Major League Baseball v.

Crist
Eleventh Circuit Court of Appeals
331 F.3d 1177 (11th Cir. 2003)

Key Search Terms: antitrust, MLB, civil investigative demands (CIDs),

exemption, contraction, Fourth Amendment

Facts
In November 2001, a MLB decided to contract two teams, the Florida Marlins
and Tampa Bay Devil Rays. The former Attorney General (AG) of Florida,
Robert Butterworth, in an effort to keep both teams in Florida issued several
civil investigative demands (CIDs) to MLB, Commissioner Allan Selig, the
Tampa Bay Devil Rays, and Florida Marlins. Issued pursuant to the AG’s
authority under Florida antitrust law, the CIDs were broad in scope requiring
each recipient to answer several interrogatories and produce voluminous
documents. However, MLB refused to answer the CIDs claiming it has a
federal right exempting it from an antitrust enforcement suit which extends to
administrative investigations. The District Court agreed, holding the antitrust
exemption covered the business of baseball and that state antitrust laws do not
apply to the proposed contraction.

Issue
Must MLB answer the CIDs and does MLB’s antitrust exemption allow MLB not
to answer the CIDs?

Holding
First, the Eleventh Circuit held that the federal exemption preempts state
antitrust law and that the issue of contraction is outside of antitrust
prosecution because deciding the number of teams in the league is at the heart
of the business of baseball. Second, contrary to the district court’s finding that
the exemption precluded investigation, the Eleventh Circuit held that Florida’s
AG could not proceed with investigation in this case because of the Fourth
Amendment and state law. The Fourth Amendment has been held to limit the
scope of investigatory power exercised by federal and state agencies.
Specifically, investigations, or “fishing expeditions,” based solely upon legal
activity are not within the broad investigative authority of regulatory agencies.
Likewise Florida state law prohibits the AG from conducting baseless
investigations by requiring the AG to have at least more than a mere intuition
that illegal activity is afoot. Thus, with no evidence of wrongdoing by MLB,
Selig, or the two Florida teams, the issuance of the CIDs did not pass any
investigative standard. As a result, the CIDs do not need to be answered
because they were issued without any authority.

Summarized by: Gary Rom