US Senate Judiciary Committee Questions MLB’s Antitrust Exemption

First reported by Evan Drellich of The Athletic, The United States Senate Judiciary Committee has sent a letter to the Executive Director of Advocates for Minor Leaguers, Harry Marino, with questions regarding the impact of Major League Baseball’s antitrust exemption on minor leaguers. The letter comes after Senator Richard Durbin stated in March that Congress should reconsider the antitrust exemption.

Major League Baseball’s Antitrust Exemption

The United States Supreme Court established MLB’s antitrust exemption in 1922 in Federal Baseball Club of Baltimore v. National League, which found that Major League Baseball does not satisfy the interstate commerce clause under the Sherman Antitrust Act because any travel is merely incidental. Thus, the Sherman Antitrust Act of 1890 does not apply to Major League Baseball.

Since 1922, Major League Baseball’s antitrust exemption has been upheld twice, in 1953 in Toolson v. New York Yankees and 1972 in Flood v. Kuhn. In 1998, Congress narrowed the scope of the antitrust exemption when it passed the Curt Flood Act, which stipulated that the antitrust exemption did not apply to player employment issues and was a major win for major league baseball players. Notably, the Curt Flood Act does not apply to minor leaguers.

For years, Major League Baseball’s antitrust exemption has been called into question due to baseball ballooning into a billion-dollar industry that includes ample commercial activities crossing state lines. In March, Senator Bernie Sanders introduced the “Save American Baseball Act” to remove Major League Baseball’s antitrust exemption. Despite Senator Sanders’ efforts, Congress has yet to eliminate the antitrust exemption.

Importantly, Major League Baseball is the only league with a general antitrust exemption. Other leagues are limited to a narrow antitrust exemption for broadcasting contracts.

Letter From Senate Judiciary Committee

Penned by Senators Richard Durbin, Charles Grassley, Richard Blumenthal, and Michael Lee, the letter takes direct aim at the antitrust exemptions’ impact on minor leaguers. Questions include:

• Please discuss the impact of the antitrust exemption on the negotiation of minor league players’ length of contract, wages, housing, or other working conditions. What effect would removing the antitrust exemption have on minor league player working conditions?

• If a more tailored approach, like extending the Curt Flood Act to cover minor league players, was taken, what would be the impact?

Other questions cover a lockout’s impact on minor leaguers, the abuse and exploitation of international athletes, and Major League Baseball removing dozens of minor league teams prior to the 2021 baseball season.

Potential Responses

The antitrust exemption allows Major League baseball to control nearly every aspect of professional baseball, including wage-fixing and other working conditions for minor leaguers. As it currently stands, minor leaguers have little opportunity to negotiate salaries, and a minor leaguers’ first contract lasts for seven seasons (less than a typical major league contract), with minimal increases in pay. Thus, removing the exemption or extending the Curt Flood Act to cover minor leaguers would enhance a minor leaguer’s ability to negotiate and instantly improve life for minor league baseball players.

Additionally, the antitrust exemption plays a role in the exploitation of international athletes because it allows Major League Baseball and the owners to set minimal parameters on the signing of international athletes. Other areas impacted by the antitrust exemption include intellectual property rights and team markets. Specifically, Major League Baseball and its owners may freely deny teams opportunities to move.

For now, it appears that Congress is ready to undertake a thorough review of Major League Baseball’s antitrust exemption. By shedding light on issues in minor league baseball, the Senate Judiciary is focusing on an area that needs change. Hopefully, changes are coming soon.

Landis Barber is an attorney at Safran Law Offices in Raleigh, North Carolina. You can connect with him via LinkedIn or via his blog offthecourtdocket.com. He can be reached on Twitter @Landisbarber.