Brown v. Pro Football Inc., DBA Washington Redskins

• Citation: 135 L.Ed.2d 521,518 U.S. 231,116 S.Ct. 2116
• Decision Date: 20 June 1996
• Docket Number: 95388
• Parties: BROWN, et al. v. PRO FOOTBALL, INC., dba WASHINGTON REDSKINS, et al.
• Court: United States Supreme Court

518 U.S. 231

116 S.Ct. 2116

135 L.Ed.2d 521

BROWN, et al.

v PRO FOOTBALL, INC., DBA WASHINGTON REDSKINS, et al.

Certiorari to the United States Court of Appeals for the District of Columbia Circuit.

No. 95-388.

Supreme Court of the United States

Argued March 27, 1996

Decided June 20, 1996

Syllabus

After their collective-bargaining agreement expired, the National Football League (NFL), a group of football clubs, and the NFL Players Association, a labor union, began to negotiate a new contract. The NFL presented a plan that would permit each club to establish a "developmental squad" of substitute players, each of whom would be paid the same $1,000 weekly salary. The union disagreed, insisting that individual squad members should be free to negotiate their own salaries. When negotiations reached an impasse, the NFL unilaterally implemented the plan. A number of squad players brought this antitrust suit, claiming that the employers' agreement to pay them $1,000 per week restrained trade in violation of the Sherman Act. The District Court entered judgment for the players on a jury treble-damages award, but the Court of Appeals reversed, holding that the owners were immune from antitrust liability under the federal labor laws.

Held: Federal labor laws shield from antitrust attack an agreement among several employers bargaining together to implement after impasse the terms of their last best good-faith wage offer. Pp. 3-18.

(a) This Court has previously found in the labor laws an implicit, "nonstatutory" antitrust exemption that applies where needed to make the collective-bargaining process work. See, e.g., Connell Constr. Co. v. Plumbers, 421 U. S. 616, 622. The practice here at issue-the postimpasse imposition of a proposed employment term concerning a mandatory subject of bargaining-is unobjectionable as a matter of labor law and policy, and, indeed, plays a significant role in the multiemployer collective-bargaining process that itself comprises an important part of the Nation's industrial relations system. Subjecting it to antitrust law would threaten to introduce instability and uncertainty into the collective-bargaining process, for antitrust often forbids or discourages the kinds of joint discussions and behavior that collective bargaining invites or requires. Moreover, if antitrust courts tried to evaluate particular kinds of employer understandings, there would be created a web of detailed rules spun by many different nonexpert antitrust judges and juries, not a set of labor rules enforced by a single expert body, the National Labor Relations Board, to which the labor laws give primary responsibility for policing collective bargaining. Thus, the implicit exemption applies in this case. Pp. 3-10.

(b) Petitioners' claim that the exemption applies only to labor-management agreements is rejected, since it is based on inapposite authority, and an exemption limited by petitioners' labor-management-consent principle could not work. Pp. 10-12.

(c) Also rejected is the Solicitor General's argument that the exemption should terminate at the point of impasse. His rationale, that employers are thereafter free as a matter of labor law to negotiate individual arrangements on an interim basis with the union, is not completely accurate. More importantly, the simple "impasse" line would not solve the basic problem that labor law permits employers, after impasse, to engage in considerable joint behavior, while uniform employer conduct-at least when accompanied by discussion-invites antitrust attack. Pp. 12-15.

(d) Petitioners' alternative rule, which would exempt from antitrust's reach postimpasse agreements about bargaining "tactics," but not those about substantive "terms," is unsatisfactory because it would require antitrust courts, insulated from the bargaining process, to delve into the amorphous subject of employers' subjective motives in order to determine whether the exemption applied. Pp. 15-16.

(e) Petitioners' arguments relating to general ``backdrop'' statutes and the ``special'' nature of professional sports are also rejected. Pp. 16-18.

(f) The antitrust exemption applies to the employer conduct at issue here, which took place during and immediately after a collective-bargaining negotiation; grew out of, and was a directly related to, the lawful operation of the bargaining process; involved a matter that the parties were required to negotiate collectively; and concerned only the parties to the collective-bargaining relationship. The Court's holding is not intended to insulate from antitrust review every joint imposition of terms by employers, for an employer agreement could be sufficiently distant in time and in circumstances from the bargaining process that a rule permitting antitrust intervention would not significantly interfere with that process. The Court need not decide in this case whether, or where, to draw the line, particularly since it does not have the detailed views of the Board on the matter. Pp. 18-19. 50 F. 3d 1041, affirmed.

Breyer, J., delivered the opinion of the Court, in which Rehnquist, C. J., and O'Connor, Scalia, Kennedy, Souter, Thomas, and Ginsburg, JJ., joined. Stevens, J., filed a dissenting opinion.

NOTICE: This opinion is subject to formal revision before publication in the preliminary print of the United States Reports. Readers are requested to notify the Reporter of Decisions, Supreme Court of the United States, Washington, D.C. 20543, of any typographical or other formal errors, in order that corrections may be made before the preliminary print goes to press.

Justice Breyer delivered the opinion of the Court.

The question in this case arises at the intersection of the Nation's labor and antitrust laws. A group of professional football players brought this antitrust suit against football club owners. The club owners had bargained with the players' union over a wage issue until they reached impasse. The owners then had agreed among themselves (but not with the union) to implement the terms of their own last best bargaining offer. The question before us is whether federal labor laws shield such an agreement from antitrust attack. We believe that they do. This Court has previously found in the labor laws an implicit antitrust exemption that applies where needed to make the collective-bargaining process work. Like the Court of Appeals, we conclude that this need makes the exemption applicable in this case.

I.

We can state the relevant facts briefly. In 1987, a collective-bargaining agreement between the National Football League (NFL), a group of football clubs, and the NFL Players Association, a labor union, expired. The NFL and the Players Association began to negotiate a new contract. In March 1989, during the negotiations, the NFL adopted Resolution G-2, a plan that would permit each club to establish a "developmental squad" of up to six rookie or "first-year" players who, as free agents, had failed to secure a position on a regular player roster. See App. 42. Squad members would play in practice games and sometimes in regular games as substitutes for injured players. Resolution G-2 provided that the club owners would pay all squad members the same weekly salary.

The next month, April, the NFL presented the developmental squad plan to the Players Association. The NFL proposed a squad player salary of $1,000 per week. The Players Association disagreed. It insisted that the club owners give developmental squad players benefits and protections similar to those provided regular players, and that they leave individual squad members free to negotiate their own salaries.

Two months later, in June, negotiations on the issue of developmental squad salaries reached an impasse. The NFL then unilaterally implemented the developmental squad program by distributing to the clubs a uniform contract that embodied the terms of Resolution G-2 and the $1,000 proposed weekly salary. The League advised club owners that paying developmental squad players more or less than $1,000 per week would result in disciplinary action, including the loss of draft choices.

In May 1990, 235 developmental squad players brought this antitrust suit against the League and its member clubs. The players claimed that their employers' agreement to pay them a $1,000 weekly salary violated the Sherman Act. See 15 U. S. C. Section(s) 1 (forbidding agreements in restraint of trade). The Federal District Court denied the employers' claim of exemption from the antitrust laws; it permitted the case to reach the jury; and it subsequently entered judgment on a jury treble-damage award that exceeded $30 million. The NFL and its member clubs appealed.

The Court of Appeals (by a split 2-to-1 vote) reversed. The majority interpreted the labor laws as "waiv[ing] antitrust liability for restraints on competition imposed through the collective-bargaining process, so long as such restraints operate primarily in a labor market characterized by collective bargaining." 50 F. 3d 1041, 1056 (CADC 1995). The Court held, consequently, that the club owners were immune from antitrust liability. We granted certiorari to review that determination. Although we do not interpret the exemption as broadly as did the Appeals Court, we nonetheless find the exemption applicable, and we affirm that Court's immunity conclusion.

II.

The immunity before us rests upon what this Court has called the "nonstatutory" labor exemption from the antitrust laws. Connell Constr. Co. v. Plumbers, 421 U. S. 616, 622 (1975); see also Meat Cutters v. Jewel Tea Co., 381 U. S. 676 (1965); Mine Workers v. Pennington, 381 U. S. 657 (1965). The Court has implied this exemption from federal labor statutes, which set forth a national labor policy favoring free and private collective bargaining, see 29 U. S. C. Section(s) 151; Teamsters v. Oliver, 358 U. S. 283, 295 (1959); which require good-faith bargaining over wages, hours and working conditions, see 29 U....