American Needle obtains favorable ruling from U.S. Supreme Court in antitrust dispute with NFL
Clients American Needle, Inc.
On May 24, 2010, the United States Supreme Court decided a significant antitrust case, ruling in favor of Jones Day client American Needle, Inc., in American Needle, Inc. v. National Football League. The Court held that the NFL's conduct is subject to scrutiny under the antitrust laws, reversing the contrary decision of the United States Court of Appeals for the Seventh Circuit and remanding the case to the lower courts for litigation under the antitrust rule of reason.
American Needle, Inc. is a manufacturer of headwear that challenged an agreement among the NFL teams to grant Reebok an exclusive license to produce and sell team-logoed headwear. Prior to Jones Day's involvement in the case, the Seventh Circuit affirmed summary judgment for the NFL on the ground that the NFL and its teams are a so-called "single entity" whose internal agreements are immune from scrutiny under Section 1 of the Sherman Antitrust Act. In a unanimous opinion, the Supreme Court reversed, holding that Section 1 scrutiny necessarily applies to agreements among entities that have separate economic interests and that are independent actors capable of making independent decisions. Applying this test to the NFL, the Court held that the NFL teams are separate and independent businesses that are not entitled to be treated as a "single entity"; accordingly, the teams' agreements (and those of the teams' instrumentality, NFL Properties, Inc.) must be scrutinized under the rule of reason.
American Needle, Inc. v. National Football League, Inc., No. 08-661 (U.S. Supreme Court)