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American Needle, Inc. v. National Football League – Is Every League or Association a "Walking Conspiracy" for Purposes of Antitrust Analysis?

05/26/2010

In American Needle, Inc. v. National Football League, the United States Supreme Court concluded that the National Football League (“NFL”) is not a single business, but rather is 32 separate entities. The Court held, in a unanimous decision delivered by Justice Stevens, that the licensing activities of the NFL constitute concerted action within the meaning of Section 1 of the Sherman Act, which is not per se illegal, but rather, must be judged under the Rule of Reason.

This decision has the potential not only to impact the methodology used by the NFL and other leagues to license and market intellectual property, but also to materially impact ongoing labor negotiations between the leagues and players’ associations. There are also broader implications for any business operating in the format of an association, partnership, joint venture or other collective. This Alert examines the American Needle decision.