Baum Research and Development filed a lawsuit against the National
Collegiate Athletic Association (NCAA), Hillerich & Bradsby, Easton Sports, Worth
Inc., and the Sporting Goods Manufacturers Association (SGMA). Baum claimed that the
defendants conspired to keep other bat manufacturers out of amateur baseball.
The NCAA rules contain few restraints on bat manufacturers. The NCAA
allows wooden and aluminum bats to be used in NCAA sanctioned competition. Baum, the maker
of composite wood bats, alleged that the defendants conspired to manipulate standards for
baseball bats used in NCAA sanctioned baseball games to perpetuate their dominance and
exclude Baum from the market. In particular, Baum stated that the aluminum bat
manufacturers conspired to eliminate competition in the market by engaging in exclusive
agreements with universities that foreclose those institutions from using competing
products.
The defendants filed a motion to dismiss pursuant to Rule 12(b)(6) of
the Federal Rules of Civil Procedure. The defendants argued that the injury Baum claims is
not an "antitrust injury," but rather from competition.
Baum had to prove that it had suffered an antitrust injury stemming
from a competition reducing aspect or effect of the defendants' behavior, that the
alleged violation tended to reduce competition in the baseball bat market, and that
Baum's injury would result from a decrease in that competition rather than from some
other consequence of the defendant's action. However, Baum did not provide any facts
to satisfy these claims.
The Court concluded that the NCAA rules did not violate antitrust laws,
but rather the absence of a rule regulating bat performance actually fostered competition.
The lax standards have allowed companies to compete aggressively with each other by
designing and manufacturing superior products. Baum's injury stems from the competition
itself. Therefore, Baum's alleged injury stems from the NCAA's lawful refusal to
change the baseball bat rules in its favor.
In a separate issue, Baum claimed that the defendants unreasonably
interfered with its contracts to induce the Mid-American Conference to reject the
contracts made with Baum. However, Baum's complaint did not indicate whether any of
the contracts were breached as a result of any actions by the defendants. Baum was given
the opportunity to clarify this ambiguity in an amended complaint. A failure to amend
would result in a dismissal.
Baum also claimed that the defendant bat manufacturers and the SGMA
interfered with its prospective economic advantage. However, Baum did not show an
interference with a realistic expectation of an economic relationship. Baum was given the
opportunity to amend the complaint to better describe its expectations.
In conclusion, the district court granted the defendants' motion
to dismiss the antitrust counts of the complaint. Baum was given leave to amend the tort
claims.
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You Make the Call. . . Index
"You Make The Call..." is a newsletter published four times per year (spring,
summer, fall, winter) by the National Sports Law Institute of Marquette University Law
School, PO Box 1881, Milwaukee, Wisconsin, 53201-1881. (414) 288-5815, fax (414) 288-5818,
munsli@vms.csd.mu.edu. (www.marquette.edu/law/sports/call.html).
This publication is distributed via fax and email to individuals in the sports field upon
request.
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Editorial Staff:
Paul M. Anderson, Editor & Designer
Kirsten Hauser, Associate Editor
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Copyright © 1999 -- All rights reserved.
