City of San Jose v. Comm'r of Baseball, No. 14-15139 (9th Cir. 2015)Annotate this Case
This case arose when the Oakland Athletics wanted to move to the City of San Jose, but the City falls within the exclusive operating territory of the San Francisco Giants. The City, seeking approval of the move, filed suit against MLB, alleging violations of state and federal antitrust laws, of California's consumer protection statute, and of California tort law. The district court granted MLB's motion to dismiss on all but the tort claims and the City appealed. The City argues that the baseball industry's historic exemption from the antitrust laws does not apply to antitrust claims relating to franchise relocation. The court held, however, that antitrust claims against MLB's franchise relocation policies are precluded by Flood v. Kuhn, and, under Portland Baseball Club, Inc. v Kuhn, the court rejected any antitrust claim that was wholly unrelated to the reserve clause. Therefore, the City's claims under the Sherman Act and Clayton Act, 15 U.S.C. 1-7 and 15 U.S.C. 12-27, must be dismissed. Further, the City's antitrust claims necessarily fall with its federal claims where the City can point to no case that has ever held that state antitrust claims continue to be viable after federal antitrust claims have been dismissed under the baseball exemption. An independent claim under California's unfair competition law is also barred so long as MLB's activities are lawful under the antitrust laws. Accordingly, the court affirmed the judgment of the district court.