Antitrust & Competition Economics: Sports
Sports leagues raise unique antitrust issues. Although most leagues consist of a collection of separately owned teams, each team is dependent on the others. No team could play even a single game without the cooperation of another team, and the production of a season of sports games, culminating in a championship, requires the joint efforts of all of the teams in the league. As a result, the question arises whether such a league is a single entity or a group of cooperating competitors. Are the league’s rules procompetitive or do they constitute collusive restraints of trade? Such issues have often challenged the courts.
Lawsuits concerning sports leagues often place at least two key economic issues before the court. The first issue is whether, for the purposes of determining the legality of a particular sports league rule, the league should be viewed as a single entity, a joint venture, or as 30 separate competing firms. The second issue is whether sports leagues have monopoly power in any relevant market.
CRA has worked on a growing number of cases involving such sports as professional football, soccer, baseball, basketball, hockey, tennis, and golf. CRA has completed more than a dozen major sports litigation matters; our clients have included leagues, teams, telecommunications companies, and employees.