Case 1:12-cv-03704-SAS Document 485 Filed 12/30/15 Page 1 of 12

UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF NEW YORK
FERNANDA GARBER, MARC
LERNER, DEREK RASMUSSEN,
ROBERT SILVER, GARRETT TRAUB,
and VINCENT BIRBIGLIA, representing
themselves and all others similarly situated,

Civil Action No. 12-cv-3704 (SAS)

Plaintiffs,
v.
OFFICE OF THE COMMISSIONER OF
BASEBALL, et al.,
Defendants.

DEFENDANTS RESPONSE IN OPPOSITION TO

PLAINTIFFS MOTION IN LIMINE TO PRECLUDE ARGUMENT OR EVIDENCE
REGARDING THE BASEBALL EXEMPTION

PAUL, WEISS, RIFKIND, WHARTON

& GARRISON LLP
1285 Avenue of the Americas
New York, New York 10019-6064
Telephone (212) 373-3000
Facsimile (212) 373-2758

KIRKLAND & ELLIS LLP

601 Lexington Avenue
New York, New York 10022
Telephone: (212) 446-4800
Facsimile: (212) 446-4900
Counsel for DIRECTV Defendants

Counsel for MLB Defendants

DAVIS POLK & WARDWELL LLP
450 Lexington Avenue
New York, New York 10017
Telephone: (212) 450-4000
Facsimile (212) 701-5800

BOIES, SCHILLER & FLEXNER LLP

575 Lexington Avenue
New York, New York 10022
Telephone: (212) 446-2300
Facsimile: (212) 446-2350
Counsel for New York Yankees Partnership

Counsel for Comcast Defendants

WILLIAMS & CONNOLLY LLP
725 Twelfth Street, N.W.
Washington, D.C. 20005
Telephone: (202) 434-5000
Facsimile: (202) 434-5029
Counsel for Yankees Entertainment and Sports
Network, LLC

Case 1:12-cv-03704-SAS Document 485 Filed 12/30/15 Page 2 of 12

Defendants respectfully submit this opposition to Plaintiffs Motion in Limine #3 (the

Motion), which seeks to preclude Defendants from presenting at trial any evidence or
argument for the proposition that Defendants broadcasting restraints are encompassed by
professional baseballs exemption from the antitrust laws.1 (Mot. at 3.) Plaintiffs Motion is
meritless and therefore should be denied.
Defendants must be permitted to present evidence that relates to aspects of the business
of baseball, which other courts repeatedly have held is fully encompassed by the baseball
exemption. In the course of defending against Plaintiffs claims that MLBs broadcast licensing
system violates the antitrust laws, Defendants may present evidence that not only is relevant to
the merits of the case, but also overlaps with the issue whether the baseball exemption applies to
broadcasting and distributing baseball telecasts via television and the Internet. Such overlap is
no basis for pretrial exclusion of relevant evidence on the merits. Although Plaintiffs purport to
seek preclusion of evidence that would waste [] trial time (id. at 1), their Motion actually seeks
to preclude evidence relevant to the Courts analysis of issues central to this case. Plaintiffs
Motion should be denied on this ground alone.
It is also proper, independently, for Defendants to develop a full factual record at trial
regarding the applicability of the baseball exemption to broadcasting and distribution of baseball
telecasts via television and the Internet. That is likely to be a central issue on any appeal in this
case from either side, no matter the outcome of trial. Given that the evidence on this issue
overlaps with evidence regarding the merits of the case, there is little, if any, cost to making the
1

Plaintiffs also seek to strike from the record certain deposition designations in which class
representatives acknowledge that they seek to challenge certain aspects of the business of
baseball. (Mot. at 3.) But the question whether the class representatives are qualified to
testify about such matters is entirely separate from whether Defendants should be precluded
from presenting evidence or argument on the baseball exemption at trial and therefore is not
appropriately considered in this Motion.
1

Case 1:12-cv-03704-SAS Document 485 Filed 12/30/15 Page 3 of 12

factual record supporting the applicability of the baseball exemption. Thus, it is appropriate for
the Court to permit Defendants to present evidence regarding the applicability of the baseball
exemption, and Plaintiffs Motion therefore should be denied for this reason as well.
I.

The Evidence That Plaintiffs Seek To Exclude Is Intertwined with Other Issues
in the Case
In their Motion, Plaintiffs seek to exclude evidence concerning the connection between

MLBs broadcast rules and the business of baseball. Such evidence is relevant not only to the
baseball exemption, but also to key issues in the case on the merits.
For example, Defendants are prepared to put forth evidence at trial of several
procompetitive effects that stem from the challenged broadcast licensing structure.

These

procompetitive effects include, among other things, the fact that the structure increases output by
incentivizing Clubs to increase the availability of local baseball within their home television
territories, permits national broadcasts that are available to fans for free, and fosters the viability
of Clubs in smaller markets. Those local and national broadcasts promote ticket sales by
encouraging consumers to attend games, which accounts for the most significant source of
revenue for the business of baseball. Evidence regarding such procompetitive justifications will
inevitably implicate the importance and benefits of the challenged structure to the sustained
success of Major League Baseball, its Clubs, and the sport generallyi.e., the business of
baseball. Similarly, Defendants will present evidence of the importance of game exclusivity to
the current broadcast licensing structure. Game exclusivity is part of the business of baseball,
and it has created incentives that have led to the explosion of output and widespread availability
of game telecasts. And Defendants will show at trial that the broadcasting rules enhance the
ability of the League, the Clubs, and their telecasts of games to compete against other
entertainment programming. Facing that competition is part of the business of baseball, and

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understanding that fact is essential to an analysis of the procompetitive nature of the current
broadcasting rules.
All of the evidence described aboverelating to the various procompetitive and output
enhancing effects of the current broadcasting license structure, the importance of game
exclusivity in the current system, and the extent to which the broadcasting rules help the League
and the Clubs compete against other entertainment providerswill be properly presented as a
key part of Defendants arguments against Plaintiffs claims on the merits. That merits evidence
is intertwined with evidence that relates to and supports application of the baseball exemption to
the broadcasting and distribution of game telecasts via television and the Internet.
Plaintiffs Motion thus asks the Court to preclude Defendants from offering evidence and
presenting arguments that will show the territorial system provides significant valueand is of
central importanceto the viability of the business of baseball. Such a limitation of Defendants
case at trial would be improper and should be denied. See Thal v. Metro. Life Ins. Co., 2006 WL
3593408, at *2 (D. Conn. Dec. 8, 2006) (denying motion in limine to preclude evidence at trial,
in part, because such evidence appears to be inextricably linked to other issues in the case, and
concluding that each side may present all admissible evidence relevant to these issues). The
challenged evidence bears not only on MLBs procompetitive justifications for the broadcast
licensing structure, but also on the extent to which the challenged rules relate directly to the
business of baseball. Part of Defendants presentation to the Court at trial will include a
demonstration that the broadcast licensing structure is necessary for the League and the Clubs to
exist as they do today. Defendants will further show that the rules and relationships that
undergird the broadcast licensing structure are a fundamental part of the business of baseball that

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cannot be modified without radical changes to, among other things, the governing agreements of
the League and the agreements between the Clubs and the regional sports networks (RSNs).
As the evidence that Plaintiffs seek to exclude is relevant to issues on the merits in the
case beyond the applicability of the baseball exemption, such evidence should not be excluded.
II.

Defendants Are Entitled To Present Evidence Establishing the Connection

Between MLBs Broadcast Rules and the Business of Baseball
The Supreme Court has made clear that the baseball exemption applies to the entire

business of baseball. See Flood v. Kuhn, 407 U.S. 258, 275 (1972); Toolson v. N.Y. Yankees,
Inc., 346 U.S. 356, 357 (1953) (per curiam). The business of baseball includes the public
exhibition of games, see, e.g., Fed. Baseball Club of Baltimore v. Natl League of Profl Base
Ball Clubs, 259 U.S. 200, 208 (1922) (Federal Baseball), both live in-person and via telecasts
distributed over television and the Internet.
The Circuit Courts likewise have repeatedly and consistently recognized that the entire
business of professional baseball is exempt from the antitrust laws. See, e.g., Flood v. Kuhn, 443
F.2d 264, 265 (2d Cir. 1971), affd, 407 U.S. 258 (1972) (holding that the Supreme Court in
Federal Baseball established the antitrust exemption for the business of organized baseball);
Salerno v. Am. League of Profl Baseball Clubs, 429 F.2d 1003, 1005 (2d Cir. 1970), cert.
denied sub nom. Salerno v. Kuhn, 400 U.S. 1001 (1971) (holding that professional baseball is
not subject to the antitrust laws); Charles O. Finley & Co. v. Kuhn, 569 F.2d 527, 541 (7th
Cir.), cert. denied, 439 U.S. 876 (1978) ([T]he Supreme Court intended to exempt the business
of baseball, not any particular facet of that business, from the federal antitrust laws.). In Flood,
the Second Circuit exempted MLBs reserve system embodied in League rules and playeremployment contracts. 443 F.2d at 265. In Salerno, the Second Circuit exempted MLBs

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employment relationship with umpires. 429 F.2d at 1005.2 In a case decided earlier this year,
the Ninth Circuit exempted MLBs process for deciding requests for franchise relocation and
held that the antitrust exemption clearly extend[s] . . . to the entire business of providing public
baseball games for profit between clubs of professional baseball players. City of San Jose v.
Office of the Commr of Baseball, 776 F.3d 686, 690 (9th Cir. 2015) (internal quotations
omitted), cert denied --- S. Ct. ---, 2015 WL 1755762 (Oct. 5, 2015). And just a few months
ago, a district court ruled that the exemption encompasses a Clubs decision to set minimum
ticket prices and purchase rooftops near its stadium, holding that the exemption protects the
general business of baseball from antitrust laws, and the public display of baseball games is
integral to that business. Right Field Rooftops, LLC v. Chi. Cubs Baseball Club, LLC, 2015
WL 5731736, at *2, *3 (N.D. Ill. Sept. 30, 2015).
At trial, Defendants intend to establish that the baseball exemption applies to the
broadcasting and distribution of game telecasts via television and the Internet, which are a
critical part of the business of baseball. In making this presentation, Defendants will show,
among other things, that local and national broadcasts collectively account for approximately
30% of baseballs total revenues. Defendants will further establish that such broadcasts play a
critical role in driving demand for live in-person attendance at MLB games, which accounts for
an additional 49% of baseballs total revenues.
2

Other Circuit Courts have held that the baseball exemption applies to the Leagues decision
on relocating a Minor League club, see Triple-A Baseball Club Assocs. v. Ne. Baseball, Inc.,
832 F.2d 214, 216 n.1 (1st Cir. 1987); the Commissioners veto of a player trade, see Charles
O. Finley & Co. v. Kuhn, 569 F.2d 527, 541 (7th Cir.) cert. denied, 439 U.S. 876 (1978); the
Leagues decision to locate a Major League Club in Minor League territory, see Portland
Baseball Club, Inc. v. Kuhn, 491 F.2d 1101, 1103 (9th Cir. 1974) (per curiam); the Leagues
process for eliminating a Club, Major League Baseball v. Crist, 331 F.3d 1177, 1183 (11th
Cir.) pet. for rehg denied, 82 F. Appx 224 (11th Cir. 2003); and the Leagues Minor League
franchise location system, see Profl Baseball Schs. & Clubs, Inc. v. Kuhn, 693 F.2d 1085,
108586 (11th Cir. 1982).
5

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Whether the baseball exemption applies ordinarily can be resolved as an issue of law, but
here, a determination of the factual predicate regarding MLBs businessi.e., whether television
and Internet distribution of game telecasts falls within the ambit of the business of baseball
may be helpful to assess the applicability of the baseball exemption to MLBs broadcast rules.
See Flood, 407 U.S. at 275; Toolson, 346 U.S. at 357. Specifically, such evidence will make
clear that MLBs broadcasting rules are part of the full business of baseball encompassed in the
baseball exemption.
Evidence establishing that the broadcasting and distribution of game telecasts via
television and the Internet are part of the business of baseball thus is relevant to the Courts
analysis of whether the baseball exemption applies. For this additional reason, such evidence
should not be excluded.
CONCLUSION
The relief sought by Plaintiffs would inhibit Defendants from presenting probative
evidence relevant to critical issues in the case, and would unduly limit Defendants ability to
present their defense. Defendants presentation of the challenged evidence will not waste trial
time. To the contrary, that evidence is central to the Defendants defense on the merits against
Plaintiffs claims, regardless of whether the Court considers the applicability of the baseball
exemption. Defendants therefore respectfully request that the Court deny Plaintiffs Motion.

Case 1:12-cv-03704-SAS Document 485 Filed 12/30/15 Page 8 of 12

Dated: December 30, 2015

Respectfully submitted,

/s/ Arthur J. Burke

Arthur J. Burke
David B. Toscano
Andrew N. DeLaney
Katherine A. Marshall
DAVIS POLK & WARDWELL LLP
450 Lexington Avenue
New York, New York 10017
Telephone: (212) 450-4000
Facsimile: (212) 701-5800
arthur.burke@davispolk.com
david.toscano@davispolk.com
Attorneys for Defendants Comcast Corporation,
Comcast SportsNet Philadelphia, L.P., Comcast
SportsNet California, LLC and Comcast
SportsNet Chicago, LLC

Case 1:12-cv-03704-SAS Document 485 Filed 12/30/15 Page 9 of 12

/s/ Beth A. Wilkinson

Beth A. Wilkinson
Alexandra M. Walsh
PAUL, WEISS, RIFKIND,
WHARTON & GARRISON LLP
2001 K Street, N.W.
Washington, D.C. 20006
Telephone: (202) 223-7300
Facsimile: (202) 223-7420
bwilkinson@paulweiss.com
awalsh@paulweiss.com
Daniel J. Toal
PAUL, WEISS, RIFKIND,
WHARTON & GARRISON LLP
1285 Avenue of the Americas
New York, New York 10019
Telephone: (212) 373-3000
Facsimile: (212) 757-3990
dtoal@paulweiss.com
Attorneys for Defendants Office of the
Commissioner of Baseball, Major League
Baseball Enterprises Inc., MLB Advanced
Media L.P., MLB Advanced Media, Inc.,
Athletics Investment Group, LLC, the
Baseball Club of Seattle, L.P., Chicago
Cubs Baseball Club, LLC, Chicago White
Sox, Ltd., Colorado Rockies Baseball Club,
Ltd., The Phillies, L.P., Pittsburgh
Baseball, Inc., and San Francisco Baseball
Associates, L.P.

Case 1:12-cv-03704-SAS Document 485 Filed 12/30/15 Page 10 of 12

/s/ Tammy A. Tsoumas

Joseph Serino, Jr., P.C.
John C. Vazquez
KIRKLAND & ELLIS LLP
601 Lexington Avenue
New York, New York 10022
Telephone: (212) 446-4800
Facsimile: (212) 446-4900
joseph.serino@kirkland.com
john.vazquez@kirkland.com
Melissa D. Ingalls
Tammy A. Tsoumas
KIRKLAND & ELLIS LLP
333 South Hope Street
Los Angeles, California 90071
Telephone: (213) 680-8400
Facsimile: (213) 680-8500
melissa.ingalls@kirkland.com
tammy.tsoumas@kirkland.com
James H. Mutchnik, P.C.
KIRKLAND & ELLIS LLP
300 North LaSalle
Chicago, Illinois 60654
Telephone: (312) 862-2000
Facsimile: (312) 862-2200
james.mutchnik@kirkland.com
Attorneys for Defendants DIRECTV, LLC,
DIRECTV Sports Networks, LLC, DIRECTV
Sports Net Pittsburgh, LLC a/k/a Root Sports
Pittsburgh, DIRECTV Sports Net Rocky
Mountain, LLC a/k/a Root Sports Rocky
Mountain and DIRECTV Sports Net Northwest,
LLC a/k/a Root Sports Northwest

Case 1:12-cv-03704-SAS Document 485 Filed 12/30/15 Page 11 of 12

/s/ John Schmidtlein

John Schmidtlein
William Vigen
Joelle Perry
WILLIAMS & CONNOLLY LLP
725 Twelfth St., N.W.
Washington, D.C. 20005
Telephone: (202) 434-5000
Facsimile: (202) 434-5029
jschmidtlein@wc.com
wvigen@wc.com
jperry@wc.com
Attorneys for Yankees Entertainment and Sports
Network, LLC

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/s/ Christopher E. Duffy

Jonathan D. Schiller
Alan B. Vickery
Christopher E. Duffy
BOIES, SCHILLER & FLEXNER LLP
575 Lexington Avenue
New York, New York 10022
Telephone: (212) 446-2300
Facsimile: (212) 446-2350
CDuffy@bsfllp.com
Attorneys for Defendant New York
Yankees Partnership

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