899 F.3d 712
9th Cir.2018Background
- Run Gum, a maker of caffeinated chewing gum, sued USATF and the U.S. Olympic Committee alleging their Olympic Trials advertising/logo restrictions unlawfully excluded non-apparel sponsors and violated Section 1 of the Sherman Act.
- USATF’s rule generally banned commercial identification on competitors’ equipment, uniforms, and bibs at the Trials, except for limited manufacturer logos on approved apparel (e.g., Nike).
- Run Gum alleged the rule functioned as a horizontal and vertical agreement and a group boycott that reduced sponsorship opportunities and fixed prices paid to athletes.
- The district court dismissed the complaint, holding the Olympic Committee and USATF were entitled to implied antitrust immunity under the Ted Stevens Olympic and Amateur Sports Act (ASA) because the restrictions were integral to fulfilling statutory duties to fund and protect the Olympic brand.
- The Ninth Circuit affirmed, applying precedent that the ASA’s delegation of monolithic control to national governing bodies can create a conflict (“clear repugnancy”) with antitrust law warranting implied immunity when rules are necessary to the ASA mission.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the ASA impliedly immunizes USATF/Olympic Committee from antitrust liability for advertising/logo restrictions at the Olympic Trials | Run Gum: restrictions are anticompetitive restraints excluding sponsors and violate Sherman Act §1 | Defs: restrictions protect Olympic marks/brand and are necessary to raise funds and fulfill ASA duties, so antitrust liability would conflict with ASA | Held: Yes—implied antitrust immunity applies because enforcement of the restrictions is integral to ASA mission and would be repugnant to antitrust enforcement |
| Whether the district court engaged in improper fact-finding at dismissal | Run Gum: court made factual findings (brand dilution) contrary to pleadings | Defs: observations about brand dilution are common-sense and relevant to statutory mission; no improper factual resolution | Held: Court’s observations were permissible; dismissal on immunity grounds affirmed |
| Whether Run Gum adequately pleaded a relevant product market (alternative ground) | Run Gum alleged an injury from exclusion of non-apparel sponsors | Defs: argued market definition was insufficient (alternative defense) | Held: Court did not reach merits because immunity dispositive; concurrence noted plaintiff also failed to plead a viable market |
| Whether Eleven Line compels a different outcome | Run Gum relied on decisions limiting immunity for non-sanctioned rules | Defs: distinctions: rules here were sanctioned/approved by national governing body and serve ASA purposes | Held: Eleven Line distinguished; not controlling because that case involved unsanctioned, atypical rule |
Key Cases Cited
- JES Props., Inc. v. USA Equestrian, 458 F.3d 1224 (11th Cir. 2006) (applied ASA-based implied antitrust immunity to a nationwide rule that furthered national governing body duties)
- Behagen v. Amateur Basketball Ass’n of the United States, 884 F.2d 524 (10th Cir. 1989) (held eligibility rules by a national governing body fall within ASA-directed monolithic control and receive implied immunity)
- Eleven Line, Inc. v. N. Tex. State Soccer Ass’n, 213 F.3d 198 (5th Cir. 2000) (refused immunity where rule was idiosyncratic, not nationally sanctioned, and lacked convincing management rationale)
- San Francisco Arts & Athletics, Inc. v. U.S. Olympic Comm., 483 U.S. 522 (1987) (recognized ASA’s grant of exclusive commercial rights advances Congressional purpose of enabling fundraising for the Olympic mission)
- Total TV v. Palmer Commc’ns, Inc., 69 F.3d 298 (9th Cir. 1995) (noting implied antitrust immunity is disfavored and requires a convincing showing of clear repugnancy between antitrust law and the regulatory scheme)