UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK
April 24, 1986
UNITED STATES FOOTBALL LEAGUE, et al., Plaintiffs, against NATIONAL FOOTBALL LEAGUE, et al., Defendants
The opinion of the court was delivered by: LEISURE
LEISURE, District Judge :
The United States Football League and certain of its member clubs (collectively referred to as the "USFL"), have sued the National Football League, its commissioner and certain of its member clubs (hereinafter collectively referred to as the "NFL"), to obtain declaratory and injunctive relief and to recover damages resulting from alleged violations of Sections 1 and 2 of the Sherman Anti-Trust Act, 15 U.S.C. §§ 1 & 2, and the common law.
The NFL has moved, in limine, pursuant to Fed. R. Evid. 402 and 403 to strike from plaintiffs' First Amended Complaint ("amended complaint") any reference, and excluding from trial any evidence, which pertains to: (1) previous antitrust litigation against the defendants; (2) the All America Football Conference ("AAFC") or the World Football League ("WFL"); (3) alleged conduct by the NFL against the American Football League ("AFL"); and (4) any matter concerning sports-related legislation enacted by Congress in 1961 and 1966, other than the fact of such legislation. In a parallel motion, the NFL has moved to strike from the amended complaint any reference, and excluding from trial, any evidence, which pertains to litigation between the Los Angeles Raiders football franchise and the NFL, and between the City of Oakland, California and the Los Angeles Raiders football franchise.
Before the Court addresses the substance of these motions, it is necessary to determine, as a matter of procedure, whether the Court has the authority to grant all of the relief requested. Federal Rules of Evidence 402 and 403, when read together, authorize the Court to rule, in limine, that certain evidence should be excluded, either because it is irrelevant, or if relevant, its probative value is substantially outwieghed by considerations of prejudice and confusion. In addition, however, the NFL asks the Court to strike certain allegations of the amended complaint as well. Fed. R. Civ. P. 12(f) authorizes the court to strike "from any pleading . . . any redundant, immaterial, impertinent, or scandalous matter." But, a motion to strike shall be made before responding to a pleading or within twenty days after the service of a pleading if no responsive pleading is required or permitted. Id. In this case, the NFL has clearly exceeded the twenty day limit set forth in the rule. In addition, on a Rule 12(f) motion, "[m]atter outside the pleadings normally is not considered." 5 Wright & Miller, Federal Practice & Procedure: Civil § 1380 at 787 88 (1969), citing Ciprari v. Servicos Aeroes Cruzeiro do sul, S.A. (Cruzeiro), 245 F. Supp. 819, 820 (S.D.N.Y. 1965), aff'd on other grounds, 359 F.2d 855 (2d Cir. 1966). When confronted with matters outside the pleadings, some courts have treated the motion to strike as one for partial summary judgment. Ciprari, 245 F. Supp. at 820; Banana Distributors, Inc. v. United Fruit Co., 19 F.R.D. 11, 13 (S.D.N.Y. 1955). In considering whether it is appropriate to treat the motion to strike as motions for partial summary judgment, the Court is mindful of the Second Circuit's admonition in Lipsky v. Commonwealth United Corp., 551 F.2d 887 (2d Cir. 1976), that ordinarily a court should not "decide to strike a portion of the complaint - on the grounds that the material could not possibly be relevant - on the sterile field of the pleadings alone." Id. at 893 (citations omitted). But where, as here, the party opposing the motion to strike has presented over 150 exhibits, there is little danger that the Court will be unable to determine questions of relevancy and admissibility that generally "require the context of an ongoing and unfolding trial in which to be properly decided." Id. The NFL's motion to strike shall therefore be treated as a motion for partial summary judgment.
As such, the Court shall apply the same standards it would apply when considering the merits of any other motion for partial summary judgment. On a motion for partial summary judgment, the court's purpose is not to try issues of fact, but rather to determine whether or not there are material issues of fact to be tried. Meiri v. Dacon, 759 F.2d 989, 992 (2d Cir.), cert. denied, 474 U.S. 829, 106 S. Ct. 91, 88 L. Ed. 2d 74 (1985). The party opposing summary judgment must present to the court specific facts showing there is a genuine issue to be tried. Rule 56(e). The Court may consider only "admissible evidence showing any genuine issue to be tried." Barnett v. Howaldt, 757 F.2d 23, 26 (2d Cir. 1985). If the moving party carries its preliminary burden of demonstrating that there is no genuine issue as to any material fact, the opposing party may not defeat the motion unless it produces "significant probative evidence tending to support [its position]." United States v. Pent-R-Books, Inc., 538 F.2d 519, 529 (2d Cir. 1976), cert. denied, 430 U.S. 906, 97 S. Ct. 1175, 51 L. Ed. 2d 582 (1977) (quotation omitted). The factual record should be viewed in the light most favorable to plaintiffs as the nonmoving parties, Barnett, 757 F.2d at 26, meaning that all inferences must be construed in their favor. Eastway Construction Corp. v. City of New York, 762 F.2d 243, 249 (2d Cir. 1985). With these standards in mind, we now turn to the substantive issues presented by the NFL's motions.
Contentions of the Parties
"Television is at the heart of this case." Memorandum of Law in Support of Plaintiffs' Motion for Summary Judgment and in Opposition to Defendants' Motions In Limine, at 10; see also Transcript of Proceedings at 32 (April 11, 1986) ("This case is a TV case.") The USFL alleges that its inability to obtain a network television contract for the Fall of 1986 was a result of "coercive" pressure applied by the NFL to the three networks not to agree to a Fall 1986 contract with the USFL. In addition, the USFL alleges that the existence of the NFL's three network television contracts has the effect of precluding a new major professional football league from ever having its games televised, thereby depriving it of the television revenues and nationwide exposure a new league requires to be able to compete successfully against the NFL.
The NFL contends that none of the "factual" allegations about the other professional football leagues, the prior antitrust suits against the NFL, or the events surrounding the 1961 and 1966 legislation are probative of any factual issue relating to the USFL's alleged antitrust injury and damages. The USFL contends that the NFL's record of antitrust violations and the history of competition in major league professional football are admissible for two reasons. First, both topics evidence the nature, sources and use of the NFL's market power since Section 1 violations constitute evidence that establishes monopolistic intent, an element of the USFL's Section 2 claim. Second, prior illegal NFL antitrust conspiracies are admissible to establish the intent, motive and method of the NFL's Section 1 conspiracy against the USFL.
The USFL argues that all three violations of Section 2 -- monopolization, attempted monopolization, and conspiracy to monopolize -- require proof of both anticompetitive intent and analysis of the defendants' market power, including the sources of that power. See, e.g., United States v. Grinnell Corp., 384 U.S. 563, 570-71, 16 L. Ed. 2d 778, 86 S. Ct. 1698 (1966) (monopolization requires proof of monopoly power and the willful acquisition or maintenance of monopoly power); Swift & Co. v. United States, 196 U.S. 375, 396, 49 L. Ed. 518, 25 S. Ct. 276 (1905) (attempted monopolization requires proof of a dangerous probability of success in monopolizing a given product market and specific intent to build monopoly); United States v. Yellow Cab Co., 332 U.S. 218, 91 L. Ed. 2010, 67 S. Ct. 1560 (1947) (conspiracy to monopolize requires proof of concerted action with intent to restrain trade and commission of an overt act).
The USFL contends that in appropriate cases, prior antitrust violations and the history of the relevant market are admissible to establish market power and intent. Thus, in Grinnell, the Supreme Court noted that defendant's "monopoly was achieved in large part by unlawful and exclusionary practices." 384 U.S. at 576. These included: (1) "restrictive agreements that preempted for each company a segment of the market where it was free of competition of the others"; (2) "[p]ricing practices that contained competitors"; (3) acquisitions of competitors; and (4) control of co-defendants that eliminated the possibility of competition. Id. (footnote omitted). "By those acquisitions it perfected the monopoly power to exclude competitors and fix prices." Id. In United States v. Paramount Pictures, Inc., 334 U.S. 131, 92 L. Ed. 1260, 68 S. Ct. 915 (1948), the Court noted that "the fact that the power created by size was utilized in the past to crush or prevent competition is potent evidence that the requisite purpose or intent attends the presence of monopoly power." Id. at 174. In Lorain Journal Co. v. United States, 342 U.S. 143, 96 L. Ed. 162, 72 S. Ct. 181 (1951), the Court stated that "the substantial monopoly which was enjoyed in Lorain by the publisher from 1933 to 1948," id. at 152, was a circumstance that "illuminated" defendant's attempt to "regain the . . . pre-1948 substantial monopoly over the mass dissemination of all news and advertising." Id. at 153.
The USFL also argues that evidence of conspiratorial conduct occurring before plaintiffs' damage period is admissible to establish the intent, motive and method of the defendants' conspiracies against the USFL. In Continental Ore Co. v. Union Carbide & Carbon Corp., 370 U.S. 690, 8 L. Ed. 2d 777, 82 S. Ct. 1404 (1962), the Court held that the trial court erred when it excluded evidence that the alleged conspiracy and monopolization had begun before the plaintiffs came into the industry. Id. at 709-10.
This evidence was clearly material to petitioners' charge that there was a conspiracy and monopolization in existence when they came into the industry, and that they were eliminated in furtherance thereof. We do not mean that a trial court may not place reasonable limits upon such evidence or set a reasonable cut-off date, evidence before which point is to be considered too remote to have sufficient probative value to justify burdening the record with it.
Id. at 710 (footnotes omitted). See also United States v. Socony-Vacuum Oil Co., 310 U.S. 150, 228-31, 84 L. Ed. 1129, 60 S. Ct. 811 (1940) (exclusion of certain evidence describing background and operation of market upheld). While these general principles are virtually unassailable, the question presented is their application to the factual allegations objected to by the NFL.
AAFC and WFL Allegations
The NFL argues that there are no allegations in the complaint, nor have any facts been presented by the USFL, showing that the NFL caused the AAFC's dissolution in 1947 or the WFL's dissolution in 1975. According to the NFL, the mere fact that the two leagues existed and disbanded is irrelevant to any issue concerning the size of the 1980's professional football market, its structure, or operation or the NFL's alleged anticompetitive intent or alleged predatory conduct against the USFL. In the cases relied upon by the USFL, where plaintiffs have shown damages as a result of a conspiracy which predated plaintiff's entrance into the market, the courts have permitted evidence of prior conduct because the identical conspiracy was involved. Continental Ore Co. v. Union Carbide & Carbon Corp., 370 U.S. 690, 8 L. Ed. 2d 777, 82 S. Ct. 1404 (1962); Strobl v. New York Mercantile Exchange, 582 F. Supp. 770 (S.D.N.Y. 1984), aff'd, 768 F.2d 22 (2d Cir.), cert. denied, 474 U.S. 1006, 106 S. Ct. 527, 88 L. Ed. 2d 459 (1985). Unless the USFL is able to produce evidence that the NFL somehow caused the breakup of the two leagues, it is argued, the allegations concerning the two prior leagues are irrelevant to any claim of an ongoing conspiracy to monopolize the United States market for professional football. The NFL contends that the USFL has not presented admissible evidence showing that there is any material question of fact that the NFL unlawfully caused the demise of the WFL. In the absence of facts showing such causal connection, the NFL contends that no fact material to the USFL's charges against the NFL will be made more or less probable by evidence concerning the existence and disbandment of either league.
At oral argument, the USFL conceded that the allegations concerning the AAFC appear in the pleadings for background purposes only. Transcript of Proceedings at 77 (April 11, 1986). Accordingly, with respect to the AAFC, the motion is granted. The USFL shall make no reference, and shall offer no evidence at trial, that implies that the NFL caused the demise of the AAFC. In addition, those portions of the amended complaint alluding to such matters shall be stricken. This ruling does not, however, preclude the USFL from referring to the AAFC in the context of a presentation for background purposes of the history of professional football in the United States.
Two incidents have come to the Court's attention that provide a basis for allegations that the NFL harmed or attempted to harm the WFL. The first arose out of the 1973 attendance by Robert Wussler, then President of CBS Sports, at a WFL owners' meeting. The USFL claims that NFL Commissioner Rozelle let it be known to the networks that he considered Wussler's attendance to be an unfriendly act. The USFL relies upon this incident both to prove that the NFL entertained anticompetitive intent toward the WFL and to prove that in 1981-82 the NFL pressured the networks not to give the fledgling USFL a television contract. In December 1981, the USFL's publicity agent invited the President of CBS Sports to attend a January 1982 Florida meeting of prospective USFL owners. One CBS executive advised the other not to attend since-Wussler's attendance at the 1973 WFL meeting "was enormously embarrassing to CBS and considered an unfriendly act by Pete [Rozelle]." Memorandum from Carl Lindemann to Neal Pilson, President, CBS Sports (Dec. 29, 1981).
When questioned about the Wussler incident during his deposition in this case, Commissioner Rozelle recalled that he told Robert Wood, President of of CBS in 1973, that Rozelle had heard that Wussler, the head of CBS Sports, had attended a WFL meeting. "I was somewhat surprised because CBS had just entered into a four-year contract with us for playing Sunday." Deposition of Alvin R. Rozelle at 408. Rozelle explained that since the law did not permit the NFL to play on Friday nights or Saturdays, and he understood that the WFL was not interested in playing games during prime time, "I was just very surprised by what I heard concerning a sports head going down there to a meeting." Id.
Rozelle's testimony concerning this incident raises a material question of fact as to whether there was an attempt to pressure CBS, if not the other networks, to avoid any involvement with the WFL. This is consistent with the USFL's theory that the same tactics have been used to discourage the networks from giving the USFL a contract to televise USFL games. A triable issue of fact exists as to whether the NFL in this way contributed to the demise of the WFL or attempted to deprive the WFL of a network contract as part of the NFL's alleged efforts to regain its pre-WFL monopoly.
The second instance of alleged NFL misconduct directed against the WFL is set forth in § 61(a) of the amended complaint, which alleges that in 1985 the NFL "reinstituted a policy, first developed by the defendant NFL Member Clubs when the WFL came into being and abandoned by the defendant NFL Member Clubs after the WFL's demise" to permit the signing of free agent players to NFL contracts for future seasons after the completion of the sixth weekend of play in the current season. Amended Complaint § 61(a). Previously, such signings were not allowed until the end of the then-current season. Id.
While there is little or no evidence that the change in the free-agent signing rule harmed the WFL, the NFL's alleged parallel response to the two leagues raises a triable issue of fact as to the NFL's monopolistic intent with respect to the WFL and later the USFL.
The decisions in United States v. Grinnell Corp., 384 U.S. 563, 16 L. Ed. 2d 778, 86 S. Ct. 1698 (1966) and Lorain Journal Co. v. United States, 342 U.S. 143, 96 L. Ed. 162, 72 S. Ct. 181 (1951), support the proposition that the history of how a monopolist achieved its position is relevant. The USFL has presented specific facts demonstrating that the allegations that the NFL unlawfully caused or attempted to cause the demise of the WFL are not "fanciful." Quinn v. Syracuse Model Neighborhood Corp., 613 F.2d 438, 445 (2d Cir. 1980). Accordingly, with respect to the WFL, the motion is denied.
The USFL's allegations concerning the AFL are also defective. While the amended complaint alleges that the AFL competed with the NFL and prospered, it also alleges that the NFL sought to frustrate the formation of the AFL by creating new NFL franchises. Paragraph 22 of the amended complaint quotes a statement by the owner of the Washington Redskins in 1960, Mr. Marshall, that the only reason for the expansion was to destroy the new AFL. In American Football League v. National Football League, 205 F. Supp. 60 (D. Md. 1962), aff'd, 323 F.2d 124 (4th Cir. 1963), it was held that these allegations were false. The AFL's claims of monopolization, attempted monopolization and conspiracy to monopolize against the NFL were dismissed. Both courts held that the NFL expansion plans antedated the AFL's formation. 205 F. Supp. at 78, aff'd, 323 F.2d at 132. Both courts also held that Mr. Marshall's statement was "not true." 205 F. Supp. at 74, aff'd, 323 F.2d at 132.
The NFL urges that in the interests of stability in the law and judicial economy that these findings should be given collateral estoppel effect and that the USFL not be permitted to resurrect stale claims that were rejected when they were fresh. Cf. Bronson v. Board of Education, 525 F.2d 344, 349 (6th Cir. 1975), cert. denied, 425 U.S. 934, 48 L. Ed. 2d 175, 96 S. Ct. 1665 (1976); United States v. 177.51 Acres of Land, 716 F.2d 78, 81 (1st Cir. 1983); Arizona v. California, 460 U.S. 605, 75 L. Ed. 2d 318, 103 S. Ct. 1382 (1983). In addition, unless the USFL presents new, credible, persuasive evidence which could not have been presented at the original trial, the allegations concerning the AFL should not be presented to the jury. See 177.51 Acres of Land, 716 F.2d at 81. The USFL has not indicated that such evidence exists. Accordingly, the motion is granted. Plaintiffs shall make no reference nor offer any evidence at trial concerning supposed conduct by the NFL directed at the AFL. The portions of the amended complaint where such allegations are set forth are hereby stricken. This ruling does not preclude the USFL from presenting evidence of the AFL as part of a background presentation of the development or history of professional football in the United States.
With respect to the Sports Broadcasting Act of 1961 and the 1966 legislation authorizing the NFL-AFL merger, the amended complaint alleges as factual matters, inter alia, the following: (1) the reasons why the NFL petitioned Congress; (2) Congress' purpose in enacting the Sports Broadcasting Act of 1961; (3) that the NFL network television contracts exceed the scope of the antitrust exemption; (4) the NFL's motive for seeking the 1966 legislation immunizing the merger with the AFL; (5) impropriety in the manner in which Congress enacted the merger law; and (6) the motives of two United States Senators. The USFL argues that a review of the history of the NFL's acquisition and the use of its market power with respect to the passage of legislation is an appropriate subject for the jury to consider.
Similar allegations were made by the plaintiffs in Mid South Grizzlies v. National Football League, 720 F.2d 772, 784 (3d Cir. 1983), cert. denied, 467 U.S. 1215, 81 L. Ed. 2d 364, 104 S. Ct. 2657 (1984), to support a claim of "unlawful acquisition of monopoly power." The court rejected these contentions.
If these allegations are true, as we must assume for purposes of a summary judgment motion, they are, perhaps, instructive on the nature of the federal legislative process. For purposes of rule of reason analysis, however, they are irrelevant. It would take a court bolder than this to claim that the congressionally authorized acquisition of market power, even market power amounting to monopoly power, was unlawful under Section 1 of the Sherman Act.
Id. (emphasis added).
This Court is of the same view. The reasons why the NFL sought such legislation, Congress' motives and the manner in which it enacted such laws are not issues of fact to be determined by a jury in an antitrust lawsuit. As a threshold matter, the interpretation of legislation ordinarily is a question of law to be resolved by the court. Bryant v. American National Bank & Trust Co. of Chicago, 407 F. Supp. 360, 363 (N.D. Ill. 1976). Plaintiffs have not brought to this Court's attention any authority for the proposition that the legislative history of a statute may be presented to a jury in a case of this nature.
Second, the activities of the NFL in lobbying Congress in connection with the passage of the Sports Broadcasting Act of 1961 and the 1966 legislation approving the NFL-AFL merger cannot be made the basis of antitrust liability. Eastern Railroad Presidents Conference v. Noerr Motor Freight, Inc., 365 U.S. 127, 5 L. Ed. 2d 464, 81 S. Ct. 523 (1961). In Noerr, the Supreme Court held that efforts to influence the government to take particular action that would produce a restraint or monopoly do not violate the Sherman Act. Id. at 136.
In United Mine Workers v. Pennington, 381 U.S. 657, 14 L. Ed. 2d 626, 85 S. Ct. 1585 (1965), the Supreme Court restated the proposition that "[j]oint efforts to influence public officials do not violate the antitrust laws even though intended to eliminate competition." Id. at 670. The Court also stated, however, that evidence of such immune conduct could be admitted within the discretion of the trial court, "if it tends reasonably to show the purpose and character of the particular transactions under scrutiny." Id. at 670 n.3 (quotation and citations omitted). Such evidence, to be admitted, would have to be found probative, yet not unduly prejudicial. Id.
One method of determining the admissibility of this evidence is to weigh its probative value and plaintiff's need for the evidence against the possibility that the admission of such evidence will prejudice the defendants' First Amendment rights. See Feminist Women's Health Center, Inc. v. Mohammad, 586 F.2d 530, 543 n.7 (5th Cir. 1978), cert. denied, 444 U.S. 924, 62 L. Ed. 2d 180, 100 S. Ct. 262 (1979). The USFL contends that the NFL's lobbying efforts in 1961 and 1966 were part of a long-standing conspiracy to monopolize the market in professional football. But an important aspect of the NFL's purpose in seeking the 1961 exemption was to join the other professional sports organizations in being able to enter into pooled rights television contracts. See S. Rep. No. 1087, 87th Cong. 1st Sess. (1961), reprinted in 1961 U.S. Code Cong. & Ad. News 3042, 3042-43. One of the terms of the 1966 merger was an increase in the number of teams. Also, at the NFL's request, the merger legislation did not "extend to the combined league any greater antitrust immunity" than existed before the merger. S. Rep. No. 1654, 89th Cong., 2d Sess. 3 (1966).
In addition, to whatever extent such conduct evidences monopolistic intent, it is cumulative to other evidence that plaintiffs have cited to Court. As evidence of the NFL's state of mind in the 1980's it is weak, since the lobbying occurred from fifteen to twenty years before the events at issue in this case took place. The low probative value of this evidence is substantially outweighed by the defendants' strong interest in preserving their First Amendment rights to petition Congress. Accordingly, evidence of the NFL's lobbying efforts and intentions with respect to the 1961 and 1966 sports-related legislation shall be excluded under Fed. R. Evid. 403 since the unfair prejudice to defendants First Amendment rights substantially outweighs the probative value of the evidence.
Notwithstanding the irrelevance and inadmissibility of these matters, or that the NFL's market power may have a "pristine 'origin,'"
these considerations do not render the NFL immune from antitrust liability in the event such market power is "abused against extra-league competitors." Id. 785 n.7.
But, for the reasons discussed, the motion is granted. Plaintiffs shall make no reference nor offer any evidence at trial describing the NFL's reasons for seeking the 1961 and 1966 legislation nor the motives and manner in which Congress enacted those laws. This does not preclude the USFL from offering evidence of such legislation as part of a background presentation of the history of professional football in the United States.
Prior NFL Antitrust Judgments
The NFL has been named a defendant in at least eighteen antitrust lawsuits. The NFL lost the following such lawsuits:
(a) United States v. National Football League, 116 F. Supp. 319 (E.D. Pa. 1953), in which certain television and radio broadcast rules were declared unreasonable restraints of trade. This decision was overruled, in part, by the Sports Broadcasting Act of 1961;
(b) Los Angeles Memorial Coliseum Comm'n v. National Football League, 726 F.2d 1381 (9th Cir.), cert. denied, 469 U.S. 990, 105 S. Ct. 397, 83 L. Ed. 2d 331 (1984) (hereinafter L.A. Coliseum) in which an intra-league rule concerning franchise relocation was declared an unreasonable restraint of trade;
(c) Kapp v. National Football League, 390 F. Supp. 73 (N.D. Cal. 1974), vacated in part, 1975-2 Trade Cas. (CCH) P 60,543 (N.D. Cal. 1975), aff'd, 586 F.2d 644 (9th Cir. 1978), cert. denied, 441 U.S. 907, 99 S. Ct. 1996, 60 L. Ed. 2d 375 (1979), in which certain rules concerning the transfer of veteran players from one NFL team to another were found to constitute an unreasonable restraint of trade. No damages were awarded;
(d) Mackey v. National Football League, 543 F.2d 606 (8th Cir. 1976), cert. dismissed, 434 U.S. 801, 98 S. Ct. 28, 54 L. Ed. 2d 59 (1977), in which intra-league rules relating to the transfer of veteran players from one NFL team to another were held to be unreasonable. This case was later settled through collective bargaining with the NFL players union. See Reynolds v. National Football League 584 F.2d 280 (8th Cir. 1978) (approving elements of settlement);
(e) Smith v. Pro Football, Inc., 193 U.S. App. D.C. 19, 593 F.2d 1173 (D.C. Cir. 1978), in which rules for the college player draft were held unreasonable under the rule of reason;
(f) North American Soccer League v. National Football League, 505 F. Supp. 659 (S.D.N.Y. 1980) aff'd in part, rev'd in part, 670 F.2d 1249 (2d Cir.), cert. denied, 459 U.S. 1074, 103 S. Ct. 499, 74 L. Ed. 2d 639 (1982), in which a rule forbidding NFL franchise owners from owning other professional sports teams was held to violate Section 1 of the Sherman Act.
The NFL has moved to strike from the amended complaint any reference and to exclude from trial any evidence which pertains to previous antitrust legislation against the defendants. The USFL argues that it is appropriate in this case to consider these past Section 1 violations as relevant to proving a Section 2 violation. In two of the cases relied upon by the USFL, United States v. United Shoe Machinery Corp., 110 F. Supp. 295 (D. Mass. 1953), aff'd per curiam, 347 U.S. 521, 74 S. Ct. 699, 98 L. Ed. 2d 910 (1954), and Union Leader Corp. v. Newspapers of New England, Inc., 284 F.2d 582 (1st Cir. 1960), cert. denied, 365 U.S. 833, 5 L. Ed. 2d 744, 81 S. Ct. 747 (1961), the same conduct that was found to violate Section 1 provided a basis for finding a Section 2 violation. In neither case, however, was an earlier unrelated Section 1 judgment held to be relevant to prove a Section 2 claim brought by a competitor. The NFL argues that these cases demonstrate only that the same conduct simultaneously may violate both sections. In both cases the Section 1 violations involved restraints of trade against a competitor, which conduct was relevant to demonstrating monopolistic intent and conduct against the same competitor.
The NFL argues that in order for its prior antitrust lawsuits to be relevant to the instant matter, there must be a direct, logical connection to the allegations in this case. See, e.g., Buckhead Theatre Co. v. Atlanta Enterprises, 327 F.2d 365 (5th Cir.), cert. denied, 379 U.S. 888, 13 L. Ed. 2d 92, 85 S. Ct. 158 (1964). In Buckhead Theatre the court held that evidence of a prior antitrust judgment would be irrelevant unless the plaintiff introduced evidence that the practices complained of in the prior case "had any injurious effect upon the plaintiff." 327 F.2d at 368-69. Even in Bray v. Safeway Stores, Inc., 392 F. Supp. 851 (N.D. Cal.), vacated per settlement, 403 F. Supp. 412 (N.D. Cal. 1975), relied upon by plaintiffs, the conduct underlying the prior judgments was the same as that alleged in the main case. 392 F. Supp. at 866-67 (abuse of buying power in order to fix prices).
The foregoing authorities indicate that plaintiffs bear the burden of showing that the conduct underlying earlier Section 1 judgments against the NFL is related to the conduct at issue in this case. This can be done either by demonstrating that there is a similarity of conduct or presenting some evidence that the prior conduct has injured plaintiff. Instead, the USFL argues, in conclusory fashion, that the prior antitrust judgments supply crucial evidence of a long-standing antitrust conspiracy dating back to the 1940's, which casts light on the current antitrust conspiracy dating back 1940's, which casts light on the current antitrust conspiracy. It contends that such evidence helps to establish the intent, motive and method of defendants' conspiratorial conduct directed against the plaintiffs. The USFL, however, has not presented specific facts that connect the alleged anticompetitive activity in the instant case to the past instances of the NFL's antitrust conduct.
The prior antitrust violations in this case involve intra-league rules concerning players, franchise matters, and broadcast rules. They have no logical tendency to show an intent to act against a competing league. They are therefore irrelevant. See, e.g., Monticello Tobacco Co. v. American Tobacco Co., 197 F.2d 629, 632 (2d Cir.), cert. denied, 344 U.S. 875, 97 L. Ed. 678, 73 S. Ct. 168 (1952) (exclusion upheld since nothing in prior antitrust conspiracy affected plaintiff).
Even if it is assumed, arguendo, that any or all of these prior NFL adverse antitrust judgments are relevant to any of the issues in the instant case, they should be excluded under Fed. R. Evid. 403. Rule 403 permits the exclusion of evidence on the grounds of prejudice, confusion or waste of time.
Although relevant, evidence may be excluded if its probative value is substantially outweighed by the danger of unfair prejudice, confusion of the issues, or misleading the jury, or by considerations of undue delay, waste of time, or needless presentation of cumulative evidence.
Fed. R. Evid. 403. These considerations were applied by the court in International Shoe Machine Corp. v. United Shoe Machinery Corp., 315 F.2d 449 (1st Cir.), cert. denied, 375 U.S. 820, 11 L. Ed. 2d 54, 84 S. Ct. 56 (1963), to exclude evidence of prior adverse antitrust judgments.
Whether admitted purely as "background" evidence or not, evidence of a judicial determination of prior illegal conduct on the part of the defendant cannot help but have a great emotive impact on a jury.
315 F.2d at 459. These considerations take on heightened importance where, as here, the evidence has such slight probative value, "but potentially high emotive impact on a jury of laymen." Monticello Tobacco Co., 197 F.2d at 633. See also Bohack Corp. v. Iowa Beef Processors, Inc., 715 F.2d 703, 710 (2d Cir. 1983) (prior bribery evidence held "inflammatory," citing International Shoe Machine Corp.). To permit the USFL to introduce evidence of these prior antitrust judgments would permit plaintiffs to create an "aura of guilt" or to "imply new wrongdoing from past wrongdoing." International Shoe Machine Corp., 315 F.2d at 460. Accordingly, the motion to strike allegations and to exclude evidence of prior antitrust litigation against defendants is granted to the extent such evidence would otherwise be offered at trial as part of plaintiffs' case-in-chief. The Court reserves its decision as to whether such matters may be admitted into evidence in the event plaintiffs present a rebuttal case.
Litigation Arising from the Raiders Move
The NFL has moved to strike allegations from the amended complaint and to exclude from trial any evidence which pertains to litigation between the Los Angeles Raiders football franchise and the NFL, and between the City of Oakland, California and the Los Angeles Raiders football franchise. The move of the Raiders franchise from Oakland, California to Los Angeles, California has spawned several lawsuits. In L.A. Coliseum, 726 F.2d 1381 (9th Cir.), cert. denied, 469 U.S. 990, 105 S. Ct. 397, 83 L. Ed. 2d 331 (1984), a NFL intra-league rule regarding movement of franchises was declared an unreasonable restraint of trade. In City of Oakland v. Oakland Raiders, 174 Cal.App.3d 414, 220 Cal.Rptr. 153 (1985), review denied, N.Y. Times, Feb. 28, 1986 at A23, col. 1 (Cal. Feb. 27, 1986), the City of Oakland's attempt to condemn the Raiders franchise through the power of eminent domain was dismissed. Lastly, in United States Football League v. National Football League, Civ. No. 85-5445, filed Aug. 8, 1985 (N.D. Cal.), the USFL alleges that as part of the NFL's effort to return the Radiers to Oakland in order to keep Oakland available for the awarding of an NFL expansion franchise, the NFL and the City of Oakland have conspired to prevent the success of the USFL Oakland Invaders.
At the outset, the NFL contends that the Supreme Court's denial of the NFL's petition for certiorari on the liability issues in the L.A. Coliseum case does not constitute a final judgment. Such issues, it contends, remain reviewable in the event an appeal is made of the damage judgment. See Hughes Tool Co. v. Trans World Airlines, Inc., 409 U.S. 363, 365 n.1, 34 L. Ed. 2d 577, 93 S. Ct. 647 (1973); Hanover Shoe, Inc. v. United Shoe Machinery Corp., 392 U.S. 481, 488 n.6, 20 L. Ed. 2d 1231, 88 S. Ct. 2224 (1968); Mercer v. Theriot, 377 U.S. 152, 153, 12 L. Ed. 2d 206, 84 S. Ct. 1157 (1964); Indianapolis v. Chase National Bank, 314 U.S. 63, 75, 86 L. Ed. 47, 62 S. Ct. 15 (1941).
Even assuming that the USFL is correct that the result in the L.A. Coliseum case is a final judgment for purposes of issue preclusion, the Court adopts its holding with respect to the other earlier NFL antitrust litigation and holds that the result in the L.A. Coliseum case is irrelevant to the issues presented in the instant case. The USFL contends that the Supreme Court's decision in United States v. Grinnell Corp., 384 U.S. 563, 16 L. Ed. 2d 778, 86 S. Ct. 1698 (1966), supports the admissibility of the judgment in the L.A. Coliseum case. Grinnell is distinguishable. In Grinnell, the Court held that the defendants achieved their monopoly by, inter alia, use of unlawful restrictive agreements that divided segments of the market among the defendants. Id. at 576. It is true that the Raiders litigation involved scrutiny of an agreement designed to regulate the division of the geographic market among the NFL member clubs. but, in the L.A. Coliseum case the court held that "the nature of NFL football requires some territorial restrictions." 726 F.2d at 1396. Furthermore, in order to effectuate the NFL's antitrust exemption granted by 15 U.S.C. § 1291, the court held that the NFL is entitled to have some control over the placement of teams. Id. No such justification for market allocation existed in Grinnell. The antitrust violation in the Raiders case occurred because the mechanism used to achieve that geographic division was found to be harmful to intra-league competition. Id. Unlike Grinnell, the fact of geographic market allocation as part of the business of professional football does not violate the antitrust laws. Lastly, the L.A. Coliseum case arose out of events the occurred before the formation of the USFL so that the antitrust violation at issue could not have harmed the USFL.
The eminent domain litigation between the City of Oakland and the Raiders is irrelevant since neither of the parties in that action are parties in the instant case. In addition, the allegations of the second USFL v. NFL litigation are relevant to the claims in this case. Moreover, the USFL contends that certain of the testimony of Al Davis, the owner of the Los Angeles Raiders, regarding aspects of the California lawsuits, is relevant to the issues herein. Specifically, he has testified to alleged efforts by the NFL to hinder the success of the USFL Oakland Invaders franchise. This testimony may be relevant to the issues presented in the instant case, to the extent that it helps to establish a broader NFL conspiracy to destroy the USFL. There should be no bar to the introduction of relevant, admissible evidence through Mr. Davis, or some other witness or means, to such effect. In all other respects, however, the motion is granted.
In summary, the NFL's motions in limine are granted in the following respects: (1) allegations in the amended complaint that the NFL caused the demise of the AAFC are stricken and evidence of such matters shall be excluded at trial; (2) allegations of predatory conduct by the NFL directed at the AFL are stricken and evidence of such matters at trial shall be excluded; (3) allegations of matters relating to the passage of the 1961 and 1966 sports-related legislation shall be stricken and evidence of such matters shall be excluded at trial; (4) allegations pertaining to previous antitrust litigation against the defendants are stricken and evidence of such matters shall be excluded from plaintiffs' case-in-chief; and (5) evidence of litigation between the City of Oakland and Los Angeles Raiders football club shall be excluded from evidence at trial. In all other respects, the motions are denied.