Traditional rules designed to control player movement within the National Football League (NFL) have recently been challenged in two federal district courts. In Kapp v. NFL Judge Sweigert concluded that these rules constitute a violation of the antitrust laws. In Mackey v. NFL Judge Larson held that the Rozelle Rule is in violation of the antitrust laws. A prospective NFL player must sign a contract that contains an option clause which gives the employing team the right to renew a player's contract for one year beyond the time stipulated in the contract, at a compensation rate of 90% of the expired contract. Once this option year is over, the player is a free agent. The NFL Constitution and By-Laws provide that a team which signs a player who has become a free agent in this way must compensate the former team. According to the Rozelle Rule, if the teams cannot reach a mutually satisfactory agreement on compensation, the League Commissioner has the power to fix compensation. The present system of player control in the NFL violates the antitrust laws. Under the rule of reason, the availability of less-restrictive means of accomplishing the same results leads to the conclusion that the present system is unreasonable and therefore illegal.
The Legality of the Rozelle Rule and Related Practices in the National Football League,
4 Fordham Urb. L.J. 581
Available at: http://ir.lawnet.fordham.edu/ulj/vol4/iss3/7