Another challenge to Major League Baseball’s antitrust exemption arrived at the Supreme Court’s doorstep on Monday, this time a lawsuit brought by teams expelled from MLB’s minor league system.
In 2021, Major League Baseball eliminated 40 teams from the minors. Four of those teams sued on antitrust grounds, alleging that what MLB did would have been illegal if not for the Supreme Court’s century-old ruling exempting the league and its teams from laws intended to prevent collusion within a industry.
Two of the teams that sued, the Staten Island Yankees and the Salem-Keizer Volcanoes, reached settlements with MLB, according to the teams’ attorney, Jim Quinn. But the other two teams, the Tri-City ValleyCats and the Norwich Sea Unicorns, asked the Supreme Court on Monday to take up the case. Lawyers for those clubs described what happened in the minors as “the zenith” of MLB’s “anticompetitive abuse.”
The lawsuit was designed to be fast-tracked to the nation’s highest court, Quinn said, with the belief that if ever the court might be willing to revoke the waiver, it might be now. The court ruled against the NCAA in another major antitrust case just two years ago.
The judges would probably only grant a hearing if they were interested in revoking the exemption and ending the unique protection baseball has long had. But any appeal to the Supreme Court is inherently a long shot, and the court has many times before decided not to hear challenges on this specific issue.
When the lawsuit was filed in December 2021 and still today, the question is whether this lawsuit and this moment would turn out differently. An answer is still at least several months away, but Monday’s filing brought the procedure one step closer.
“The philosophy of antitrust law is competition,” said Greg Silbert of Weil, Gotshal & Manges, who drafted the petition on behalf of the teams. “But because baseball is exempt from antitrust laws, these 30 teams got together and they all said, ‘We’re all going to agree that each of us will have exactly four affiliates, no more, no less.’ And then they picked minor league teams that they thought, for various reasons, would be beneficial to MLB.”
MLB declined to comment Monday. Their formal response to the petition is due later this fall. In a brief to the Second Circuit Court of Appeals earlier this year, the league’s attorneys argued that “the antitrust exemption has not encouraged baseball to engage in anticompetitive restructuring.”
Challenges to the exemption have taken different forms over time, but all have failed. Silbert and Quinn argue that their volley has a better reputation than its predecessors for several reasons.
Quinn said three justices — Samuel Alito, Neil Gorsuch and Brett Kavanaugh — “have strongly indicated that if presented with the right case, they would overturn baseball’s exemption.”
“That’s really what we think we have going forward,” Quinn continued.
Quinn was primarily referring to a famous antitrust case from two years ago, NCAA v. Alston, in which the court unanimously ruled that the NCAA could not limit education-related compensation for student-athletes. That case went hand in hand with the arrival of NIL agreements.
In expressing the court’s opinion in that case, Gorsuch cited a baseball group, Advocates for Minor Leaguers. Kavanaugh wrote an aggressive acceptance of the decision.
Alito, meanwhile, has spoken at some length about baseball’s exemption.
The current court also seems less concerned about adhering to legal precedent, Quinn said, noting the overturning of Roe v. Wade. And specifically in the context of antitrust cases, precedents are not always so relevant, both attorneys said.
“The court has realized that its antitrust decisions need to be reviewed as the facts evolve, in a way that other decisions do not,” Silbert said. “The idea that once a court decides an issue, it must remain decided unless Congress passes a new law has much less force in the antitrust context.”
The plaintiffs say they will have big names behind them. Third parties interested in a case can file friend-of-the-court or amicus curiae briefs, and must do so within the next month.
“We hope to have some very high-profile amicus supporters,” Silbert said. “Having amicus briefs, particularly from credible or authoritative parties, is something the court looks at.”
The US Department of Justice previously intervened in the case, questioning the merits of the exemption.
However, Silbert noted that only about 1 percent of the petitions the Supreme Court receives are ultimately heard.
(Photo of Justice Brett Kavanaugh: Oliver Douliery/AFP via Getty Images)
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