Friday, May 08, 2009

History backs NHL on an antitrust suit

Jim Balsillie has threatened to file an antitrust lawsuit if he is prevented by the NHL from moving the Phoenix Coyotes to Hamilton. The NHL would prefer not to have their bylaws challenged in court because anything can happen there. But history is clearly on their side.

Following expansion in 1967, the original owners of the California Golden Seals quickly soured on the Oakland-San Francisco area and wanted to move the team to Vancouver. The owners led by Barry van Gerbig launch a lawsuit under the Sherman Antitrust Act and the case was finally decided in 1974. The US District Court determined that the Act did apply to professional hockey but that teams were not in economic competition with each other. Therefore the NHL's restrictions on relocation was not an illegal attempt to monopolize trade. Of course the league would not agree to move the team during the period that the issue was being litigated (something Balsillie might want to take note).

However, the NHL thought a team in Vancouver was an excellent idea and added the Canucks as well as the Buffalo Sabres in 1970. In 1976 the Seals were finally moved to Cleveland and renamed the Barons. Two years later the team merged with the failing Minnesota North Stars and eventually moved to Dallas in 1992.