s new voting law.[20] Such decision angered many federal legislators, who voiced their desire to retaliate by revoking MLB’s antitrust exemption altogether.[21] Senator Ted Cruz stated "[i]f Major League Baseball is going to act dishonestly and spread lies about Georgia's voting rights bill to favor one party against the other, they shouldn't expect to continue to receive special benefits from Congress."[22]


Siding with congressional anger at MLB's decision, Missouri also passed a Concurrent Resolution urging Congress to end MLB's antitrust exemption.[23] The resolution attacked MLB's political decision to move the All-Star Game out of Georgia and called for the federal government to "stop granting special privileges to specific, favored corporations…."[24]


As it currently stands, two bills have been introduced in Congress.[25] The first is the “Competition in Professional Baseball Act,” S. 1111, introduced by Senator Mike Lee and co-sponsored by Senator Cruz, Senator John Hawley, Senator Marco Rubio, and Senator Marsha Blackburn.[26] The second is the “Competition in Professional Baseball Act,” H.R. 2511, introduced by Congressmen Jeff Duncan and co-sponsored by thirty-three other representatives.[27]

Both bills would remove MLB's antitrust exemption by repealing Section 26(b) of the Clayton Act, where the Curt Flood Act of 1998 is codified and which provides MLB its current exemption.[28] At present, both were referred to their respective Committee on the Judiciary, but no such movement has occurred since then.[29]


Although it is unclear whether we will soon see the demise of MLB's antitrust exemption, either at the hands of Congress or the Supreme Court, one thing is clear: when professional sports leagues make moves like MLB did, they must appreciate that they can become a "political football" for the objectives of any party or interest in opposition. And who knows if this will deter similar decisions in the future.



Francesca Casalino is a 2023 J.D. Candidate at Brooklyn Law School. She can be reached via email at francesca.casalino@brooklaw.edu, on Twitter @FrancescaCasalino, or on LinkedIn at https://www.linkedin.com/in/francesca-casalino-059574124/.


[1] Federal Baseball Club of Baltimore, Inc. v. Nat’l League of Pro. Baseball Clubs, 259 U.S. 200 (1922). [2] Flood v. Kuhn, 407 U.S. 258 (1972). [3]See Toolson v. New York Yankees, Inc., 346 U.S. 356 (1953); United States v. Int’l Boxing Club, 348 U.S. 236 (1955); Radovich v. Nat’l Football League, 352 U.S. 445 (1957); Haywood v. Nat’l Basketball Ass’n, 401 U.S. 1204 (1971); Flood v. Kuhn, 407 U.S. 258 (1972). [4] 1997-2000 MLB-MLBPA Basic Agreement, Article XXVIII (1996). [5] Curt Flood Act of 1998, 15 U.S.C. §26(b). [6]See City of San Jose v. Office of the Comm’r of Baseball, 776 F.3d 686 (9th Cir. 2015), cert. denied, 577 U.S. 816 (2015); Miranda v. Selig, 860 F.3d 1237 (9th Cir. 2017), cert. denied, 138 S. Ct. 507 (U.S. 2017); Wyckoff v. Office of Comm’r of Baseball, 705 Fed. App’x 26 (2d Cir. 2017), cert. denied, 138 S. Ct. 2621 (U.S. 2018); Right Field Rooftops, LLC v. Chicago Cubs Baseball Club, LLC, 870 F.3d 682 (7th Cir. 2017), cert. denied, 138 S. Ct. 2621 (U.S. 2018). [7]See id. [8] Wyckoff, 705 Fed. App’x 26. [9] Right Field Rooftops, LLC, 870 F.3d 682. [10] Complaint at 1-5, Staten Island Yankees et al. v. Major League Baseball, 1:21cv10876 (filed Dec. 20, 2021). [11]Id. [12]Id. at 5. [13] Nat’l Collegiate Athletic Ass’n v. Alston, 141 S. Ct. 2141 (U.S. 2021). [14]Id. at 2159-2160. [15]Id. at 2159. [16]Id. at 2160. [17]Id. at 2158. [18] Nat’l Collegiate Athletic Ass’n v. Board of Regents of Univ. of Okla., 468 U.S. 85 (1984). [19] Alston, 141 S. Ct. at 2158. [20] Anthony Castrovince, ’21 All-Star Game, Draft Moved from Atlanta, Major League Baseball (Apr. 2, 2021), https://www.mlb.com/news/2021-all-star-game-draft-relocated. [21]See Tal Axelrod, Republicans Blast MLB For Moving All-Star Game, The Hill (Apr. 2, 2021, 5:26 PM), https://thehill.com/homenews/state-watch/546246-republicans-blast-mlb-for-moving-all-star-game. [22]Republicans Want to Yank Baseball’s Antitrust Immunity after MLB Reaction to Georgia Voting Law, Reuters, (Apr. 14, 2021, 3:16 PM), https://www.reuters.com/world/us/republicans-want-yank-baseballs-antitrust-immunity-after-mlb-reaction-georgia-2021-04-14/. [23] H.R. Con. Res. 20, 101st Gen. Assemb., First Reg. Sess. (Mo. 2021). [24]Id. [25] Competition in Professional Baseball Act, S. 1111, 117th Cong. (2021); Competition in Professional Baseball Act, H.R. 2511, 117th Cong. (2021). [26] S. 1111. [27] H.R. 2511. [28] S. 1111; H.R. 2511; 15 U.S.C. §26(b). [29] H.R. 2511 - Competition in Professional Baseball Act, Congress.gov, https://www.congress.gov/bill/117th-congress/house-bill/2511?s=4&r=5 (last visited Nov. 23, 2021); S. 1111 - Competition in Professional Baseball Act, Congress.gov, https://www.congress.gov/bill/117th-congress/senate-bill/1111?s=5&r=57 (last visited Nov. 23, 2021).