Supreme Court rules against Baltimore baseball team 100 years ago, excluding current MLB from antitrust – Baltimore Sun

More than a dozen men gathered for a banquet at the Belvedere Hotel in Baltimore in March 1914, and though they were ready to embark on uncharted and challenging territory, they were candid and confident. The men were stakeholders in the new Federalist League—a rival to the American and National Leagues—and every rhetoric and statement was mired in condemnation.

Someone said “You can’t lose,” and many called the war: This new baseball league, which already has star players, will win.

Another said, “If there isn’t enough room for three big leagues in this country, you can stick it in your hat that the Feds aren’t going to be the ones to go to the wall.”

By the following year, 1915, the eight-team Federal League was dissolved. The league boasted about the future of the Hall of Famers—and Wrigley Field in Chicago was built for the Federal League—but ultimately couldn’t compete with the Major League and National League, which fought to extricate itself from the new league. After two seasons, the “Feders” were gone.

However, the intangible result from that league, and specifically from Baltimore club, the Terrapins, is still significant today.

Baltimore—which had been keen on a major league team since the Baltimore left the Orioles after the 1902 season and later became the New York Yankees—welcomed the Terrapins, who wore orange and black, in 1914. They were dubbed “Baltimore’s big league club” Thus, while in 1915 two Federal League owners were allowed to buy into existing major league teams and five others agreed to the takeover, He refused a settlement of $75,000. Instead of that He kept the fight alive in the courts, and the established leagues fought back by arguing that organized baseball had conspired to monopolize the sport.

The battle lasted for years, until May 29, 1922, when the U.S. Supreme Court, headed by William Howard Taft, ruled against Baltimore and organized baseball leagues. The court said that baseball is not an interstate commerce, and therefore, the Sherman Antitrust Act of 1890 did not apply.

That decision, made 100 years ago this week, allowed MLB to enjoy an incredibly rare antitrust exemption today — giving it a leeway and freedom that other industries and professional sports don’t have — even with most experts agreeing that the exemption is flawed and illogical.

“Does the exemption make sense? No, no,” said Edmunds, a professor at Notre Dame College of Law with a focus on antitrust law and baseball. “It didn’t happen for very long.”

Although he had a famous career, Supreme Court Justice Oliver Wendell Holmes received a barrage of criticism for the decision he wrote in the 1922 case, Federal Baseball Club of Baltimore, v. the National League of Professional Baseball Clubs. And while an academic paper for 2020 said that ‘Bumped hard’ In the resolution, a The paper published this year sought to “repurpose anger” and “blame” against Holmes and directed toward two other Supreme Court decisions. Twice, in 1953 and 1972, the court largely upheld baseball’s antitrust exemption.

The three cases allowed baseball to operate without the scrutiny of antitrust law—the rules established to promote competition in business—and no matter which court it was “to blame,” the 1922 lawsuit, brought by the Baltimore Terrapins, laid the groundwork.

In the years since, other professional sports leagues have sought similar exemptions, with no luck, and so MLB has remained, oddly enough, in a category of its own. Courts rarely create antitrust exceptions, said Patricia Campbell, a professor of law at the University of Maryland’s Carey College who studies antitrust law.

“So the baseball exemption is unique,” she said.

The Curt Flood Act, passed in 1998, removed baseball’s antitrust exemption as it relates to MLB players — but kept the rest of the MLB antitrust exemption intact.

“There are a lot of other things that apply to it,” said Nellie Drew, professor of sports law at the University of Buffalo. “So things like MLB, transfer of ownership, amateur recruitment, franchise transfer, licensing are all things. [those] kind of thing.”

It allows MLB more control and gives them the ability to make decisions without having to worry about antitrust law. And while it has long been imprinted into the fabric of baseball’s action, it has been opposed by many, including last year both Republican Senator Ted Cruz of Texas and Independent Progressive Senator Bernie Sanders of Vermont.

“I think it’s based on a flawed law,” Drew said.

In its third ruling on baseball’s antitrust status, in 1972, the Supreme Court handed over liability to Congress, saying that through “affirmative inaction,” the legislative branch somehow supported the exemption.

“If there is any inconsistency or illogicality in all of this, this long-standing inconsistency and illogicality must be addressed by Congress, not by this court,” she wrote.

Congress, over the years, has considered removing the exemption for various reasons. A year ago, Republican senators threatened to rescind the exemption after the MLB moved its All-Star game from Atlanta to Denver after passing changes to Georgia’s voting laws. Cruz said at the time that the MLB “should not expect to continue receiving special benefits from Congress.”

Then, this year, Sanders announced a bill that would rescind the MLB’s exemption.

“The anti-competitive grip that Major League Baseball exerts on the sport, its players, workers, and communities must end,” the bill said.

Edmonds, the Notre Dame professor, said that over the past several decades there have been more than 100 bills relating to antitrust exemptions in baseball and other sports, but — in part because of lobbying power in MLB — the legislation is unlikely to repeal the exemption. The best opportunity, in his estimation, came two years ago, when MLB severed ties with 42 minor league teams.

“I don’t think Congress has much interest in revoking the exemption because that was probably the best opportunity in recent years for them to come together and say we’re going to get rid of that exemption,” he said.

Four teams who lost their MLB affiliation filed a lawsuit last year in the Southern District of New York, arguing that MLB would not have been able to take such a step without an antitrust exemption.

“There is practically no other business in the United States even It is considered The lawsuit states that such brazen horizontal agreement between competing firms. “However, MLB and its clubs have had no such harassment because for nearly a century they have been demanding an aberrant ‘get out of jail’ card that was judicially created from antitrust scrutiny.”

In plain terms, the lawsuit goes against previous Supreme Court decisions.

“It’s time to throw the baseball exception into the dustbin of antitrust history,” she stated.

Because the court has already confirmed the exemption twice and because it has previously handed the case over to Congress, it may seem unlikely that it will overturn the precedent. But last year, Judge Neil Gorsuch wrote that “this court refused to extend the logic of federal baseball to other sports leagues—and even acknowledged criticism of the decision as ‘unrealistic’, ‘inconsistent’ and ‘aberration.[al]. “

The lawsuit goes on to say that perhaps if the Supreme Court is given another chance, it will reconsider the MLB’s exemption.

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“If you want an athletic analogy, they throw the field hard,” Campbell said.

Armed with a century of precedent, the MLB classifies the lawsuit from the previous four major league teams as “Obviously trivial,” But there is still a chance of getting to the Supreme Court.

“This is the opportunity for the court if it really wants to overturn the antitrust exception,” Campbell said. “Who knows what will happen? The court can say it is up to Congress. We don’t know how that will happen.”

Returning to the Belvedere in 1914, the nascent Confederation began with this confidence, eager for war with the establishment.

“If one can predict the future of Major League baseball clubs from the spirit that appeared last night,” an article in The Sun read, “the new organization’s outlook appears to be already rosy.”

But the Brooklyn Tip-Tops, Buffalo Blues, Chicago Whales, Kansas City Packers and Newark Peppers, among other teams in the Federal League, didn’t last. Baltimore pitcher star, Chief Bender, who is credited to baseball historians for highlighting the slider and inducted into the Hall of Fame, had the worst season of his career in Baltimore in 1915, when Terrapin went 47-107.

For all the resolute optimism with which the federation began, it quickly faded away. It wouldn’t be until decades later, in 1954, when Baltimore finally acquired another major league team. The Orioles are now the big club of Baltimore, and the Terrapins have become the University of Maryland’s nickname. The Baltimore Terrapins were short-lived and forgettable—however, they somehow live on the century-old state and the puzzling precedent that created it.