Baseball Before the Bar, Part 2
Before moving on to the advent of free agency, I want to talk for a bit about the last case from the previous post. Why is the Federal Base Ball Ruling such a big deal? The key to the ruling is not that baseball is exempt from antitrust laws. That settles the case at hand, but it is not as important as the way Justice Holmes got to that point. Follow me through the legal reasoning.
Holmes does not simply assert that the Sherman Antitrust Act does not apply to major league baseball. That would settle the case, and given his position on the Supreme Court, his statement would be legally enforceable without any logical foundation. Rather, Holmes argues that baseball does not fit into the class of items covered by the act. In this case, that means that baseball is not a matter of interstate commerce. This avoids the Sherman Act, for sure, but it does a lot more. By arguing that baseball is not a matter of interstate commerce, it becomes immune from congressional regulation. Think about that for a minute, because its ramifications are widespread.
Because baseball is not a matter of interstate commerce, it gets to avoid federal labor regulations as well as federal antitrust regulations. Players wanted to challenge the legality of the reserve clause for years, and this led to hundreds of holdouts from the time of Nap Lajoie to the time of Dave McNally. The Supreme Court, though, had closed off the players legal recourse. I have no reason to think this was Holmes’ intention, but the sweeping claim that the business of baseball is the “business [of] giving exhibitions of base ball, which are purely state affairs” compels lower courts to apply the same logic to any other case involving federal regulations of major league baseball.
Now, this reasoning seems especially strange. The Supreme Court switches its Commerce Clause jurisprudence in 1937, famously making the New Deal constitutional. At the same time, but unnoticed, they undermined Holmes’s claim. The claim that baseball in intrastate makes no sense post-1937. It took until the 1970s, though, for the rest of the legal world to begin ignoring the sweeping claim of the Federal Base Ball Ruling. In 1972, the claim still stopped Curt Flood from becoming a free agent in Flood v. Kuhn. The move past Flood is at the heart of modern baseball. It, in turn, leads to the birth of free agency, and it will be the subject of my next post.