Baseball’s Antitrust Exemption Survives US Supreme Court Appeal

The US Supreme Court refused to consider requiring Major League Baseball to comply with federal antitrust law, turning away a bid to overturn longstanding high court rulings that give the sport a special exemption.

Without comment, the justices rejected an appeal from the former owner of a Puerto Rican winter league team in a clash that had implications for the sport’s top level. Had it been successful, the appeal could have exposed Major League Baseball to suits over franchise relocations, expansion and staff salaries.

The rebuff leaves intact an exemption that the high court itself has described as an “aberration.” Baseball is the only sport that enjoys antitrust immunity, and critics say that special status gives the league unwarranted leverage in its business dealings.

The Major League Baseball Players Association, which urged the court to take up the case, called the exemption “bad for baseball, baseball fans and affected communities, as well as for all economic sectors professional baseball affects,” according to a filing in the case.

MLB declined a request for comment in advance of the Supreme Court action.

The Supreme Court last considered baseball’s status in 1972, when outfielder Curt Flood challenged his trade from the St. Louis Cardinals to the Philadelphia Phillies. Flood said baseball’s “reserve system,” which at the time barred free agency, violated US antitrust law. The court said it was bound by a 1922 decision immunizing the sport.

The latest Supreme Court appeal grew out of a dispute in the six-team Liga de Beisbol Professional de Puerto Rico. Thomas J. Axon was seeking to sue the league for ousting him as the owner of the Cangrejeros de Santurce club after he had pressed for stadium improvements and then threatened to move the team out of San Juan.

Two lower courts said the Supreme Court’s antitrust exemption applied to the Puerto Rican league and barred Axon’s federal claims. That prompted him and his businesses to seek review in the nation’s highest court.

The case is Cangrejeros de Santurce Club v. Liga de Beisbol Professional de Puerto Rico, 25-416.

To contact the reporter on this story:
Greg Stohr in Washington at gstohr@bloomberg.net

To contact the editors responsible for this story:
Elizabeth Wasserman at ewasserman2@bloomberg.net

Greg Stohr, Steve Stroth

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