66 F.3d 523 (2nd Cir. 1995), 744, Caldwell v. American Basketball Ass'n, Inc.

Docket Nº:744, Docket 94-7147.
Citation:66 F.3d 523
Party Name:1995-2 Trade Cases P 71,122 Joe L. CALDWELL, Plaintiff-Appellant, v. The AMERICAN BASKETBALL ASSOCIATION, INC.; The Spirits of St. Louis Basketball Club, a limited partnership; Ozzie Silna; Daniel Silna; Harry Weltman; Donald Schupak; and Tedd Munchak, Defendants-Appellees.
Case Date:September 21, 1995
Court:United States Courts of Appeals, Court of Appeals for the Second Circuit

Page 523

66 F.3d 523 (2nd Cir. 1995)

1995-2 Trade Cases P 71,122

Joe L. CALDWELL, Plaintiff-Appellant,



St. Louis Basketball Club, a limited partnership; Ozzie

Silna; Daniel Silna; Harry Weltman; Donald Schupak; and

Tedd Munchak, Defendants-Appellees.

No. 744, Docket 94-7147.

United States Court of Appeals, Second Circuit

September 21, 1995

        Argued Jan. 30, 1995.

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[Copyrighted Material Omitted]

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        Philip J. Shea, Phoenix, AZ (Shea & Wilks, Phoenix, AZ, of counsel), for plaintiff-appellant.

        Jack David, New York City (Steven Finell, David C. Berg, Siller, Wilk & Mencher, New York City, of counsel), for defendants-appellees The Spirits of St. Louis Basketball Club, Daniel Silna and Donald Schupak.

        Herbert Teitelbaum, New York City (Teitelbaum, Hiller, Rodman, Paden & Hibsher, P.C., of counsel), for defendant-appellee Tedd Munchak.

        Before MESKILL, WINTER and McLAUGHLIN, Circuit Judges.

        WINTER, Circuit Judge:

        Joe L. Caldwell appeals from Judge Sand's grant of summary judgment, Caldwell v. American Basketball Ass'n, 825 F.Supp. 558 (S.D.N.Y.1993), dismissing his complaint. The complaint alleged that the various appellees violated the Sherman Act, 15 U.S.C. Sec. 1 et seq., by conspiring to prevent him from playing professional basketball and by attempting to monopolize the market for professional basketball services. It further alleged that appellees The Spirits of St. Louis Basketball Club, Donald Shupak, and Daniel Silna committed intentional or prima facie torts under New York law. Because Caldwell's antitrust claims are barred by the nonstatutory labor exemption and his state law claims are preempted by the National Labor Relations Act ("NLRA"), 29 U.S.C. Sec. 151 et seq., we affirm.


        In 1970, Caldwell signed a five-year contract to play basketball for the Carolina Cougars, a member team of the appellee American Basketball Association ("ABA"). In the same year, pursuant to the NLRA, the ABA Players' Association (the "Union") became the exclusive collective bargaining representative for all ABA players. Caldwell served as vice-president and later president of the Union and as the Union's player representative for the Cougars. Caldwell, 825 F.Supp. at 560-61.

        During Caldwell's first four seasons with the Cougars, he performed ably and was elected to the All-Star team during two of the four years. He also became team captain of the Cougars. After Caldwell's fourth season, the owner of the Cougars, appellee Tedd Munchak, sold the team and became commissioner of the ABA. A group headed by appellees Ozzie and David Silna became the new owners of the Cougars. The Cougars subsequently moved to St. Louis and were renamed "The Spirits of St. Louis." Id. at 561-62.

        On November 20, 1974, Marvin Barnes, a star player for the Spirits, failed to appear

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for an important game. Barnes's dissatisfaction with his contract with the Spirits had prompted him to "jump" the team as a negotiating tactic. When the Spirits' coach asked Caldwell where Barnes was, Caldwell denied having any knowledge of Barnes's whereabouts. Although Barnes returned to the team soon thereafter, the Spirits (as assignee from the Cougars) suspended Caldwell pursuant to certain terms in his individual contract, because they believed that he had been involved in planning the incident. Id. at 562.

        Caldwell appealed his suspension, with the aid of the Union, to the ABA commissioner. However, Caldwell decided not to pursue internal remedies in the ABA but rather to litigate the suspension. Accordingly, in February 1975 Caldwell brought a contract action in a federal district court in Georgia against Munchak, who was a guarantor of his individual contract. After a bench trial, Caldwell recovered his full 1974-75 salary of $220,000, plus interest, costs and expenses. Id. at 563.

        Caldwell never played professional basketball again. His contract with the Spirits would have expired, or did expire, on October 29, 1975, but Caldwell alleges that he "was never told that his suspension was lifted, or that the Spirits had terminated his contract, or that other teams were free to negotiate with him." Id. at 562. After merger negotiations with the NBA succeeded, the ABA and the Spirits ceased operations after the 1975-76 season. Id. at 564.

        Caldwell filed the instant lawsuit in early 1975. It was placed on the district court's suspense calendar pending resolution of the Georgia action but was not reactivated for eighteen years due to Caldwell's bankruptcy proceedings. Id. at 563. Caldwell alleged in his complaint that the defendants: (i) "combined and conspired to blacklist him and deprive him of the opportunity to continue his career as a professional basketball player" in violation of Section 1 of the Sherman Act; (ii) conspired and attempted to monopolize the market for professional basketball services in violation of Section 2 of the Sherman Act; and (iii) acted tortiously and maliciously when they suspended Caldwell "indefinitely." Id. at 564, 574, 576.

        Caldwell asserted that appellees and the National Basketball Association ("NBA") desired to keep him out of professional basketball during the 1974-76 period in order to exclude him from the ABA-NBA merger negotiations that were then taking place. Caldwell claimed that he had achieved "notoriety" a year earlier when, as acting president of the Union, he had refused to approve the terms of a collective bargaining agreement.

        Appellees offered evidence that Caldwell's physical limitations accounted for his inability to secure employment as a professional basketball player after 1975. In that regard, the record shows that: (i) Caldwell was 33 years old at the time of his suspension and less than two percent of NBA players during the five basketball seasons between 1976 and 1981 were 34 years old or older; (ii) Caldwell had sustained a torn ligament during the 1971 season; and (iii) Caldwell had sustained an additional injury in an automobile accident in January, 1975. Id. at 564. Moreover, all but four of the ABA's teams ceased operations after the merger, resulting in a decreased demand for basketball players.

        The district court granted summary judgment in favor of appellees on the ground that Caldwell's physical limitations were the sole cause of his failure to secure another position as a professional basketball player. Caldwell, 825 F.Supp. at 570. We affirm, but on different grounds.


        We review the district court's grant of summary judgment de novo, Aslanidis v. United States Lines, Inc., 7 F.3d 1067, 1072 (2d Cir.1993), and view the evidence in the light most favorable to Caldwell. See Prunier v. City of Watertown, 936 F.2d 677, 679 (2d Cir.1991).

  1. State Law Claims

            We take the unusual step of addressing Caldwell's state law claims first because our resolution of those claims sheds light upon the disposition of his federal antitrust claims.

            Caldwell asserts that the refusal of ABA teams to hire him was the result of a

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    stance he had earlier taken as Union president in opposing a new collective bargaining agreement and because of appellees' resultant desire to exclude him from any role in the ABA-NBA merger negotiations. The essence of his factual claim thus is that the ABA refused him employment because he had engaged in union activities that are protected by Section 7 of the National Labor Relations Act. If true, these facts would constitute an unfair labor practice under NLRA Secs. 8(a)(1) and (3). 29 U.S.C. Sec. 158(a)(1), (3).

            States are preempted from regulating conduct that even "arguably" constitutes an unfair labor practice under NLRA Sec. 8. San Diego Bldg. Trades Council v. Garmon, 359 U.S. 236, 244-45, 79 S.Ct. 773, 779, 3 L.Ed.2d 775 (1959). In Amalgamated Ass'n of Street, Elec. Ry. and Motor Coach Employees of Am. v. Lockridge, 403 U.S. 274, 91 S.Ct. 1909, 29 L.Ed.2d 473 (1971), the Supreme Court applied the Garmon preemption doctrine in the context of a state judgment based on a breach of contract theory and on facts that arguably constituted a violation of NLRA Secs. 8(b)(2) and (a)(1), (3). Id. at 293, 91 S.Ct. at 1921. It noted that concurrent state court and federal administrative jurisdiction over such conduct bristled with potential...

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