SW Legal Educational Publishing

Plaintiff Must Clearly Define Relevant Market to Establish Antitrust Claim
Description Federal district court dismissed a suit filed by Adidas against the NCAA for restricting advertising on college uniforms and equipment used in NCAA competition. Adidas failed in its allegations to show that there was a relevant market, so the suit must be dismissed.
Topic Antitrust
Key Words Relevant Market
C A S E   S U M M A R Y
Facts Adidas sued the NCAA for violating Sections 1 and 2 of the Sherman Act by unreasonably restraining trade and engaging in a group boycott by having NCAA schools act as a cartel to restrict the sale of NCAA promotional rights. "This intentional restriction of promotional rights artificially limits the price and quality options available to apparel manufacturers as consumers of promotional space, forces manufacturers to pay additional amounts for billboard space or other advertising, decreases the selection of apparel offered to the end consumer, increases the price of the apparel for end consumers, and financially benefits the NCAA and its member institutions." The NCAA replied that Adidas failed to define the relevant market, so the suit should be dismissed.
Decision Suit dismissed. "The first step in an antitrust analysis is defining the relevant market or markets." Adidas asserts "that NCAA promotional rights are excellent advertising vehicles for increasing demand for athletic apparel and footwear. They do not, however, establish that such promotional rights are, in and of themselves, a relevant market." They failed to explain why other similar forms of advertising, such as sponsorship for professional teams or the Olympics are not reasonably interchangeable with NCAA promotion rights. "The market for the sales of NCAA promotional rights cannot be considered a relevant market for purposes of Adidas' instant claims under 1 or 2 of the Sherman Act."
Citation Adidas America, Inc. v. NCAA, - F.Supp.2d - (1999 WL 713973, D. Kan.)

Back to Antitrust Listings

©1997-2000  South-Western, a division of Cengage Learning, Inc. Cengage Learning is a trademark used herein under license.