Garber v. MLB - Writ of Mandamus

5/19/2018 Garber v. MLB - Writ of Mandamus

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14-United States Court of Appeals

for the

Second Circuit

In re: OFFICE OF THE COMMISSIONER OF BASEBALL,

MAJOR LEAGUE BASEBALL ENTERPRISES, INC., MLB ADVANCED MEDIA, L.P.,

MLB ADVANCED MEDIA, INC., ATHLETICS INVESTMENT GROUP LLC, THE

BASEBALL CLUB OF SEATTLE, LLLP, CHICAGO CUBS BASEBALL CLUB, LLC,

CHICAGO WHITE SOX, LTD., COLORADO ROCKIES BASEBALL CLUB, LTD., NEWYORK YANKEES PARTNERSHIP, THE PHILLIES, PITTSBURGH BASEBALL

HOLDINGS, INC. and SAN FRANCISCO BASEBALL ASSOCIATES LLC

PETITION FOR A WRIT OF MANDAMUS RELATING TO DECISION OF

THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT

OF NEW YORK, CASE NO. 12-CV-3704, HONORABLE SHIRA A. SCHEINDLIN

PETITION FOR A WRIT OF MANDAMUS

BRADLEY I.RUSKINJENNIFER R.SCULLION

JORDAN B.LEADER

SHAWN S.LEDINGHAM,JR.

PROSKAUER ROSE LLP

Attorneys for Petitioners Office of the

Commissioner of Baseball, Major League

Baseball Enterprises, Inc., MLB Advanced

Media, L.P., MLB Advanced Media, Inc.,

Athletics Investment Group LLC, The Baseball

Club of Seattle, LLLP, Chicago Cubs Baseball

Club, LLC, Chicago White Sox, Ltd., Colorado

Rockies Baseball Club, Ltd., The Phil lies,

Pittsburgh Baseball Holdings, Inc. and San

Francisco Baseball Associates LLC

Eleven Times Square

New York, New York 10036

(212) 969-3000

JONATHAN D.SCHILLERALAN B.VICKERY

CHRISTOPHER E.DUFFY

BOIES,SCHILLER &FLEXNER LLPAttorneys for Petitioner New York

Yankees Partnership

575 Lexington AvenueNew York, New York 10022

(212)446-2300

Case 14-4233, Document 1-2, 11/12/2014, 1368465, Page 1 of 96


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CORPORATE DISCLOSURE STATEMENT

Pursuant to Rule 26.1 of the Federal Rules of Appellate Procedure,

Petitioners the Office of the Commissioner of Baseball; Major League Baseball

Enterprises, Inc.; MLB Advanced Media, L.P.; MLB Advanced Media, Inc.;

Athletics Investment Group LLC; The Baseball Club of Seattle, LLLP; Chicago

Cubs Baseball Club, LLC; Chicago White Sox, Ltd.; Colorado Rockies Baseball

Club, Ltd.; New York Yankees Partnership; The Phillies; Pittsburgh Baseball

Holdings, Inc.; and San Francisco Baseball Associates LLC make the following

disclosures:

The Office of the Commissioner of Baseball d/b/a Major League

Baseball is an unincorporated association and, as such, has no

corporate parent. There is no publicly held corporation that owns

10% or more of the Office of the Commissioner of Baseball.

Major League Baseball Enterprises, Inc. (MLBE) is a New York

corporation. It has no corporate parent and there is no publicly held

corporation that owns 10% or more of MLBE.

MLB Advanced Media, L.P. (MLBAM) is a limited partnership

organized under the laws of the State of Delaware. It has no corporate

parent and there is no publicly held corporation that owns 10% or

more of MLBAM.



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MLB Advanced Media, Inc. is a Delaware corporation. It has no

corporate parent and there is no publicly held corporation that owns

10% or more of MLB Advanced Media, Inc.

Athletics Investment Group LLC d/b/a Oakland Athletics Baseball

Club is a California limited liability company. Athletics Investment

Group LLC is wholly owned by Athletics Holdings LLC, which is a

Delaware limited liability company. There is no publicly held

corporation that owns 10% or more of Athletics Investment Group

LLC or Athletics Holdings LLC.

The Baseball Club of Seattle, LLLP is a limited liability limited

partnership organized under the laws of the State of Washington. The

Baseball Club of Seattle, LLLPs corporate parent is Nintendo of

America, Inc. Nintendo of America, Inc. is a wholly owned

subsidiary of publicly held Nintendo Co. Ltd.

Chicago Cubs Baseball Club, LLC is a Delaware limited liability

company. It is wholly owned by Chicago Baseball Holdings, LLC

(CBH), which is a Delaware limited liability company. There is no

publicly held corporation that owns 10% or more of Chicago Cubs

Baseball Club, LLC or CBH.



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Chicago White Sox, Ltd. is an Illinois limited partnership. It has no

corporate parent and there is no publicly held corporation that owns

10% or more of Chicago White Sox, Ltd.

Colorado Rockies Baseball Club, Ltd. is a Colorado limited

partnership. It has no corporate parent and there is no publicly held

corporation that owns 10% or more of Colorado Rockies Baseball

Club, Ltd.

New York Yankees Partnership is a limited partnership formed under

the laws of Ohio. It has a parent entity named YGE Holdings, LLC, a

Delaware limited liability company that is not publicly held. No

publicly held corporation owns 10% or more of the membership

interests in New York Yankees Partnership.

The Phillies is a limited partnership organized under the laws of the

Commonwealth of Pennsylvania. It has no corporate parent and there

is no publicly held corporation that owns 10% or more of The Phillies.

Pittsburgh Baseball Holdings, Inc. is a Pennsylvania corporation. It

has no corporate parent and there is no publicly held corporation that

owns 10% or more of Pittsburgh Baseball Holdings Inc.



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San Francisco Baseball Associates, LLC is a Delaware limited

liability company. There is no publicly held corporation that owns

10% or more of San Francisco Baseball Associates LLC.

Dated: November 12, 2014 PROSKAUER ROSE LLP

By: s/ Bradley I. Ruskin

Bradley I. Ruskin

Jennifer R. Scullion

Jordan B. LeaderShawn S. Ledingham, Jr.





Athletics Investment Group LLC, The Baseball

Club of Seattle, LLLP, Chicago Cubs Baseball

Club, LLC, Chicago White Sox, Ltd., Colorado

Rockies Baseball Club, Ltd., The Phillies,

Pittsburgh Baseball Holdings, Inc., and SanFrancisco Baseball Associates LLC

BOIES, SCHILLER & FLEXNER LLP

By: s/ Jonathan D. Schiller

Jonathan D. Schiller

Alan B. VickeryChristopher E. Duffy

Attorneys for Petitioner New York YankeesPartnership



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TABLE OF CONTENTS

CORPORATE DISCLOSURE STATEMENT .......................................................... i

TABLE OF CONTENTS ........................................................................................... v

TABLE OF AUTHORITIES .................................................................................. vii

INTRODUCTION ..................................................................................................... 1

RELIEF SOUGHT ..................................................................................................... 6

ISSUES PRESENTED ............................................................................................... 7

BACKGROUND ....................................................................................................... 7

I. THE PROFESSIONAL BASEBALL ANTITRUST EXEMPTION .............. 7

II. NATURE OF THE ACTION AND PROCEEDINGS BELOW .................... 9

STANDARD FOR ISSUING THE WRIT .............................................................. 11

REASONS FOR GRANTING THE PETITION ..................................................... 12

I. NO MEANS OTHER THAN A WRIT IS ADEQUATE TO ENSURE

THE MLB DEFENDANTS ARE SPARED THE BURDENS OF

LITIGATION AND TRIAL, AS THE SUPREME COURT INTENDED .. 12

II. THE DISTRICT COURTS ABUSE OF DISCRETION AND

USURPATION OF POWER EACH INDEPENDENTLY PROVIDETHE MLB DEFENDANTS WITH A RIGHT TO MANDAMUS............... 15

A. The District Court Erred in Refusing to Apply the Exemption to

the Business of Baseball ...................................................................... 16

B. Even if the Exemption Applied Only to Certain Aspects of the

Business of Baseball, MLBs Territorial Broadcast Structure IsIncluded ............................................................................................... 18

1. League Territorial Rules and Structure Are Exempt ................ 18

2. The Supreme Court Exempted Territorial Broadcast Rules inToolson and the District Court Erred in Holding Otherwise .... 19



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3. The District Court Erred in Relying on the Sports

Broadcasting Act and Henderson ............................................. 23

a. The Sports Broadcasting Act of 1961 Provides No

Basis for Limiting the Exemption .................................. 23

b. Henderson Actually Supports Application of the

Exemption in this Case ................................................... 26

C. The District Courts Opinion Amounted to a Judicial Usurpation of

Power ................................................................................................... 28

III. A WRIT IS APPROPRIATE TO RELIEVE THE MLB DEFENDANTS

FROM THE DISTRICT COURTS REFUSAL TO APPLY WELL-

SETTLED LAW ............................................................................................ 28

CONCLUSION ........................................................................................................ 30



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TABLE OF AUTHORITIES

Page(s)

FEDERAL CASES

Abelesz v. OTP Bank,

692 F.3d 638 (7th Cir. 2012) .............................................................................. 30

Balintulo v. Daimler AG,

727 F.3d 174 (2d Cir. 2013) ............................................................................... 13

Charles O. Finley & Co. v. Kuhn,

569 F.2d 527 (7th Cir. 1978) .................................................................... 7, 16, 17

Cheney v. United States,542 U.S. 367 (2004) ...................................................................................... 11, 30

City of San Jos v. Office of the Commr of Baseball,

No. 13-cv-02787, 2013 U.S. Dist. LEXIS 147543

(N.D. Cal. Oct. 11, 2013) .......................................................................... 3, 19, 21

Fed. Baseball Club of Balt., Inc. v. Natl League

of Profl Baseball Clubs,

259 U.S. 200 (1922) .............................................................................................. 7

Flood v. Kuhn,

407 U.S. 258 (1972) .....................................................................................passim

Garber v. Office of the Commr of Baseball,

No. 12-cv-3704, 2014 U.S. Dist. LEXIS 133743(S.D.N.Y. Sept. 22, 2014) ............................................................................... 5, 11

Gardella v. Chandler,

172 F.2d 402 (2d Cir. 1949) ........................................................................... 4, 17

Hale v. Brooklyn Baseball Club,No. 1294 (N.D. Tex. 1958) ................................................................................. 27

Henderson Broad. Corp. v. Houston Sports Assn,541 F. Supp. 263 (S.D. Tex. 1982) ............................................................... 26, 27



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In re Armsted Indus.,

No. 369, 1993 U.S. App. LEXIS 13784 (Fed. Cir. May 14, 1993) .................... 13

In re City of New York,

607 F.3d 923 (2d Cir. 2010) ................................................................... 15, 28, 30

In re Roman Catholic Diocese of Albany, N.Y.,

745 F.3d 30 (2d Cir. 2014) ................................................................................. 15

Laumann v. Natl Hockey League,

No. 12-cv-1817 (S.D.N.Y.), 2014 U.S. Dist. LEXIS 109951

(S.D.N.Y. Aug. 4, 2014) ..............................................................................passim

Major League Baseball v. Butterworth,

181 F. Supp. 2d 1316 (N.D. Fla. 2002) ........................................................ 19, 29

Major League Baseball v. Crist,

331 F.3d 1177 (11th Cir. 2003) ...................................................................passim

McCoy v. Major League Baseball,

911 F. Supp. 454 (W.D. Wash. 1995) ................................................................ 19

Miss. Chem. Corp. v. Swift Agric. Chems. Corp.,

717 F.2d 1374 (Fed. Cir. 1983) .................................................................... 13, 14

Morsani v. Major League Baseball,79 F. Supp. 2d 1331 (M.D. Fla. 1999) ................................................................ 19

New Orleans Pelicans Baseball, Inc. v. Natl Assn

of Profl Baseball Leagues, Inc.,

No. 93-253, 1994 U.S. Dist. LEXIS 21468

(E.D. La. Feb. 26, 1994) ................................................................................. 3, 19

Piazza v. Major League Baseball,

831 F. Supp. 420 (E.D. Pa. 1993) ....................................................................... 19

Portland Baseball Club, Inc. v. Baltimore Baseball Club, Inc.,

282 F.2d 680 (9th Cir. 1960) .............................................................................. 16

Portland Baseball Club, Inc. v. Kuhn,

491 F.2d 1101 (9th Cir. 1974) ........................................................................ 3, 16



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Profl Baseball Schools & Clubs, Inc. v. Kuhn,

693 F.2d 1085 (11th Cir. 1982) ................................................................ 3, 18, 29

Radovich v. Natl Football League,

352 U.S. 445 (1957) .....................................................................................passim

Salerno v. Am. League of Profl Baseball Clubs,

310 F. Supp. 729 (S.D.N.Y. 1969) ..................................................................... 29

Salerno v. Am. League of Profl Baseball Clubs,

429 F.2d 1003 (2d Cir. 1970) ......................................................................passim

Toolson v. New York Yankees, Inc.,

101 F. Supp. 93 (S.D. Cal. 1951).................................................................. 21, 29

Toolson v. New York Yankees, Inc.,200 F.2d 198 (9th Cir. 1952) ........................................................................ 22, 29

Toolson v. New York Yankees, Inc.,346 U.S. 356 (1953) .....................................................................................passim

Triple-A Baseball Club Assocs. v. Ne. Baseball, Inc.,

832 F.2d 214 (1st Cir. 1987) ........................................................................... 3, 16

United States v. Intl Boxing Club of N.Y., Inc.,

348 U.S. 236 (1955) .......................................................................................... 6, 8

United States v. Shubert,

348 U.S. 222 (1955) .............................................................................. 6, 8, 16, 22

STATE CASES

Minn. Twins Pship. v. Minnesota,

592 N.W.2d 847 (Minn. 1999) ........................................................................... 13

FEDERAL STATUTES

15 U.S.C. 26b(b)(3)................................................................................................. 9

15 U.S.C. 1291 et seq...................................................................................... 25, 27

15 U.S.C. 1294 ...................................................................................................... 25

28 U.S.C. 1292(b) ............................................................................................. 5, 12



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28 U.S.C. 1651(a) ................................................................................................. 11

OTHER AUTHORITIES

16 Charles A. Wright & Arthur R. Miller, Federal Practice andProcedure, 3935.7 (3d ed. 2014) ...................................................................... 14

Petitioners Brief,

Toolson v. New York Yankees, Inc.,346 U.S. 356, 1953 WL 78316 (1953) ............................................................... 20

Respondents Brief,

Toolson v. New York Yankees, Inc.,

346 U.S. 356, 1953 WL 78318 (1953) ............................................................... 20

Petitioners Reply Brief,Toolson v. New York Yankees, Inc.,

346 U.S. 356, 1953 WL 78319 (1953) ............................................................... 20

Request for Consideration of Supplemental Authority,

City of San Jos v. Office of the Commr of Baseball,

No. 14-15139 (9th Cir. Aug. 11, 2014), ECF No. 40 ........................................... 6



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INTRODUCTION

This Petition arises from a pending antitrust case challenging the internal

rules of Major League Baseball (MLB) about where and how live baseball

games can be shown via telecast. Plaintiffs seek to have rules fundamental to

MLBs structurespecifically the longstanding existence of home television

territoriesdeclared illegal and to hold MLB (and the other Petitioners (together,

the MLB Defendants)) liable for treble damages. Their attack violates the nearly

century-old rule that the business of baseball is immune from the antitrust laws, an

exemption the Supreme Court has reaffirmed six times. So too, the Second

Circuit, like every other Circuit to opine on the exemption, has recognized that

professional baseball is not subject to the antitrust laws. Salerno v. Am. League

of Profl Baseball Clubs, 429 F.2d 1003, 1005 (2d Cir. 1970).

In declaring the business of baseball exempt from antitrust liability, the

Supreme Court also expressly shielded MLB from the burden of defending its

business in antitrust lawsuits just like this one and trials like the one the MLB

Defendants face here. The Supreme Court aptly characterized the exemption as an

umbrella over baseball. Radovich v. Natl Football League, 352 U.S. 445, 450

51 (1957). The refusal of the district court (Scheindlin, J.) to adhere to well-settled

precedent threatens to eviscerate that protective umbrella, forcing the MLB

Defendants to stand trial in order to justify the league structure. An appeal from an



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adverse final judgmentafter the burdens of litigation and trial have been borne

would be too late to protect the MLB Defendants rights to be free from these

burdens. Only a writ from this Court will suffice.

In the face of controlling Supreme Court and Second Circuit law, the district

court should have applied the exemption and entered summary judgment in favor

of Petitioners. In declining to do so, it reached the astonishing conclusion,

contrary to fact and established precedent, that live broadcasts of baseball games

games Americans have watched on television for decadesare a subject that is

not central to the business of baseball. Laumann v. Natl Hockey League,1No.

12-cv-1817, 2014 U.S. Dist. LEXIS 109951, at *37 (S.D.N.Y. Aug. 4, 2014)

(Addendum, Exhibit A).

The district court rested its decision upon several clearly erroneous

interpretations of law and resulting abuses of discretion.

First, the district court ignored the holdings in the Supreme Courts opinions

on the exemption and this Courts holding in Salernothat the business of baseball

is exempt from the antitrust laws. The district courts decision instead to restrict

the exemption to only certain very limited aspects of the business of baseball

1The court below coordinated the challenge against MLB in Garber v. Office of

the Commissioner of Baseball, No. 12-cv-3704 (S.D.N.Y.) with a related (but not

consolidated) lawsuit against the NHL and others entitled Laumann v. National

Hockey League. The district court issued a joint opinion denying summary

judgment in both cases, but captioned the order withLaumannlisted first.



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namely, those that were considered intrastate commerce in the 1950sis flatly at

odds with well-settled law. Neither the Supreme Court nor any Circuit Court of

Appeals has limited the scope of the exemption to any particular facet of the

business of baseball. The district court committed plain error and abused its

discretion in ruling otherwise, because its decision falls outside the range of

permissible decisions on this issue.

Second, the district court disregardedwithout explanationthe consistent

case law from across the country holding that the rules governing MLBs territorial

structure in particular are exempt from antitrust scrutiny.2 MLBs territorial

structure, which governs where clubs can exhibit baseball gamesin person or by

live telecastis central to the business of baseball and has repeatedly been held to

be exempt from antitrust laws. The rules challenged in this case are part of that

territorial structure, which is designed to promote local fan loyalty for the home

team, connect those fans to the team, and promote in-person game attendance, all

of which are essential to the continuing vitality of MLB and its clubs. The district

courts refusal to so hold here is plain error and an abuse of discretion.

2Major League Baseball v. Crist, 331 F.3d 1177 (11th Cir. 2003); Triple-A

Baseball Club Assocs. v. Ne. Baseball, Inc., 832 F.2d 214 (1st Cir. 1987); ProflBaseball Schools & Clubs, Inc. v. Kuhn, 693 F.2d 1085 (11th Cir. 1982); Portland

Baseball Club, Inc. v. Kuhn, 491 F.2d 1101 (9th Cir. 1974); City of San Jos v.

Office of the Commr of Baseball, No. 13-cv-02787, 2013 U.S. Dist. LEXIS

147543 (N.D. Cal. Oct. 11, 2013) (appeal pending); New Orleans Pelicans

Baseball, Inc. v. Natl Assn of Profl Baseball Leagues, Inc., No. 93-253, 1994

U.S. Dist. LEXIS 21468 (E.D. La. Feb. 26, 1994).



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Third, the district court concluded that MLBs broadcasting rules are not

subject to the exemption, despite the Supreme Courts decision in Toolson v. New

York Yankees, Inc., which applied the exemption to shield those very same types of

rules from challenge, and despite this Circuits longtime recognition that live

broadcasting is part of the business of baseball. 346 U.S. 356 (1953); Gardella v.

Chandler, 172 F.2d 402, 40708 (2d Cir. 1949) (Hand, J., concurring). Ignoring

this precedent, the district court reached its decision based on (1) its

misunderstanding that Toolson was a case turning on intrastate commerce, an

interpretation directly at odds with the Supreme Courts later descriptions of

Toolsonand with this Courts description of the case in Salerno; (2) a statute (the

Sports Broadcasting Act) that expressly has no impact on the nonapplicability of

the antitrust laws to the challenged baseball rules; and (3) a district court opinion

not from this Circuit that, even while being critical of the exemption, recognized

that the exemption protects league structure. No authority justifies the district

courts failure to apply the binding precedent of Toolson, Gardella, and many

other decisions.

Reinforcing its error on summary judgment, the district court also refused to

consider the overwhelming authority supporting Petitioners dismissal when it

denied their motion for certification of the order for interlocutory appeal. The

district courtwithout any explanation or analysisopined: I do notbelieve my



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ruling is contrary to existing law. Garber v. Office of the Commr of Baseball,

No. 12-cv-3704, 2014 U.S. Dist. LEXIS 133743, *6 (S.D.N.Y. Sept. 22, 2014)

(emphasis in original) (Addendum, Exhibit B). Moreover, the district court

ignored MLBs argument that it was entitled to an umbrella to protect it from the

irreparable harm it will suffer if this litigation goes forward. Nor did the district

court acknowledge this Courts opinions in Salerno and Gardella, much less

substantively address those issues and whether they warranted certification under

28 U.S.C. 1292. Instead, the district court simply stated that the exemption

issue ha[d] already been decided and decline[d] to reopen it in considering

certification. Id.

The district courts legal error is not a harmless error that can be mended on

appeal. For the exemption to serve as an umbrella over baseballas the

Supreme Court expressly intendedit must be able to protect the business of

baseball from the harassment that would ensue if antitrust litigation and trials

were permitted. Radovich, 352 U.S. at 45051. If MLB is required to expend vast

amounts of time and resources involved in a trial of this case, it will have been

deprived of the benefit of this umbrella protection, which no post-judgment

appeal can correct. Further, MLB may be subjected to the burdens and costs of



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litigating other cases that may be filed based on the district courts order.3 For

these reasons, the Supreme Court has repeatedly held that only Congress may

constrict the scope of the exemption and this issue is settled as far as the Supreme

Court is concerned. 4 Furthermore, the district courts order amounts to a

usurpation of Congressional power. Only a writ of mandamus will provide MLB

with the protection from the burdens of this and other litigation that the district

courts order may encourageburdens from which the Supreme Court hasheld it

must be protected.

RELIEF SOUGHT

Petitioners respectfully request this Court immediately issue a writ of

mandamus directing the United States District Court for the Southern District of

New York to grant summary judgment in Petitioners favor and dismiss them

entirely from the underlying action, based on the exemption from the antitrust laws

that exists for the business of professional baseball as raised in this case.

3For example, only a week after the district court issued its Order, the Order had

already been cited by an appellant in another case challenging internal league rules

and structure. Req. for Consideration of Suppl Authority, City of San Jos v.

Office of the Commr of Baseball, No. 14-15139 (9th Cir. Aug. 11, 2014), ECF No.40 (arguing that Judge Scheindlins opinion in this action supported the reversal of

the Northern District of Californias dismissal of claims challenging territorial

rules on the grounds that they were barred by the baseball exemption).

4See Flood, 407 U.S. at 283, 285;Radovich, 352 U.S. at 451; United States v. Intl

Boxing Club of N.Y., Inc., 348 U.S. 236, 244 (1955); United States v. Shubert, 348U.S. 222, 22930 (1955); Toolson, 346 U.S. at 357.



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ISSUES PRESENTED

Did the district court commit legal error when it ruled that the professional

baseball exemption from the antitrust laws did not bar Plaintiffs antitrust

challenge to MLBs territorial broadcast rules and structure and allowed the action

to continue?

BACKGROUND

I. THE PROFESSIONAL BASEBALL ANTITRUST EXEMPTION

In 1922, the Supreme Court held that the Clayton and Sherman Acts do not

apply to the business of baseball. Fed. Baseball Club of Balt., Inc. v. Natl League

of Profl Baseball Clubs, 259 U.S. 200 (1922). Justice Oliver Wendell Holmes,

writing for a unanimous Court, concluded baseball was not interstate commerce

and therefore was not regulated by the Sherman Act. Id. at 20809. While the

Supreme Courts Commerce Clause analysis has changed over the last 92 years,

the scope of the antitrust exemption has not. The Supreme Court has consistently

reaffirmed that the business of baseball, including as raised in this case, is

beyond the scope of antitrust regulation. As the Seventh Circuit correctly noted,

the Supreme Court has held three times that the business of baseball is exempt

from the federal antitrust laws.5 Charles O. Finley & Co. v. Kuhn, 569 F.2d 527,

5 Moreover, in three additional decisions the Supreme Court has reaffirmed the

vitality and benefits of the baseball exemption while declining to extend it to other



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541 (7th Cir. 1978). And each time, it is clear, the Supreme Court intended to

exempt the business of baseball, not any particular facet of that business, from the

federal antitrust laws. Id. The increasing importance of live game broadcasts to

the business of baseball over the decades has not affected the Supreme Courts

view of the exemption. See Flood v. Kuhn, 407 U.S. 258, 283 (1972) (The advent

of radio and television, with their consequent increased coverage and additional

revenues, has not occasioned an overruling of Federal Baseballand Toolson.).

The current basis for the exemption is equally clear. The Supreme Court has

repeatedly reaffirmed baseballs antitrust exemption based on stare decisis,

baseballs reliance interests, and the Courts express direction to Congress on this

subject. See Flood, 407 U.S. at 285; Toolson, 346 U.S. at 357; see also supra note

5. It has not rested on the distinction between interstate and intrastate commerce

since the Supreme Courts 1953 Toolsondecision, in which the High Court held

Congress had no intention to bring baseball within the anti-trust laws. Salerno,

429 F.2d at 1005 (citing Toolson, 346 U.S. 356).

During this time, the Supreme Court also has consistently held that the

matter is resolved as far as the courts are concerned, and concluded that, if the

exemption is to be altered or curtailed, it must be addressed by Congress and not

the courts. See supra note 4. In 1972, the Supreme Court recognized that

industries. See Radovich, 352 U.S. at 45152; Intl Boxing, 348 U.S. at 24142;

Shubert, 348 U.S. at 230.



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Congresss deliberate decision not to repeal the exemption amounted to

something other than mere congressional silence and passivity, and instead

constituted positive inaction, reflecting that Congress had no intention of

including the business of baseball within the scope of the federal antitrust laws.

Flood, 407 U.S. at 283 (quoting Toolson, 346 U.S. at 357). Congresss only action

on the exemption since receiving this charge from the Supreme Court was to enact

the Curt Flood Act in 1998 (the Flood Act). The Flood Act repealed the

exemption only for disputes relating to employment of Major League Baseball

players, while making clear that the statute does not apply the antitrust laws to

any other aspect of the business of baseball, including most notably for present

purposes, the marketing or sales of the entertainment product of organized

professional baseball and the licensing of intellectual property rights. 15 U.S.C.

26b(b)(3). Thus, Congress intended to leave the exemption intact for the precise

conduct challenged in this litigation.

II. NATURE OF THE ACTION AND PROCEEDINGS BELOW

The core business of professional baseball is exhibiting baseball games to

fans across the country. The most common way baseball fans see games is through

live video distribution. Pursuant to its longstanding territorial broadcast rules,

MLB collectively makes games available in the national market, while its clubs

can license games locally in their respective home television territories. MLB



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distributes games nationally through multiple over-the-air and cable networks and

its own recently-created national network (MLB Network). In addition, MLB has

created two national out-of-market pay packages for avid fans and those who

reside outside of the home television territories of their chosen clubthe Extra

Innings package (which is available through cable, satellite, and telco distributors)

and the MLB.TV package (which is available via the Internet), through which fans

can purchase a package of all games outside of their market. As a result, today

virtually every one of the nearly 2,500 MLB games played each year is made

available live to virtually every consumer across America.

In this case, putative consumer classes consisting of certain present or past

purchasers of the out-of-market packages have brought an antitrust action against

MLB and certain affiliated entities and baseball clubs, as well as certain of the

regional networks that telecast MLB games and certain cable and satellite services

that distribute those networks and the Extra Innings package.6 Plaintiffs challenge

MLBs territorial broadcast rules and seek to eliminate its home television

territories. In their place, Plaintiffs wish to impose a dramatically new league

structure on MLB in which each club competes with the joint venture that is Major

6 Petitioners are the Office of the Commissioner of Baseball (doing business as

Major League Baseball), Major League Baseball Enterprises, Inc., MLB Advanced

Media, L.P., MLB Advanced Media, Inc. and the nine MLB clubs sued in this

case. MLB is an unincorporated association of 30 clubs, which collectively enact

certain rules governing baseball at the Major League level.



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League Baseball and with each of its fellow member clubs throughout the country

in the sale of live game telecast rights.

On May 19, 2014, the MLB Defendants moved for summary judgment on

multiple grounds, including that Plaintiffs claims were barred as a matter of law

by the professional baseball exemption. After declining to grant the defendants

request for oral argument, the district court denied the MLB Defendants motion

for summary judgment on August 4, 2014 (the Order) and subsequently declined

to certify its ruling with respect to the exemption for interlocutory appeal.

Laumann, 2014 U.S. Dist. LEXIS 109951 (denying summary judgment); Garber,

2014 U.S. Dist. LEXIS 133743 (denying certification). This Petition followed.

STANDARD FOR ISSUING THE WRIT

Under the All Writs Act, Circuit Courts may issue all writs necessary or

appropriate in aid of their respective jurisdictions and agreeable to the usages and

principles of law. 28 U.S.C. 1651(a). The Supreme Court has set forth three

requirements for the issuance of a writ of mandamus: (1) the petitioner must have

no other adequate means to attain the relief sought; (2) the petitioner must have a

clear and indisputable right to issuance of the writ; and (3) the Circuit Court

must be satisfied that the writ is appropriate under the circumstances. Cheney v.

United States, 542 U.S. 367, 38081 (2004). Each of these requirements is

satisfied here.



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12

REASONS FOR GRANTING THE PETITION

I. NO MEANS OTHER THAN A WRIT IS ADEQUATE TO ENSURE

THE MLB DEFENDANTS ARE SPARED THE BURDENS OF

LITIGATION AND TRIAL, AS THE SUPREME COURT INTENDED

A writ of mandamus is appropriate in this instance because no other

mechanism is available to protect the MLB Defendants from the burdens of

litigation and trial that would result from the district courts refusal to apply the

well-settled baseball antitrust exemption. The business of baseball has evolved

based on the rule exempting it from such litigation, and undercutting the exemption

now would undermine years of business decisions central to the sport. While the

Courts power under the All Writs Act is to be used sparingly, this matter involves

an extraordinary situation, in which the district court misinterpreted binding

precedent in a manner that is patently at odds with both Supreme Court and Circuit

precedent, subjecting the MLB Defendants here to the burdens of complex class

litigation, trial, and possible adverse outcome, which the Supreme Court has held

baseball should not bear. Appeal of an adverse final judgment would be

insufficient to prevent the MLB Defendants from bearing those burdens, including

a trial at which they would be required to justify their conduct and possible post-

trial remedies issued by the trial court. The MLB Defendants moved for

certification of the issue pursuant to 28 U.S.C. 1292(b), but the district court

refused to certify the issue. Thus, only mandamus will suffice to protect the MLB



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Defendants here. See Balintulo v. Daimler AG, 727 F.3d 174, 186 (2d Cir. 2013)

(If a district court refuses certification, or certification is not otherwise available,

however, then a party may petition for a writ of mandamus . . . .).

As noted above, the Supreme Court has held that the baseball exemption is

designed not only to shield the industry from antitrust liability, but also to protect

the industry from the harassment of litigation attacking the business of baseball.

Radovich, 352 U.S. at 45051. Indeed, the Supreme Court expressly referenced

the flood of litigation that would follow its repudiation as a basis to sustain the

unequivocal line of authority applying the antitrust exemption to baseball. Id. In

analogous situations where state officials have sought to investigate MLB or its

clubs, courts have pointedly recognized that a right to be free from antitrust

investigation is inherent in professional baseballs right to be free from antitrust

liability.7 Where a party has a right not to have to engage in further proceedings,

mandamus may be the only way to protect that right. In re Armsted Indus., No.

369, 1993 U.S. App. LEXIS 13784, *4 (Fed. Cir. May 14, 1993) (quoting Miss.

Chem. Corp. v. Swift Agric. Chems. Corp., 717 F.2d 1374, 1380 (Fed. Cir. 1983)).

InMississippi Chemical, the district court refused to apply binding Supreme Court

precedent that prohibited lawsuits from going forward against alleged patent

7See Crist, 331 F.3d at 1189 (holding state Attorney General could not conduct

antitrust investigation into baseball because exemption precluded antitrust

liability); Minn. Twins Pship. v. Minnesota, 592 N.W.2d 847, 856 (Minn. 1999)

(same).



25/96

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infringers when the patent at issue had been found invalid in another proceeding.

Miss. Chem., 717 F.2d at 137677. The Federal Circuit granted mandamus,

ordering the district judge to grant the alleged infringers motion for summary

judgment.8Id.at 1380. In doing so, the Circuit Court recognized that the Supreme

Court had granted alleged infringers the right . . . not to relitigate the validity of a

patent. Id. Such a right, the Federal Circuit held, is entitled to extraordinary

protection. Id.(quotingLummus Co. v. Commonwealth Oil Ref. Co., 297 F.2d 80

(2d Cir. 1961). Mandamus was appropriate because it was the only way to

protect that right. Miss. Chem., 717 F.2d at 1380.

Here too, the district court refused to recognize the MLB Defendants right

to be free from the burdens of litigation. As inMississippi Chemical, [i]f this case

went to trial before the district court . . . there is no adequate means by which

[Petitioners] could correct the district judges error of failing to apply [the

applicable Supreme Court precedent]. Id. The MLB Defendants will have

already incurred the burdens of trial. Therefore, mandamus is the only available

8 Although mandamus is disfavored as a mechanism to challenge summary

judgment orders that find that a triable question of fact exists, Mississippi

Chemicallike this caseinvolved a pure question of law. Mandamus wastherefore appropriate to reverse the district judges legal error in that case and is

likewise appropriate here. See 16 Charles A. Wright & Arthur R. Miller, Federal

Practice and Procedure, 3935.7 (3d ed. 2014) (Summary-judgment orders . . .

may turn on issues of law that warrant review by mandamus.). Here, the decision

on the MLB Defendants summary judgment motion makes plain that the district

court has decided the exemption issue as a matter of law.



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means to protect the MLB Defendants rightrecognized by the Supreme Court

to be free from those burdens.

II.

THE DISTRICT COURTS ABUSE OF DISCRETION ANDUSURPATION OF POWER EACH INDEPENDENTLY PROVIDE

THE MLB DEFENDANTS WITH A RIGHT TO MANDAMUS

The MLB Defendants have a clear and indisputable right to a writ of

mandamus both because the district court plainly abused its discretion in holding

as a matter of law that MLBs rules governing live televised broadcasts of baseball

games are not exempt from the antitrust laws, and because it transferred to the

courts a decision that the Supreme Court held rests with Congress. See In re City

of New York, 607 F.3d 923, 929 (2d Cir. 2010) (right to mandamus is clear and

indisputable when there is a judicial usurpation of power or a clear abuse of

discretion).

For purposes of mandamus, a district court abuses its discretion if it (1)

bases its ruling on an erroneous view of the law or on a clearly erroneous

assessment of the evidence or (2) renders a decision that cannot be located within

the range of permissible decisions. In re Roman Catholic Diocese of Albany,

N.Y., 745 F.3d 30, 37 (2d Cir. 2014). In this case, the district court based its Order

on an erroneous view of the legal basis of the exemption and rendered a decision

that is contrary to the established body of law on the exemption.

The district court improperly failed to apply the exemption to the business of



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16

baseball at issue here. Here, its error is magnified because this case involves an

aspect of the business of baseball that repeatedly has been found to fall within the

exemptionnamely, MLBs internal rules governing territory and its structure. As

shown below, the Supreme Court itselfat least implicitlyheld the exemption

covered the very type of rules challenged here in dismissing the complaint in

Toolson.

Additionally, the Supreme Court has made it abundantly clear its decisions

are settled andonly Congress may narrow the exemption, if it is to be narrowed at

all. See, e.g., Shubert, 348 U.S. at 230. The district courts attempt to limit the

exemption here amounts to a judicial usurpation of power, further evidencing the

MLB Defendants clear and indisputable right to mandamus.

A. The District Court Erred in Refusing to Apply the Exemption to

the Business of Baseball

The Supreme Court and all Circuit Court cases have consistently held that

the exemption covers the business of baseball.9 This Court has followed suit,

succinctly stating in Salerno that professional baseball is not subject to the

antitrust laws. 429 F.2d at 1005. The Seventh Circuit has stated broadly, the

Supreme Court intended to exempt the business of baseball, not any particular

9See, e.g., Flood, 407 U.S. at 28485; Radovich, 352 U.S. at 452; Toolson, 346

U.S. at 357; Crist, 331 F.3d at 1181 n.10; Triple-A Baseball, 832 F.2d at 216 n.1;

Charles O. Finley & Co., 569 F.2d at 541; Portland Baseball Club, 491 F.2d at

1103; Salerno, 429 F.2d at 1005; Portland Baseball Club, Inc. v. Baltimore

Baseball Club, Inc., 282 F.2d 680, 680 (9th Cir. 1960).



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facet of that business, from the federal antitrust laws. Charles O. Finley & Co.,

569 F.2d at 541. To grant this Petition, this Court need not explore or determine

the outer limits of the exemption; it need only recognize the continued viability of

existing precedent holding that the specific claims at issue in this case indisputably

are limited to mattersterritories and live game telecaststhat are squarely part of

the business of baseball and covered by the baseball exemption to the antitrust

laws.

The district court erroneously held that MLBs territorial broadcast rules

that is, the rules that govern where and how live baseball games are provided to the

viewing publicwere not central enough to baseballs business to fall within the

exemption. Laumann, 2014 U.S. Dist. LEXIS 109951 at *37. And it did so

without even referencinglet alone distinguishingJudge Learned Hands

recognition, even as early as 1949, that the broadcasting of games of MLB clubs

was part of the business [of baseball] itself.10

Gardella, 172 F.2d at 40708

(Hand, J., concurring). Because the live broadcasts of baseball games at issue here

10In Gardella, this Court considered whether the increasingly central role interstate

broadcasting of games played in the business of baseball undermined the

exemption, becauseat that time, pre-Toolsonthe exemption was premised onan understanding that baseball was not interstate commerce. 172 F.2d at 40708

(Hand, J., concurring). The key observation in Gardella that remains true after

Toolson reaffirmed the exemption on grounds other than baseballs intrastate

natureand, indeed, has only become more valid in the 65 years since Judge Hand

recognized itis that the broadcasting of MLB games is not merely incident[al]

to the business of baseball, but is a part of the business itself. Id.



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are clearly a part of the business of baseballas they have been for decadesthe

district courts refusal to apply the exemption to the rules governing game

broadcasts was clearly in error, warranting mandamus.

B. Even if the Exemption Applied Only to Certain Aspects of the

Business of Baseball, MLBs Territorial Broadcast Structure Is

Included

Whatever analytical construct a court may apply to the issue of the

exemption, it is beyond dispute that MLBs territorial broadcast structure and rules

are part of the core business of baseball and thus are exempt from the antitrust

laws.

1. League Territorial Rules and Structure Are Exempt

The Supreme Court and lower federal courts have already spoken to the

precise issue presented by this case. League territorial rules adopted by MLB and

the clubsand specifically league broadcast territoriesare exempt. 11 MLBs

territorial structurewhich, among other things, fosters fan loyalty for the home

team by governing where games are played and broadcastis central to the

business of baseball. SeeProfl Baseball Schools & Clubs, Inc. v. Kuhn, 693 F.2d

1085, 108586 (11th Cir. 1982) (rules governing club location are an integral part

of the business of baseball and exempt from antitrust laws). Almost every court

to review whether the exemption applies to league rules governing league

11See supra note 2.



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territorial structure has recognized that those rules are exempt. As one district

court observed:

The defendants are in the business of baseball. Their businessis a legally sanctioned monopoly. One of the central features ofthat monopoly is the power to decide who can play where.

New Orleans Pelicans, 1994 U.S. Dist. LEXIS 21468 at *27. The district courts

decision is one of only two post-Toolson federal decisions to decline to apply the

exemption to MLB rules, territory, or structure.12

It is simply bad law and must be

reversed.

2. The Supreme Court Exempted Territorial Broadcast Rules

in Toolsonand the District Court Erred in Holding

Otherwise

The district courts refusal to apply the exemption to MLBs broadcasting

territories is clear error because the territorial rules challenged here are the

equivalent of the rules challenged by the plaintiffand ultimately exempted by the

Supreme Courtin Toolson. George Toolson framed his appeal with one

comprehensive question to the Supreme Court: Are the activities and

12The only other such case is the Eastern District of Pennsylvanias decision in

Piazza v. Major League Baseball, 831 F. Supp. 420 (E.D. Pa. 1993). That decision

predated the Flood Act, and indeed it (and a few Florida state court cases relying

on it) have been widely criticized by every other federal court to address it. See,e.g., Crist, 331 F.3d at 1181 n.10; San Jos, 2013 U.S. Dist. LEXIS 147543 at

*3334 (appeal pending);Major League Baseball v. Butterworth, 181 F. Supp. 2d

1316, 132331 (N.D. Fla. 2002); Morsani v. Major League Baseball, 79 F. Supp.

2d 1331, 1335 n.12 (M.D. Fla. 1999); McCoy v. Major League Baseball, 911 F.

Supp. 454, 457 (W.D. Wash. 1995);New Orleans Pelicans, 1994 U.S. Dist. LEXIS

21468 at *25.



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organization of professional baseball, as set forth in petitioner[]s complaint,

subject to the Federal Anti-Trust Laws? Pet. Reply Br., Toolson v. New York

Yankees, Inc., 346 U.S. 356, 1953 WL 78319, *1 (Oct. 13, 1953). Chief among the

challenged activities and organization were the league territorial broadcast rules,

which Mr. Toolson described as integral to his antitrust challenge. Id.at *23.

Mr. Toolson complained to the Supreme Court:

Defendants have further agreed that each Major League Club

may broadcast or telecast its games from a station in its home

territory; that no Major League club shall authorize a broadcastor telecast of any of its games from a station outside its home

territory and within the home territory of any other baseball

club, without the consent of such other clubs

Pet. Br., Toolson v. New York Yankees, Inc., 346 U.S. 356, 1953 WL 78316, *6, 8

9 (Sept. 16, 1953); see also Resp. Br., Toolson v. New York Yankees, Inc., 346 U.S.

356, 1953 WL 78318, *45 (Oct. 2, 1953).

Although the Supreme Courts opinion in Toolson is short, it necessarily

concluded that allof the alleged antitrust violations in that caseincluding those

relating to television broadcasting and exclusive broadcast territorieswere

subject to the exemption. 346 U.S. at 357. In affirming the dismissal of the entire

case, the Supreme Court stated that Congress had no intention of including the

business of baseball within the scope of the federal antitrust laws. Although the

Supreme Court did not mention any particular aspect of the business of baseball in

affirming the exemption, the context above makes clear it necessarily dismissed



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Toolsons challenge to all of the specific activities of the business of baseball

alleged in his complaint and set forth in his petition to the Supreme Court, which

expressly attacked baseballs exclusive broadcast territories. Cf. City of San Jos

v. Office of the Commr of Baseball, 2013 U.S. Dist. LEXIS 147543, *19 n.10, *24

n.12, *33 (N.D. Cal. Oct. 11, 2013) (applying exemption to the rules governing

club relocation in part because of the Supreme Courts application of the

exemption to territorial broadcasting rules in Toolson) (appeal pending). There is

no dispute that, after the Supreme Court ruled in Toolson, nothing remained for

trialnot even the allegations of anticompetitive broadcast territories.

Nonetheless, the district court improperly refused to apply Toolson here

because it read that case as turning on whether baseball was intrastate in nature and

simply disregarded the specific activities challenged by Toolson that were held by

the Supreme Court to be covered by the exemption.13 Laumann, 2014 U.S. Dist.

13The district court also discounted Toolsons holding because none of the

published opinions in the Toolsoncasesat the district, circuit, or Supreme Courtlevelseven mentioned the territorial broadcasting allegations. Laumann, 2014

U.S. Dist. LEXIS 109951 at *31. Although the district court in Toolson clearly

recognized that the complaint challenged the structure of Organized Baseball,

the regulations which govern that structure, and the central role that baseballbroadcasting plays in the business of baseball, it is true that it did not recite allof

the complaints allegations in the opinions brief recitation of the facts. Toolson v.

New York Yankees, Inc., 101 F. Supp. 93, 9394 (S.D. Cal. 1951). Of course, the

district courts brevity in describing the allegations has no impact on the result of

that casedismissal of the entire action for lack of subject matter jurisdiction. Id.at 95. Nor does the fact that neither the Supreme Court nor the Ninth Circuit

mentioned in its brief one-paragraph opinion any of the allegations in the



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LEXIS 109951 at *31. Because television broadcasting is an interstate industry

by nature, the district court reasoned, it could not fall within the holding of

Toolson. Id. This reading of Toolson is not only wrong from the face of the

Supreme Courts opinion and the facts of that case, it also contradicts this Courts

and the Supreme Courts subsequent interpretations of Toolson.

In reaffirming Federal Baseball, the Supreme Court in Toolson did not

double down on the intrastate commerce rationale for the exemption, but rather

held that Congress had no intention of including the business of baseball within

the scope of the federal antitrust laws. Toolson, 346 U.S. at 357. In following

years, the Supreme Court reiterated this shift in basis for the exemption, observing

that Toolsonwas premised on Congressional intent, stare decisis, the burdens of

litigation, and reliancenot on the intrastate nature of baseball. Radovich, 522

U.S. at 45052.14 Circuit Courts of Appeals, including this Court, have explicitly

rejected the intrastate reading of Toolson adopted by the district court here,

observing that the ground upon which Toolsonrested was that Congress had no

intention to bring baseball within the anti-trust laws, not that baseballs activities

complaint undermine the ultimate result in Toolsonaffirmance of the cases

dismissal because the business of baseball is exempt. Toolson, 346 U.S. at 35657; Toolson v. New York Yankees, Inc., 200 F.2d 198, 199 (9th Cir. 1952).14See also Shubert, 348 U.S. at 230 (observing that Supreme Court in Toolsondid

not reaffirm exemption on basis of all that was said in Federal Baseball, but

rather on bases of Congressional intent and stare decisis).



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did not sufficiently affect interstate commerce. Salerno, 429 F.2d at 1005; see

also Crist, 331 F.3d at 1188 n.25 (In [Toolson], the Court retreated from its

cramped view of interstate commerce and instead rested its decision on what it

perceived as congressional intent.). The district court plainly erred in relying on

its interstate commerce interpretation of Toolsonas a basis for rejecting both the

actual holding of that case (the business of baseball is exempt) and the effect of

that case (dismissal of allegations challenging MLBs territorial broadcast rules).

3.

The District Court Erred in Relying on the Sports

Broadcasting Act and Henderson

Rejecting Toolsonand this Circuits interpretation of Toolson, as well as the

body of cases applying the exemption to league territory and structure, the district

court based its conclusion on a 1961 statute and a 1982 opinion by a Texas district

judge. Neither of these authorities justifies ignoring binding Supreme Court and

Circuit Court precedent. And both are also completely inapplicable.

a. The Sports Broadcasting Act of 1961 Provides No

Basis for Limiting the Exemption

The district court abused its discretion when it held that Congress intended

the Sports Broadcasting Act of 1961 (the SBA) to limit the baseball exemption.

Misconstruing the relevance of Congressional intent as a basis for the exemption,

the district court turned to a narrow statutory antitrust exemption for several sports

industriesthe SBAto construe the scope of the judicially created baseball



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24

exemption. Because it believed the statutory exemption does not exempt the

broadcast rules at issue in this case, the district court concluded Congress intended

those rules to be subject to the antitrust laws. Laumann, 2014 U.S. Dist. LEXIS

109951 at *32.

The Supreme Court has repeatedly asked only one question in evaluating

Congresss intent vis--vis the exemption: Has Congress repealed the exemption?

In Toolson, the Supreme Court recognized that Congress has had the [Federal

Baseball] ruling under consideration but has not seen fit to bring such business

under [the antitrust] laws. Toolson, 346 U.S. at 357. It therefore concluded that

Congress did not intend baseball to be subject to antitrust laws. Id. In

subsequently reaffirming the exemption inRadovichand Flood, the Supreme Court

made the same observationbecause Congress had not repealed the exemption,

the exemption remained in full force.15 Floods statement that Congress, by its

positive inaction, has allowed [Federal Baseball and Toolson] to stand for so long

and, far beyond mere inference and implication, has clearly evinced a desire not to

disapprove them legislatively, is particularly instructive because Flood was

decided over a decade after enactment of the SBA. 407 U.S. at 28384. This

Supreme Court precedent conclusively demonstrates that the district court was

15See Radovich, 352 U.S. at 451 (affirming the Supreme Courts intent to adhere

to Federal Baseball and Toolson, so long as the Congress continues to

acquiesce).



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wrong to conclude that the SBA narrowed the exemption.

Moreover, the SBA would be relevant only if it somehow repealed the

baseball exemption. The statute did nothing of the sort. To the contrary, the SBA

expressly took a hands-off approach to the baseball exemption by stating that the

statute did not affect the applicability or nonapplicabilityof the antitrust laws in

any way other than to provide a narrow statutory exemption.16

15 U.S.C. 1291,

1294 (emphasis added). The SBA merely codified a portion of baseballs

exemption while simultaneously providing that narrow exemption to other sports.

As the Supreme Court observed in Flood, the SBA was expansive rather than

restrictive as to antitrust exemption. 407 U.S. at 28182. Because the SBA did

not repeal or otherwise limit the exemption, it has no bearing on the exemptions

application.17

16It appears the Supreme Court in Floodrecognized this implicit approval of the

exemption by the legislators who drafted the SBA. In quoting the SBA and

describing its expansive effect, the Court emphasized its deference to thenonapplicability of antitrust laws by italicizing that word when it quoted the

statute. Flood, 407 U.S. at 282 n.18.17The district court also gave undue emphasis to the SBA because it believed the

SBA represented Congresss sports antitrust policy at the time that Flood replaced

Federal Baseballs and Toolsons holdings based on interstate commerce with alimited holding based only on stare decisis and inferred congressional intent.

Laumann, 2014 U.S. Dist. LEXIS 109951 at *32. However, as discussed above, it

was in Toolsonnot in Floodthat the Supreme Court first premised the

exemption on Congressional intent. Thus, when Congress enacted the SBA, the

scope of the exemption had already been established and Congress left that scope

intact in the statute. See 15 U.S.C. 1294.



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b. HendersonActually Supports Application of the

Exemption in this Case

The district courts only other basis for refusing to apply the exemption to

MLBs territorial broadcast rules is a 1982 opinion in which the Southern District

of Texas declined to apply the exemption to an antitrust challenge arising out of

the Houston Astros decision to broadcast on one Houston radio station instead of

another. Henderson Broad. Corp. v. Houston Sports Assn, 541 F. Supp. 263, 264,

265 (S.D. Tex. 1982). Regardless of whetherHendersonwas wrongly decided, the

opinion is inapposite, because it did not involve any challenge to league rules or

structure regarding territorial restrictions on telecasts. Id.at 264, 270. Indeed, the

decision not to apply the exemption underscored its understanding that league

structure [was] obviously not implicated in [that] case. Id.at 270. Although the

Southern District of Texas did not hide its disapproval of the exemption, it

recognized that rules governing league structure are exempt. Id.at 269.

Unlike in Henderson, league structure is clearly at the core of Plaintiffs

lawsuit. Plaintiffs challenge longstanding league-wide rules governing broadcast

territories. AsHendersonitself observed, without league broadcast rules, weaker

teams may be denied television income and game coverage, putting the league in

danger that the structure of the league would become impaired and its continued



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operations imperiled. Id. at 26970 (quoting S. Rep. No. 87-1087 (1961)).18

The

district courts reliance on Henderson to allow an antitrust challenge to league

structure of broadcast territories is clearly unwarranted.19

The district court refused to apply the binding precedent of this Court and

the Supreme Courtas well as the extremely persuasive opinions of every other

Circuit Court to opine on the exemptionin refusing to apply the exemption to the

business of baseball, generally, or the territorial broadcast structure of baseball,

specifically. It did so based on a misreading of an inapplicable statute and an out-

of-Circuit district court opinion that actually supports the use of the exemption

18 To be sure, the Senate Report quoted in Henderson refers to the statutory

exemption created by the SBA, not the broader judicially created baseball

exemption. See 15 U.S.C. 1291 et seq. However, the court inHendersonappliedthe logic behind these remarks equally to the baseball exemption, as both it and the

SBA protect the league structure from the harm that would result from unfettered

broadcasting of baseball games. Henderson, 541 F. Supp. at 26970.19

Moreover, the district court ignored the only case to explicitly discuss in detail

and apply the exemption to MLBs broadcasting rules on the basis that the opinionwas unpublished and pre-dated the SBA. See Hale v. Brooklyn Baseball Club, Tr.

of Mtn. to Dismiss Hrg, No. 1294 (N.D. Tex. 1958) (Addendum, Exhibit C).

Given the utter irrelevance of the SBA, the district court erred in ignoring the case

on this basis. In Hale, a minor league baseball club challenged the allegedly

monopolistic restraint of radio broadcasting and telecasting of baseball games.

Id. at *23. In language fully applicable here, the court inHaleheld that baseballsbroadcasting rules were exempt both because the broadcasting of baseball games is

integral to the business of baseball, as much a part of the game-day experience as

in-person fan attendance, and because the sale of radio and television

broadcasting rights of baseball games was certainly within the mind and thinking

of every member of the [Supreme] Court when Toolsonaffirmed the exemption.

Id.



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here. Mandamus is appropriate to reverse that error.

C. The District Courts Opinion Amounted to a Judicial Usurpation

of Power

The MLB Defendants also have a clear and indisputable right to a writ of

mandamus because the district court usurped Congresss exclusive power to limit

the scope of the exemption. As detailed above, pages 8 to 9, the Supreme Court

has clearly indicated that if the exemption is to be narrowed in any way, only

Congress may do so. The district court nonetheless took upon itself authority that

even the Supreme Court has eschewed. Mandamus is appropriate to curb this

usurpation of Congressional prerogative. See City of New York, 607 F.3d at 929.

III. A WRIT IS APPROPRIATE TO RELIEVE THE MLB DEFENDANTS

FROM THE DISTRICT COURTS REFUSAL TO APPLY WELL-

SETTLED LAW

Where a district court flagrantly misapplies a well-settled principle of law,

mandamus is appropriate under the circumstances. See City of New York, 607 F.3d

at 940 n.17. There are few principles of law as long settled as the exemption of the

business of baseball from the antitrust laws. The Supreme Court has observed that

the exemption may be an aberration from traditional antitrust law, but:

the aberration is an established one, and one that has been recognizednot only in Federal Baseball and Toolson, but in Shubert,

International Boxing, and Radovich, as well, a total of five

consecutive cases in this Court. It is an aberration that has been withus now for half a century, one heretofore deemed fully entitled to the

benefit of stare decisis, and one that has survived the Court'sexpanding concept of interstate commerce.



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29

Flood, 407 U.S. at 282. Nevertheless, as detailed above, the district court entirely

missed the mark by ignoring binding Supreme Court and Circuit precedent and

relying on irrelevant authority. Mandamus is appropriate to remedy the district

courts misapplication of the now nearly century-old principle that the business of

baseball is exempt from the antitrust laws.

Moreover, mandamus is particularly appropriate here, where the exemption

not only serves as a defense to liability, but also may deprive the courts of subject

matter jurisdiction to try antitrust challenges to the business of baseball. Several

courts, including this one, have either dismissed antitrust challenges to the business

of baseball or affirmed dismissal of such challenges because the antitrust

exemption of the business of baseball [is] so well established that the complaint

was insufficient even to sustain federal jurisdiction. Major League Baseball v.

Butterworth, 181 F. Supp. 2d 1316, 133132 (N.D. Fla. 2002), affd sub nom.

Crist, 331 F.3d 1177; see, e.g., Salerno v. Am. League of Profl Baseball Clubs,

310 F. Supp. 729, 731 (S.D.N.Y. 1969) ([H]aving found that organized baseball

does not fall within the scope of the federal anti-trust laws, this Court lacks

jurisdiction of the subject matter . . . .), affd 429 F.2d 1003 (2d Cir. 1970).20

20See also Profl Baseball Schools & Clubs, 693 F.2d at 1086 (holding district

court properly dismissed the antitrust claims for want of subject matter

jurisdiction); Toolson, 101 F. Supp. 93, 95 (S.D. Cal. 1951) (dismissing action

for want of jurisdiction of the subject matter), affd 200 F.2d 198 (9th Cir. 1952)

and 346 U.S. 356 (1953).



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Courts have given the word jurisdiction in the All Writs Act a generous reading,

and this Court need not conclude that the Order raises a jurisdictional issue in the

traditional sense to find mandamus appropriate. See Cheney, 542 U.S. at 380

(courts have not confined themselves to an arbitrary and technical definition of

jurisdiction in applying the All Writs Act). Nevertheless, mandamus is

particularly appropriate here because [i]ssuance of a writ in this case does what

the writ was intended to doconfine the district court to a lawful exercise of its

prescribed jurisdiction. Abelesz v. OTP Bank, 692 F.3d 638, 653 (7th Cir. 2012).

CONCLUSION

Mandamus serve[s] as a useful safety valve for promptly correcting serious

errors . . . . City of New York, 607 F.3d at 939. For the foregoing reasons,

Petitioners respectfully request the Court issue a writ of mandamus, directing the

district court to grant summary judgment in Petitioners favor and to dismiss them

entirely from the underlying action.

Dated: November 12, 2014 PROSKAUER ROSE LLP

By: s/ Bradley I. Ruskin

Bradley I. Ruskin

Jennifer R. Scullion

Jordan B. LeaderShawn S. Ledingham, Jr.







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Athletics Investment Group, LLC, The

Baseball Club of Seattle, LLLP, Chicago Cubs

Baseball Club, LLC, Chicago White Sox, Ltd.,

Colorado Rockies Baseball Club, Ltd., The

Phillies, Pittsburgh Baseball Holdings, Inc.,and San Francisco Baseball Associates LLC

BOIES, SCHILLER & FLEXNER LLP

By: s/ Jonathan D. Schiller

Jonathan D. Schiller

Alan B. Vickery

Christopher E. Duffy

Attorneys for Petitioner New York YankeesPartnership



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ADDENDUM



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INDEX

Exhibit A. Order Denying Motion for Summary Judgment,

Laumann v. Natl Hockey League, No. 12-cv-1817, 2014

U.S. Dist. LEXIS 109951 (S.D.N.Y. Aug. 4, 2014)

Exhibit B. Order Denying Motion to Certify Order for ImmediateAppeal Pursuant to 28 U.S.C. 1292(b),

Garber v. Office of the Commissioner of Baseball, No.

12-cv-3704, 2014 U.S. Dist. LEXIS 133743 (S.D.N.Y.

Sept. 22, 2014)

Exhibit C. Excerpt from Addendum to Memorandum of Law in

Support of Motion for Summary Judgment,

Garber v. Office of the Commissioner of Baseball, No.

12-cv-3704, (S.D.N.Y. May 27, 2014) (copy ofTranscript of Motion to Dismiss Hearing,Hale v.

Brooklyn Baseball Club, No. 1294 (N.D. Tex. Sept. 19,

1958))



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EXHIBITA



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Page 1

THOMAS LAUMANN, ROBERT SILVER, GARRETT TRAUB, and

DAVID DILLON, representing themselves and all other similarly sit-

uated, Plaintiffs, - against - NATIONAL HOCKEY LEAGUE, et al.,

Defendants. MARC LERNER, DEREK RASMUSSEN, and GAR-

RETT TRAUB, representing themselves and all other similarly situ-

ated, Plaintiffs, - against - OFFICE OF THE COMMISSIONER OF

BASEBALL, et al., Defendants.

12-cv-1817 (SAS),12-cv-3704 (SAS)

UNITED STATES DISTRICT COURT FOR THE SOUTHERN

DISTRICT OF NEW YORK

2014 U.S. Dist. LEXIS 109951; 2014-2 Trade Cas. (CCH) P78,868

August 4, 2014, Decided

August 8, 2014, Filed

PRIOR HISTORY: Laumann v. NHL, 989 F.

Supp. 2d 329, 2013 U.S. Dist. LEXIS 167420(S.D.N.Y., 2013)

COUNSEL: [*1] For Plaintiffs: Edward A.

Diver, Esq., Howard I. Langer, Esq., Peter E.

Leckman, Esq., Langer Grogan & Diver, P.C.,

Philadelphia, Pennsylvania; Kevin M. Costello,

Esq., Gary E. Klein, Esq., Klein Kavanagh

Costello, LLP, Boston, Massachusetts; Michael

Morris Buchman, Esq., John A. Ioannou, Esq.,

Pomerantz Haudek Block Grossman & Gross

LLP, New York, New York; Alex Schmidt,Esq., Mary Jane Fait, Esq., Wolf Haldenstein

Adler Freeman & Herz LLP, New York, New

York; Robert LaRocca, Esq., Kohn, Swift &

Graf, P.C., Philadelphia, Pennsylvania; J.

Douglas Richards, Esq., Jeffrey Dubner, Esq.,

Cohen, Milstein, Sellers & Toll, PLLC, New

York, New York.

For Office of the Commissioner of Baseball,

Major League Baseball Enterprises Inc., MLBAdvanced Media L.P., MLB Advanced Media,

Inc., Athletics Investment Group, LLC, The

Baseball Club of Seattle, L.L.P., Chicago

White Sox, Ltd., Colorado Rockies Baseball

Club, Ltd., The Phillies, Pittsburgh Baseball,

Inc., and San Francisco Baseball Associates,

L.P., Defendants: Bradley I. Ruskin, Esq., Carl

Clyde Forbes, Esq., Helene Debra Jaffe, Esq.,

Jennifer R. Scullion, Esq., Robert Davis

Forbes, Esq., Proskauer Rose LLP, New York,

New York; Thomas J. Ostertag, [*2] Esq.,Senior Vice President and General Counsel,

Office of the Commissioner of Baseball, New

York, New York.

For National Hockey League, NHL Enterprises,

L.P., NHL Interactive Cyberenterprises, LLC,

Chicago Blackhawk Hockey Team, Inc., Com-cast-Spectacor, L.P., Hockey Western New



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2014 U.S. Dist. LEXIS 109951, *; 2014-2 Trade Cas. (CCH) P78,868

York LLC, Lemieux Group, L.P., Lincoln

Hockey LLC, New Jersey Devils LLC, New

York Islanders Hockey Club, L.P. and San Jose

Sharks, LLC, Defendants: Shepard Goldfein,

Esq., James A. Keyte, Esq., Paul M. Eckles,

Esq., Matthew M. Martino, Esq., Skadden,

Arps, Slate, Meagher & Flom LLP, New York,

New York.

For DIRECTV, LLC, DIRECTV Sports Net-

works, LLC, DIRECTV Sports Net Pittsburgh,

LLC a/k/a Root Sports Pittsburgh, DIRECTV

Sports Net Rocky Mountain, LLC a/k/a Root

Sports Rocky Mountain, and DIRECTV Sports

Net Northwest, LLC a/k/a Root Sports North-

west, Defendants: Andrew E. Paris, Esq., JoannM. Wakana, Esq., Louis A. Karasik, Esq., Al-

ston & Bird LLP, Los Angeles, California.

For Comcast Corporation, Comcast SportsNet

Philadelphia, L.P., Comcast SportsNet

Mid-Atlantic L.P., Comcast SportsNet Califor-

nia, LLC, and Comcast SportsNet Chicago,

LLC, Defendants: Arthur J. Burke, Esq., James

W. Haldin, Esq., Davis Polk [*3] & Ward-

well, New York, New York.

For Yankees Entertainment and Sports Net-

works, LLC and New York Yankees Partner-

ship: Jonathan D. Schiller, Esq., Alan Vickery,

Esq., Christopher Duffy, Esq., Boies, Schiller

& Flexner LLP, New York, New York.

For The Madison Square Garden Company and

New York Rangers Hockey Club, Defendants:

Stephen R. Neuwirth, Esq., Richard I. Werder,

Jr., Esq., Ben M. Harrington, Esq., Quinn

Emanuel Urquhart Oliver and Sullivan LLP,New York, New York.

JUDGES: Shira A. Scheindlin, United States

District Judge.

OPINION BY: Shira A. Scheindlin

OPINION

OPINION AND ORDER

SHIRA A. SCHEINDLIN, U.S.D.J.:

I. INTRODUCTION

Plaintiffs bring these putative class actions

against the National Hockey League ("NHL")

and various individual clubs in the league (the

"NHL Defendants"); Major League Baseball

("MLB") and various individual clubs in the

league (the "MLB Defendants") (together the

"League Defendants"); multiple regional sports

networks ("RSNs") that produce and distribute

professional baseball and hockey program-

ming;1 two multichannel video programmingdistributors ("MVPDs" or "distributors"),

Comcast and DIRECTV (together with the

RSNs, the "Television Defendants" or "broad-

casters"); Madison Square Garden [*4] Com-

pany and the New York Rangers Hockey Club

(the "MSG Defendants"); and New York Yan-

kees Partnership and Yankees Entertainment &

Sports Network, LLC ("YES") (together the

"Yankee Defendants"). Plaintiffs allege viola-

tions under Sections 1 and 2 of the Sherman

Antitrust Act (the "Sherman Act").

1 Several defendant RSNs are owned

and controlled by defendant Comcast,

several are owned and controlled by de-

fendant DIRECTV, and two are inde-

pendent of the MVPDs but share owner-

ship with an individual club.

On July 27, 2012, the defendants jointly

moved to dismiss the Complaints in both ac-

tions, Garber v. Office of the Commissioner of

Baseball ("Garber")and Laumann v. NationalHockey League ("Laumann"). In an Opinion

and Order dated December 5, 2012, I granted

the motion in part and denied it in part. 2Plain-

tiffs Fernanda Garber and Peter Herman were

dismissed from both cases, and plaintiff Robert

Silver was dismissed from the Garbercase, for

lack of antitrust standing. Additionally, I dis-

missed plaintiffs' claims under Section 2 of the



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Sherman Act against the Television Defend-

ants.3

2 See Laumann v. National Hockey

League, 907 F. Supp. 2d 465 (S.D.N.Y.

2012).

3 See id. at 492.

On August 19, 2013, [*5] Comcast and its

affiliated RSNs (the "Comcast Defendants")

filed a motion to compel arbitration against

Garrett Traub, Silver, Vincent Birbiglia,

Thomas Laumann, and Derek Rasmussen, and

to stay the claims of David Dillon and Marc

Lerner pending resolution of the arbitration.

Comcast's motion was granted as to Traub,Laumann, and Rasmussen, but denied as to

Silver, Birbiglia, Dillon, and Lerner. The same

day, DIRECTV and its affiliated RSNs (the

"DIRECTV Defendants") filed a motion to

compel arbitration against Lerner. DIRECTV's

motion was denied in full.4

4 See Garber, 989 F. Supp. 2d 329,

Dkt. No. 222;Laumann, 989 F. Supp. 2d

329, Dkt. No. 167.

The Comcast Defendants, the DIRECTVDefendants, the NHL Defendants, and the

MLB Defendants now move for summary

judgment on the remaining claims.5 For the

reasons that follow, all four motions are DE-

NIED in full.

5 The Yankee Defendants and the

MSG Defendants have joined in the other

defendants' motions. See Garber, No. 12

Civ. 3704, Dkt. No. 280 (indicating that

the New York Yankees "refer[] the Courtto the memorandum of law and statement

of material facts filed today by the other

Major League Baseball club defendants

in this action," and that "YES, [*6]

which is a regional sports network

("RSN"), respectfully refers the Court to

the memoranda of law and statements of

material facts filed today by the other

RSN defendants in this action"). See also

Laumann, No. 12 Civ. 1817, Dkt. No.

217 (indicating the MSG Defendants'

joinder in the NHL Defendants' revised

motion for summary judgment).

II. BACKGROUND

NHL is an unincorporated association of

thirty major league professional ice hockey

clubs, nine of which are named as defendants in

Laumann.6MLB is an unincorporated associa-

tion of thirty professional baseball clubs, nine

of which are named as defendants in Garber.7

The clubs within each League are competitors

-- both on the field and in the contest to broad-en their fan bases. However, the clubs must al-

so coordinate in various ways in order to pro-

duce live sporting events, including agreeing

upon the game rules and setting a schedule of

games for the season.8Both leagues divide their

member teams into geographic territories and

assign each team a home television territory

("HTT") for broadcasting purposes.9Neither the

Comcast Defendants nor the DIRECTV De-

fendants played a role in the initial creation of

the Leagues' HTTs.10

6 See NHL Defendants' [*7] Motion

for Summary Judgment ("NHL Mem.")

at 3.

7 SeeMemorandum of Law in Support

of the MLB Defendants' Motion for

Summary Judgment ("MLB Mem.") at 4.

8 See MLB Defendants' Rule 56.1

Statement of Undisputed Material Facts

("MLB 56.1") 4-5. See also NHL

Mem. at 3.

9 See Comcast's Statement of Undis-puted Material Facts Pursuant to Local

Rule 56.1 ("Comcast 56.1") 2; NHL

Mem. at 4-5; MLB 56.1 68.

10 See Comcast 56.1 4; The DI-

RECTV Defendants' Rule 56.1 Statement

of Undisputed Facts ("DIRECTV 56.1")

4.



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The structure of the territorial broadcasting

system is largely uncontested. By League

agreement, each club agrees to license its

games for telecast only within its designated

HTT.11 The clubs then contract with RSNs

through Rights Agreements.12 The Rights

Agreements generally provide each RSN the

exclusive right to produce a club's games and

telecast them in the HTT.13The Agreements do

not permit the RSNs to license telecasts for

broadcast outside the HTTs.14 The Rights

Agreements also require the RSNs to provide

their telecasts to the Leagues without charge for

use in the out-of-market packages ("OOM

packages").15The clubs keep the revenue from

their respective Rights Agreements. [*8]There are significant differences in the eco-

nomic value of the various HTTs.16

11 SeeMLB 56.1 68; NHL Mem. at

5.

12 SeeNHL Mem. at 5; Comcast 56.1

2.

13 MLB 56.1 93; Comcast 56.1 6,

14; DIRECTV 56.1 6; NHL Mem. at 5.

Plaintiffs do not challenge the clubs' right

to grant production and distributionrights for their own games to only one

RSN (hereinafter "content exclusivity").

Such exclusivity is to be distinguished

from the exclusivity established by the

territorial rules, which prevent each RSN

from televising its programming outside

the HTT and protect it from competing

with the programming of other teams'

games within the HTT (hereinafter "ter-

ritorial exclusivity").

14 SeeComcast 56.1 22.15 SeeMLB 56.1 68, 150; Comcast

56.1 18; NHL Mem. at 6.

16 SeeMLB 56.1 25; NHL Mem. at

4.

In order to produce the telecasts of live

games, the RSNs invest in equipment, produc-

tion facil

Garber v. MLB - Writ of Mandamus

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