Professional Sports and Federal Antitrust Law
In the summer of 1958, the Senate Judiciary Subcommittee on Antitrust and Monopoly held a multi-part hearing entitled, "Organized Professional Team Sports." The hearing focused on legislation to limit the applicability of federal antitrust laws to "exempt certain aspects of designated professional team sport." In 12 separate days of testimony, 37 witnesses appeared before the subcommittee. Representatives from professional baseball, hockey, basketball and football leagues, including players, managers, and commissioners, testified about how antitrust laws affected their respective industries. Among those who testified were baseball greats such as Ted Williams, Jackie Robinson, Mickey Mantle, and New York Yankees manager Casey Stengel.
In years prior, a number of laws such as the Sherman Antitrust Act, the Clayton Antitrust Act, and the Celler-Kefauver Act were enacted to prevent companies from illegally forming or maintaining a monopoly in a particular market. Baseball, however, had routinely escaped federal antitrust scrutiny, as courts ruled that organized baseball did not qualify as "interstate trade or commerce," as defined by antitrust laws. The issue required clarification by the Supreme Court, and, in 1922, the Court heard arguments in Federal Baseball Club v. National League. The Court, including former college baseball player and then-Chief Justice Howard Taft, decided unanimously that the Sherman Antitrust Act did not apply to Major League Baseball because the "business [of] giving exhibitions of baseball" did not constitute interstate commerce. That opinion was delivered by a former amateur baseball player, Justice Oliver Wendell Holmes.
Over the next 25 years, the emergence of radio and television altered the means by which Major League Baseball (MLB) sold its "product" to customers, increasing questions as to whether the nature of the MLB's conduct should be considered both interstate and commerce. In the 1950s, the Supreme Court considered three important cases that brought further attention to the issue. The first, Toolson v. New York Yankees (1953), affirmed that baseball was indeed outside the purview of federal antitrust laws. Yet, in two subsequent cases, the Supreme Court ruled that the federal antitrust laws did indeed apply to boxing (United States v. International Boxing Club ) and football (Radovich v. National Football League ). These arguably conflicting decisions spurred the Subcommittee on Antitrust and Monopoly to hold hearings in 1958, further examining the application of federal antitrust laws to professional sports leagues as a whole.
In 1961, Congress passed the Sports Broadcasting Act, which allowed the nation's professional teams engaged in baseball, basketball, football, and hockey to join together and form single network agreements for national broadcasting rights for their respective leagues. Congress has continued to hold hearings on, and enact legislation affecting, the intersection of antitrust laws and professional sports.