Supreme Court takes antitrust case over NFL apparel licensing

Supreme Court takes antitrust case over NFL apparel licensing - NFL - CBSSports.com Football

WASHINGTON -- The Supreme Court agreed Monday to decide whether the National Football League and its 32 teams can enter an exclusive licensing deal with a maker of team jerseys and other gear without violating federal antitrust law.

The court said it will hear an appeal from American Needle Inc., of Buffalo Grove, Ill., that challenges an agreement the NFL struck with Reebok International Ltd. American Needle had been one of many firms that manufactured NFL headgear until the league granted an exclusive contract to Reebok in 2001.

The NFL won the case in the federal appeals court in Chicago. But it also asked the Supreme Court to hear the case in a quest for a more sweeping decision that could put an end to what the league considers costly, frivolous antitrust lawsuits.

The case concerns whether the league is essentially a "single entity" that can act collectively or 32 distinct businesses that must be careful about running afoul of antitrust laws by working too closely together.

In a statement, NFL spokesman Greg Aiello said the league looked forward to explaining why the court should extend, on a national basis, favorable appeals court rulings on how antitrust laws apply "to the unique structure of a sports league."

Here's my guess what will happen if they are allowed to do this: prices will soar, and sales will fall.

So what's the practicality of having anti-trust in a case like this?

Here's my guess what will happen if they are allowed to do this: prices will soar, and sales will fall.

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Under what basis do you make the analysis? Exclusive deals mean that the sole provider of the NFL brand sportswear can use their lack of competition to increase the price. Look at how EA crushed the competition in such a way using Maden video games. Preventing such deals would mean the competition among sportswear manufacturers would lower the price.

rathi said:

Under what basis do you make the analysis? Exclusive deals mean that the sole provider of the NFL brand sportswear can use their lack of competition to increase the price. Look at how EA crushed the competition in such a way using Maden video games. Preventing such deals would mean the competition among sportswear manufacturers would lower the price.

Click to expand...

They're going to raise the price too much because they will have the monopoly, but sales will slip. Once that happens they will lower prices to more realistic levels to increase their profit margin.