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Miranda v. Selig

United States Court of Appeals, Ninth Circuit

June 26, 2017

Sergio Miranda; Jeffrey Dominguez; Jorge Padilla; and Cirilo Cruz, Individually and on Behalf of All Those Similarly Situated, Plaintiffs-Appellants,
v.
Allan Huber Selig, Bud; Kansas City Royals Baseball Corp.; Miami Marlins, L.P.; San Francisco Baseball Associates, LLC; Boston Red Sox Baseball Club L.P.; Angels Baseball L.P.; Chicago White Sox LTD.; St. Louis Cardinals, LLC; Colorado Rockies Baseball Club, Ltd.; Baseball Club of Seattle, LLP; Cincinnati Reds, LLC; Houston Baseball Partners, LLC; Athletics Investment Group, LLC; Rogers Blue Jays Baseball Partnership; Cleveland Indians Baseball Co., L.P.; Cleveland Indians Baseball Co., Inc.; Padres L.P.; San Diego Padres Baseball Club, L.P.; Minnesota Twins, LLC; Washington Nationals Baseball Club, LLC; Detroit Tigers, Inc.; Los Angeles Dodgers Holding Co.; Sterling Mets L.P.; Atlanta National League Baseball Club, Inc.; AZPB L.P.; Baltimore Orioles, Inc.; Baltimore Orioles, L.P.; Phillies L.P.; Pittsburgh Baseball, Inc.; Pittsburgh Baseball P'Ship; New York Yankees P'Ship; Tampa Bay Rays Baseball Ltd.; Rangers Baseball Express, LLC; Rangers Baseball, LLC; Chicago Baseball Holdings, LLC; Milwaukee Brewers Baseball Club, Inc.; Milwaukee Brewers Baseball Club, L.P.; Office Of Commissioner Of Baseball, Dba Major League Baseball; Los Angeles Dodgers, LLC, Defendants-Appellees.

          Argued and Submitted April 18, 2017 San Francisco, California

         Appeal from the United States District Court for the Northern District of California Haywood S. Gilliam, Jr., District Judge, Presiding D.C. No. 3:14-cv-05349-HSG

          Samuel Kornhauser (argued) and David Truong, Law Offices of Samuel Kornhauser, San Francisco, California; Brian David, Law Offices of Brian David, Chicago, Illinois; for Plaintiffs-Appellants.

          John W. Keker (argued), David J. Rosen, Thomas E. Gorman, and R. Adam Lauridsen, Keker & Van Nest LLP, San Francisco, California, for Defendants-Appellees.

          Before: Sidney R. Thomas, Chief Judge, and Ferdinand F. Fernandez and Mary H. Murguia, Circuit Judges.

         SUMMARY [*]

         Antitrust

         Affirming the district court's dismissal of an antitrust suit brought by minor league baseball players, the panel held that professional minor league baseball is exempt from federal antitrust laws.

         The panel concluded that because it was bound by Supreme Court and Ninth Circuit precedent upholding the business of baseball's exemption from federal antitrust laws, and because Congress explicitly exempted minor league baseball in the Curt Flood Act of 1998, the players failed to state an antitrust claim.

          OPINION

          THOMAS, Chief Judge

         In this case we consider whether professional minor league baseball is exempt from federal antitrust law. Applying controlling precedent, we hold that it is, and we affirm the judgment of the district court.

         I

         Major League Baseball ("MLB") is an unincorporated association consisting of thirty MLB franchises, also known as clubs or teams. Each franchise employs approximately forty baseball players on its "40-man roster, " with up to twenty-five players on its "active roster, " who play at the major league level. As part of MLB's "farm system, " each franchise also employs 150 to 250 players who compete at the minor league level. MLB franchises employ a high number of minor league players hoping that a handful will develop into major league players. Therefore, though minor league players train and play for minor league clubs, they are nonetheless employed by an MLB club.

         MLB requires all franchises to use its Uniform Player Contract ("the Contract") when hiring minor league players. Any change to the Contract terms requires permission from the MLB Commissioner. Once completed, all Contracts are filed with the MLB Commissioner for approval. Under the Contract's so-called "reserve clause, " MLB franchises receive exclusive rights to their minor league players for seven championship seasons, approximately seven years. This provision precludes players from playing for any other baseball team during the contract period, whether or not the team is an MLB ...


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