Major League Baseball v. Butterworth

• Citation: 181 F.Supp.2d 1316
• Decision Date: 27 December 2001
• Docket Number: No. 4:01cv511-RH.,4:01cv511-RH.
• Parties: MAJOR LEAGUE BASEBALL, etc., et al., Plaintiffs, v. Robert A. BUTTERWORTH, etc., Defendant.
• Court: U.S. District Court — Northern District of Florida

181 F.Supp.2d 1316

MAJOR LEAGUE BASEBALL, etc., et al., Plaintiffs, v. Robert A. BUTTERWORTH, etc., Defendant.

No. 4:01cv511-RH.

United States District Court, N.D. Florida, Tallahassee Division.

December 27, 2001.

COPYRIGHT MATERIAL OMITTED

Michael Eugene Kinney, John Phillips Cole, Foley & Lardner, Jacksonville, FL, Mary K. Braza, Milwaukee, WI, for Major League Baseball and Allan H. Selig.

Lori S. Rowe, Gray, Harris & Robinson, PA, Peter V. Antonacci, Gray, Harris & Robinson, Tallahassee, FL, for Tampa Bay Devil Rays, Ltd. and Florida Marlins Baseball Club LLC.

Patricia A. Conners, Attorney General, State of Florida, John D C Newton, II, Attorney General, State of Florida, Economic Crimes Etc. Div., Tallahassee, FL, for Robert A. Butterworth.

MEMORANDUM OPINION

HINKLE, District Judge.

Major League Baseball has announced its intention to contract from 30 clubs to 28 for the 2002 season. The issue in this action is whether the federal and state antitrust laws apply to the proposed contraction. The defendant Attorney General of the State of Florida asserts that the antitrust laws do apply. Pursuant to his statutory authority to investigate possible violations of the federal and state antitrust laws, the Attorney General has issued civil investigative demands to plaintiffs Major League Baseball, its Commissioner, and the two Florida major league baseball clubs. Plaintiffs seek declaratory and injunctive relief against the Attorney General on the grounds that the "business of baseball," including the decision whether to contract, is exempt from the federal and state antitrust laws. Plaintiffs are correct.

By separate order, a preliminary injunction has been entered. This opinion sets forth the court's findings of fact and conclusions of law in support of the preliminary injunction and establishes a procedure for further consideration of this case.

I Background

Baseball is an American game that has occupied a unique position in American society. Its history traces to the 19th century and has been described with some wistfulness in the normally pedestrian pages of the United States Reports. See Flood v. Kuhn, 407 U.S. 258, 260-64, 92 S.Ct. 2099, 32 L.Ed.2d 728 (1972). But whatever its history, big league baseball is also big business. Some would say it faces big issues.

Major League Baseball is an unincorporated association of the 30 major league baseball clubs. It is governed by a Constitution adopted in January 2000. The Constitution authorizes contraction on the affirmative vote of three-fourths of the clubs.

On November 6, 2001, the clubs voted 28 to 2 in favor of contracting from 30 clubs to 28 for the 2002 season. The two Florida clubs voted in favor of contraction. On December 13, 2001, Major League Baseball announced that negotiations with the Players Association, an organization representing major league baseball players, had failed and that Major League Baseball was proceeding with the planned contraction. As this opinion is written, it appears that contraction is imminent.

On November 13, 2001, the Attorney General of the State of Florida issued sweeping civil investigative demands ("CIDs") to the plaintiffs in this action: Major League Baseball, Commissioner Allan H. Selig in his official and individual capacities, and the two Florida major league baseball clubs, the Tampa Bay Devil Rays, Ltd., and the Florida Marlins Baseball Club, L.L.C. Each CID said it was "issued pursuant to the Florida Antitrust Act of 1980, Section 542.28, Florida Statutes," identifying no other authority for its issuance. Each CID demanded that the recipient answer broad interrogatories and produce voluminous documents by December 13, 2001. The Attorney General refused to extend the deadline.

On December 10, 2001, plaintiffs filed this action, contending that, as a matter of federal law, the "business of baseball," a concept that plaintiffs assert includes the proposed contraction from 30 teams to 28, is exempt from the federal and state antitrust laws. Plaintiffs' complaint demanded declaratory and injunctive relief.

Plaintiffs filed motions for a temporary restraining order and preliminary injunction. On December 11, 2001, a hearing was held on plaintiffs' motion for a temporary restraining order. All parties were represented by counsel and presented argument. All parties agreed that the entire action appeared to present only issues of law. I denied the motion for temporary restraining order on the ground that plaintiffs would suffer no irreparable harm prior to a hearing on plaintiffs' motion for preliminary injunction. I scheduled the motion for preliminary injunction for hearing on December 18, 2001, a date approved by both sides, and announced my intention to consolidate the trial on the merits with the preliminary injunction hearing, as authorized by Federal Rule of Civil Procedure 65(a)(2). A written order confirmed the proposed consolidation and established a procedure for each side to give advance notice of its positions. Each side submitted a comprehensive trial brief in advance of the scheduled hearing.

On December 18, 2001, the preliminary injunction hearing and consolidated trial on the merits convened, with both sides announcing ready. Both sides presented testimony and exhibits, as well as argument. The Attorney General asserted during the testimony of plaintiffs' first witness that the Attorney General intended to seek discovery on issues being addressed by the witness (a very general summary of the effects contraction would have on such matters as scheduling) and thus intended to oppose full consolidation of the merits with the preliminary injunction hearing. At the conclusion of the hearing, I announced on the record my intention to enter a preliminary injunction, outlined the reasons for that decision, and indicated that a written preliminary injunction and more comprehensive written explanation of the decision would be issued. I also announced that the Attorney General would be given the opportunity to review the written order and to address within a reasonable time thereafter whether he believed discovery and further proceedings should be commenced or instead agreed that the merits should be treated as consolidated with the preliminary injunction hearing in all respects and a final judgment entered. The Attorney General agreed to that procedure and agreed that plaintiffs should not be required to provide security as a condition of the preliminary injunction prior to the Attorney General's election whether to seek further proceedings in this court. A preliminary injunction was entered on December 21, 2001, in the expectation that this more comprehensive opinion would be issued.

These matters have been addressed with considerable dispatch because they are matters of some urgency and because, with commendable professionalism, both sides have cooperated in the prompt submission of the significant procedural and substantive issues presented by this case.

II Jurisdiction

Plaintiffs assert that a state officer — the Attorney General of the State of Florida — has taken action, and has threatened further action, in violation of federal law. Plaintiffs seek relief under 42 U.S.C. § 1983 and the federal Declaratory Judgment Act, 28 U.S.C. §§ 2201-02. The action arises under federal law and is within this court's jurisdiction under 28 U.S.C. § 1331.

Because plaintiffs seek only prospective relief and name as the defendant only a state officer, not the state in its own name, the Eleventh Amendment does not bar the action, under the doctrine of Ex parte Young, 209 U.S. 123, 28 S.Ct. 441, 52 L.Ed. 714 (1908). See Morales v. Trans World Airlines, Inc., 504 U.S. 374, 112 S.Ct. 2031, 119 L.Ed.2d 157 (1992) (holding that federal district court properly enjoined state attorney general from threatened enforcement of state regulations that were preempted by federal law). The Attorney General does not assert the contrary.¹

III Abstention

The Attorney General asserts I should abstain under the line of cases commencing with Younger v. Harris, 401 U.S. 37, 91 S.Ct. 746, 27 L.Ed.2d 669 (1971). Those cases address the circumstances under which a federal court should decline to exercise its jurisdiction in deference to state criminal proceedings or certain state civil proceedings (ordinarily civil proceedings initiated by the state itself or by its officers or agencies). For two reasons, I exercise my discretion against abstention here.

First, no state criminal or civil proceeding is pending. Abstention ordinarily is not required when proceedings of substance take place in federal court before any state criminal or civil proceeding is pending. See, e.g., Hawaii Housing Authority v. Midkiff, 467 U.S. 229, 104 S.Ct. 2321, 81 L.Ed.2d 186 (1984) (upholding district court's refusal to abstain when state court proceedings did not begin until after proceedings of substance had taken place in district court). A necessary corollary of this rule is that abstention is not required when no state proceeding is pending at all. See Red Bluff Drive-In, Inc. v. Vance, 648 F.2d 1020, 1032 (5th Cir.1981) (holding lack of an ongoing state proceeding warranted the district court's refusal to abstain under Younger).²

Second, the essential issue in this case on the merits is whether the Florida Attorney General's authority to investigate and enforce the antitrust laws has been preempted, with respect to the business of baseball, by federal law. The reasons for Younger abstention-deferring as a matter of comity to the state's efforts to enforce its own laws in a state forum in which any federal defense may be fully and fairly adjudicated-are substantially weakened when the issue is whether the state law at issue has been preempted by federal law, so that the state tribunal or officer at issue is acting beyond its jurisdiction.

This is illustrated by Baggett v. Department of Professional Regulation, 717 F.2d 521 (11th Cir.1983). In...