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Baseball on Trial

Baseball on Trial: The Origin of Baseball's Antitrust Exemption

Copyright Date: 2014
Pages: 296
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    Baseball on Trial
    Book Description:

    The controversial 1922 Federal Baseball Supreme Court ruling held that the "business of base ball" was not subject to the Sherman Antitrust Act because it did not constitute interstate commerce. In Baseball on Trial, legal scholar Nathaniel Grow defies conventional wisdom to explain why the unanimous Supreme Court opinion authored by Justice Oliver Wendell Holmes, which gave rise to Major League Baseball's exemption from antitrust law, was correct given the circumstances of the time. Currently a billion dollar enterprise, professional baseball teams crisscross the country while the games are broadcast via radio, television, and internet coast to coast. The sheer scope of this activity would seem to embody the phrase "interstate commerce." Yet baseball is the only professional sport--indeed the sole industry--in the United States that currently benefits from a judicially constructed antitrust immunity. How could this be? Drawing upon recently released documents from the National Baseball Hall of Fame, Grow analyzes how the Supreme Court reached this seemingly peculiar result by tracing the Federal Baseball litigation from its roots in 1914 to its resolution in 1922, in the process uncovering significant new details about the proceedings. Grow observes that while interstate commerce was measured at the time by the exchange of tangible goods, baseball teams in the 1910s merely provided live entertainment to their fans, while radio was a fledgling technology that had little impact on the sport. The book ultimately concludes that, despite the frequent criticism of the opinion, the Supreme Court's decision was consistent with the conditions and legal climate of the early twentieth century.

    eISBN: 978-0-252-09599-3
    Subjects: Law

Table of Contents

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  1. Front Matter
    (pp. i-vi)
  2. Table of Contents
    (pp. vii-viii)
    (pp. ix-xii)
    (pp. 1-4)

    The United States Supreme Court’s 1922 decision inFederal Baseball Club of Baltimore, Inc. v. National League of Professional Baseball Clubsranks among the most frequently criticized opinions in Supreme Court history. In a unanimous ruling authored by Justice Oliver Wendell Holmes Jr., the Court held that the “business of base ball” was not subject to the Sherman Antitrust Act because it did not constitute interstate commerce. Although the Supreme Court has subsequently acknowledged the anomalous nature of this ruling, it has nevertheless affirmedFederal Baseballon two separate occasions, first in 1953 and then again in 1972. As a...

  5. 1 The Rivalry Begins: 1913
    (pp. 5-21)

    “It will be war to the hilt with organized baseball from this time forth,” exclaimed J. Edward Krause. “We have the money, and the money will tempt the players we want.”¹ The “we” that Krause was referring to was the Federal League of Professional Base Ball Clubs, a new league that began play in 1913. Following the successful completion of the organization’s inaugural season, Krause—president of the league’s Indianapolis franchise—was serving notice that the Federals had their sights set on challenging the supremacy of the two established major leagues, the American and National, in 1914.

    The Federal League...

  6. 2 The Opening Salvos: December 1913 to June 1914
    (pp. 22-45)

    The news of December 27, 1913, sent a shockwave throughout professional baseball: star shortstop Joe Tinker had signed a three-year contract with the Chicago Federals, or “ChiFeds,” for $12,000 per season. The future Hall of Famer—immortalized in Franklin P. Adams’s poem “Baseball’s Sad Lexicon” regaling the Chicago Cubs’ famed double play combination of “Tinker to Evers to Chance”—jumped to the Federal League after his contract was sold earlier that off-season from the Cincinnati Reds to Brooklyn for $25,000. Following the sale, Brooklyn rejected Tinker’s demand for a $7,500 salary, offering him no more than $5,000 per season. Tinker...

  7. 3 The Federal League Strikes Back: June 1914 to December 1914
    (pp. 46-64)

    Although the Federal League’s large-scale raid of organized baseball collapsed following the Illinois court’s June 1914 decision in theChief Johnsoncase, the circuit was nevertheless able to convince several players to defect from organized baseball shortly after the opinion was issued. The same day that theJohnsondecision was released, outfielder Armando Marsans announced that he was leaving the Cincinnati Reds to join the Federal League. The twenty-eight-year-old native of Matanzas, Cuba, first came to the United States to play professionally in 1908. Marsans had developed into a strong everyday player for the Reds by 1913, his third season...

  8. 4 The Landis Case: January 1915
    (pp. 65-93)

    “We’re going to break up organized baseball,” Federal League president Jim Gilmore excitedly exclaimed to a reporter fromBaseball Magazineon the morning of January 5, 1915. “I have just come from my lawyers. We filed this bill with Judge [Kenesaw Mountain] Landis,” he explained. Gilmore then described his bold aims for the lawsuit: “We’ll sue them for conspiracy and for restraint of trade. We’ll break up the baseball trust and the National Commission. We’ll free every ball player in the United States. We’ll have the courts declare them free agents and we’ll put a stop once and for all...

  9. 5 The Long Wait: February 1915 to February 1916
    (pp. 94-111)

    Shortly after the Chicago hearing, organized baseball’s attorneys began preparing formal answers to the Federal League’s allegations on behalf of each of the twenty-one defendants. John Galvin and Ellis Kinkead, the National Commission’s lawyers, took the lead on the project.¹ They drafted a comprehensive answer for the Cincinnati Reds, as well as a joint answer for the three members of the National Commission, each of whom had been individually named as a defendant in the suit.² These answers denied the Federals’ various claims, reiterating many of the same defenses asserted during the hearing.

    In addition, Cincinnati’s answer set forth a...

  10. 6 An Aborted Trial: February 1916 to June 1917
    (pp. 112-134)

    In the weeks following the dismissal of the Federal League’s antitrust suit, organized baseball worked behind the scenes to resolve its budding dispute with the Baltimore Federals. The efforts to assuage the team were primarily focused on working out an arrangement between the BaltFeds and their counterparts from Baltimore. Specifically, the major leagues hoped that they could persuade Jack Dunn, owner of the city’s International League team, to purchase the BaltFeds’ stadium, thereby securing some settlement proceeds for the rival franchise.

    A week after Judge Landis dismissed the suit in Chicago, National Commission chairman August Herrmann wrote to American League...

  11. 7 Baltimore Goes to Trial, Again: June 1917 to April 1919
    (pp. 135-158)

    Despite the press reports heralding the end of all Federal League–related litigation, the major leagues quickly learned that they had not heard the last of the Baltimore Federals. Indeed, the very same day that the team terminated its lawsuit in Philadelphia, Baltimore’s counsel sent a letter to organized baseball’s attorneys, George Pepper and Frank Prichard, notifying them that the plaintiff continued to believe that the peace agreement was signed “in prejudice of [its] rights,” and demanding that no settlement payments be made to the other former Federal League clubs “until the rights of the Federal Baseball Club of Baltimore...

  12. 8 The Defense and Verdict: April 1919
    (pp. 159-187)

    “Gentlemen of the jury, it is bad enough to have to sit for hours and listen to witnesses,” George Pepper began his opening statement, “but you are really to be commiserated where it comes to the point where you have to listen to the talk of lawyers.” “Our friends [the plaintiff’s counsel] have been at the bat quite a long time,” he continued, “it has been a long inning, but I do not think many players have crossed the plate. I do not know just how the time has been consumed.”¹

    Turning to the substantive merits of the case, organized...

  13. 9 The Appeal and Final Decision: May 1919 to October 1922
    (pp. 188-218)

    While organized baseball continued to lick its wounds following the verdict in Washington, its attorneys set to work preparing the appeal. The American League’s counsel, Benjamin Minor, began to draft a Bill of Exceptions—a required step in the appellate process at the time—in which the defense formally identified all of its grounds for appeal. Owing to several extensions and delays, this process would consume the rest of 1919, with the major leagues eventually finalizing their appeal in February 1920. In total, the defendants identified thirty-five alleged legal errors committed by Justice Stafford during the trial, ranging from various...

    (pp. 219-228)

    Scholars have not been kind to Justice Holmes’s decision inFederal Baseball. The opinion ranks among the most frequently criticized in Supreme Court history, with commentators declaring it “unsatisfactory,” “irrational,” and “absurd.”¹ These critics typically argue that “Holmes was clearly wrong” given the regularity with which professional baseball players traveled between states, and thus write the decision off as a reflection of the justice’s “utter misunderstanding of the nature of the business of baseball.”² One author has even gone so far as to speculate that the decision may have resulted from a secret conspiracy between Chief Justice William Howard Taft...

  15. NOTES
    (pp. 229-264)
    (pp. 265-272)
  17. INDEX
    (pp. 273-282)
  18. Back Matter
    (pp. 283-284)