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09-17-2004, 12:35 AM
David A. Rainer
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Originally Posted by me2
I'm saying the teams have full control over how much they want to pay to whoever they want to pay. The franchisor takes no part in salary negotiations, sets no levels individual salaries. Those things are entirely up to the players and teams to work out. Let the teams fight each other for players. Lets teams spend as much as they want. However teams must the criteria to enter the Stanley Cup, that being a total salary lower than X. Above X, the teams can do what they like, arrange the own comp, enter a new NHL Megabucks comp etc.

For example company could run a racing car circuit where teams were only allowed to spend $1m/y.
So let me get this straight... Each team is allowed to spend however they want, but only those teams that spend under a certain amount of money can play in the NHL (or if in the NHL, not the playoffs)?

This would still be a very easy case for any federal judge. As the point of playing in the NHL is to go to and play in the Stanley Cup, putting a disincentive for a team to spend money by placing a restriction on entry into the playoffs is still a group boycott, an illegal combination to suppress wages, and a violation of the Sherman Act.

At the very base of it, any time any one or any thing places a restriction that involves (i.) the suppression of wages; and (ii.) two or more legally separate entities, there will definitely be a violation. As this is a restriction to (i.) suppress wages (cap at X) and (ii.) being carried out by more than one entity (the member franchises), it is a violation.

In your racing circuit example, if it is only a single company involved, then there is no problem. If it is a league restriction that is imposed on the member companies, the court would ask if there is an affect on competition. A driver would presumably argue that it is suppressing my wages, and therefore affecting competition in the labor market. The league is then in violation of the Sherman Act UNLESS it goes thru the collective bargaining process and then just about any reasonable restriction is OK.

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