On June 9, 2008, the Sixth Circuit rejected a coach’s challenge to the NCAA’s disciplinary rules because he did not allege that the disciplinary rules implicated commercial activity or that he suffered antitrust injury. Bassett v. Nat’l Collegiate Athletic Ass’n, No. 06-5795, 2008 WL 2329755 (6th Cir. June 9, 2008). The Sixth Circuit held that to state a claim under Section 1 of the Sherman Act, “there must be a commercial activity implicated.” Id. at *5. The court further held that “the appropriate inquiry is whether the rule itself is commercial, not whether the entity promulgating the rule is commercial.” Id. (citations omitted). The court then rejected the challenge because the enforcement of disciplinary rules is not a commercial activity. The court also held that plaintiff did not allege antitrust injury. To satisfy this element, the plaintiff had to allege an “anticompetitive effect on the coaching market.” Id. at *7. The coach’s exclusion based on enforcement of the disciplinary rules was insufficient to establish an antitrust injury. It should be noted that the decision contains good dicta explaining when the rule of reason as opposed the per se analysis applies and the nature of the rule of reason analysis.
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Posted by : | On : June 21, 2008
Apr
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Posted by : | On : April 8, 2008
On March 24, 2008, the United States District Court for the Northern District of California granted partial summary judgment and dismissed plaintiffs’ challenge to the Star Network’s fixed interchanges fees that was based on a per se violation of Section 1 of the Sherman Act. See In re ATM Fee Antitrust Litig., No. C 04-02676 CRB, 2008 WL 793876 (N.D. Cal. Mar. 24, 2008). This action challenges the fixed fee that the Star Network (through its members) pays to the owner of the ATM used by the cardholder. The court applied the rule of reason because the fixed fee is “reasonably necessary to the legitimate cooperative aspects of the venture.” Id. at *10 (citation omitted). The court concluded that fixed nature of “the fee promotes cooperation between the venture’s members and cannot be set individually. Under the circumstances, that is all Defendants must show to avoid a per se analysis.” Id. The court, however, certified the question for interlocutory appeal because there is “serious doctrinal confusion over the proper analysis of cooperative arrangements among competitors.” Id. at 12 (citation omitted).