187 F. Supp. 3d 1219
D. Or.2016Background
- Run Gum, a maker of caffeinated gum, sponsors professional runners and sought to have its sponsored athletes wear Run Gum-branded apparel at the 2016 U.S. Olympic Track & Field Trials in Eugene, Oregon.
- USOC (federally chartered) has exclusive authority over U.S. Olympic participation and commercial use of Olympic designations; USATF is the national governing body (NGB) for track & field and hosts the Trials under USOC authority.
- USOC/USATF published "2016 Olympic Trials Uniform Advertising and Logo Regulations" forbidding commercial identification on competitor apparel except (1) apparel-manufacturer logos (subject to size limits) and (2) registered track-club identification.
- Run Gum sued under Section 1 of the Sherman Act, alleging a horizontal and vertical conspiracy (USOC, USATF, apparel manufacturers) to exclude individual-sponsor logos from the field of competition and seeking injunctive relief against enforcement.
- Defendants moved to dismiss under Rule 12(b)(6), arguing (a) no plausible agreement; (b) an improper, overnarrow relevant market; (c) no adequate pleading of a per se horizontal restraint; and (d) implied antitrust immunity under the Ted Stevens Amateur Sports Act (ASA).
- The court concluded that, because Congress empowered USOC/NGBs to protect and monetize the Olympic brand and fundraising, the ASA implies immunity for these apparel-logo restrictions and dismissed the complaint with prejudice.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Existence of an agreement in restraint of trade | Run Gum: USOC and USATF (and apparel manufacturers) agreed to ban individual-sponsor logos at the Trials, evidencing a conspiracy | Defendants: USATF merely adopted/implemented USOC rules and did not participate in creating an anticompetitive agreement | Court: Plausibly alleged enforcement by USATF but insufficient evidence of USATF crafting the policy; assumed agreement under Toscano enforcement prong but not establishment prong |
| Relevant market definition | Run Gum: The market is sponsorship of individual athletes' competition apparel at the 2016 Trials — a unique, non-substitutable opportunity | Defendants: Market is impermissibly narrow; many reasonable substitutes (other advertising, other events) exist | Court: Market pleaded is artificial/overly narrow; numerous plausible substitutes exist (other ads, other events) |
| Per se horizontal restraint | Run Gum: The ban is a horizontal agreement among apparel/equipment manufacturers and NGBs, subject to per se illegality | Defendants: No factual allegations tying unnamed manufacturers into a horizontal conspiracy; boilerplate allegations insufficient | Court: Plaintiff's pleadings lack evidentiary facts as to horizontal co-conspirators; per se claim fails at the pleading stage |
| Implied antitrust immunity under the ASA | Run Gum: Regulations don't implicate the ASA's core purpose and exemptions would be overbroad | Defendants: ASA grants USOC/NGBs authority to protect Olympic marks and fundraising; regulations necessary to preserve brand and sponsorship value | Court: Held USOC/USATF entitled to implied immunity — restrictions are necessary to implement ASA's fundraising/brand-protection scheme; dismissed with prejudice |
Key Cases Cited
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (plausibility pleading standard governs antitrust complaints)
- Ashcroft v. Iqbal, 556 U.S. 662 (courts need not accept legal conclusions as factual allegations)
- Monsanto Co. v. Spray‑Rite Serv. Corp., 465 U.S. 752 (concerted action requires a conscious commitment to a common scheme)
- Toscano v. Professional Golfers' Ass'n, 258 F.3d 978 (9th Cir.) (distinguishes acceptance of rules from participation in creating/enforcing conspiratorial restraints)
- Kendall v. Visa U.S.A., Inc., 518 F.3d 1042 (9th Cir.) (must plead evidentiary facts to support a Section 1 conspiracy)
- Newcal Indus., Inc. v. Ikon Office Solutions, 513 F.3d 1038 (9th Cir.) (plaintiff must allege defendant's market power in a properly defined relevant market)
- Leegin Creative Leather Prods., Inc. v. PSKS, Inc., 551 U.S. 877 (per se rules limited; most restraints analyzed under rule of reason)
- Texaco Inc. v. Dagher, 547 U.S. 1 (per se treatment applies to certain obvious anticompetitive horizontal agreements)
- Palmer v. BRG of Ga., Inc., 498 U.S. 46 (market allocation agreements are per se illegal)
- JES Props., Inc. v. USA Equestrian, Inc., 458 F.3d 1224 (11th Cir.) (ASA can imply antitrust immunity for NGB rules necessary to implement congressional purpose)
- Behagen v. Amateur Basketball Ass'n of U.S., 884 F.2d 524 (10th Cir.) (NGB eligibility rules fell within ASA-authorized activity and warranted immunity)
- San Francisco Arts & Athletics, Inc. v. U.S. Olympic Comm., 483 U.S. 522 (Supreme Court recognized USOC's control over Olympic-related commercial use to support fundraising)