SPORTS LAW – Summer 2009
Professor Edelman
I. Sports & Society: Regulating the Professional Sports Industry
a. An introduction to judicial oversight in pro sports
i. Dichotomy between internal self-regulation and external gov’t oversight
1. Internal self-reg: The Mitchell Report
a. Mitchell is director of Red Sox
2. External gov’t oversight needed when one feels mistreated by league
a. Congressional hearings
b. Phoenix Coyotes requested court’s help to prevent NHL from blocking their move
ii. Weiler and Roberts do not believe that there is anything known as “sports law”
1. Torts, contract, anti trust, property, etc
a. Edelman does not totally agree with that statement
Crouch v. NASCAR (1988)
– US Court of Appeals, 2nd Cir.
o Facts à Crouch (P) a stock car driver, challenged NASCAR’s interpretation and application of its rules to the outcome of a race in which Crouch was stripped of a victory
§ Race was appealed to National NASCAR reviewer who declared LaJoie winner
o Holding à The District Court should have deferred to NASCAR’s interpretation of its own rules in the absence of an allegation that NASCAR acted in bad faith or in violation of any local, state or federal laws
o Notes à “Waiver of recourse” à giving up a right to go to the court system
§ GENERAL RULE: cannot sue private organization for private organization’s rules
· NASCAR – Private Association, not-for-profit, governing body
General Rule of Judicial Non Interference
o Courts typically prefer to avoid the rules of a private associations
o Extremely strong where there is a waiver of recourse
§ 2 Exceptions:
· Illegality / Unlawful
· Bad Faith (does not follow basic rudiments of due process
Carve outs of judicial non-interference
o Illegal; or
o Does not follow basic rudiments of due process (ie. act in good faith)
§ 5th & 14th Amend. don’t apply b/c NASCAR is not a state actor
· Can’t mean Constitution due process
· State law due process must be follow in good faith
– “Dismal Swamp” à term used for the result if case after case of private organizations are brought into the court
o Organization has most competent knowledge of their own rules
M’Baye v. World Boxing Association (2006)
– US District Court, S.D. NY
o Facts à M’Baye brought action for breach of contract and injunction contending that the WBA breached its own rules governing ranking of fighters and sanctioning of bouts to his detriment…He was 3 times passed over for a title match when he was the “official contender”
o Issues à
§ Should the court decide this dispute?
§ Has M’Baye met the standard for issuance of a preliminary injunction?
§ What relief is appropriate?
o Holdings à
§ M’Baye has alleged bad faith and supported his claim with concrete evidence
§ Yes he has met the standard for the granting of a preliminary injunction
§ WBA is ordered to refrain from sanctioning any bout for the vacant regular championship—or any super championship—in the super lightweight division unless it involves M’Baye
o Notes à Court may get involved in response to legitimate allegations of bad faith or illegality
§ M’Baye was able to get a verdict because he successfully asserted a “bad faith” claim
b. Public Funding for Pro Sports
History of pro sports:
– US & Europe
o US: first know as barnstorming leagues
§ Baseball was first major sport in US à no league just lots of teams playing under contractual agreement
§ Globetrotters – remaining version of barnstorming team
· Problems w/ barnstorming leagues
o Rules are not always consistent
o During early barnstorming era some games played 3 balls to a walk, some 4, some no walks at all
o No champion crowned
o Lack of standard contracts
o Difficult to reach agreements between teams
o 1876
§ Albert Goodwill Spalding à baseball player / manager
§ William Holbert à
· These two men created the National League of baseball
o Standardized balls & strikes and innings per game
o Revenues became standardized
o Home games v road games became standardized
o 1903 à American League merged w/ NL
– How did there get to be a commissioner in 1921?
o Following the White Sox scandal of 1919
§ Owned by Comiskey
· Nicknamed the Black Sox b/c owner was so cheap that he refused to pay to have uniforms washed
· Allegations that they intentionally threw World Series
– Fans got unhappy and went to gov’t à owners get concerned that gov’t will become involved
o Jan 1921, Albert Lasker gathered baseba
uspended Mays himself for “deserting his club and breaking contract”
o The Yankees then sued American league president “Ban” Johnson
– Issue à Whether the MLB commissioner acted with w/ in his power to suspend a player for walking off the field
– Holding à Courtcites Washington’s farewell speech that says for a chance to the Constitution, there must be written amendment, not change by usurpation
o Judge granted permanent injunction against May’s suspension
Milwaukee Am. Ass’n v. Landis (1931)
US District Ct. Northern District of Illinois
– Facts:
o Parties had previously agreed to grant commissioner jurisdiction to hear and determine disputes btwn leagues and clubs, or to which a player might be a party
§ Those decisions are final
o Fred Bennett was transferred several times between the St Louis Browns and several minor league teams but all teams were controlled by same person, Phil Ball
o When commissioner Landis learned of this inter club relationship he declared Bennett a free agent and this suit followed
§ Landis had jurisdiction in a case of “conduct detrimental to baseball” à now known as “best interests clause”
– Issue à Does the commissioner have the power to declare a player a free agent?
– Holding à Yes…suit is dismissed
o Standard used by court à the facts negative any assertion that this decision was made arbitrarily or fraudulently
– TAKE AWAY à Where commissioner is serving as neutral arbitrator, his ruling should stand unless it was made by arbitrary or fraudulent
Charles O. Finley v. Bowie Kuhn (1978)
US Court of Appeals, 7th Circuit
– Facts à Finley (owner of the A’s) sold the contract rights to for Joe Rudi & Rollie Fingers to the Red Sox for $2mm, and Vida Blue to the Yankees for $1.5mm
Commissioner Kuhn disapproved w/ the assignments of the
