MR. CHIEF JUSTICE WARREN delivered the opinion of the Court.
This is a civil antitrust action brought by the Government in the United States District Court for the Southern District of New York. The defendants—three corporations and two individuals—are engaged in the business of promoting professional championship boxing contests.
The Government's complaint alleges that promoters of professional championship boxing contests
The promoter's receipts from the sale of television, radio, and motion picture rights to championship matches, according to the complaint, represent on the average over 25% of the promoter's total revenue and in some instances exceed the revenue derived from the sale of admission tickets.
These allegations must of course be taken as true at this stage of the proceeding. And the defendants do not deny that the allegations state a cause of action if their business is subject to the Sherman Act. The question thus presented is whether the defendants' business as described in the complaint—the promotion of professional championship boxing contests on a multistate basis, coupled with the sale of rights to televise, broadcast, and film the contests for interstate transmission—constitutes "trade or commerce among the several States" within the meaning of the Sherman Act.
The question is perhaps a novel one in that this Court has never before considered the antitrust status of the boxing business. Yet, if it were not for Federal Baseball and Toolson, we think that it would be too clear for dispute
Notwithstanding these decisions, the defendants contend that they are exempt from the Sherman Act under the rule of stare decisis. They, like the defendants in the Shubert case, base this contention on Federal Baseball and Toolson. But they would be content with a more
For the reasons stated in the Toolson opinion and restated in United States v. Shubert, ante, p. 222, Toolson neither overruled Federal Baseball nor necessarily reaffirmed all that was said in Federal Baseball. Instead, "[w]ithout re-examination of the underlying issues," the Court adhered to Federal Baseball "so far as that decision determines that Congress had no intention of including the business of baseball within the scope of the federal antitrust laws." 346 U. S., at 357. We have held today in the Shubert case that Toolson is not authority for exempting other businesses merely because of the circumstance that they are also based on the performance of local exhibitions. That ruling is fully applicable here.
Moreover, none of the factors underlying the Toolson decision are present in the instant case. At the time the Government's complaint was filed, no court had ever held that the boxing business was not subject to the antitrust laws.
The issue was, in fact, before Congress only recently. In 1951, four identical bills were introduced in Congress— three in the House and one in the Senate—forbidding the application of the antitrust laws "to organized professional sports enterprises or to acts in the conduct of such enterprises."
With respect to baseball, the Subcommittee recommended a postponement of any legislation until the status of Federal Baseball was clarified in the courts.
As in the Shubert case, we are concerned here only with the sufficiency of the Government's complaint. We hold
MR. JUSTICE BURTON, retaining the views expressed in his dissent in the Toolson case, 346 U.S. 356, 357, joins the opinion and judgment of the Court in this case. MR. JUSTICE REED joins in this concurrence.
[For dissenting opinion of MR. JUSTICE FRANKFURTER, joined by MR. JUSTICE MINTON, see post, p. 248.]
[For dissenting opinion of MR. JUSTICE MINTON, see post, p. 251.]
APPENDIX TO OPINION OF THE COURT.
The complaint describes the "Nature of Trade and Commerce Involved" as follows:
10. Boxers usually compete in amateur tournaments as a preliminary to becoming professionals. As amateurs they receive no pay and box under the sponsorship of local independent boxing clubs, associations or other organizations. When they become professionals, they contract to box an opponent on a per bout basis for local promoters and receive a fee. If their skill as professional boxers results in an increasing willingness of the public to pay to view their contests, they can demand higher fees and a greater percentage of receipts from the sale of tickets and other rights. If their skill increases, they engage in preliminary and other bouts throughout the United States and eventually participate in major bouts. The fee for a major bout is usually a sum guaranteed by the promoter or a predetermined percentage of the net receipts from the sale of tickets and motion picture, radio and television rights.
11. The most lucrative asset to a professional boxer is recognition and designation by the various state athletic
flyweight .................... 112 lbs. bantamweight ................. 118 " featherweight ................ 126 " lightweight .................. 135 " welterweight ................. 147 " middleweight ................. 160 " light heavyweight ............ 175 " heavyweight .................. All above 175 lbs.
A "world champion" gains his title by defeating the existing champion or by eliminating all contenders, and remains world champion in his division until he is, in turn, defeated by a contender or resigns the title. Such a title affords to its holder financial returns from personal appearances and exhibitions throughout the United States, from endorsements and other activities, as well as a greater percentage of the receipts from his bouts. The promotion of professional championship boxing contests is also more lucrative than the promotion of other boxing contests.
12. Of the various "world championships," the heavyweight division is the most important to boxers and promoters, as it returns the greatest financial benefits. The flyweight and bantamweight divisions are not of substantial importance in the United States because very few American boxers are of such light weights. No championship contest has been held in the flyweight division in the United States since 1935; none in the bantamweight division since 1947.
13. The promotion of professional championship boxing contests, in which the winners achieve "world champion" titles, includes negotiating and executing contracts with boxers for the main and preliminary bouts, arranging and maintaining training quarters, leasing suitable arenas, such as stadia or ball parks where substantial numbers of the public may be seated to view the contest, negotiating and executing contracts for the employment of matchmakers, advertising agencies, press agents, seconds, referees, judges, announcers and other personnel; organizing, assembling, and arranging other details necessary to the
14. Promoters of professional championship boxing contests make a substantial utilization of the channels of interstate trade and commerce to:
15. Motion picture films of professional championship boxing contests are distributed and exhibited in theatres throughout the United States and in foreign countries. Similarly, radio and television broadcasts of such contests are transmitted throughout the United States and radio broadcasts of them are also transmitted to foreign countries.
16. The 21 major professional championship boxing contests promoted in the United States since June 1949
16 (a). A promoter of a professional championship fight usually derives substantially all of his revenue from two sources: (a) sale of tickets of admission and (b) sale of rights to telecast, broadcast and produce and distribute motion pictures of the fight. In such fights, sale of television, radio and motion picture rights account for a substantial proportion of the promoter's total revenue. Since 1949 sale of these rights has represented, on the average, over 25% of the total revenue derived from championship fights, and has exceeded, in some instances, the revenue received from sale of tickets of admission. With the progressive and continuing expansion of television facilities, the proportion of the promoter's total revenue derived from television, radio and motion pictures, has been on an ascending curve, in relation to revenue derived from sale of tickets of admission. In the Marciano-Walcott heavy-weight championship fight of May 15, 1953, at Chicago, Illinois, promoted by defendants IBC (N. Y.), IBC (Ill.), James D. Norris and Arthur M. Wirtz, the promoters' receipts from sale of tickets of admission were, after federal admission taxes, $253,462.37, while their television, radio and motion picture revenue was approximately $300,000.
MR. JUSTICE FRANKFURTER, with whom MR. JUSTICE MINTON joins, dissenting.
It would baffle the subtlest ingenuity to find a single differentiating factor between other sporting exhibitions, whether boxing or football or tennis, and baseball insofar as the conduct of the sport is relevant to the criteria or considerations by which the Sherman Law becomes applicable to a "trade or commerce." § 1, 26 Stat. 209, 15 U. S. C. § 1. Indeed, the interstate aspects of baseball
In 1922, the Court found commercialized baseball outside the scope of the Sherman Law. Federal Baseball Club v. National League, 259 U.S. 200. Last Term the Court refused to re-examine "the underlying issues" of this adjudication and adhered to it. Toolson v. New York Yankees, Inc., 346 U.S. 356. What were the "underlying issues"? They were the constituents of baseball in relation to the Sherman Law. By adhering to that decision, the Court refused to depart from a judgment necessarily based on these constituent elements. To my understanding, that is what is meant by "[w]ithout re-examination of the underlying issues." The Court decided as it did in the Toolson case as an application of the doctrine of stare decisis. That doctrine is not, to be sure, an imprisonment of reason. But neither is it a whimsy. It can hardly be that this Court gave a preferred position to baseball because it is the great American sport. I do not suppose that the Court would treat the national anthem differently from other songs if the nature of a song became relevant to adjudication. If stare decisis be one aspect of law, as it is, to disregard it in identic situations is mere caprice.
Congress, on the other hand, may yield to sentiment and be capricious, subject only to due process. As a matter of fact, one of the explicit factors that led to the result in Toolson was the recognition of congressional refusal to upset
Between them, this case and Shubert illustrate that nice but rational distinctions are inevitable in adjudication. I agree with the Court's opinion in Shubert for precisely the reason that constrains me to dissent in this case. Within a year after Federal Baseball the Court, again unanimously and through the same writer, found that a bill against the show business based on the Sherman Law was not so frivolous as to call for dismissal. Hart v. B. F. Keith Vaudeville Exchange, 262 U.S. 271. For more than 30 years, therefore, these two decisions stood as the law. The Shubert case plainly falls within the adjudication of Hart. By the same process of reasoning, boxing falls within Federal Baseball, which this Court revitalized in Toolson despite all the new factors on which the dissent in Toolson relied.
MR. JUSTICE MINTON, dissenting.
To make a case under the Sherman Act, two things among others are essential: (1) there must be trade or commerce; (2) such trade or commerce must be among the States.
In the Federal Baseball case, 259 U.S. 200, this Court held that baseball was not trade or commerce. It said, "personal effort, not related to production, is not a subject of commerce," and since the baseball game was an exhibition wholly intrastate, there could be no trade or commerce among the States. 259 U.S. 200, 209.
In the Baseball case, this Court held that traveling from State to State to play the game and all the details of arrangements were incident to the exhibition. In Toolson v. New York Yankees, 346 U.S. 356, we did not overrule the Federal Baseball decision; in fact, we reaffirmed the holding of that case.
When boxers travel from State to State, carrying their shorts and fancy dressing robes in a ditty bag in order to participate in a boxing bout, which is wholly intrastate, it is now held by this Court that the boxing bout becomes interstate commerce. What this Court held in the Federal Baseball case to be incident to the exhibition now becomes more important than the exhibition. This is as fine an example of the tail wagging the dog as can be conjured up.
The Court says: "The conspiracy, it is claimed, began in 1949 with an agreement among the defendants and Joe Louis, then heavyweight champion of the world, that Louis would resign his title, . . . procure exclusive rights to the services of the four leading title contenders in a series of elimination contests which would result in the recognition of a new heavyweight champion, . . . and . . . assign all such exclusive rights to the defendants." Of course, there was at the time only one champion, Joe Louis. He had a monopoly on that, and while he got it by competition, he did not get it in trade or commerce. I do not suppose that Joe Louis had to go back into the ring and be walloped to a knockout or a decision before he could surrender his championship. And if he arranged with four other fellows to fight it out in elimination contests for the championship and no one else was restrained from doing the same, it is difficult for me to see how there was any conspiracy. If other promoters wanted to start an elimination contest, they were free to do so. Whether they received public acceptance depended upon something other than trade or commerce. What does a boxer or athlete have for sale but "personal effort, not related to production," which, as Justice Holmes said, is not commerce? Such services they may contract about free from any control of the Sherman Act. Suppose the
As I see it, boxing is not trade or commerce. There can be no monopoly or restraint of nonexistent commerce or trade. Whether Congress can control baseball and boxing I need not speculate. What I am saying is that Congress has not attempted to do so. If there is a conspiracy, it is not one to control commerce between the States.
"§ 1. . . . Every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several States, or with foreign nations, is declared to be illegal . . . . Every person who shall make any contract or engage in any combination or conspiracy declared by sections 1-7 of this title to be illegal shall be deemed guilty of a misdemeanor . . . .
"§ 2. . . . Every person who shall monopolize, or attempt to monopolize, or combine or conspire with any other person or persons, to monopolize any part of the trade or commerce among the several States, or with foreign nations, shall be deemed guilty of a misdemeanor . . . ."
Section 4 confers jurisdiction on the district courts "to prevent and restrain violations of sections 1-7 of this title" in equity proceedings instituted under the direction of the Attorney General.