by Bill Sweet
Tomorrow, the US Southern District Court hears arguments against Major League Baseball claiming that existing broadcast procedures violate the Sherman antitrust act on the grounds that they are anticompetitive.The central matter seems to be that MLB carves out each team's market territory - the Red Sox in Boston/New England, the Yankees/Mets in the New York metropolitan area - thus preventing other teams from directly or indirectly broadcasting their games to other markets. Because this prohibits individual franchises from competing for market-share, it may violate the exemption given to MLB.
Rulings like this are probably necessary to sort out how the professional leagues can and cannot conduct business, as they are a strange hybrid of privately-owned businesses collectively colluding to control competition - in the case of MLB, shielded by a literal antitrust exemption at the federal level. For example, if sports franchises to be treated as private businesses working in cooperation under a trade league, is it a good idea for society to allow the leagues to be treated as non-profit entities (similar to Chambers of Commerce)?
The case - Garber vs. Office of Commissioner of Baseball - was certified as a class action in May after determining in 2014 that the antitrust exemption did not prevent the case from being heard. Also, any settlement will not involve cash settlements for damages, and is limited only to injunctive relief, meaning that MLB may have to change their policies going forward.
Nathaniel Grow at Fangraphs writes:
"During the trial, the parties will thus focus their arguments on whether MLB’s broadcasting rules have, on the whole, harmed or benefited fans. The plaintiffs, for example, will argue that MLB’s exclusive local broadcast territories have effectively given each team a monopoly over its local television market. Absent these restrictions, the plaintiffs will contend that teams would directly compete with one another by televising their games in each others’ home markets."
A similar case tried by the same attorneys against the NHL (Laumann) was settled out of court, resulting in "the NHL has agreed to allow out-of-market fans to purchase a smaller package featuring only their favorite team’s games for 20% less than the cost of the league-wide service." This settlement did not overturn blackout restrictions.
That's likely to where this is going, which would mean that you might be able to purchase an out-of-market channel or feed for any baseball team going forward. I would welcome that.
- Bill
