Labor Exemption from Antitrust

1
Labor Exemption from Antitrust
2
Alternative Ways to Define the Scope of the Labor
Exemption

• 1) no protection for otherwise anticomp CBAs
• 2) exempt only those restraints contained in the
  agreement at the behest of the union
• 3) exempt any agreements actually made by union
  and mgt
• 4) exempt any employment practices during the
  pendency of a collective bargaining relationship
• 5) complete protection under literal language of
  6 for any agreement that restrains trade in the
  labor market

3
Eliminating Alternatives

• Why doesnt the literal language of 6 compel the
  adoption of Option 5?
• Suppose the union agreed that the standard player
  contract would include a promise not to sign with
  a club in a rival league for 3 years after
  expiration of the contract?
• Why should multi-employer agreements EVER be
  protected by the labor exemption?
• Courts are supposed to accommodate antitrust and
  labor policy

4
The Mackey Test

• 1) Restraint primarily affects only the parties
  to the CBA
• 2) Topic is a mandatory subject of bargaining
  under the NLRA
• 3) Restraint is the result of bona fide arms
  length bargaining

5
Applying Mackey

• Suppose NBA players, as part of revenue sharing/
  salary cap, agreed w/ owners on minimum ticket
  prices or price of jackets?
• How does Mackeys prong (1) apply if fans are
  injured?
• Why should the highly restrictive NHL By-law
  challenged in McCourt 230 be exempt, under
  Jewel Teas test 226 that the restriction be
  part of arms length bargaining in pursuit of
  their own union policies?

6
Wood

• Rookie challenges NBA CBA that limits his salary
  due to the cap 2nd Circuit rejects
• Agree with Winter J that accepting rookies
  challenge to cap provisions of CBA is
  fundamentally at odds with federal labor policy?
• Suppose court held rookie cap to be illegal what
  would resulting CBA look like?

7
Clarett

• Should NFL be required under labor law to
  negotiate with the union about eligibility for
  draft?
• Should unions be allowed to negotiate on behalf
  of potential members of bargaining unit?
• Is the NFLs eligibility rule the result of good
  faith bargaining?

8
2nd Cir. approach

• Rejects Mackey
• Suggests unionized players should have NO
  antitrust rights

9
When Does the Labor Exemption Expire?

• NHL has rigid salary cap
• By barring rich/lousy teams from improving and
  not sharing revenue, harms competitive balance
  and thus violates 1
• CBA will expire in 60 days and NHLPA is opposed
  to the cap
• Hypo What would you advise the NHL Before Brown?
  
• After Brown?

10
After Brown Options for NFLPA

• Suppose impasse occurs, and your negotiation
  skills not going to persuade NFL Mgt Council to
  agree to a CBA that does not unreasonably
  restrain trade
• What are the unions options?

11
/2 Brown

• Do you agree with Justice Breyer that it would be
  odd to fashion an antitrust exemption that gave
  additional advantages to professional football
  players that transport workers, coal miners, or
  meat packers would not enjoy 246?
• Has the Court appropriately accommodated
  consumer/fan interests?
• Suppose a consumer class action challenged a
  labor restraint?

12
Brady claims

• Lawsuit seeks injunction against lockout,
  correctly noting that an agreement among
  employers to refuse jointly to employer non-union
  workers is a clear Sherman Act violation
• NFL offers 3 defenses
• Norris-LaGuardia Act bans federal court
  injunctions
• Court should stay hand pending resolution of
  unfair labor practice complaint
• Labor exemption continues where decertification
  is just a tactic

13
Brady 8th Circuit decision

• Applies literal language of N-LGA Act, depriving
  federal courts of jurisdiction to issue
  injunctions in a case involving or growing out
  of a labor dispute
• Rejects limit to unionized employees
• Rejects limit to injunctions against workers
• Dissent claims this was clear purpose
• Cf. Mackey interpretation of 6

14
Brady analysis

• DOJ recently won injunction against agreement
  among Silicon Valley firms not to poach each
  others key tech employees (who had never been
  unionized)
• Is this inconsistent with Brady?
• Should players be able to use decertification
  option? When, if ever, should the labor
  exemption expire in professional sports?