NFL defeats lawsuit over alleged monopoly on team merchandise

By Mike Scarcella

July 15 (Reuters) - The National Football League and its teams have persuaded a U.S. judge to dismiss a lawsuit alleging they violated antitrust law through their control over the distribution of licensed merchandise.

Manhattan-based U.S. District Judge Andrew Carter Jr on Monday said retailer Casey’s Distributing Inc had not provided enough evidence to support the proposed class action, which claimed that the NFL’s tight distribution rules left consumers with fewer options and higher prices.

Casey’s buys NFL merchandise from licensed manufacturers and resells it. The Nebraska-based company in 2022 sued the NFL and its 32 teams, accusing them of illegally monopolizing the licensing of trademarked team products.

Casey’s claimed it and other online retailers were being denied the opportunity to sell on some platforms such as Amazon.com.

“While plaintiffs have been harmed by the actions of the defendants, the law protects competition, not competitors,” Carter wrote. He said there was nothing in Casey’s lawsuit that adequately alleged consumers were forced to pay higher prices due to the alleged scheme.

The NFL and attorneys for Casey’s did not immediately respond to requests for comment.

Casey’s also named as a defendant the sports merchandise giants Fanatics. Casey’s said its products were removed from Walmart after it chose Fanatics as its exclusive seller. Fanatics did not immediately respond to a request for comment.

The NFL and Fanatics had denied any wrongdoing. Walmart and Amazon were not defendants.

In its lawsuit, Casey’s said Amazon’s online marketplace is the most important platform for small businesses like Casey’s to participate in the market for licensed NFL merchandise.

The NFL in asking Carter to dismiss Casey’s lawsuit said its online distribution policy was flexible, and that retailers that want to sell on Amazon must first seek approval by NFL Properties, which licenses the intellectual property for the league and its teams.

In a court filing, the NFL defended its distribution rules as lawful, saying they focus on brand and consumer protection and do not impose restrictions or rules on price or output.

Carter said Casey’s will have a chance to refile its lawsuit by the end of the month to try to persuade him to allow the claims to move forward.

The case is Casey’s Distributing Inc v. National Football Club et al, U.S. District Court, Southern District of New York, No. 1:22-cv-03934-ALC.

For plaintiffs: John Balestriere of Balestriere Fariello and Justin Nematzadeh of Nematzadeh PLLC

For NFL: Bradley Ruskin, David Munkittrick and Jeffrey Warshafsky of Proskauer Rose