City of Oakland Strikes Back Against NFL, Claiming It Forces Host Cities to Make a “Hobson’s Choice”
In a lawsuit over the Oakland Raiders’ relocation to Las Vegas, the city of Oakland has argued that the NFL has forced it and other host cities to make a “Hobson’s choice”: either pay excessive prices to keep an NFL team, or lose the team altogether.
As we reported in December 2018, the city of Oakland sued the NFL and all of its 32 teams over the decision to relocate the Raiders to Las Vegas, claiming that the league violated its own policies in addition to federal antitrust laws. In July 2019, U.S. Magistrate Judge Joseph C. Spero granted a motion to dismiss the lawsuit, finding that the city could not recover damages based on lost tax revenue from the broad scope of economic activity associated with the presence of a professional football team. However, Judge Spero also granted Oakland leave to amend, allowing the city to file an amended complaint in September. The NFL and its teams followed with another motion to dismiss the suit in October.
In their motion to dismiss, the NFL and its teams argued that the city of Oakland lacked standing since it has not paid the alleged overcharge. The NFL also claimed that the city failed to allege a relevant market or boycott. Further, the NFL and its teams claimed that they are under no obligation to consider the interests of host locations or local governments when making decisions. Finally, the NFL alleged that the city lacked standing since it was not a party to the NFL’s relocation policies.
The city of Oakland has now filed a brief in opposition to the NFL’s motion to dismiss. In its brief, the city argued that its amended complaint was adequately pled since it was harmed by both the Raiders departure and by not being allowed to host a new team. Oakland argued that it is a viable competitor in the market for having hosted the Raiders for decades. By refusing to allow Oakland to host an expansion team, the city claims that the NFL and its teams engaged in a group boycott.
In addition to these arguments, the city claimed that the NFL is artificially constraining the number of teams in its league. In support of this argument, the city cited to opinions from economists stating that the league can accommodate 40 teams or more. By having complete control over the number of teams, the NFL can artificially create bidding wars, the city argued. Oakland also addressed the NFL’s arguments regarding the relocation policies, arguing that they are meant to protect host cities and that the NFL did not give the city adequate notice or say in the decision to relocate the Raiders.
While the counsel for the city of Oakland is confident that its amended complaint will survive the NFL’s motion to dismiss, it is unclear whether Judge Spero will agree with the city’s arguments. We will continue to monitor the situation.