City of Oakland v. Oakland Raiders, No. 20-16075 (9th Cir. 2021)
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The City of Oakland sued the NFL and its member teams, alleging that the defendants created artificial scarcity in their product (NFL teams), and used that scarcity to demand supra-competitive prices from host cities. The city alleged that when it could not pay those prices, the defendants punished it by allowing the Raiders to move to Las Vegas.
The Ninth Circuit affirmed the dismissal of the case. While the city had Article III standing because it plausibly alleged that, but for the defendants’ conduct, it would have retained the Raiders, the defendants’ conduct did not amount to an unreasonable restraint of trade under section 1 of the Sherman Act. The city failed sufficiently to allege a group boycott, which occurs when multiple producers refuse to sell goods or services to a particular customer, alleging only that a single producer, the Raiders, refused to deal with it. The city also failed sufficiently to allege statutory standing on a theory that the defendants’ conduct constituted an unlawful horizontal price-fixing scheme. A finding of antitrust standing requires balancing the nature of the plaintiff’s alleged injury, the directness of the injury, the speculative measure of the harm, the risk of duplicative recovery, and the complexity in apportioning damages; here, the city was priced out of the market and was a nonpurchaser. Any damages were highly speculative and would be exceedingly difficult to calculate.
Court Description: Antitrust. The panel affirmed the district court’s dismissal, for failure to state a claim, of an antitrust action brought by the City of Oakland against the National Football League and its member teams. The City alleged that defendants created artificial scarcity in their product of NFL teams, and then used that scarcity to demand supra-competitive prices from host cities. The City alleged that when it could not pay those prices, defendants punished it by allowing the Raiders to move to Las Vegas. The panel held that the City had Article III standing because it plausibly alleged that, but for defendants’ conduct, it would have retained the Raiders, and thus made the required showing that its injury was likely caused by defendants. Affirming the district court’s dismissal, the panel held that defendants’ conduct did not amount to an unreasonable restraint of trade in violation of § 1 of the Sherman Act. The panel held that the City failed sufficiently to allege a group boycott, which occurs when multiple producers refuse to sell goods or services to a particular customer. Here, the City alleged only that a single producer, the Raiders, refused to deal with it. The panel held that the City also failed sufficiently to allege statutory standing on a theory that 4 CITY OF OAKLAND V. OAKLAND RAIDERS defendants’ conduct constituted an unlawful horizontal price- fixing scheme. The panel held that a finding of antitrust standing requires a balancing of the nature of the plaintiff’s alleged injury, the directness of the injury, the speculative measure of the harm, the risk of duplicative recovery, and the complexity in apportioning damages. The panel reasoned that here, the City was priced out of the market and therefore was a nonpurchaser. In addition, the City’s damages were highly speculative and would be exceedingly difficult to calculate. Concurring, Judge Bumatay wrote that he would hold that the price-fixing claim was too speculative to satisfy the threshold of constitutional standing. He wrote that the City did not show that its injury was fairly traceable to defendants’ challenged conduct, but rather relied on speculation upon speculation to connect its injury of the Raiders leaving for Las Vegas to the NFL’s entry rule. Judge Bumatay thus concurred in the court’s judgment and joined Parts I, II, and III.B of the majority opinion. CITY OF OAKLAND V. OAKLAND RAIDERS 5
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