The NFL’s deal with Reebok was a massive blow
The NFL’s deal with Reebok was a massive blow to American Needle, but
what you wouldn’t be able to tell today. In the lobby of the company’s Buffalo Grove, IL, headquarters – so innocuous that it has no sign outside identifying its occupant – one can still see silver footballs mounted on plaques from the NFL recognizing the company’s excellence. Inside the building, American Needle is rearranging its warehouse to account for Red Jacket and other apparel lines it launched after losing the NFL contract; shirts, after all, require a different shelving system than hats. It’s all part of the reinvention the embroiderer underwent to avoid collapse and regain revenue that it had lost.
The lawsuit that Carey and notoriously publicity-shy CEO Robert Kronenberger filed in 2004 wasn’t an immediate winner. Judges ruled against American Needle in the northern Illinois district court and later the 7th Circuit Court of Appeals, supporting the NFL’s argument that its 32 teams comprised a single entity, and a single entity logically couldn’t conspire with itself. Left there, the case would have been closed.
But then a funny thing happened. American Needle appealed to the Supreme Court, and the NFL supported it. While American Needle was focused on righting a perceived wrong that cost it millions of dollars, NFL leadership was seeking something bigger. Quite simply, a ruling by the highest court that the NFL was a single entity would stop any future antitrust suit against the league. The domino effect would have hit other major leagues that don’t have blanket antitrust exemptions (Major League Baseball is the only one that does), potentially revamping the landscape of American professional sports. The National Basketball Association, the National Hockey League, Major League Soccer and the world’s two major professional tennis organizations filed amicus curiae briefs to support the NFL, underscoring the case’s wide-ranging impact.
