The USFL was formed in May 1983 as a spring and summer alternative to the NFL. For three seasons from 1983 to 1985, the USFL captured the attention of hardcore football junkies looking for an off-season fix by bringing football to smaller markets overlooked by the NFL, attracting some of college football’s most exciting stars and introducing a flamboyant style of play that had gone missing from the grind-it-out NFL. In 1985, the USFL sought to take the fight with the NFL onto the field, by switching to a fall/winter schedule, and into the courtroom, by suing the NFL as a monopoly.
In USFL v. NFL, 842 F.2d 1335 (2nd Cir. 1988), the United States Football League, which had gone out of business largely due to poor business decisions by its owners, appealed from a jury verdict that found that, although the National Football League had a monopoly on professional football in the United States, the USFL was only entitled to $1. in damages. A landmark analysis of antitrust law resulted from the appeal but did nothing to save the USFL.
The USFL argued that the NFL, by making television contracts with all three major networks, violated the Sherman Anti-Trust Act and excluded the USFL from the marketplace. The court rejected this argument, noting that the Sports Broadcasting Act of 1961, which had been amended in 1966 to confer antitrust immunity on the merger of the AFL and the NFL, did not limit the sale of television rights for professional football to a single network.
The court also upheld the jury’s finding that the NFL did not have the power to prevent the USFL from obtaining a network contract. The terms of the NFL’s contracts with the television networks were for only five years, and did not contain any provisions that would have stopped the networks from televising USFL games. The USFL’s failure to obtain lucrative television contracts was largely its own fault, as it had failed to establish fan loyalty due to repeated moves, including abandoning nearly all of the country’s largest television markets.
The jury did find, however, that the NFL had illegally monopolized professional football by enticing USFL owners with promises of ownership in new NFL franchises; conducting a supplemental draft of USFL players; expanding its roster size to make room for USFL players; and attempting to cripple the USFL’s Oakland Invaders by promising to return the Los Angeles Raiders to Oakland. Even so, the jury only awarded $1 in damages, a far cry from the $1.7 billion in damages sought by the USFL. The USFL’s economic expert wrongly assumed that the USFL’s losses were only caused by the NFL and ignored the USFL’s own history of mismanagement. She also assumed that the NFL had prevented the USFL from obtaining a television contract, when the evidence showed that the USFL was simply not an attractive entertainment product. The court upheld the award of $1, holding that the jury had every right to reject the opinions of the USFL’s economist based on her faulty assumptions.
The result of USFL v. NFL was a quintessential Pyrrhic victory for the USFL. The decision not to award substantial damages left the league without enough revenue to continue, and the USFL never played another game after the 1985 season, finally shuttering its operations in 1987. In the nearly 25 years since the case was decided, no other football league has ever posed a serious threat to the NFL’s dominance of the professional football market in the United States. The USFL was not without its successes, however. The league proved that professional football was viable in smaller markets, particularly in the Sun Belt. The relative success of the USFL in places like Tampa Bay, Jacksonville, and Phoenix eventually lead to the establishment of NFL franchises in those cities. Noteworthy players and coaches like Steve Young, Herschel Walker, Reggie White, Steve Spurrier, Jim Mora, Marv Levy, and George Allen were all USFL alumni. Finally, several of the USFL’s rules (the two point conversion, salary-cap, and the format for instant replay) have since been adopted by the NFL.
Plus, it ain’t over yet for the USFL. A newly formed USFL plans on kicking off its second generation this spring. And, as USFL v. NFL shows us, an up-and-comer needs to bring its “A” game in order to play with the big boys.
Michael Simzak is the Youth Programs Coordinator at the National Constitution Center and the official sports writer for Constitution Daily. David A. DuBois, Esq., is an attorney with Rawle & Henderson LLP, the nation's oldest law office, established in 1783.