St. Louis Convention & Visitors Com'n v. National Football League
| Decision Date | 03 September 1998 |
| Docket Number | Nos. 97-4055,97-4223,s. 97-4055 |
| Citation | 1998 WL 559082,154 F.3d 851 |
| Parties | 1998-2 Trade Cases P 72,258 ST. LOUIS CONVENTION & VISITORS COMMISSION, Plaintiff-Appellant/Cross-Appellee, v. NATIONAL FOOTBALL LEAGUE; B & B Holdings, Inc.; The Five Smiths, Inc.; Buffalo Bills, Inc.; Chicago Bears Football Club, Inc.; Cleveland Browns Football Company, Inc.; Dallas Cowboys Football Club, Ltd.; PBD Sports, LTD; The Detroit Lions, Inc.; The Green Bay Packers, Inc; Houston Oilers, Inc.; Indianapolis Colts, Inc.; Kansas City Chiefs Football Club, Inc.; Miami Dolphins, Ltd.; Minnesota Vikings Football Club, Inc.; New England Patriots, Limited Partnership; The New Orleans Saints; New York Football Giants, Inc.; New York Jets Football Club, Inc.; Philadelphia Eagles Holdings, L.P.; Pittsburgh Steelers Sports, Inc.; Chargers Football Company; San Francisco Forty-Niners, Limited; Seattle Seahawks, Inc.; Pro-Football Inc., Defendants-Appellees/Cross-Appellant. |
| Court | U.S. Court of Appeals — Eighth Circuit |
Alan Popkin, St. Louis, MO, argued (Arthur L. Smith and Charles S. Kramer, on the brief), for Appellant.
Gregg H. Levy, Washington, DC, argued (Sonya D. Winner, Frank Rothman, James Keyte, Alan C. Kohn and John A. Klobasa, on the brief), for Appellee.
Before WOLLMAN and MURPHY, Circuit Judges, and KYLE, 1 District Judge.
After St. Louis lost its professional football team to Phoenix in 1988, extensive efforts began to obtain another team and resulted in the successful relocation of the Los Angeles Rams in 1995. Many millions of dollars were spent in order to accomplish the relocation, and the St. Louis Convention and Visitors Center (CVC) sued the National Football League and twenty four of its member teams (collectively the NFL) alleging that these expenditures were made necessary by actions of the NFL in violation of antitrust and tort law. The case was tried before a jury for over four weeks before it ended in a judgment in favor of the NFL. CVC appeals the dismissal of its claim for Sherman Act conspiracy and tortious interference with contract. The NFL cross appeals the refusal of the district court 2 to rule that the league and the member teams do not amount to a single entity for antitrust purposes. We affirm the judgment.
The move of the St. Louis Cardinals football team to Phoenix in 1988 caused the Missouri state legislature, the city of St. Louis and the surrounding county to undertake to find a replacement by the beginning of the 1995 season. The legislature assigned the effort to procure a team to CVC, a body previously created by the Missouri legislature and empowered to promote the convention and tourism business in St. Louis. See Mo. St. Ann. §§ 67.601, 67.607. The initial goal was to obtain one of the two NFL expansion franchises to be established in 1993. In order to attract a team the city resolved to build a convention center in downtown St. Louis called America's Center which would include a new football stadium. The football stadium was called the Trans World Dome, and its $258 million cost was paid from state and local government funds. The stadium lease was assigned to CVC which became its manager and initially subleased the right to present football in the dome to private parties.
Problems associated with control over the lease and the potential ownership group caused St. Louis to be passed over in the NFL's expansion voting. The new franchises were awarded to Jacksonville, Florida and Charlotte, North Carolina. This forced the St. Louis football enthusiasts to adopt another strategy, and they turned their attention toward attracting an existing team. They founded a civic organization called FANS, Inc. (Football at the New Stadium), to assist their efforts. FANS, acting on behalf of CVC, then approached the Los Angeles Rams and began to negotiate a deal for the team to move to St. Louis. As a result a written agreement was eventually signed by CVC and the Rams.
The NFL League Constitution and Bylaws require a favorable vote by three fourths of the team owners to permit relocation, and the proposal for the Rams to movewas initially voted down by the owners. It was later approved after the Rams agreed to pay the NFL a $29 million relocation fee. CVC eventually agreed with the Rams to pay $20 million of this fee, despite a clause in their contract allowing CVC to cancel if the fee were to exceed $7.5 million.
The Rams began playing in St. Louis in 1995, and in that year CVC was unable to make some of the payments owed to the team. CVC then brought this suit against the league and twenty four of its member teams. It also made an agreement with the Rams that they would receive half of any recovery obtained in the case in return for forgiveness of the money CVC owed them. The theory CVC presented at trial was that the league's relocation rules and the way they had been applied had created an atmosphere in which teams were unwilling to relocate. It contended that this anti-relocation atmosphere had discouraged interested teams from bidding on the St. Louis lease. The result was a one buyer market which forced the CVC to give more favorable lease terms than it would have in a competitive market.
The league was formed in 1966 by a union of the American Football League and the National Football League, and it functions as the governing body of a joint venture of thirty professional football teams producing "NFL football." The teams are independently owned and managed by different business interests. The league is organized through the League Constitution and Bylaws, an agreement among team members that sets out rules for league management of matters such as game rules, game schedules, team ownership, and location of teams. Most decisions affecting the league are made by vote of team representatives at NFL meetings. When NFL members decided to create two new team franchises for 1993, representatives from various cities made presentations to team owners in order to win a franchise.
St. Louis political leaders and business people were among those who made presentations to the league, and they emphasized the benefits an NFL team could expect from the stadium lease and the city. But there were problems with the St. Louis application for a team. At the time of the expansion decisions the exclusive right to use the Trans World Dome for professional football games was held by St. Louis NFL, Inc., which was controlled by two St. Louis businessmen, Jerry Clinton who owned one third and Jim Orthwein who owned the remaining two thirds. The fact that rights to lease the stadium for football were held by individuals who were unrelated to CVC caused the owners to pass over St. Louis as the site of an expansion team.
CVC's next option was to arrange for an existing team to leave its home city and relocate to St. Louis. Community members formed the civic organization FANS, Inc. in January of 1994, headed by former Senator Thomas Eagleton, to accomplish the task which they were increasingly anxious to complete. Around this time Congressman Richard Gephardt alerted FANS that the Los Angeles Rams were considering relocating from their stadium in Anaheim, California. He had seen a newspaper report that the Rams were discussing a possible move to Baltimore, Maryland. Congressman Gephardt concluded that since Baltimore had been one of St. Louis' main competitors during the expansion process, the city should follow Baltimore's lead and approach the Rams. FANS then contacted John Shaw, the Rams president, and began negotiations on a relocation agreement and stadium lease. During this period, St. Louis was competing with Hartford and Anaheim in addition to Baltimore.
FANS made an initial presentation to the Rams, but talks ended because of problems with Clinton and Orthwein having control over the lease and because FANS had leaked information about the negotiations to the press, including the Rams' list of features it desired in a new stadium (the "wish list"). Discussions resumed only after CVC gained control over the lease, and the Rams told CVC that they would discontinue any business dealings if the CVC approached any other team about moving to St. Louis. CVC never contacted any other team to solicit a bid on the lease. CVC considered it the better course to focus on only one team, and it believed its presentation during the expansion process should have been sufficient to stimulate the interest of other teams.
The Rams and CVC eventually agreed on a lease. The Rams agreed to pay to CVC $25,000 rent per game, plus half of the game day expenses. In return the Rams would receive all of the ticket revenue from Rams games, 75% of the first $6 million in advertising revenue and 90% of the remainder, 100% of the profit from the concessions at Rams games and a portion of the concessions profit from other events. Rams president John Shaw estimated the lease would produce approximately $40 million per season in revenue for the Rams. CVC agreed to a number of other obligations, including promises to pay $28 million to fulfill bond obligations which the Rams owed on Anaheim Stadium, to build a $9.9 million training facility for the team, and to pay the team's moving costs. Once the Rams and CVC reached their agreement, the Rams presented their relocation application to the league owners for approval in March, 1995.
Relocation decisions by the NFL come under Article 4.3 of the league constitution which provides that "[n]o member club shall have the right to transfer its franchise or playing site to a different city, either within or outside its home territory, without prior approval by the affirmative vote of three-fourths of the existing member clubs of the league." While not expressed in the governing documents, the league claims the right to assess a relocation fee on any team seeking to move. At the time CVC was dealing with the Rams, the NFL had levied one...
To continue reading
Request your trial
-
Randall v. Buena Vista County Hosp.
..."Section 1 of the Sherman Antitrust act makes it unlawful to form a conspiracy in restraint of trade." St. Louis Convention & Visitors Comm'n v. N.F.L., 154 F.3d 851, 861 (8th Cir.1998); Double D Spotting Serv., Inc. v. Supervalu, Inc., 136 F.3d 554, 558 (8th Cir.1998) (section 1 of the She......
-
Clarett v. National Football League
...the restriction's `harm to competition outweighs any procompetitive effects.'") (quoting St. Louis Convention & Visitors Comm'n v. National Football League, 154 F.3d 851, 861 (8th Cir.1998)). 164. Even if this case did not arise in the sports context, the rule of reason might have applied. ......
-
Craftsmen Limousine, Inc. v. Ford Motor Co.
...that tends "`to exclude the possibility that the alleged coconspirators acted independently.'" St. Louis Convention & Visitors Comm'n. v. N.F.L., 154 F.3d 851, 861 (8th Cir.1998) (quoting Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 585, 106 S.Ct. 1348, 89 L.Ed.2d ......
-
Craftsmen Limousine, Inc. v. Ford Motor Co.
...that tends "`to exclude the possibility that the alleged coconspirators acted independently.'" St. Louis Convention & Visitors Comm'n. v. N.F.L., 154 F.3d 851, 861 (8th Cir.1998) (quoting Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 575, 106 S.Ct. 1348, 89 L.Ed.2d ......
-
Impact: Injury and Causation
...735 F.2d 1555, 1564 (5th Cir. 1984). Conclusory expert testimony will not suffice. See St. Louis Convention & Visitors Comm’n v. NFL, 154 F.3d 851, 863 (8th Cir. 1998). 40. See Ashcroft v. Iqbal, 556 U.S. 662 (2009); Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007); Somers v. Apple, Inc. , 7......
-
Summary Judgment in Conspiracy Cases
...action need not be excluded when direct evidence is provided.”). 127 . See, e.g. , Saint Louis Convention & Visitors Comm’n v. NFL, 154 F.3d 851, 861 (8th Cir. 1998). 128 . See, e.g. , TRI, Inc. v. Boise Cascade Office Prods., 315 F.3d 915, 918 (8th Cir. 2003) (affirming summary judgment wh......
-
Issues in Antitrust Private Litigation: Sports Cases
...Football League, 791 F.2d 1356, 1365 (9th Cir. 1986) (Raiders II). 60. St. Louis Convention & Visitors Comm’n v. Nat’l Football League, 154 F.3d 851, 864-65 (8th Cir. 1998). 61. 779 F.2d 444 (8th Cir. 1985). 62. Id. at 451. Issues in Antitrust Private Litigation: Sports Cases 95 “stemmed fr......
-
Table of cases
...141 St. Francis Medical Center v. C.R Bard, Inc., 657 F. Supp. 2d 1069 (E.D. Mo. 2009), 121 St. Louis Convention & Visitors Comm. v. NFL, 154 F.3d 851 (8th Cir. 1998), 156 S. Motor Carriers Rate Conference v. United States, 471 U.S. 48 (1985), 22, 44, 45, 68, 69, 97 Sanderson v. Culligan In......