Case Study

CASE NAME AND
CITATION: American Football League v. National Football
League, 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

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      National Football League and its Owners,
Defendants/Appellants

 

FACTS: The American Football League (plaintiff) filed a lawsuit
against the National Football League (defendant) under the assumption that the
National Football League was violating the Sherman Act. The plaintiff and its
owners felt as though the defendant and its owners were attempting to
monopolize the league by offering expansion franchises in Dallas, Texas and
Minneapolis, Minnesota in order to disrupt the American Football Leagues plan
to create and establish their own franchises within those same cities. The
district court dismissed the lawsuit and the American Football League appealed
and lost.

 

PROCEDURAL HISTORY:  Who is asking the court to do what?  How did the
case procedurally get before this court?

 

ISSUE(S): Determining whether or not the
National Football League was in violation of the Sherman Act, and whether there
is a relevant market for an additional professional football league within the
nation.

 

HOLDING: In the question of determining whether or not there is a
relevant market for both leagues, the district court properly recognized that
the relevant market may not be the same for all aspects of each league’s
enterprise. A relevant market for recruiting players may be different from the
market for television coverage.  Which way did the court answer the
questions posed in the issues?  What did they decide?

 

REASONING:  For a plaintiff to claim that a defendant is monopolizing
a particular market, it is appropriate to limit the geographic market to the
area which the defendant sought to immerse itself. Equally, if monopoly power
has been acquired in a seperately identifiable and normally competitive market,
it is immaterial that the defendant did not possess the same monopoly power in
an unrelated market elsewhere. The American Football League essentially
contends that the relevant market is a broken-up market attributable to the
cities in which house National Football League teams or prospective cities.
Each league has teams across the country in which each of the teams travel back
and forth to play games. In locating franchises, neither league restricted
itself to any geographic section of the country or limited itself to select
cities. The National Football League did not have the power to monopolize the
relevant market. The National Football League’s occupation in some cities, such
as 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 desirable
cities were in place prior to the American Football Leagues formation does not
mean that it is an illegal monopoly. Unless the National Football League’s
natural monopoly power is misled to gain a competitive advantage for teams
located in other cities, there is no antitrust violation. It often happens that
the first competitor acquires a desirable site which a latecomer also finds
desirable. However, the first competitor is not required to relinquish any of
those sites in order to allow the latecomer a competitive advantage. Why did
the court decide the case the way it did?  What legal standard did they
use or establish?  What prior cases did the Court rely upon and why?

 

DECISION: The judgement that the defendant’s league and owners did not
have the power to monopolize the relevant market was affirmed. The plaintiffs
had no evidence of monopolization by the defendants within the relevant market
and no attempts or conspiracy by the defendants to monopolize the league.

 

COMMENTS: Is there anything else that should be mentioned about this
case? Is it a “landmark” case? Was the court “divided”? Were there any
weaknesses/discrepancies in the court’s opinions? What were your personal
thoughts on the case?

 

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