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Sportswear Manufacturer Prevails in Appeal of Antitrust Case Against NFL

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By FindLaw Staff on May 24, 2010 2:58 PM

American Needle, Inc. v. Nat'l Football League, No. 08-661, involved an an antitrust action challenging the NFL's grant to Reebok of an exclusive license to create apparel incorporating the NFL's intellectual property.  The Supreme Court reversed the Seventh Circuit's affirmance of summary judgment for defendants, holding that the alleged conduct related to licensing of intellectual property constituted concerted action that was not categorically beyond the coverage of Section 1 of the Sherman Act.

As the Court wrote:  ""Every contract, combination in the form of a trust or otherwise, or, conspiracy, in restraint of trade" is made illegal by §1 of the Sherman Act, ch. 647, 26 Stat. 209, as amended, 15 U.S.C. §1. The question whether an arrangement is a contract, combination, or conspiracy is different from and antecedent to the question whether it unreasonably restrains trade. This case raises that antecedent question about the business of the 32 teams in the National Football League (NFL) and a corporate entity that they formed to manage their intellectual property. We conclude that the NFL's licensing activities constitute concerted action that is not categorically beyond the coverage of §1. The legality of that concerted action must be judged under the Rule of Reason."

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