Neeld v. National Hockey League

• Decision Date: 19 September 1977
• Docket Number: Civ. No. 77-32.
• Citation: 439 F. Supp. 446
• Parties: Gregory P. NEELD, Plaintiff, v. NATIONAL HOCKEY LEAGUE, a nonprofit unincorporated association, Atlanta Hockey, Inc., a Georgia Corporation, Storer Broadcasting, Inc., a Florida Corporation, Niagara Frontier Hockey Corporation, a New York Corporation, Chicago Black Hawks Hockey Team, Inc., an Illinois Corporation, Detroit Red Wings Hockey Club, Inc., a Michigan Corporation, California Sports, Inc., a California Corporation, Northstar Financial Corporation, a Minnesota Corporation, Club de Hockey Canadian, a Canadian Corporation, Nassau Sports Limited, a limited partnership, Madison Square Garden Center, Inc., a New York Corporation, Philadelphia Hockey Club, Inc., a Pennsylvania Corporation, Pittsburgh Penguins, Inc., a Pennsylvania Corporation, Missouri Arena Corporation, a Missouri Corporation, Harold E. Ballard, a sole proprietorship, Vancouver Hockey Club, Ltd., a Canadian Corporation, Washington Capitals Hockey Club, a limited partnership, H & L Partnership, a Colorado limited partnership, Defendants.
• Court: U.S. District Court — Western District of New York

439 F. Supp. 446

Gregory P. NEELD, Plaintiff, v. NATIONAL HOCKEY LEAGUE, a nonprofit unincorporated association, Atlanta Hockey, Inc., a Georgia Corporation, Storer Broadcasting, Inc., a Florida Corporation, Niagara Frontier Hockey Corporation, a New York Corporation, Chicago Black Hawks Hockey Team, Inc., an Illinois Corporation, Detroit Red Wings Hockey Club, Inc., a Michigan Corporation, California Sports, Inc., a California Corporation, Northstar Financial Corporation, a Minnesota Corporation, Club de Hockey Canadian, a Canadian Corporation, Nassau Sports Limited, a limited partnership, Madison Square Garden Center, Inc., a New York Corporation, Philadelphia Hockey Club, Inc., a Pennsylvania Corporation, Pittsburgh Penguins, Inc., a Pennsylvania Corporation, Missouri Arena Corporation, a Missouri Corporation, Harold E. Ballard, a sole proprietorship, Vancouver Hockey Club, Ltd., a Canadian Corporation, Washington Capitals Hockey Club, a limited partnership, H & L Partnership, a Colorado limited partnership, Defendants.

Civ. No. 77-32.

United States District Court, W. D. New York.

September 19, 1977.

COPYRIGHT MATERIAL OMITTED

Daniel S. Mason, Furth, Fahrner & Wong, San Francisco, Cal., Robert J. Salomon, Fudeman & Renaldo, Buffalo, N. Y., for plaintiff.

Bingham B. Leverich, Covington & Burling, Washington, D. C., Brian F. Toohey, Cohen, Swados, Wright, Hanifin, Bradford & Brett, Buffalo, N. Y., for defendants.

MEMORANDUM and ORDER

ELFVIN, District Judge.

This is the second action filed by plaintiff Gregory P. Neeld, an individual who has sight in only one eye, against the National Hockey League ("NHL") and its member franchises. Section 12.6 of the NHL By-Laws provides that:

"A player with only one eye, or one of whose eyes has a vision of only three-sixtieths (3-60ths) or under, shall not be eligible to play for a Member Club."

In June of 1975 plaintiff had been selected by the Buffalo Sabres hockey team ("the Sabres", of which the member franchisee is defendant Niagara Frontier Hockey Corporation) in the fourth round of the so-called amateur players' draft, but was rendered ineligible to compete for a position on the team by Section 12.6.

Prior to filing the instant nine-count complaint January 21, 1977, plaintiff had commenced an action September 8, 1975 in the United States District Court for the Northern District of California ("the California action") against the same defendants¹ in which the Honorable Robert H. Schnacke of that court entered an order September 23, 1976 granting defendants' motion for summary judgment. The complaint in the California action alleged that the NHL and its member clubs conspired in violation of section 1 of the Sherman Act, 15 U.S.C. § 1, to prevent plaintiff from competing for a position on the Sabres and on any other NHL team and from otherwise playing professional hockey in the NHL. Although such complaint did not specifically mention or refer to Section 12.6, the memoranda of law and affidavits submitted to the court in the California action and the transcript of the proceedings held before Judge Schnacke on defendants' motion for summary judgment clearly reveal that the matter there in dispute between the parties and the legal issue then decided by that court was the application vel non of such by-law to plaintiff and that the granting of summary judgment in favor of defendants was based solely upon a finding that such by-law was a reasonable restraint of trade and hence not violative of section 1 of the Sherman Act. The California action is presently on appeal to the Court of Appeals for the Ninth Circuit.

In the instant complaint, count I alleges that the amateur players' draft conducted by the NHL and its member teams violates section 1 of the Sherman Act by precluding plaintiff from seeking employment by and negotiating with any member club other than the Sabres. Count II reasserts the allegations of count I and alleges that the NHL's amateur players' draft also violates section 340 of the General Business Law of the State of New York, known as the Donnelly Act. Count III alleges that, after the filing of the California action, defendants continued to refuse plaintiff the opportunity to play professional hockey in the NHL, that defendants communicated with other professional hockey leagues and their member teams and franchises and attempted to influence them to refuse employment to plaintiff, and that defendants have discriminated against plaintiff's brothers in their efforts to obtain employment with NHL member teams, all in violation of the Sherman Act. It is alleged in count IV that the implementation of Section 12.6 by member clubs constitutes a violation of section 296 of the New York Human Rights Law. In counts V and VI, respectively, plaintiff alleges that defendants' adherence to Section 12.6 is violative of 42 U.S.C. §§ 1983 and 1985(3). Count VII alleges that such by-law conflicts with provisions of the collective bargaining agreement between the NHL and the NHL Players' Association and that enforcement of the by-law violates section 301 of the Labor-Management Relations Act, 29 U.S.C. § 185. The complaint's count VIII asserts that defendants' prevention of plaintiff's employment in the NHL by application of Section 12.6 to him constitutes the common law tort of interference with prospective economic advantage. Plaintiff further alleges in count IX that defendants have defamed his professional reputation by publishing and declaring false and inaccurate statements regarding his ability as a hockey player.

The matter is now before me on defendants' motion pursuant to Fed.R.Civ.P. rule 12(b)(1) and (6) to dismiss the complaint for lack of subject matter jurisdiction and for failure to state a claim upon which relief can be granted or, in the alternative, for summary judgment.² Defendants strenuously urge that the judgment entered in the California action is res judicata as to all nine counts of the instant complaint. They contend that the California action was based upon the same cause of action as is here asserted in that the complaint therein sought redress for the same alleged wrong-doing by defendants and involved the same alleged injury to plaintiff—to wit, unlawful interference with and preclusion of his employment in the NHL. Defendants assert that the present action is barred by long-established principles of res judicata which prohibit a plaintiff from splitting a cause of action and litigating in separate forums what could and should have been litigated in one action. On the other hand, plaintiff contends that defendants' continued use of the amateur draft system and continued adherence to Section 12.6 renders inapplicable the doctrine of res judicata. He asserts that the instant complaint does not merely allege new grounds for the same relief or involve new legal theories of liability for the same cause of action, but sets forth new causes of action which could not have been raised at the time of the California action and consequently were not litigated and ruled upon in or otherwise foreclosed by that action.

As a general proposition, when a second suit is commenced between the same parties or their privies and bottomed on the same cause of action, a prior final judgment rendered on the merits by a court of competent jurisdiction constitutes an absolute bar to said second action. Cromwell v. County of Sac, 94 U.S. 351, 352, 24 L.Ed. 195 (1877); Herendeen v. Champion Intern. Corp., 525 F.2d 130, 133 (2d Cir. 1975); United States v. General Electric Company, 358 F.Supp. 731, 738 (S.D.N.Y.1973). The judicially-created doctrine of res judicata, however, does not operate as a bar to a second action between the same parties or their privies where said second action is brought on a cause of action different than that on which final judgment was rendered in the prior suit.³Lawlor v. National Screen Service, 349 U.S. 322, 326, 75 S.Ct. 865, 99 L.Ed. 1122 (1955); Herendeen v. Champion Intern. Corp., supra, at 133. The doctrine of res judicata provides that, when final judgment has been entered on the merits of a cause of action, it is conclusive and final between the parties or their privies "not only as to every matter which was offered and received to sustain or defeat the claim or demand, but as to any other admissible matter which might have been offered for that purpose." Cromwell v. County of Sac, supra, at 352; see, also, Irving Nat. Bank v. Law, 10 F.2d 721, 724 (2d Cir. 1926), in which the Honorable Learned Hand stated that the bar extends "not only to all matters pleaded, but to all that might have been * * *". The United States Court of Appeals for the Second Circuit, citing Heiser v. Woodruff, 327 U.S. 726, 735, 66 S.Ct. 853, 90 L.Ed. 970 (1946), has recently observed in a per curiam opinion, In re Interstate Stores, Inc., 558 F.2d 1046, 1047 (2d Cir. 1977), that a final judgment is res judicata "not only as to all matters litigated and decided by it, but as to all relevant issues which could have been but were not raised and litigated in the suit." It must be remembered, however, that these broad statements as to the extent of res judicata should not be interpreted to bar a subsequent action between the same parties on a different cause of action. Only with respect to the same cause of action does res judicata bar those grounds or issues which might have been, but were not, raised and litigated in the former action. Saylor v. Lindsley, 391 F.2d 965, 968 (2d Cir. 1968); McNellis v. First Federal Sav. & L. Ass'n of Rochester, N. Y., 364 F.2d 251, 254 (2d Cir.), cert. denied, 385 U.S. 970, 87 S.Ct. 504, 17 L.Ed.2d 434 (1966). The former judgment, when final and on the merits, puts to rest the whole cause of action which was the subject matter of the first action, including all matters which could have been, but were not, raised, but does not estop a plaintiff from suing the same defendants on a distinct and separate cause of...