The Baseball Trust: A History of Baseball's Antitrust Exemption

by Stuart Banner

Overview

The impact of antitrust law on sports is in the news all the time, especially when there is labor conflict between players and owners, or when a team wants to move to a new city. And if the majority of Americans have only the vaguest sense of what antitrust law is, most know one thing about it-that baseball is exempt. In The Baseball Trust, legal historian Stuart Banner illuminates the series of court rulings that resulted in one of the most curious features of our legal system-baseball's exemption from antitrust law. A serious baseball fan, Banner provides a thoroughly entertaining history of the game as seen through the prism of an extraordinary series of courtroom battles, ranging from 1890 to the present. The book looks at such pivotal cases as the 1922 Supreme Court case which held that federal antitrust laws did not apply to baseball; the 1972 Flood v. Kuhn decision that declared that baseball is exempt even from state antitrust laws; and several cases from the 1950s, one involving boxing and the other football, that made clear that the exemption is only for baseball, not for sports in general. Banner reveals that for all the well-documented foibles of major league owners, baseball has consistently received and followed antitrust advice from leading lawyers, shrewd legal advice that eventually won for baseball a protected legal status enjoyed by no other industry in America. As Banner tells this fascinating story, he also provides an important reminder of the path-dependent nature of the American legal system. At each step, judges and legislators made decisions that were perfectly sensible when considered one at a time, but that in total yielded an outcome-baseball's exemption from antitrust law-that makes no sense at all.

Product Details

ISBN-13:	9780199974696
Publisher:	Oxford University Press
Publication date:	03/01/2013
Sold by:	Barnes & Noble
Format:	eBook
Pages:	336
File size:	3 MB

About the Author

Stuart Banner is Norman Abrams Professor of Law at the University of California, Los Angeles School of Law. A noted legal historian, he is the author of many books, including most recently American Property: A History of How, Why, and What We Own; Who Owns the Sky? The Struggle to Control Airspace from the Wright Brothers On; and Possessing the Pacific: Land, Settlers, and Indigenous People from Australia to Alaska.

Table of Contents

Introduction 1. The Reserve Clause 2. The Baseball Trust 3. The Supreme Court Steps In 4. The Birth of the Antitrust Exemption 5. Baseball Becomes Unique 6. A Political Football 7. Three Months of State Antitrust Law 8. The Curt Flood Case 9. The End of the Reserve Clause 10. A Shrunken Exemption

Editorial Reviews

…The Baseball Trust…is a valuable corrective to the widely held view that the romance of baseball was the main reason that courts have treated it with special solicitude. Baseball's status was, in fact, the product of happenstance of a sort surprisingly commonplace in the law…Mr. Banner…is…a sure-footed historian and a legal writer of exceptional grace and clarity. His evident love of baseball does not seem to cloud his judgment.

The New York Times - Adam Liptak

"Splendid....[A] valuable corrective to the widely held view that the romance of baseball was the main reason that courts have treated it with special solicitude....Mr. Banner, who teaches law at the University of California, Los Angeles, is himself a sure-footed historian and a legal writer of exceptional grace and clarity."—Adam Liptak, New York Times

"Among the most compelling baseball books this season..."—David Ulin, Los Angeles Times

"Stuart Banner, a law professor and noted legal historian, explores the history that led to baseball's being the only sport exempt from antitrust laws. Through the use of extensive primary materials, Banner leads the reader through the history of the decisions that ultimately led to 'such a weird state of affairs'....The Baseball Trust is a well-researched and entertaining look at how antitrust law has affected the national pastime."—Library Law Journal

"One of the great puzzles of the history of both baseball and anti-trust law is the 'exemption' granted to the baseball industry from anti-trust law. Nearly everyone agrees that the exemption, which is not available to other professional sports, makes very little sense as a matter of law or economics. Stuart Banner demonstrates that the exemption was not intended to serve the usual reason for avoiding anti-trust laws, but rather to preserve baseball's 'reserve clause,' which bound players indefinitely to their clubs and thereby reduced the players' leverage. By following shrewd advice from lawyers, organized baseball was able to convince both the courts and Congress that replacing the reserve clause with free agency would undermine competitive balance. Even though this turned out not to be the case, baseball's anti-trust exemption remains in place. Banner's book will be the place to start in understanding that curious anomaly."—G. Edward White, author of Creating the National Pastime

"In this important study, Banner provides extensive treatment of organized baseball's battle with antitrust regulations....[A] decidedly strong contribution to the literature on organized baseball and the law."—Library Journal

"This is the best single-volume history of baseball's antitrust exemption. Prof. Banner does an excellent job mining primary sources to show how savvy lawyers and baseball officials laid the groundwork for 'baseball's bizarre monopoly.' Banner brings a lawyer's rigor, a historian's discerning eye, and a baseball fan's ear to this very important work of baseball and American legal history. This is a tale that needed to be told."—Brad Snyder, author of A Well-Paid Slave: Curt Flood's Fight for Free Agency in Professional Sports

"Through The Baseball Trust, Banner provides baseball fans, legal scholars, and historians alike with a tremendous source on this highly complex topic."—Journal of Sport History

From the Publisher

In this important study, Banner (law, Univ. of California, Los Angeles) provides extensive treatment of organized baseball’s battle with antitrust regulations. He goes back to 1879—before federal antitrust laws were in place—when baseball’s reserve clause was devised, contractually binding a player to a team for the whole of his career. Banner refutes the long-standing analysis that competitive balance and the safeguarding of capital investments required the reserve clause, but acknowledges that many relatively well-paid players felt ambivalent about the clause. He counters stereotypical notions regarding baseball and antitrust law, including the belief that a 1922 Supreme Court ruling asserted that Congress determined “to exempt baseball from the antitrust laws.” Nevertheless, that 1922 ruling was predicated on an analysis of interstate commerce that soon dissipated. Decades of challenges to the reserve clause followed, culminating in the agreement to allow free agency. As of today, baseball’s antitrust exemption remains battered but intact. ¬
VERDICT Not for casual baseball fans, this is a decidedly strong contribution to the literature on organized baseball and the law. — RCC

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Library Journal

Price fixing, union busting, collusion and criminality--and that's just the beginning of this inside-baseball footnote to baseball history. Banner (Law/UCLA; American Property: A History of How, Why, and What We Own, 2011, etc.) opens by calling professional baseball's almost total exemption from antitrust law "one of the oddest features of our legal system," not least because other sports--to say nothing of other industries--are governed by that body of law. Consider a system whereby a recent college graduate in computer programming would have to work for Microsoft, in a city of Microsoft's choice; the illegal nature of such an enterprise would be immediately evident, even in our age, when corporations rule. Yet, because the Supreme Court, in an opinion written by Oliver Wendell Holmes in 1922, ruled that baseball was exempt from the Sherman Act, "because baseball was not a form of interstate commerce," baseball players can be scooped up and sent wherever the owners deem best. But is not baseball a form of interstate commerce? Of course it is. Banner closely examines the origin of the idea that it is not, which represents yet another triumph of the owners. To call the author's presentation opinionated is to risk understatement--at one point, he writes of Judge Kenesaw Mountain Landis, who delayed one antitrust suit, that pro baseball "was lucky enough to get a judge who put his love of the game above his professional obligations to follow the law"--but it is clear where his sympathies lie: with the players, the fans and the game itself, anywhere, it seems, except with the owners, who are the sole beneficiaries of the exemption. America's game? The legal morass surrounding that exemption is as American as it gets--and, writes Banner, "it shows no signs of weakening." Baseball fans of a legal bent will find this lively study both maddening and illuminating.

Kirkus Reviews