Clarett v. National Football League

Decision Date24 May 2004
Docket NumberDocket No. 04-0943.
PartiesMaurice CLARETT, Plaintiff-Appellee, v. NATIONAL FOOTBALL LEAGUE, Defendant-Appellant.
CourtU.S. Court of Appeals — Second Circuit

Gregg H. Levy, Covington & Burling (Joshua D. Wolson, James M. Garland, and Benjamin C. Block, on the brief), Washington, DC, for Defendant-Appellant.

Alan C. Milstein, Sherman, Silverstein, Kohl, Rose & Podolsky (Jeffrey P. Resnick; John B. Langel, Burt M. Rublin, and Amy L. Weiss, Ballard Spahr Andrews & Ingersoll, LLP; Robert A. Skirnick and Daniel B. Allanoff, Meredith Cohen Greenfogel & Skirnick; Robert A. McCormick, Michigan State University, on the brief), Pennsauken, NJ, for Plaintiff-Appellee.

G. Michael Pharis, Taylor, Porter, Brooks & Phillips L.L.P. (Fredrick R. Tully and Robert W. Barton, on the brief), Baton Rouge, LA, for Amicus Curiae American Football Coaches Association.

Jeffrey A. Mishkin, Skadden, Arps, Slate, Meagher & Flom LLP (Peter S. Julian and Darren C. Broughton; Richard W. Buchanan, National Basketball Association; William L. Daly and Julie Spar, National Hockey League, on the brief), New York, NY, for Amici Curiae National Basketball Association, the Women's National Basketball Association, and the National Hockey League.

Gregory L. Curtner, Miller, Canfield, Paddock & Stone, PLC (David R. Grand, on the brief), New York, NY, for Amicus Curiae National Collegiate Athletic Association.

James W. Quinn, Weil, Gotshal & Manges LLP (Bruce S. Meyer; Richard A. Berthelsen, National Football League Players Association; Jeffrey L. Kessler, Joseph Angland, and David G. Feher, Dewey Ballantine LLP, on the brief), New York, NY, for Amicus Curiae National Football League Players Association.

Perry H. Apelbaum, United States House of Representatives, Rep. John L. Conyers, Ranking Member, Committee on the Judiciary (Kanya A. Bennett, Stacey Dansky, and Michelle A. Persaud, on the brief), Washington, DC, for Amicus Curiae John Conyers, Jr., Member of Congress.

Before: SACK, SOTOMAYOR, Circuit Judges, and KAPLAN, District Judge.*

SOTOMAYOR, Circuit Judge.

Defendant-appellant National Football League ("NFL" or "the League") appeals from a judgment of the United States District Court for the Southern District of New York (Scheindlin, J.) ordering plaintiff-appellee Maurice Clarett ("Clarett") eligible to enter this year's NFL draft on the ground that the NFL's eligibility rules requiring Clarett to wait at least three full football seasons after his high school graduation before entering the draft violate antitrust laws. In reaching its conclusion, the district court held, inter alia, that the eligibility rules are not immune from antitrust scrutiny under the non-statutory labor exemption.1 We disagree and reverse.

BACKGROUND

Clarett, former running back for Ohio State University ("OSU") and Big Ten Freshman of the Year, is an accomplished and talented amateur football player.2 After gaining national attention as a high school player, Clarett became the first college freshman since 1943 to open as a starter at the position of running back for OSU. He led that team through an undefeated season, even scoring the winning touchdown in a double-overtime victory in the 2003 Fiesta Bowl to claim the national championship.3 Prior to the start of his second college season, however, Clarett was suspended from college play by OSU for reasons widely reported but not relevant here.4 Forced to sit out his entire sophomore season, Clarett is now interested in turning professional by entering the NFL draft. Clarett is precluded from so doing, however, under the NFL's current rules governing draft eligibility.

Founded in 1920, the NFL today is comprised of 32 member clubs and is by far the most successful professional football league in North America.5 Because of the League's fiscal success and tremendous public following, a career as an NFL player "represents an unparalleled opportunity for an aspiring football player in terms of salary, publicity, endorsement opportunities, and level of competition." Clarett, 306 F.Supp.2d at 384. But since 1925, when Harold "Red" Grange provoked controversy by leaving college to join the Chicago Bears,6 the NFL has required aspiring professional football players to wait a sufficient period of time after graduating high school to accommodate and encourage college attendance before entering the NFL draft. For much of the League's history, therefore, a player, irrespective of whether he actually attended college or not, was barred from entering the draft until he was at least four football seasons removed from high school. The eligibility rules were relaxed in 1990, however, to permit a player to enter the draft three full seasons after that player's high school graduation.

Clarett "graduated high school on December 11, 2001, two-thirds of the way through the 2001 NFL season" and is a season shy of the three necessary to qualify under the draft's eligibility rules. Clarett Decl. at ¶ 6. Unwilling to forego the prospect of a year of lucrative professional play or run the risk of a career-compromising injury were his entry into the draft delayed until next year, Clarett filed this suit alleging that the NFL's draft eligibility rules are an unreasonable restraint of trade in violation of Section 1 of the Sherman Act, 15 U.S.C. § 1, and Section 4 of the Clayton Act, 15 U.S.C. § 15.

Because the major source of the parties' factual disputes is the relationship between the challenged eligibility rules and the current collective bargaining agreement governing the terms and conditions of employment for NFL players, some elaboration on both the collective bargaining agreement and the eligibility rules is warranted. The current collective bargaining agreement between the NFL and its players union was negotiated between the NFL Management Council ("NFLMC"), which is the NFL member clubs' multi-employer bargaining unit, and the NFL Players Association ("NFLPA"), the NFL players' exclusive bargaining representative. This agreement became effective in 1993 and governs through 2007. Despite the collective bargaining agreement's comprehensiveness with respect to, inter alia, the manner in which the NFL clubs select rookies through the draft and the scheme by which rookie compensation is determined, the eligibility rules for the draft do not appear in the agreement.

At the time the collective bargaining agreement became effective, the eligibility rules appeared in the NFL Constitution and Bylaws, which had last been amended in 1992.7 Specifically, Article XII of the Bylaws ("Article XII"), entitled "Eligibility of Players," prohibited member clubs from selecting any college football player through the draft process who had not first exhausted all college football eligibility, graduated from college, or been out of high school for five football seasons. Clubs were further barred from drafting any person who either did not attend college, or attended college but did not play football, unless that person had been out of high school for four football seasons. Article XII, however, also included an exception that permitted clubs to draft players who had received "Special Eligibility" from the NFL Commissioner. In order to qualify for such special eligibility, a player was required to submit an application before January 6 of the year that he wished to enter the draft and "at least three NFL seasons must have elapsed since the player was graduated from high school." The Commissioner's practice apparently was, and still is, to grant such an application so long as three full football seasons have passed since a player's high school graduation.8 Appellant's Brief, at 7 n. 3.

Although the eligibility rules do not appear in the text of the collective bargaining agreement, the NFL Constitution and Bylaws that at the time of the agreement's adoption contained the eligibility rules are mentioned in three separate provisions relevant to our discussion. First, in Article III, Section 1 (Scope of Agreement), the collective bargaining agreement states:

This Agreement represents the complete understanding of the parties as to all subjects covered herein, and there will be no change in the terms and conditions of this Agreement without mutual consent.... [T]he NFLPA and the Management Council waive any rights to bargain with one another concerning any subject covered or not covered in this Agreement for the duration of this Agreement, including the provisions of the NFL Constitution and Bylaws; provided, however, that if any proposed change in the NFL Constitution and Bylaws during the term of this Agreement could significantly affect the terms and conditions of employment of NFL players, then the [NFLMC] will give the NFLPA notice of and negotiate the proposed change in good faith.

(emphasis added). Second, Article IV, Section 2 (No Suit) provides generally that "neither [the NFLPA] nor any of its members" will sue or support a suit "relating to the presently existing provisions of the Constitution and Bylaws of the NFL as they are currently operative and administered." Third, Article IX, Section 1 (Non-Injury Grievance) makes "[a]ny dispute ... involving the interpretation of, application of, or compliance with, ... any applicable provision of the NFL Constitution and Bylaws pertaining to terms and conditions of employment of NFL players" subject to the grievance procedures afforded under the collective bargaining agreement.

Before the collective bargaining agreement became effective, a copy of the Constitution and Bylaws, as amended in 1992, was provided by the NFL to the NFLPA along with a letter, dated May 6, 1993, that "confirm[ed] that the attached documents are the presently existing provisions of the Constitution and Bylaws of the NFL referenced in Article IV, Section 2, of the Collective Bargaining Agreement." The May 6 letter was signed by representatives of the...

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