Justice Dept. Asks Court to Limit Scope of M.L.B.’s Antitrust Exemption

In a filing on Wednesday, the Department of Justice asked a federal court to limit the scope of Major League Baseball’s antitrust exemption to “conduct that is central to the offering of professional baseball exhibitions.”

Calling the century-old exemption an aberration — no such exemption exists for other United States-based sports leagues — the filing said the Supreme Court ruling that created the exemption was based on a “repudiated” interpretation of the Constitution.

The antitrust exemption, which protects M.L.B.’s way of doing business, has been challenged in the past — Senator Bernie Sanders of Vermont, among others, has called for its removal — but it has stood up to all previous legal challenges.

Wednesday’s comments came in a filing called a “statement of interest,” which allows the government to weigh in on ongoing legal cases where it is not a plaintiff or the defendant. In another recent statement of interest filed in a District of Columbia court, the Justice Department had urged a judge to reconsider his dismissal of an antitrust lawsuit against Amazon.

In this instance, the filing was related to a suit in which three former minor league teams affiliated with major league clubs, including the Staten Island Yankees, have sued M.L.B. accusing the league of antitrust violations when their teams, along with 40 others, were eliminated in a recent consolidation of Minor League Baseball.

M.L.B. has asked for the suit to be dismissed, citing, in part, the antitrust exemption. The Justice Department took no formal position on the league’s request for a dismissal in its Wednesday filing in the U.S. District Court for the Southern District of New York. But it did ask the court to “define the exemption narrowly.”

While the filing is relevant to M.L.B. in the short term because of how it plays into the ongoing lawsuit, the potential for a removal of the exemption based on various legal challenges could have far larger repercussions in terms of how teams conduct their business and the various freedoms afforded to players.

Wednesday’s filing was signed by Jonathan Kanter, the head of the Justice Department’s antitrust division, who along with Lina Khan, the chair of the Federal Trade Commission, is part of a group of progressives attempting to advance reforms to antitrust law. For decades, they argue, courts have applied the law in a way that favors big corporations. Both regulators were appointed last year by President Biden, who also signed an executive order in July 2021 meant to spur competition across the economy.

David McCabe contributed reporting.

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