Federal Appeals Court Affirms Lower Court Ruling for NFL in Antitrust Case

Jul 6, 2007

The 6th U.S. Circuit Court of Appeals has affirmed a lower court’s decision that the statute of limitations had run out on an antitrust claim brought by the Hamilton County (Ohio) Board of County Commissioners.
The panel found, specifically, that the plaintiffs, who had alleged that the NFL illegally used their influence as a de facto monopoly to pressure cities into picking up the tab for expensive new stadiums, did not file within the 4-year statute of limitations.
Commissioner Todd Portune, who championed the plaintiffs’ cause from the beginning, could not hide his frustration, telling the local media: “It seems that every judicial authority that has taken a look at this has agreed that it is a terrible deal, but rather than acting on those aspects, they have instead hung their hats on a technicality.”
The plaintiffs were seeking $200 million in punitive damages from the NFL.
The origins of the dispute extended back to 1996 when county voters approved a half-cent sales tax hike to build the $450 million Paul Brown Stadium. The county signed a lease with the defendants in 1997. However, the plaintiffs did not file the antitrust lawsuit until 2003, arguing in the complaint that they were misled by the defendants into believing that the Bengals were struggling financially and needed a new stadium to survive.
The plaintiffs claimed that they did not find out the true state of the Bengals’ finances until 2001, suggesting that the concept of “fraudulent concealment of a federal antitrust claim” had come into play. This, the district court summarized, meant “the four-year federal statute of limitations began anew from the time the plaintiff knew or should have known of the federal claim. State of Michigan ex rel. Kelley v. McDonald Dairy Co., 905 F. Supp. 447, 451 (W.D. Mich. 1995); see also Norton-Children’s Hosp. v. James E. Smith & Sons, Inc., 658 F.2d 440, 445 (6th Cir. 1981); State of Ohio ex rel. Fisher v. Louis Trauth Dairy, Inc., 856 F. Supp. 1229, 1236 (S.D. Ohio 1994) (Spiegel, J.).”
Central to its argument was the contention that it learned of the Bengals’ and the NFL’s “misleading” statements and/or omissions in May 2001, leading to the discovery of facts necessary to bring the instant suit. At that time, the Los Angeles Times published evidence regarding team revenues and profits submitted as part of a lawsuit between the NFL and Oakland Raiders owner Al Davis.
“These materials revealed that the Bengals were actually among the most profitable teams in the 1990s,” continued the lower court in its 2006 opinion. “For example, in 1996, the team posted the eighth-highest profit in the league of $10.9 million. One year later, it posted the ninth-highest profit of $12.2 million. The plaintiff argues that this information – refused the County during the negotiation process – reveals that the Bengals did not, in fact, require the stadium deal to be ‘competitive and viable.’”
The lower court and the appeals court, however, disagreed with that theory, finding that the plaintiffs failed to meet their burden under the fraudulent concealment doctrine.
The 6th Circuit summarized that “the county, like all local governments competing to attract professional sports teams, understood this reality long before it entered the May 1997 lease and understood the leveraging truth that goes with it: The only thing worse than having a losing team is having no team no team for the community and its political leaders to support and no reason to say: ‘There’s always next year.’”
Hamilton County Board of County Commissioners v. NFL et al.; 6th Cir.; NO. 06-3348; 6/19/07
Attorneys of Record: (argued for appellant) Arthur Miller, Harvard Law School. Robert Raymond Furnier, Furnier & Flagel LLC, Cincinnati, OH; Stanley Morris Chesley, Waite Schneider Bayless & Chesley Co LPA, Cincinnati, OH; Paul M DeMarco, Waite Schneider, Cincinnati, OH.
(argued for appellees) Gregg H Levy, Covington & Burling, Washington, DC. Kenneth Franklin Seibel, Mark Joseph Byrne, Jacobs, Kleinman, Seibel & McNally, Cincinnati, OH. Robert Alexander Pitcairn, Jr, James Francis McCarthy, III, Wijdan Jreisat, Katz Teller Brant & Hild, Cincinnati, OH.


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