Today the Supreme Court will hear oral arguments in what some media outlets are billing as the most important case in the history of professional sports.
Nine years ago, the National Football League agreed to a deal with Reebok wherein Reebok would have the exclusive benefit of producing licensed NFL apparel. In 2004, American Needle, one of the former official team apparel manufacturers, sued the NFL. American Needle claimed that by brokering this exclusive deal with Reebok, the NFL had violated Section 1 of the Sherman Act, restricting competition between the 32 teams. American Needle has appealed the decisions of the trial and appellate courts.
Both American Needle and the NFL want this case to appear before the high court. The NFL would like the antitrust issue settled as much as the company that is suing them. With a Supreme Court ruling that the NFL is one business, not a group of 32 competing businesses, the NFL will function exactly as Major League Baseball does. MLB has been exempt from antitrust legislation since shortly after the first World War. The MLB is a monopoly where the owners have control. The players union (MLBPA) exists as a counterpart to that monopoly, accepting or rejecting the decisions that affect the players.
Drew Brees is slated to testify as a representative of the NFLPA. His recent editorial in the Washington Post spelled out a grim future in the event the NFL wins this suit. The NFL operating as one business will mean increased league leverage in player salary negotiations. American Needle’s success in its quest to define the league as a group of competing businesses means each team will be able to operate within its own framework, giving players maximum contract control. However, the union exists to protect the players. The labor concerns of the current players fall on deaf ears, because players don’t have to agree to any contracts they do not want. Additionally, the current collective bargaining agreement between the NFL and NFLPA gives the players 60% of all league revenues, including proceeds from licensed products. It boggles the mind why current players would want the manufacturing of apparel to go back to the individual teams without the larger platform of the NFL to maximize revenues from sales. It’s because they don’t – they just want to make sure they have the ultimate power over where they play and for how much.
Somehow this case has departed from what it is really about: who can produce NFL team apparel. American Needle was one of many businesses that manufactured licensed apparel, sold it, and enjoyed a profit. Now only one company gets to do that. The NFL controls the prices, the outlets, and anything else they choose. Defining the NFL as a single entity is not a precedent. The precedent was already set in 1922 with MLB. The fans need to keep their eye on the ball – what does a ruling in favor of the NFL mean to us? If the NFL is declared a single entity, will this apparel price point control stretch to ticket prices and concessions? Stay tuned.


















