Opinion ID: 402332
Heading Depth: 2
Heading Rank: 2

Heading: The Group Boycott Claim

Text: 42 Brenner first contends that his suspension by the WBC constitutes a per se unlawful group boycott under Section 1 of the Sherman Act, 15 U.S.C. § 1 (1976). We disagree. 43 In general, group boycotts and concerted refusals to deal are considered per se unlawful. Klor's, Inc. v. Broadway-Hale Stores, Inc. 359 U.S. 207, 212, 79 S.Ct. 705, 709, 3 L.Ed.2d 741 (1959); see Fashion Originators' Guild of America, Inc. v. FTC, 312 U.S. 457, 465-67, 61 S.Ct. 703, 706-707, 85 L.Ed. 949 (1941). However, in Silver v. New York Stock Exchange, 373 U.S. 341, 348-49, 83 S.Ct. 1246, 1252, 10 L.Ed.2d 389 (1963), the Supreme Court recognized a narrow exception to per se invalidity of group boycotts and concerted refusals to deal where a justification derived from the policy of another statute or otherwise mandates application of the rule of reason. 44 Based in part upon the realization that (i)n some sporting enterprises a few rules are essential to survival, Hatley v. American Quarter Horse Association, 552 F.2d 646, 652 (5th Cir. 1977), courts have been reluctant to subject the cooperative activities of sports organizations to application of the group boycott per se rule. Instead, some courts have confined the per se rule to concerted attempt(s) by a group of competitors at one level to protect themselves from competition from non-group members who seek to compete at that level(,) Smith v. Pro Football, Inc., 593 F.2d 1173, 1178 (D.C.Cir.1978), and concluding that the concerted activity at issue did not fall within this paradigm have applied the rule of reason, see, e.g., NASL v. NFL, 670 F.2d 1249, at 1258 (2d Cir. 1982); United States Trotting Association v. Chicago Downs Association, 665 F.2d 781, 787-90 (7th Cir. 1981) (en banc); Neeld v. NHL, 594 F.2d 1297, 1298-1300 (9th Cir. 1979); Smith v. Pro Football, Inc., 593 F.2d at 1178-80 & n.22; Mackey v. NFL, 543 F.2d 606, 619 (8th Cir. 1976), cert. dismissed, 434 U.S. 801, 98 S.Ct. 28, 54 L.Ed.2d 59 (1978); Gunter Harz Sports, Inc. v. United States Tennis Association, 511 F.Supp. 1103, 1115-16 (D.Neb.1981); Cooney v. American Horse Shows Association, 495 F.Supp. 424, 430 (S.D.N.Y.1980). Other courts have recognized that Silver creates an exception to the per se boycott rule for reasonably self-regulated industries and have evaluated the sports organizations' self-regulation under the tripartite test announced in Denver Rockets v. All-Pro Management Inc., 325 F.Supp. 1049, 1064-65 (C.D.Cal.1971). 8 See, e.g., Linseman v. World Hockey Association, 439 F.Supp. 1315, 1327 (D.Conn.1977); Hatley v. American Quarter Horse Association, 552 F.2d at 652-53. 45 Brenner does not dispute that professional sports organizations may fall within the Silver exception. Instead, he contends that Silver is applicable only to sports regulations which insure either that competitors will be fairly matched and will not be exposed to unreasonable risk of injury or that the contest will not be corrupted. Brenner asserts that he was entitled to judgment notwithstanding the verdict on his group boycott claim because the discipline at issue in this case was not directed at either of these objectives and, hence, was unreasonable as a matter of law. We disagree. We reject Brenner's contention that discipline imposed by a sports organization for the violation of rules and regulations aimed at achieving reasonable objectives other than participant parity, safety and league integrity serve no purpose beyond the stifling of competition. Therefore, we decline to find such discipline per se unreasonable. Surely, every disciplinary rule which a league may invoke, although by its nature it may involve some sort of a restraint, does not run afoul of the anti-trust laws. Molinas v. NBA, 190 F.Supp. 241, 244 (S.D.N.Y.1961); see Hatley v. American Quarter Horse Association, 552 F.2d at 653-54. Absent a facial showing of anticompetitive purpose underlying the adoption or enforcement of a rule, the disciplinary activity of a sports organization must be evaluated under either the Denver Rockets test or the rule of reason. 46 In the present case, Judge Metzner properly instructed the jury that it must find that appellees' conduct constituted an unreasonable restraint of trade if a fair preponderance of the evidence supported either of two conclusions: (1) that Brenner's suspension was effected by appellees to prevent him from engaging in his trade; or (2) that appellees' conduct failed to satisfy any of the prongs of the tripartite Denver Rockets test. J.App. at 137a. 47 Brenner next contends that even if appellees' conduct did not constitute a per se group boycott he was entitled to judgment n.o.v. or to a new trial because he proved that, as a matter of law, appellees failed to satisfy various aspects of the Denver Rockets test. First, Brenner maintains that the district court erred in holding that he had failed to present evidence that the WBC does not fulfill an inherent need for uniformity, fairness and integrity in boxing. Brenner asserts that he presented evidence below establishing that the WBC is corrupt and that its rules are administered in an arbitrary and ad hoc fashion. We find no merit in these claims. We agree with the district court that Brenner failed to substantiate these assertions. In contrast, appellees presented overwhelming evidence that the WBC has established a system of ranking boxers and a body of reasonable rules and procedures designed to insure organized boxing competition around the world. In this regard, the WBC does not differ significantly from other sports regulatory bodies whose purpose is to insure the organized presentation of sporting events. See, e.g., Deesen v. PGA, 358 F.2d 165 (9th Cir.), cert. denied, 385 U.S. 846, 87 S.Ct. 72, 17 L.Ed.2d 76 (1966); Heldman v. United States Lawn Tennis Association, 354 F.Supp. 1241, 1243-44 (S.D.N.Y.1973); Molinas v. NBA, 190 F.Supp. at 243-44. 48 Brenner next asserts that he is entitled to judgment n.o.v. or to a new trial on his group boycott claim because, as a matter of law, none of the four alleged bases for his suspension constitutes a valid ground for excluding him from the market and because the suspension notice which he received was insufficient. 9 We find both of these arguments to be without merit. On the notice issue, Sulaiman's February 15, 1979 letter to Brenner informed him of his violation of specific WBC rules and urged Brenner either to comply with these rules or to present his side of the dispute to the Grievance and Appeals and/or the Disciplinary Committees of the WBC. This notice was clearly sufficient. Silver requires only that Brenner be given some form of notice and, if timely requested, a hearing.... 373 U.S. at 361, 83 S.Ct. at 1259. 49 Similarly, we cannot conclude that Brenner's failure to honor his agreements with the WBC or with its rules were improper bases under Section 1 of the antitrust laws for suspending him from promoting WBC world title fights. Brenner has not presented, nor can we discern, a patently anticompetitive purpose behind the adoption of the WBC's rules or its agreement with Brenner. Neither can we conclude that the executive committee which suspended Brenner was composed of competitors who stood to gain from his suspension. Accordingly, the trial court did not err in instructing the jury to determine, in accordance with the Denver Rockets test, whether any of the asserted bases for Brenner's suspension were reasonably related to a policy justifying self-regulation and whether Brenner was given notice of the charges and an opportunity for a hearing. 50 Finally, Brenner asserts that he is entitled to a new trial on the group boycott claim because the trial court erred in instructing the jury that the burden was on him to prove by a fair preponderance of the evidence that the WBC had not satisfied all of the elements of the Denver Rockets test. Under Fed.R.Civ.P. 51, in order to raise a challenge to the jury instructions on appeal, a party must object to those instructions before the jury retires to consider its verdict. Since Brenner failed to object to the instructions below, absent plain error, he is precluded from raising this claim on appeal. Cohen v. Franchard Corp., 478 F.2d 115, 122-25 (2d Cir.), cert. denied, 414 U.S. 857, 94 S.Ct. 161, 38 L.Ed.2d 106 (1973). 51 We have recognized that the plain error doctrine, especially in civil cases, should be applied only where the error (is) so serious and flagrant that it goes to the very integrity of the trial. Modave v. Long Island Jewish Medical Center, 501 F.2d 1065, 1072 (2d Cir. 1974). Because Silver is an exception to the general per se invalidation of group boycotts, it is arguable that the burden should be on the defendant to satisfy the tripartite test once the plaintiff has established the existence of conduct which constitutes a group boycott or a concerted refusal to deal. Nevertheless, in light of the unsettled nature of the law in this area, the failure of the district court to place the burden on appellees in the present case was not plain error. Accordingly, we decline to grant Brenner a new trial on this ground.