Commissioners Must Take Action

Letter to the Editor:

Commissioners Must Intervene More Often

Mark:

Another good issue.

Your article on the Islanders (click here) correctly sets forth the legal context of the commissioner's powers to intervene in the best interest of the sport. I would just add a brief comments about the business and competitive context in which this power is exercised. To me, what is significant is that this power is not exercised more often.

Despite all the league's rhetoric about being "single entities," professional sports leagues allow the grossest sort of mismanagement by their "franchises" that a true single entity franchisor, like McDonalds or General Motors, would never tolerate. (Can you imagine Chevrolet allowing its one Long Island dealer to "cut payroll" by letting its best sales and automotive repair staff go, watching sales plummet, and doing nothing?)

Since sports leagues do not face the pressure of competition because there are all monopolists within their own sport, the one potential protection that consumers might have is that the commissioner's office could at least ensure that they are efficient monopolists. But the commissioners rarely do so. Over the years, commissioners have steadfastly refused to intervene when owners make poor business judgments that are clearly detrimental to the league as a whole. The reason is that the commissioner is not really supposed to act in the best interests of the sport, he is supposed to act in the best interests of the owners, and the owners are less interested in maximizing their own collective interests and more interested in protecting their own prerogatives.

Steve Ross

Professor of Law, University of Illinois College of Law

Champaign, IL