Supreme Court hears arguments in NFL antitrust case

[JURIST] The US Supreme Court [official website; JURIST news archive] heard oral arguments [day call, PDF; merit briefs] Wednesday in two cases. In American Needle Inc. v. NFL [oral arguments transcript, PDF; JURIST report], the Court heard arguments on whether the National Football League (NFL) [league website] and its member teams are a single entity that is exempt from rule of reason claims under Section 1 of the Sherman Act [text]. The NFL teams reached an agreement with Reebok to license and sell consumer headwear and clothing with the respective teams' logos and not to grant licenses to Reebok's competitors for 10 years. The US Court of Appeals for the Seventh Circuit ruled [opinion, PDF] that the NFL and its member teams are a single entity under the Sherman Act. Counsel for the petitioner, American Needle, cited the Court's 1984 decision in NCAA v. Board of Regents [opinion text], arguing that:

The 32 teams of the National Football League are separately owned and controlled profit-making enterprises. Under this Court's decision in NCAA, as well as the Court's more general joint venture jurisprudence, those clubs are entities whose distinct agreements are, indeed, subject to Section 1 scrutiny.

The fact of the matter is there is a longstanding consensus, judicial and legislative, that agreements among sports teams about whether and how they will participate in the marketplace is subject to scrutiny under the Sherman Act, Section 1.
Counsel for the NFL argued that:
There is no dispute that the NFL, including its licensing arm, NFL Properties, is a lawful venture. If venture formation is not an issue, then decisions by the venture about the venture's product are unilateral venture decisions, unilateral venture actions. They are not concerted actions of the -- of the venture's members.
The Court appeared skeptical of the NFL's position, with Justice Sonia Sotomayor suggesting, "you are seeking through this ruling what you haven't gotten from Congress: An absolute bar to an antitrust claim."

In Jerman v. Carlisle [oral arguments transcript, PDF], the Court heard arguments on whether a debt collector's legal error qualifies for the bona fide error defense under the Fair Debt Collection Practices Act (FDCPA) [15 USC § 1692 text, PDF]. Petitioner Karen Jerman filed an action challenging the debt collection practices of the Carlisle law firm, claiming that they violated the FDCPA when they used allegedly deceptive forms to notify her of a foreclosure on her home. Specifically, Jerman claims that defendants violated the FDCPA by representing to Jerman that her debt would be assumed valid unless she disputed the debt "in writing" even though the FDCPA does not require a written dispute. The US Court of Appeals for the Sixth Circuit ruled [opinion, PDF] that although the defendants violated the FDCPA by instructing Jerman that she must dispute the debt in writing, defendants qualified for the FDCPA bona fide error defense. Counsel for Jerman argued:
Congress rarely makes ignorance of the law a defense to civil liability, and the Fair Debt Collection Practices Act is no exception to that rule. While it may seem unfair to hold defendants in some sense strictly liable for legal mistakes in the civil context, the accumulated wisdoms of generations of legal practice has been that attempting to fix that unfairness through a mistake of law defense causes more harm than it prevents.

And as a consequence, in light of that subtle understanding, courts should not read a Federal statute to establish a mistake of law defense, unless Congress quite plainly makes that intent to do so clear. And in this case, nothing in the text, structure, or the history of the bona fide error provision of the FDCPA indicates such an intent.
Counsel for the US argued as amicus curiae on behalf of the petitioner. Counsel for the respondents argued that "in a review of the text of this statute, all of the components may be read plainly to include the bona fide error defense, to include legal error."


 

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