Toolson v. New York Yankees, Inc. et al ., 101 F. Supp. 93 (S. D. Cal. 1951)

Gottesman, Robert S.

English

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Buffalo Law Review Volume 1 Number 3 Article 27 4-1-1952 Monopolies—Interstate Commerce—Organized Baseball Robert S. Gottesman Follow this and additional works at: https://digitalcommons.law.buffalo.edu/buffalolawreview  Part of the Antitrust and Trade Regulation Commons Recommended Citation Robert S. Gottesman, Monopolies—Interstate Commerce—Organized Baseball, 1 Buff. L. Rev. 342 (1952). Available at: https://digitalcommons.law.buffalo.edu/buffalolawreview/vol1/iss3/27 This Recent Decision is brought to you for free and open access by the Law Journals at Digital Commons @ University at Buffalo School of Law. It has been accepted for inclusion in Buffalo Law Review by an authorized editor of Digital Commons @ University at Buffalo School of Law. For more information, please contact lawscholar@buffalo.edu. BUFFALO LAW REVIEWAppeals pointed out the irreconcilable conflict of the decisions in this regard,Reilley v.-Steinhart 217 N. Y. 549, 112 N. E. 468 (1916) and subsequentlyrefused to answer the question directly. Franklin Sugar Refining Co. V. Lipowicz247 N. Y. 465, 160 N. B. 916 (1928). Only recently it has been held that in theabsence of an express intention to the contrary the N. Y. Statute of Frauds (N. Y.Pers. Prop. Law Sec. 31(1) is to be characterized as substantive. Silverman v'.Indevco Inc. 106 N. Y. S. 2d 699 (1951). It was Story's original position thatthe requirement of writing under the Statute of Frauds is substantive, Story,Conflict of Laws §262 (1st ed., 1834), and his views were urged upon the Englishcourt in Leroux v. Brown, supra.Professor Morgan has expressed the view that the law of the locus shouldbe applied even to matters of procedure if they are likely to have a materialinfluence on the outcome of the case as long as its application would not violatethe public policy of the forum. Morgan, Choice of Law Governing Proof, 58 Harv.L Rev. 153, 195 (1944).It is submitted that the court in the principal case follow the better rule incharacterizing the N. Y. Statute of Frauds as substantive. Effect is thus given tothe contract valid in the state where made, which has the closest connection withthe contract, and the outcome of the case will not depend on the state in whichit is tried but will be the same in the forum as well as in the place of the makingof the contract.Phyllis I. HubbardMONOPOLIES-INTERSTATE COMMERCE-ORGANIZED BASEBALLPlaintiff, a professional baseball player, sued the defendant baseball clubsand leagues under the Sherman Act (26 Stat. 209, 15 U. S. C. A. §§1, 2) andClayton Act (38 Stat. 731, 15 U. S. C A. §15), alleging that he was deprived ofhis livelihood by the defendants. The complaint was dismissed for want ofjurisdiction over the subject matter; the court holding that baseball was notinterstate commerce and defendant's activity was not within the purview of theantitrust legislation. Toolson v. New York Yankees, Inc. et al., 101 F. Supp. 93(S. D. Cal. 1951).The Sherman Act was enacted in 1890 in order to suppress devices andpractices which tend toward monopolies in restraint of interstate commerce.U. S. v. Colgate, 250 U. S. 300 (1919); D. R. Wilder Mfg. Co. v. Corn ProductsRef. Co., 236 U. S. 165 (1915); Northern Securities Co. v. U. S., 193 U. S. 197(1904). Early applications of the statute were limited to activities which wereobviously interstate commerce. U. S. v. Joint Traffic Association, 171 U. S. 505RECENT DECISIONS(1898); Northern Securities Co. v. U. S. supra, (interstate carriers). Localactivities which only affected interstate commerce were not held to be within thescope of the act. U. S. v. E. C. Knight, 156 U. S. 1 (1895) (monopoly in sugarindustry).Since these early decisions, the court's interpretation of interstatecommercehas been extended to include many local activities which only incidentally affectinterstate commerce. These include: manufacturing, N. L. R. B. v. Jones &Laughlin Steel Corp., 301 U. S. 1 (1937); agriculture, Wlickard v. Filburn, 317U S. 111 (1942); intrastate railroads, Houston, East & West Texas Ry. Co. v.U. S., 234 U. S. 342 (1914); practice of medicine, American Medical Associationv. U. S., 110 F2d 703 (1940), cert. denied 310 U. S. 644 (194 0);.insurance,U. S. v. South-Eastern Underwriters Association, 332 U. S. 533 (1944); trade innews among the states, Associated Press v. U. S., 326 U. S. 1 (1945); theatricalproductions, Ring v. Spina, 148 F2d 647 (1945); motion pictures, U. S. v. Para-mount Pictures, 334 U. S. 131 (1948); and fixing local prices, Mandeville IslandFarms v. American Crystal Sugar Co., 334 U. S. 219 (1948).Baseball, however, was held not to be interstate commerce in Federal BaseballClub of Baltimore, Inc. v. National League of Professional Baseball Clubs et al.,259 U. S. 200 (1922). The court based its decision on two grounds: (1) laborexpended other than in the production of goods is not commerce; and (2) thetransportation of players and equipment across state lines is merely incident tothe chief purpose of baseball clubs.Hooper v. California, 155 U. S. 648 (1895) was cited to support the firsttest. But the Hooper case has been completely undermined by U. S. v. South-Eastern Underwriters Assn., supra, which held insurance to be interstate commercewithin the scope of the antitrust statutes. Similarly, other fields involving the useof labor other than in the production of goods have been found to be commerceunder the Sherman and Clayton Acts. Ring v. Spina, supra; Asso. Press v. U. S.,supra; American Medical Asso. v. U. S., supra.The incidental test 'has been used by the cotirt in several cases to determinewhether defendant's activities constituted interstate commerce. Northern Securi-ties Co. v. U. S., supra; Standard Oil Co. v. U. S., 193 U. S. 197 (1904); ApexHosiery v. Leader, 310 U. S. 469 (1940). However, this approach was seriouslyimpaired when the court in Wickard v. Filburn, supra, ruled that a farmer'sproduction of only 239 bushels of wheat in excess of his quota, set under theAgricultural Adjustment Act of 1938 (52 Star. 31, as amended 7 U. S. C. §1281et seq.), had a substantial effect on interstate commerce. This result was reachedeven though defendant's activities were purely local and the excess wheat was in-tended for his personal consumption. Cf: Mandeville Island Farms Inc. v. AmericanBUFFALO LAIF REVIEWCrystal Sugar Co., supra; Martino v. Michigan Window Cleaning Co., 327 U. S.,173 (1946); Mabee v. White Plains Pub. Co., 327 U. S. 178 (1946); RolandElectric Co. v. Walling, 326 U. S. 657 (1946). Contra: North American Co. v.Securities Exchange Commission, 327 U. S. 686 (1946).The Federal Baseball case, supra, was not followed in Gardella v. Chandler,172 F. 2d 402 (2d Cir. 1949). The court distinguished present day baseballfrom that of 1922 and held it to be now within the scope of the antitrust statutes.Radio and television broadcasting of games were the principal grounds of distinc-tion. The court compared the televising of games to a theatrical production inwhich the viewers, although in a different state from the source of the broadcast,are the spectators and the players the actors, together forming an indivisible unit.Organized Baseball has grown considerably since the time of the FederalBaseball Case. Today players are more frequently shuttled back and forth acrossstate lines to play games and to carry out their assignments in the extensive farmsystems. In 1951 the 16 major league teams owned a total of 175 farm clubsscattered throughout the United States and Canada. World's Series receipts forthe 4 games played in 1950 amounted to $1,928,669.03 of which $975,000.00 wasderived from national radio and television broadcasting of the games. See BaseballGuide and Record Book 1951, pp. 130, 158.It is submitted that Organized Baseball's present interstate features combinedwith its monopolistic practices are sufficient to bring it within the antitrust acts.Future exemptions from these statutes, if necessary to baseball's continued existenceand the public interest, should be made by Congressional enactment and notby the courts.Robert S. GottesmanLABOR LAW-UNION LIABILITY FOR CONCERTED ACTIONWHERE THERE IS AN ALTERNATIVE JUDICIAL REMEDYThe plaintiff employed a member of one of the defendant unions who hadbeen fired and suspended for a violation of a union rule. When the plaintiffrefused the local Building Trades Council's request that the employee be compelledto pay the fine or be discharged, the Council called the workers off the job andtogether with the other unions, picketed and boycotted to compel compliance withtheir demands. An added condition to the resumption of work was the paymentof a sum of money to a charity as a penalty on the employer. The employerthereupon sued the Building Trades Council, the participating locals and theiragents on two counts for damages arising out of the work stoppage. The Nevadacourt found for the plaintiff on both counts holding that (1) to compel payment

Monopolies—Interstate Commerce—Organized Baseball

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Monopolies—Interstate Commerce—Organized Baseball

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