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Keywords

lawsuitplaintiffdefendantmotiontrusttrademarkcorporationantitrustmotion to dismiss
defendantmotiontrusttrademarkcorporationantitrustmotion to dismiss

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American Needle, Inc. v. New Orleans Louisiana Saints, 385 F.Supp.2d 687, 2005-1 Trade Cases P 74,819

Facts

American Needle, Inc., a corporation that designs and sells headwear featuring trademarked logos of NFL teams, filed an antitrust lawsuit against the NFL, its member teams, and Reebok after the NFLP granted Reebok an exclusive licensing agreement for such merchandise. This change in licensing practices eliminated competition among manufacturers for the use of NFL trademarks. American Needle's license expired in March 2001 and was not renewed, prompting the lawsuit alleging monopolization and restraint of trade under the Sherman Act.

American Needle, a corporation headquartered in Buffalo Grove, Illinois, designs, manufactures, and sells headwear carrying the trademarked names and logos of various professional athletic teams.

Issue

Whether the defendants' exclusive licensing agreement constituted a violation of the Sherman Act by monopolizing the market for NFL-branded headwear and apparel.

Whether the defendants' exclusive licensing agreement constituted a violation of the Sherman Act by monopolizing the market for NFL-branded headwear and apparel.

Rule

Analysis

The court found that the exclusive licensing agreement with Reebok did not automatically constitute a per se violation of the Sherman Act, as the restraints imposed by sports leagues require a rule of reason analysis. The plaintiff's claims for monopolization and restraint of trade were not dismissed based on their market definitions, as the law does not preclude antitrust claims based on the alleged markets defined by NFL trademarks.

To determine whether a trade restraint runs afoul of antitrust law under the rule of reason, a court must determine the consequences of the restraint on the affected market. See Havoco of America, Ltd. v. Shell Oil Co., 626 F.2d 549, 554 (7th Cir.1980); see also 42nd Parallel North v. E. Street Denim Co., 286 F.3d 401, 404 (7th Cir.2002).

Conclusion

The court granted the defendants' motion to dismiss Count IV but denied the motion regarding Counts I, II, III, and V, allowing the antitrust claims to proceed.

For the foregoing reasons, defendants' motion to dismiss count IV is granted, and their motion to dismiss counts I, II, III and V is denied.

Who won?

The court's decision to deny the motion to dismiss Counts I, II, III, and V indicates that American Needle, Inc. prevailed in part, allowing its claims of monopolization and restraint of trade to move forward. The court recognized the potential validity of American Needle's market definitions and the necessity of a thorough examination of the facts in relation to antitrust law.

The court's decision to deny the motion to dismiss Counts I, II, III, and V indicates that American Needle, Inc. prevailed in part, allowing its claims of monopolization and restraint of trade to move forward.

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