The U.S. Supreme Court has ruled that the National Football League can be considered 32 separate teams, rather than one big business, with respect to selling NFL merchandise.
The Court’s unanimous ruling reversed a lower court ruling that threw out an antitrust suit brought against the league by American Needle, which used to make NFL-approved hats.
“Although NFL teams have common interests such as promoting the NFL brand, they are still separate, profit-maximizing entities, and their interests in licensing team trademarks are not necessarily aligned,” Justice John Paul Stevens wrote.
American Needle sued the league after losing the hat contract to Reebok, saying the league violated antitrust law when all 32 of its teams worked together to go with Reebok and keep American Needle out of the NFL hat business.
Now the lawsuit will go back to district court.
More detail how does this impact 2011 and CBA negotiations?
I agree with and support this ruling. I think each team should be able to establish their own licensing contracts, especially if they can do so with local manufacturers and vendors. This is a win for consumers/fans, IMO.
Ah yes, the 32 separate teams who work together, but are not allowed to buy from different vendors for hats. Sad day for American capitalism.
Hey, you’ve already got the name; if you can’t make money off NFL hats, you could make money in the much more profitable NFL steroid industry
And if this is the Supreme Court, if it’s good enough for Merchandise reasons, what’s the difference if each individual state’s drug testing policies should apply over that of the NFL’s?
Basically, how does this affect Starcaps Cases?
I would think this would also set federal precedent as to cases like the “William’s Wall” drug issue….if the teams are deemed to be individual businesses, then each NFL team would be required to follow it’s individual State law as it regards drug testing policies and laws………I would like to hear what the PFT founding father and in-house lawyer has to say about this new ruling.
Could this have any repercussions for the Vikings players possible PED suspensions? If each team is its own entity, then wouldn’t be required to follow the states employment laws?
Curious as to how this will impact the Williams Wall case when it goes to the Supreme Court. If they rule it the same, which they certainly should, each team should be beholden to each states laws in which the reside, rather than federal laws that the NFL wants to use. And if thats the case, the suspensions of the WW are gone for good.
You can bet that Jerry Jones was probably secretly backing American Needle.
So now they have a problem that the drug testing policy has to follow the local state’s laws, right?
I don’t disagree with John Paul Stevens statement but I don’t like the NFL can have it both ways being 32 entities when its convienient and one entity when it’s convienient.
I see this ruling softly being pointed out at in an issue currently known as “Star Caps”.
32 teams, not 1 business.
Any impact on let’s say, the EA sports exclusive agreement (doubt it), or perhaps tv contracts (directv NFL sunday ticket, which I love) being sold individually by each “company”? I’m thinking more on the lines of a YES channel that the Yankees have.
By the way, who wears baseball caps for football games? Jerseys n the like I know, but unless you’re a coach wearing a visor, here’s looking at you Sean Payton, it seems off.
This is no great ipiphany.
The federal government has for years granted the NFL (and the other pro sports leagues) exemption from antitrust laws. They have been allowed to violate the laws because they supposedly serve a greater public good.
So American Needle is filing suit on the basis of something that the government has already deemed irrelevant. I would love to know how much public money is being spent to try this case.
Sorry, I spelled “epiphany” wrong.
This doesn’t seem right. Aren’t the contracts signed by the league with the merch companies ? I was under the impression there was one league master contract, not 32 separate contracts with each team.
I on still on the fence on this one, I can see both sides of the argument. Here’s a nice move which I see the NFL taking; teams can have apparel mfg’d by any company they choose, but all merchandise must contain the NFL shield …. which you know is going to only be licensed to whom they want mfg’d the merchandise …. which will lead to yet another lawsuit and many more years of courtroom battles …. btw, I doesn’t the NFL (and not the individuals teams) own the team names and logos; that was the whole legal basis for the Cleveland Browns becoming the Baltimore Ravens instead of the Baltimore Browns.
With this, could teams choose not to abide by the blackout rules?
“Although NFL teams have common interests such as promoting the NFL brand, they are still separate, profit-maximizing entities, and their interests in licensing team trademarks are not necessarily aligned,” Justice John Paul Stevens wrote.
De Smith says: No they ain’t? The NFL be not-for-profit yo!
I suspect the NFL is slowly backing itself into a corner and could ultimately risk their anti-trust exemption if they keep pushing. The NFL has went overboard in trying to throw their weight and power around in how it applies itself to individual issues. They want to be one entity when it benefits them and 32 individual entities when it doesn’t…….I think this U.S. Supreme court ruling draws a line in the sand with the NFL, telling them that they can’t continue to have it both ways and if they continue to press the issue, their anti-trust exemption could be scrutinized once again.
Starcaps is about the CBA vs. state law. This is not, therefore no relevance.
A rare win for the little guy, nice to see.
IMO this seems to establish a precedent the last judge appeared to be looking for.
Williams/Starcaps case is likely to go buh-bye now.
What does this mean for American Jobs…more cheap crap from the Phillippines or Inda…
Unanimous. With this court. Awesome. Every team in the NFL is today having their best and brightest reviewing every single policy regarding marketing, collective bargaining, etc, anything to do with making more more money.
I would love to hear FLorio’s two cents on this, heavy on the legal context.
Precident for Starcaps?
This is not news says:
May 24, 2010 11:56 AM
A rare win for the little guy, nice to see.
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Did you even read the article?
zod says:
May 24, 2010 11:54 AM
Starcaps is about the CBA vs. state law. This is not, therefore no relevance
You are entitled to your opinion but I suspect you are wrong. The issue(s) do overlap as the NFL says it does not have to abide by any State laws as it regards drug testing (using the CBA as it’s defense) and if the US Supreme court states that the NFL is 32 seperate entities then each NFL team must abide by it’s states drug testing laws. It is and has been the basis of the Starcaps lawsuit all along, that State drug testing laws over-ride the NFL’s individual agreement between employer and employee as it is the individual team that has been deemed the individual employer (entity) with this new ruling.
GirthyOne says:
Sad day for American capitalism.
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Let’s get this sraight: 32 teams buy only from one manufacturer and you call this capitalism. The reason why you buy from multiple vendors is because it helps you get a better price and THAT is capitalism.
American Needle’s case is good for Jerry Jones and bad for Ziggy Wilf. The NFL has grown to where it is because they’ve shared their revenue and made ALL the teams financially stable (You can believe all the gloom and doom that you want but these teams aren’t losing money). The New York Giants are giving up so much money in TV revenue that it’s not funny but they do it for the good of the Packers and Jaguars and Bills, who would all drop to the bottom of the league in revenue if they stopped sharing it.
Like it or not, the NFL is the ultimate COMMUNIST organization in this country and it’s served it well. If Rozelle hadn’t convinced them to share revenue after the AFL showed the way, several teams would have went under because the AFL had the money and the will to spend them under the table.
Yeah small battle for the little guy but they’ll end up losing the war.
This is more or less to keep up with consistancy as for as merchandise goes. When you got to buy a hat you see the same style and design just with the team’s logo. Its for consistancy sake.
NFL will win this. Sore losers – American Needle.
There are natural monopolies placed all around our nation, and sports organizations are natural monopolies. If they weren’t, then the Draft wouldn’t exist, there wouldn’t be salary caps, etc… The reason for their communistic traits is to ensure the best possible team comparable matches, such as the Arizona Cardinals being awful years ago and suddenly they come out of nowhere to make the Super Bowl.
Secondly, we’re all speculating too far ahead- this legislation states that each of the teams is an entity unto itself only in the realm of merchandising, not drug testing. This case could only be used as persuasive precedent for individual drug testing per team, meaning that the courts could only say hey, this happened at one time and we’d like to use that. This doesn’t necessarily mean that the entire league now has to be considered as 32 individual teams always, just in this instance.
American Needle hasn’t really won anything yet.
NFL said “this case has no merit, we are one business not 32 so the one business can choose a single hat maker if it chooses.”
Lower court said “you are correct, NFL is one business, so American Needles suit has no merit.”
American Needle asked if Supreme court agreed.
Supreme’s says “NFL is 32 entities, so yes it is possible each team could select its own hat-maker.”
So its back to lower court where NFL can certainly argue, and each of the 32 teams can agree, that Reobok was the better deal. The 32 teams can also argue they perferred to have NFL negotiate the hat deal on their behalf. Volume discounts and all.
Then the question becomes should a group of 32 entities be told they can’t negotiate a contract as a single unit if they opt to?
edgy,
I think you get the unintended consequences of this deal. If anything, I wonder if more owners are now going to start throwing the burden of responsibility for stadiums and concessions back onto the cities in which they reside? I could really see a team like the Jags for instance (my team); I could see Wayne Weaver say, Duval County, I want 100% concessions or I will move the team to LA.
Just watch, logos on uniforms is coming soon. They already do it with practice unis. The Jacksonville Jaguars brought to you by CSX. Cheaper to label a jersey than a stadium.
Not a great few months for the NFL from a legal perspective. Is there anyone in the NFL legal department saying “you know, maybe we ought to settle this case”, or is the NFL so headstrong that it doesn’t know when to fold’em?
If this begins to effect revenue sharing look out. To many small market teams are not gonna vote for any CBA that doesn’t include sharing if ot even more sharing then they already do. It was rumor back when they first opted out that some owners wanted more while others like Jerry Jones wanted less. The real issue is not whether the play and owners ever get something done, its gonna be a fight between the few major markets vs the rest of the NFL.
Hmmmmm I wonder what this means for NFL 2K and Madden
edgy1957 says: May 24, 2010 12:17 PM
GirthyOne says:
Sad day for American capitalism.
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Rozelle hadn’t convinced them to share revenue after the AFL showed the way, several teams would have went under because the AFL had the money and the will to spend them under the table.
Hey, Edgy:
did you miss the day at school they went over “went” and “gone”? It’s never too late…
So the Packers should thank the Giants for revenue sharing???? Besides some Vikings fan’s comments that is the dumbest most inaccurate statement I’ve seen on PFT!
Get a clue, everything doesn’t revolve around NY.
This is not news,
Sorry, I need to learn to read.
Now, I’m not always a fan of what the NFL does but to me, it’s a case of American Needle wanting to eat its cake and have it too. They were probably perfectly happy to have the exclusive contract concept as long as THEY had it and now, they’re on the other side of the fence.
I like what Edgy had to say. He hit it on the head.
What about the idea of these teams being “franchises,” like we call them, and that making the NFL the business from which they franchise? Like a Burger King may be owned by a local guy, but he still has to operate under the BK rules. He doesn’t have to market like all of BK (still chips in for the national ads), participate in all the sales, promos, or policies, but they’re still serving Whoppers and playing by their rules.
I think I may have just reasoned it out for myself.
The NFL is now like Burger King – FINALLY.
The most important thing to remember here: both American Needle and Reebok hats are horrible. I wish New Era would’ve sued.
1mge says:
So the Packers should thank the Giants for revenue sharing???? Besides some Vikings fan’s comments that is the dumbest most inaccurate statement I’ve seen on PFT!
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You really don’t have a clue, do you? Why don’t you look at MLB where teams get TV revenue from LOCAL packages and tell me that it isn’t relevant. The Yankees make so much more than the Brewers that it’s not funny and Green Bay isn’t Milwaukee. MLB got so territorial because of the Braves AND the threat that if the Yankees did the same thing, they’ve had even more revenue than they have now.
When the league brought all the teams under one national contract, they went from a modest per year contract prior to revenue sharing to $4.6 mil per year in 1961 to $14 mil per year within 3 years and 18 mil in 5 years: most of it coming from revenue from the Giants, Bears and Rams.
You can live in a fantasy world and believe that the Packers would still get $100 mil per year for their broadcast rights but that’s foolish notion. The NFL suckles from a $3 bil per year TV teat and if they all had to fend for themselves, the Packers would be near the bottom in TV revenue. Even if you were to believe that they are such a national team that people would pay to watch them nationally, the revenue generated in Wisconsin couldn’t even begin to come close to what the Giants or the Jets could get from their local rights and both would still beat the Packers in national revenue.
Does this mean the nfl can’t try to screw with the ‘Who Dat’ merchandise anymore?
# GirthyOne says: May 24, 2010 12:07 PM
This is not news says:
May 24, 2010 11:56 AM
A rare win for the little guy, nice to see.
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Did you even read the article?
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Dear GirthyOne,
American Needle (WIN) = Little Guy
NFL (LOSE) = Big Guy
This is not news (WIN) = Little Guy
GirthyOne (LOSE) = Big Guy
That’s two, we are on a roll!