Supreme Court ruling states NFL teams are separate entities

by Griffin McElroy on May 24th 2010 6:30PM

According to USA Today, a recent Supreme Court ruling has denied the National Football League antitrust law protections, stating that its 32 constituent teams must be considered separate entities. The court reversed the dismissal of a suit filed against the league by American Needle, Inc., a company which was locked out of the football-themed hatmaking business after the NFL penned a 10-year exclusivity agreement with Reebok. Gee, that sounds awfully familiar.

The case of American Needle v. NFL has returned to the lower courts, where a decision in favor of the former could drastically change the face of the NFL's licensing business. In short, if the district courts find the league in violation of antitrust laws, it could repeal exclusivity agreements like the one with Reebok -- or, likely more pertinent to your interests, the one with EA Sports, which brought a hasty end to the NFL2K series. We'll keep an eye out for further developments in this lawsuit.

Source

Tags: antitrust, ea, ea-sports, Electronic-Arts, football, lawsuit, madden, madden-11, nfl, nfl-2k, sports, supreme-court

Reader Comments (31)

Glad the ruling went this way.

i agree. i LOVE the NFL (seriously, I'm obsessed with it) but i do despise their tendency to grant exclusivity contracts. EA Sports, DirecTV, and Reebok all have these questionable contracts. competition is good.

This will be a case to watch.

Or maybe Backbreaker with NFL teams

Competition is good.

It's only natural that organized sports oppose competition.

Competition is not necessarily good in the world of professional sports. That's why these leagues are given anti-trust exemptions in the first place, because there's too great a risk of dilution of talent, resulting in poor performances and decreased experience for the consumer.

If only games like Mutant League Football were back. Then we wouldn't have these issues of possible negativities happening due to licensing.

aritokrat,

You're repeating the lies that the major sports leagues want everyone to believe. There's little evidence that sports leagues need broad antitrust protection, which is backed up by the fact that MLB is the only league to have such protection. Football has grown into the multibillion dollar powerhouse it is without such antitrust exemptions.

The right argument is that if you need antitrust exemptions to exist, then your business model is probably weak enough that you don't deserve to exist.

The only thing that these types of antitrust exemptions do is put more money in owners pockets while taking money from fans, coaches, players and other businesses.

So your answer of EA having the exclusive license of the NFL is Mutant League Football? You do realize that Mutant League Football is EA right?

What's really important in all of this is that New Era may be able to make official NFL gear now!

hhhhh so what this means is we can get a football game with only 2 REAL teams on it now?? or all but ONE team??? oh hell

Joystiq should propose to have a team inserted in the game named after them to replace the Lions or something. It would be epically hilarious.

I'd just like to see 2K games back without EA being able to monopolize on everything NFL and ESPN licensed.

Chris D. is right on track here. If the league's teams aren't able to sell their rights as a unit, then you could see some really funny things, like Dallas home games on only ABC, and Saint Louis games only on Telemundo.

More likely I suspect that they'll just rewrite their contracts, all teams will "license" their rights to a single company and that company will license it out, instead of there being an implicit license from the teams to the league, and then various cuts of licensing fees.

It'll turn into a new kind of shell game.

I could see Jerry Jones asking way too much for Cowboys' rights and have things go really strange for some game. While I understand this company wants to be able to make hats, it's not like it's their right to do it.

Maybe i'm totally off my rocker here, but I thought EA had the deal with the NFLPA (similar to with MLBPA), not with the NFL itself. NFLPA is a union and not subject to anti-trust law in this manner.

The deal was made with the NFL in whole. Not just the NFLPA.

The deal was with the NFL, which is why All Pro Football was able to use NFLPA players. However, even if this opens up the licensing we might end up with the real teams, but still not the real players, as their images are licensed separately.

I think the most important part of this ruling may actually be the end to DirecTV's exclusive deal for NFL Sunday Ticket. It's actually been on the plate of quite a few congresspeople for a while.

This has more potential to be bad then good. As if the ruling goes the wrong way in the lower courts, it could mean to make a NFL football game you have to pay each team what they feel there team is worth.

Then on top of that, you'd probably have to contract all the players separately as well. Instead of the oh this is great for sports video games, this could make it much more worse, or even increase the price if for a fully licensed video game with real teams, real players, etc.

Ridding NFL videogames of Madden's monopoly would be a HUGE leap forward for the license on the medium. No more incremental or cosmetic changes from year to year; we'd once again have competition driving genuine product improvement and innovation every year.

Heck yeah, I'm for that. After the "online code" fracas EA started last week, I feel it couldn't happen to a better company. Now they'll actually be forced to WORK some to get gamers' money; it'll be pretty easy for another developer to undersell EA's microtransaction-happy NFL game with one that actually has all that stuff right on the disc from day one.

It sounds good at first, but there are lots of potential problems. Enjoy playing AFC2K12 and Madden NFC '12. There are all kinds of potential dilution problems with this ruling, and most of them negatively affect the consumer more than anything else.

Now that the NFL is no longer ruled a single entity, but 32 separate entities, would their exclusive contract with EC be considered collusion, and therefore void?

*EA

Hmm..... I usually suck at football games, I played the demo, and maybe I'll get used to it. I'll keep playing it and maybe sell my BFBC2 game for it, its been collecting dust ever since that damn Red Dead Redemption and Halo: Reach BETA. I hope that nets me a good $30..............

Whoops, must have put this in the wrong article, this is meant for the Backbreaker article, please down vote it for it is a mockery!

NFL 2k12!!!!!!!!!!!!!!!!

If they act like a trust, they should be considered one. It's all the same thing. Under this understanding, the teams freely compete with one another as business entities, which is only partially the case, as they exist in a bounded, codified environment.

I can't see much changing unless EA now goes after 2KSports MLB deal which I really hope happens. Funny thing EA made the better baseball game and 2KSports had the better football game until all these exclusive deals were created.

GOD I hope they do. Madden has been the same stagnant crap just slapped in marginally shinier packaging for years.

Don't get too excited. Since there is a player's union, competing football games are no better off. The hat company is just making hats with logos, but 2K would need to use player names and likenesses. The players have the rights to refuse to allow this, and since they are in a union, would be required to. So we are still out of luck.

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Supreme Court ruling states NFL teams are separate entities

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