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Flood v.

United States Supreme Court
407 U.S. 258 (1972)

Key Search Terms: antitrust, reserve system, Kurt Flood

Player movement in professional baseball in 1970 was restricted by the reserve
system. In essence, the reserve system allows a team to retain the rights of
players indefinitely once the team has acquired that player’s rights through free
agent signing or trade. Curt Flood, a twelve year veteran of the St. Louis
Cardinals, objected to his trade to the Philadelphia Phillies shortly after the
completion of the 1969 season. Flood was not consulted prior to the trade and
he asked Bowie Kuhn, the Commissioner of Baseball, to nullify the trade
making him a free agent so he could sign with any ball club. Kuhn rejected the
request which prompted Flood to sue baseball claiming its reserve system
violated federal antitrust laws.

The issue is whether the business of baseball is engaged in interstate conduct
and should be subjected to federal antitrust law in line with the Supreme
Court’s previous holdings that other professional sports and similar activities
were subject to federal antitrust law.

Businesses that engage in interstate commerce are subject to federal antitrust
law. Thus, baseball’s use of radio and television broadcasts that cross state
lines are enough to confer federal antitrust regulation. Baseball’s exemption
was first created in the 1922 case, Federal Baseball, as the Supreme Court
found that baseball was outside the scope of federal antitrust law. Later, in
1953, the Supreme Court in Toolson directly upheld Federal Baseball and
numerous other cases recognized baseball’s exemption. As a result, Justice
Blackmun held that baseball is a business engaged in interstate commerce,
but ultimately decided to adhere to more than a half century of case precedent
that exempted baseball from federal antitrust law. The Supreme Court also
held that only professional baseball, not any other professional sport, enjoyed
the exemption. The main reasoning behind the court’s decision was Congress’s
“positive inaction.” As baseball developed free of federal legislative action,
Congress repeatedly introduced remedial legislation to alter the exemption
created in Federal Baseball. However, if Congress intended to subject
baseball’s reserve system to the reach of antitrust statutes, the court reasoned,
these remedial measures would have been passed. Thus, it is responsibility of
Congress, not the court, to remedy baseball’s exemption.

Summarized By: Gary Rom