December 11, 2018
City of Oakland files federal antitrust and breach of contract lawsuit against the National Football League, Oakland Raiders and other 31 league teams
Tuesday, December 11, 2018
OAKLAND, CA — Oakland City Attorney Barbara J. Parker announced that the City will file a federal antitrust and breach of contract lawsuit today against the National Football League (“NFL”), the Raiders and each of the other 31 NFL clubs (“NFL Defendants”).
The City Attorney recommended and the Oakland City Council authorized filing the lawsuit to recover damages resulting from the Raiders’ illegal move to Las Vegas, including lost revenue, money that Oakland taxpayers invested in the Raiders and other costs.
In voting to approve the Raiders’ move to Las Vegas and boycotting Oakland in the marketplace for hosting a football club, the NFL defendants violated federal antitrust laws. The Raiders’ move also violated the NFL’s own policies for team relocation.
Federal antitrust laws provide treble damages plus attorneys’ fees. The City will seek a resolution for the maximum amount of damages available. The lawsuit will not ask the court to prevent the Raiders’ move to Las Vegas or keep the team in Oakland.
“The defendants brazenly violated federal antitrust law and the league’s own policies when they boycotted Oakland as a host city,” City Attorney Parker said. “The Raiders’ illegal move lines the pockets of NFL owners and sticks Oakland, its residents, taxpayers and dedicated fans with the bill. The purpose of this lawsuit is to hold the defendants accountable and help to compensate Oakland for the damages the defendants’ unlawful actions have caused and will cause to the people of Oakland.”
For years, the NFL defendants – a carefully limited number of football clubs – have been recognized as a “cartel” in the marketplace for professional football. In 1984, a California federal court affirmed that the NFL defendants had misused their cartel power in determining when an NFL team may move to a new city. In response, the NFL adopted, and the NFL defendants agreed to follow, express “relocation policies” to guide future team moves. These policies focus on issues like population, economic projections, facilities, regional balance and fan loyalty in making relocation determinations. The relocation policies expressly favor host cities like Oakland in any relocation determination.
Recently, the NFL has allowed NFL clubs to move even when the relocation is a clear violation of its relocation policies. Threats of relocation are a central part of the NFL’s practice of demanding public financing for new stadiums, which significantly increase team revenues and ticket prices. Further, each time an NFL club moves, all NFL teams share in a “relocation fee.” In the last several years, the NFL defendants have shared approximately $1.47 billion in these fees. The Raiders alone have agreed to pay over $370 million to the other NFL defendants for their “yes” vote on the Raiders’ move to Las Vegas.
The NFL’s demand for the public to bankroll new stadiums under threat of club relocation has pushed cities like Oakland out of the marketplace for professional football teams, caused skyrocketing ticket prices, and enriched the NFL owners. In violation of the antitrust laws, the NFL is using its cartel status to undermine competition and generate fortunes for themselves, all at a significant cost to taxpayers.
City Attorney Parker will file the lawsuit in the United States District Court for the Northern District of California, with the assistance of the law firms of Berg & Androphy and Pearson, Simon & Warshaw, LLP, nationally recognized antitrust lawyers. The firms are working on a contingency basis, so their fees and costs will be paid solely from any recovery.
“The NFL has a long history of misusing its tremendous market power in violation of antitrust laws,” said Jim Quinn, the lead attorney from Berg & Androphy, who has successfully litigated against the NFL for more than twenty years. “This time the NFL defendants violated their own bylaws in their effort to cash in on the Raiders’ move. Oakland is standing up to this unlawful and disloyal treatment by the league owners.”
“The NFL supposedly has objective rules about team location which were completely ignored,” said Clifford Pearson, lead attorney from Pearson, Simon & Warshaw, LLP. “Before a team is ripped from the fabric of a community, there needs to be a valid reason other than simply money. The City of Oakland deserved better treatment.”
The Oakland City Council voted to authorize the lawsuit on July 24, 2018. Councilmember Noel Gallo made the motion to authorize filing the lawsuit, Council President Larry Reid seconded the motion, and the motion passed with seven ayes and one abstention (Councilmember Lynette Gibson McElhaney).