Clarett, Moultrie, and Applying the Nonstatutory Labor Exemption to Professional Sports’ Draft Eligibility Rules

Authors

Mathew Santoyo

Abstract

Collective bargaining is the mechanism by which major sports leagues and their players unions have negotiated the terms and conditions of employment for many decades. One standard provision of these collective bargaining agreements is a draft eligibility rule governing the conditions by which prospective athletes are eligible for the league’s entry draft. These collective bargaining agreements exists at the intersection of two somewhat discordant areas of law: antitrust and labor law. Under antitrust law, Congress enacted a policy favoring competition and prohibiting unreasonable restraints on trade. On the other hand, under labor law, Congress enacted a policy favoring collective bargaining. These policies conflict because collective bargaining is a restraint on trade. To rectify this conflict, the Supreme Court created the nonstatutory exemption, which shields collective bargaining activities from antitrust scrutiny. In Brown v. Pro Football, Inc., the Supreme Court created a four-part test defining when collective bargaining activities are shielded from antitrust scrutiny: the activities must (1) take place during and immediately after collective bargaining negotiations, (2) grow out of the lawful operation of the bargaining process, (3) involve mandatory subjects of collective bargaining, and (4) concern parties to the collective bargaining relationship. This framework leaves two open questions: what are mandatory subjects of collective bargaining, and what is the lawful operation of the collective bargaining process? The Second Circuit in Clarett v. NFL, and the District of Oregon in O.M. by & through Moultrie v. National Women’s Soccer League took two different approaches to these questions. This note proposes that to remain faithful to the goal of the nonstatutory exemption, courts should consistently adopt the approach that draft eligibility rules are mandatory subjects of collective bargaining, and voluntary recognition agreements are part of the lawful operation of the collective bargaining process. This will allow nascent sports leagues and unions in their infancy to collectively bargain the terms and conditions of their employment free from antitrust scrutiny.

Recommended Citation

Mathew Santoyo, Clarett, Moultrie, and Applying the Nonstatutory Labor Exemption to Professional Sports’ Draft Eligibility Rules, 89 Brook. L. Rev. 897 (2024).
Available at: https://brooklynworks.brooklaw.edu/blr/vol89/iss3/6