WEBVTT - Obamacare at SCOTUS & Soccer Monopoly Trial 0:00:02.759 --> 0:00:07.000 This is Bloomberg Law with June Grossel from Bloomberg Radio. 0:00:08.720 --> 0:00:13.280 Obamacare is back at the Supreme Court for the fourth time. 0:00:13.680 --> 0:00:17.479 The latest case challenges the task force that recommends some 0:00:17.560 --> 0:00:21.520 of the medical services health insurers must cover free of 0:00:21.680 --> 0:00:26.320 charge under the Affordable Care Act, for example, cancer screenings, 0:00:26.600 --> 0:00:31.120 statins to prevent heart disease, and medication to prevent HIV. 0:00:32.040 --> 0:00:36.159 The ultra conservative Fifth Circuit Court of Appeals found that 0:00:36.200 --> 0:00:40.040 the structure of that task force is unconstitutional under the 0:00:40.080 --> 0:00:44.680 appointment's clause. The Biden administration appealed to the Supreme Court, 0:00:45.000 --> 0:00:50.160 saying that decision jeopardizes the availability of critical preventive care 0:00:50.280 --> 0:00:54.120 for millions of Americans. Joining me is healthcare attorney Harry 0:00:54.160 --> 0:00:58.920 Nelson of Leech Tishman Nelson Hardiman Harry, this isn't a 0:00:58.960 --> 0:01:00.640 threat to the entire law. 0:01:01.080 --> 0:01:04.840 Tell us what's at stake here in this case, which 0:01:04.920 --> 0:01:09.039 is called Basera versus Braidwood Management, is a case that's 0:01:09.080 --> 0:01:14.000 bringing together challenges the constitutionality of several provisions of the 0:01:14.040 --> 0:01:16.600 Affordable Care Act. It's a little bit of a grab bag. 0:01:16.840 --> 0:01:19.479 The only scheme that seems to tie all these services 0:01:20.040 --> 0:01:23.600 is that they are all forms of preventive healthcare. So 0:01:24.000 --> 0:01:26.920 there are three main issues. One is that the Affordable 0:01:26.959 --> 0:01:31.920 Care Action requires insurance companies to cover fifty preventive services, 0:01:32.080 --> 0:01:37.200 including HIV prevention medications, which have become somewhat controversial in 0:01:37.319 --> 0:01:42.240 certain quarters, vaccinations, cancer screenings, and it does not require 0:01:42.360 --> 0:01:46.720 patient cost sharing, meaning patients to pay copays and to 0:01:46.760 --> 0:01:49.760 have to pay any deductibles or any portion of responsibility. 0:01:49.800 --> 0:01:52.960 That's one provision is this preventive services mandate. And then 0:01:53.000 --> 0:01:57.720 there's also an argument being made that the various services, 0:01:57.800 --> 0:02:02.280 particularly the US Preventive Service Task Force, are unconstitutional. That's 0:02:02.320 --> 0:02:05.000 more of a procedural issue of how the members of 0:02:05.000 --> 0:02:07.840 that task force are appointed and the fact that they're 0:02:07.840 --> 0:02:09.919 not appointed by the President or confirmed by the Senate. 0:02:10.160 --> 0:02:13.919 And finally, there are a series of religious objections being made, 0:02:14.160 --> 0:02:18.680 particularly on HIV prevention drugs. There's a therapy called PREP 0:02:19.040 --> 0:02:21.960 which is being funded, and some of the plaintiffs are 0:02:22.160 --> 0:02:25.200 arguing that it infringes on their religious beliefs to have 0:02:25.280 --> 0:02:29.760 to be forced to provide this sort of prophylactic treatment 0:02:30.160 --> 0:02:31.600 that covers the cost of PREP. 0:02:32.160 --> 0:02:37.360 As you mentioned, the plaintiffs here are Christian businesses suing 0:02:37.480 --> 0:02:41.600 over Obamacare. Now the Fifth Circuit, it seems like what 0:02:41.720 --> 0:02:46.480 they upheld is that the structure of the US Preventive 0:02:46.639 --> 0:02:51.680 Services Task Force is unconstitutional under the appointment's clause. So 0:02:51.760 --> 0:02:54.920 this is the argument that we've heard before and that 0:02:55.000 --> 0:02:59.040 has succeeded sometimes about whether or not their principal officers 0:02:59.520 --> 0:03:00.960 or in fear, what are your officers. 0:03:01.800 --> 0:03:03.640 First of all, the case was brought by even though 0:03:03.680 --> 0:03:05.960 it's in the name of a business that was forced 0:03:05.960 --> 0:03:09.600 to cover people. The case is being funded and initiated 0:03:10.080 --> 0:03:14.800 by a prominent conservative activist in Texas, doctor Stephen Hotts. 0:03:15.080 --> 0:03:18.600 And the argument is about this task force and essentially 0:03:19.040 --> 0:03:24.000 a signing of power to a panel of sixteen volunteer 0:03:24.160 --> 0:03:29.280 members who are nationally recognized experts in things like preventive medicine, 0:03:29.320 --> 0:03:34.000 family medicine, pediatrics, epidemiology. They're chosen by a federal agency 0:03:34.000 --> 0:03:38.000 within the Medicare program called the Agency for Healthcare Research 0:03:38.040 --> 0:03:42.640 and Quality AHRQ, So it's kind of a technocratic panel. 0:03:42.920 --> 0:03:46.200 It's not a political appointment. And part of the argument 0:03:46.240 --> 0:03:50.720 here is that the decisions they're making are political decisions 0:03:50.800 --> 0:03:53.800 that really should be appointments by the president and confirmations 0:03:53.800 --> 0:03:56.080 by the Senate, and the argument it seems to be 0:03:56.120 --> 0:03:59.080 that the task force is really operating without sufficient oversights 0:03:59.240 --> 0:04:00.760 as a result of sort of the way it was 0:04:00.800 --> 0:04:04.320 set up in violation of the appointments clause of the Constitution. 0:04:04.880 --> 0:04:08.000 First of all, this went to Judge Ried O'Connor in Texas, 0:04:08.400 --> 0:04:13.920 who is the judge notorious for striking down Obamacare in 0:04:13.960 --> 0:04:18.280 its entirety, and that was overruled, and even the Fifth 0:04:18.360 --> 0:04:25.120 Circuit narrowed his decision. He had had an injunction nationwide. 0:04:26.440 --> 0:04:28.600 It was clear that the Fifth Circuit was trying to 0:04:28.680 --> 0:04:32.839 narrow the decision. Judge O'Connor's decision was a very aggressive 0:04:33.480 --> 0:04:37.240 conservative activist opinion, I think the way most people view it, 0:04:37.520 --> 0:04:41.360 and while they do take quite seriously the appointment clause issue, 0:04:41.360 --> 0:04:44.320 I think some of the other arguments about religious freedom 0:04:44.839 --> 0:04:48.280 are issues that were already tried, you know, for example, 0:04:48.279 --> 0:04:50.720 in the hobby Lobby case for the Supreme Court more 0:04:50.720 --> 0:04:53.000 than a few years ago, in the early days Affordable 0:04:53.040 --> 0:04:55.520 Care Act. And my sense is that the Fifth Circuit 0:04:55.560 --> 0:04:59.719 wanted to focus attention on the appointments clause argument because 0:04:59.720 --> 0:05:04.040 that's definitely a very grounded textual argument and a fight 0:05:04.360 --> 0:05:07.839 that's going on in this country between you know, liberals 0:05:07.839 --> 0:05:12.720 and conservatives over the authority to make appointments to organizations 0:05:12.760 --> 0:05:14.760 like this and the extent to which they have to 0:05:14.800 --> 0:05:17.960 follow the process set out in the Constitution or whether 0:05:18.440 --> 0:05:22.039 you know, more creative mechanisms can be set out. I 0:05:22.040 --> 0:05:25.320 don't think when this particular panel has created anyone in 0:05:25.480 --> 0:05:30.200 vision to be controversy over the particular therapies, whatever with 0:05:30.360 --> 0:05:32.440 the prep or you know, anything else. But it is 0:05:32.520 --> 0:05:35.400 clear that these issues are now political, and so I 0:05:35.400 --> 0:05:37.520 do think that that issue is going to be an 0:05:37.520 --> 0:05:40.760 interesting one. Sucreme Court it's going to have to tangle 0:05:40.800 --> 0:05:41.080 with them. 0:05:41.440 --> 0:05:45.760 So the Solicitor General said that if this decision is 0:05:45.839 --> 0:05:49.719 a firm that it could affect things like cancer screenings, 0:05:49.839 --> 0:05:52.279 I mean things that have nothing to do with you know, 0:05:52.320 --> 0:05:55.080 the religious objections of the plaintiffs. 0:05:56.320 --> 0:05:59.720 I do believe that the issue around cancer screenings had 0:05:59.839 --> 0:06:04.560 a political issue. The cancer screenings were particularly for cervical 0:06:04.600 --> 0:06:09.840 cancer and also were related to screens for mammograms, and 0:06:09.880 --> 0:06:13.080 I think there were a lot of concerns about sort 0:06:13.080 --> 0:06:16.880 of women's health and this particular advisory panel, you know, 0:06:17.000 --> 0:06:22.039 making recommendations that were liberal and a perception that you 0:06:22.080 --> 0:06:26.120 know that they were supporting sexual activity, for example, when 0:06:26.480 --> 0:06:29.440 abstinence should be encouraged outside of marriage. There were definitely 0:06:29.480 --> 0:06:34.360 some other conservative issues beyond the obvious one of prep 0:06:34.520 --> 0:06:37.719 which has become such an important therapy for HIV prevention. 0:06:38.120 --> 0:06:40.839 But I do think that's the underlying issue with inclusion 0:06:40.880 --> 0:06:42.640 of cancer as one of the areas that they were 0:06:42.640 --> 0:06:43.159 objecting to. 0:06:43.560 --> 0:06:49.279 So the Biden administration is appealing, but the Trump administration 0:06:49.640 --> 0:06:53.960 is coming in and it's been consistently hostile to Obamacare. 0:06:54.480 --> 0:06:55.440 It might not defend the. 0:06:55.480 --> 0:06:59.000 Law, right, Yeah, it's interesting. The Biden administration was clearly 0:06:59.480 --> 0:07:03.120 opposing and really arguing that this task force operates as 0:07:03.160 --> 0:07:06.520 an advisory body rather than as an agency that has 0:07:06.520 --> 0:07:09.840 final authority, so that it was not triggering an appointment 0:07:09.920 --> 0:07:14.400 clause issue. But I do suspect that the Trump administration 0:07:14.560 --> 0:07:19.040 is likely to not defend the law to favor a 0:07:19.480 --> 0:07:23.480 sort of broad reading of federal power under the appointments clause. 0:07:23.560 --> 0:07:28.120 And so my sense is that within conservative political activist community, 0:07:28.520 --> 0:07:31.880 there's a belief that the current court will support that reading. 0:07:31.960 --> 0:07:34.240 So I do think that both the administration and the 0:07:34.280 --> 0:07:38.720 Court are receptive to that central argument here. 0:07:39.360 --> 0:07:44.320 If that happens, this applies so far, this injunction only 0:07:44.360 --> 0:07:47.800 to the blandiffs here, but that could lead to a 0:07:47.920 --> 0:07:51.960 lawsuit asking for nationwide relief if the court upholds this. 0:07:52.600 --> 0:07:55.840 Yeah, absolutely, what's really interesting. And again, if you go 0:07:55.960 --> 0:07:57.760 back to I don't have the year in front of you, 0:07:57.800 --> 0:07:59.760 but I think it was twenty fourteen or twenty fifteen, 0:08:00.240 --> 0:08:04.360 we had the Hobby Lobby decision, which was about conservative 0:08:04.400 --> 0:08:08.480 religious employers desire not to be forced, you know, to 0:08:08.520 --> 0:08:12.160 cover certain costs like birth control. What we're seeing here 0:08:12.280 --> 0:08:16.760 is a broader set of issues being subjected to religious 0:08:16.960 --> 0:08:20.920 liberty claims. And so I do think that you could 0:08:20.960 --> 0:08:26.400 see more employers and a broader range of programs potentially 0:08:26.960 --> 0:08:29.239 following the lead of the plane iff in this case. 0:08:29.680 --> 0:08:33.199 And so yeah, I do think there is a significant 0:08:33.360 --> 0:08:37.200 potential impact on access to care and potentially a huge 0:08:37.320 --> 0:08:41.040 public health backlash. For example, if cancer screenings go down, 0:08:41.520 --> 0:08:43.960 you know, because I'm sure our employers aren't required to 0:08:44.480 --> 0:08:47.400 you know, wave cost sharing requirements. I think this could 0:08:47.400 --> 0:08:51.240 be particularly burdensome for small employers, and it's going to be. 0:08:51.320 --> 0:08:54.600 It really is kind of awakening religious liberty arguments. 0:08:54.600 --> 0:08:59.120 Again, the Supreme Court is upheld Obamacare three times. It's 0:08:59.160 --> 0:09:05.600 a program that people like and need, and there are 0:09:05.640 --> 0:09:08.000 constant attacks on it. There have been something like two 0:09:08.040 --> 0:09:10.080 thousand different lawsuits. 0:09:10.400 --> 0:09:12.520 I think we're looking at a very different Supreme Court 0:09:12.880 --> 0:09:16.000 right now. If you remember back to the original challenges, 0:09:16.440 --> 0:09:19.600 you know, we saw a court where John Roberts was 0:09:19.679 --> 0:09:22.640 the center of the court, and his decision to separate 0:09:22.880 --> 0:09:26.720 from his conservative colleagues at that time, where it was 0:09:26.720 --> 0:09:30.440 a five to four conservative advantage, swung things. Now with 0:09:30.559 --> 0:09:34.640 the six to three conservative advantage, john Roberts joining and 0:09:34.679 --> 0:09:38.320 sort of taking the same position or similar position to 0:09:38.400 --> 0:09:41.240 the views of the affordable character he took back when 0:09:41.240 --> 0:09:43.800 we were dealing with this ten plus years ago. Now 0:09:43.840 --> 0:09:47.480 you're looking at Brett Kavanaugh and at Amy Comy Barrett, 0:09:47.480 --> 0:09:50.520 and so a very different makeup on the court and 0:09:50.679 --> 0:09:54.960 potentially a willingness to go and take more aggressive positions. 0:09:55.000 --> 0:09:57.400 So I do think it's going to be interesting to 0:09:57.400 --> 0:10:00.600 watch this case because it will be telling that even 0:10:00.880 --> 0:10:04.440 fairly recent Supreme Court precedent may be you know, up 0:10:04.480 --> 0:10:08.439 for reevaluation. And yeah, I think that's part of the 0:10:08.800 --> 0:10:11.080 backdrop in context of this case. A lot of people 0:10:11.080 --> 0:10:12.080 are going to be watching closely. 0:10:12.480 --> 0:10:18.640 The PSTF requires insurers to cover more than fifty preventive services. 0:10:19.040 --> 0:10:24.439 Are those all in jeopardy If the court affirms this decision. 0:10:24.240 --> 0:10:28.880 The case is challenging the entire validity of the us PPF, 0:10:28.920 --> 0:10:33.240 of the Prevention Task Force, and it certainly jeopardizes everything 0:10:33.320 --> 0:10:36.000 that they were doing, and who knows that could lead 0:10:36.000 --> 0:10:38.880 to a backlash. And I also think, even though this 0:10:38.960 --> 0:10:41.360 case is only about that task force, that kind of 0:10:41.400 --> 0:10:47.240 feature of use of clinical specialist advisory, you know, support 0:10:47.440 --> 0:10:50.520 for the government for government plans was a central part 0:10:50.559 --> 0:10:53.320 of the affordable character in a number of other respects. 0:10:53.880 --> 0:10:56.280 And I think this is in some ways an attack 0:10:56.440 --> 0:11:02.000 on the participation of the healthcare community, the scientific community, 0:11:02.360 --> 0:11:05.920 on that process without the President and primateur without the 0:11:05.960 --> 0:11:09.800 Senate confirmation. So I do think that this is essentially 0:11:09.840 --> 0:11:12.839 a much bigger issue, even though the flashpoint that brought 0:11:12.840 --> 0:11:16.480 it are these particular issues that drew you know, religious 0:11:16.480 --> 0:11:18.199 objections from conservative Christians. 0:11:18.440 --> 0:11:20.480 Harry, Before I let you go, I want to ask 0:11:20.520 --> 0:11:25.240 a couple of questions about healthcare in the upcoming Trump administration. 0:11:26.000 --> 0:11:30.400 The abortion pill MiFi pristone is being used in a 0:11:30.480 --> 0:11:35.560 majority of abortions these days. Could Trump direct the FDA 0:11:35.920 --> 0:11:39.439 to revoke the approval of MIFA pristone. 0:11:40.280 --> 0:11:43.040 That's a big question that I've been on my mind 0:11:43.400 --> 0:11:47.520 since the election and even before. You know, there certainly 0:11:47.679 --> 0:11:51.679 is a contingency within the conservative activist community who would 0:11:51.880 --> 0:11:56.800 like him to step in and to direct FDA leadership 0:11:56.880 --> 0:12:01.800 to re examine the current policies around the pristone, its approval, 0:12:02.400 --> 0:12:05.440 and all of the guidelines that surround it that were 0:12:05.600 --> 0:12:08.800 changed to make it much more accessible. I do think 0:12:08.880 --> 0:12:12.160 that that is a very real possibility. The interesting question 0:12:12.240 --> 0:12:15.840 here is that President Trump himself has said that he 0:12:15.920 --> 0:12:19.719 wants this chapter of abortion issues closed. It clearly has 0:12:19.760 --> 0:12:25.520 been a political loser until this cycle for the Republicans, 0:12:25.559 --> 0:12:28.320 and so it's interesting because this is an issue where 0:12:28.320 --> 0:12:32.960 the conservative Christian legal community clearly wants to take this 0:12:33.080 --> 0:12:36.880 on and to use the FDA itself to pull back 0:12:36.920 --> 0:12:41.199 on access to MISS pristone and by extension, telemedical abortion, 0:12:41.800 --> 0:12:44.719 and the President himself may not be so enthusiastic. So 0:12:45.080 --> 0:12:47.560 it's going to be interesting to watch where that goes. 0:12:47.559 --> 0:12:49.440 But I think it's certainly a big concern on the 0:12:49.480 --> 0:12:52.840 mind of the reproductive health access community. 0:12:53.520 --> 0:12:59.240 There's also a concern about vaccines because of the possibility 0:12:59.520 --> 0:13:03.800 or probability that Robert F. Kennedy Junior is going to 0:13:03.800 --> 0:13:07.320 be the HHS secretary. What do you think is the 0:13:07.480 --> 0:13:12.880 likelihood that he would change federal vaccine recommendations. 0:13:13.800 --> 0:13:16.600 I do think it's going to be a period under 0:13:16.640 --> 0:13:21.640 his leadership, assuming he's confirmed, of really heightened scrutiny for 0:13:21.920 --> 0:13:25.959 both current and future vaccines, and it's going to mean 0:13:26.000 --> 0:13:29.400 that the process will move lower. And I don't think 0:13:29.480 --> 0:13:33.040 we're going to see vaccines going away, but I think 0:13:33.120 --> 0:13:38.720 that mandates and government advisory issuances around vaccines are likely 0:13:38.760 --> 0:13:41.360 to change. And I think there's just a change in 0:13:41.360 --> 0:13:45.439 the culture of vaccinations that is certainly negative from the 0:13:45.480 --> 0:13:48.120 view of most of the public health community. And my 0:13:48.240 --> 0:13:51.720 only prayer is that we don't see some massive outbreak 0:13:51.840 --> 0:13:56.320 of a disease that has largely gone away, something like measles, 0:13:56.320 --> 0:13:58.120 because of this. But there's definitely going to be a 0:13:58.240 --> 0:14:02.920 change in the culture, you know, around vaccine and a 0:14:02.960 --> 0:14:08.800 lot more sort of scrutiny and skepticism after a Kennedy FDA. 0:14:09.360 --> 0:14:10.960 We'll have to wait and see how he does in 0:14:11.000 --> 0:14:15.080 those confirmation hearings coming up. Thanks so much, Harry. That's 0:14:15.120 --> 0:14:20.240 Harry Nelson, a partner at leech Tishman Nelson Hardiman. US 0:14:20.280 --> 0:14:23.880 Soccer and Major League Soccer will face off against the 0:14:23.920 --> 0:14:28.080 now defunct North American Soccer League in an anti trust 0:14:28.120 --> 0:14:32.840 trial in Brooklyn Federal Court. The NASL claims that US 0:14:32.880 --> 0:14:37.320 Soccer and MLS colluded to eliminate it from the upper 0:14:37.360 --> 0:14:42.960 tiers of US men's professional soccer, and NASL is seeking 0:14:43.040 --> 0:14:47.600 treble damages of more than five hundred million dollars. Joining 0:14:47.600 --> 0:14:51.120 me is anti trust expert Peter Carstensen, a professor at 0:14:51.160 --> 0:14:57.440 the University of Wisconsin Law School. The NASL is blaming 0:14:57.640 --> 0:15:01.840 US Soccer and MLS for driving it out of business. 0:15:01.920 --> 0:15:03.760 What's the main question in the case. 0:15:04.280 --> 0:15:08.200 As best I can tell, the key question is going 0:15:08.280 --> 0:15:15.160 to be whether the decisions that the Soccer Federation made 0:15:15.440 --> 0:15:21.360 were relatively disinterested judgments on the merits of whether or 0:15:21.480 --> 0:15:24.800 not a particular league should be allowed to participate at 0:15:24.840 --> 0:15:30.920 a particular level, or alternatively, whether these decisions were made 0:15:31.360 --> 0:15:36.720 with a goal of excluding a otherwise reasonable competitive alternative 0:15:36.800 --> 0:15:40.000 from access to the market. And what you're looking at 0:15:40.120 --> 0:15:43.880 is a regulator and the question is how did that 0:15:43.920 --> 0:15:49.480 regulator make decisions, what went into that decision, and what 0:15:49.600 --> 0:15:51.920 kind of review might there have been of the decision. 0:15:52.720 --> 0:15:57.520 So if the decision was the product of some kind 0:15:57.600 --> 0:16:04.800 of an understanding agreement with the existing upper level leagues 0:16:05.360 --> 0:16:09.320 that there shouldn't be any more comparable leagues allowed in, 0:16:09.960 --> 0:16:12.320 then that's going to look like an anti trust violation. 0:16:12.440 --> 0:16:16.000 Is going to look like using that power over access 0:16:16.280 --> 0:16:20.000 to exclude competition. That's an agreement and restraint of trade. 0:16:20.160 --> 0:16:23.280 That's illegal. On the other hand, you need some kind 0:16:23.280 --> 0:16:25.080 of a decision maker about who gets to play at 0:16:25.080 --> 0:16:28.080 what level. That's the first thing that is really kind 0:16:28.080 --> 0:16:31.040 of common ground here, as best I can tell. Somebody 0:16:31.080 --> 0:16:34.560 has to make these decisions, they need to have criteria 0:16:34.640 --> 0:16:39.800 standards for making that decision. If the decision is one 0:16:40.160 --> 0:16:45.680 on the merits, No, your league does not merit participation 0:16:46.080 --> 0:16:49.320 at either Division one or Division two level, but only 0:16:49.320 --> 0:16:53.600 at a Division three level, then that's not a restraint 0:16:53.640 --> 0:16:58.360 of trade in that it's a legitimate I'd call it 0:16:58.440 --> 0:17:04.119 regulatory about the credentials of that particular league. This is 0:17:04.200 --> 0:17:10.080 a very confusing area of anti trust law because anti 0:17:10.119 --> 0:17:17.120 trust law doesn't recognize these the facto market regulators as 0:17:17.320 --> 0:17:20.360 being a special case that needs to be looked at 0:17:20.560 --> 0:17:22.919 in a distinct kind of way. Some of us have 0:17:23.400 --> 0:17:27.200 tried to say, hey, understand what you're really dealing with. 0:17:27.480 --> 0:17:31.160 Here's how it can be made more sensible in terms 0:17:31.160 --> 0:17:35.000 of coherent standards. Everybody knows what the rules are likely 0:17:35.080 --> 0:17:39.240 to be, but so far no core has really articulated 0:17:39.280 --> 0:17:42.000 that kind of vision. It's the big issue in the 0:17:42.119 --> 0:17:44.720 NCAA litigation really as well. 0:17:45.200 --> 0:17:49.840 US Soccer said it rejected the NSL in twenty sixteen 0:17:49.880 --> 0:17:52.359 because it didn't meet the minimum standards that it was 0:17:52.520 --> 0:17:58.040 objectively applying, such as minimum stadium seating capacity of fifteen thousand, 0:17:58.280 --> 0:18:02.720 number of teams, time zone coverage in other benchmarks. But 0:18:03.280 --> 0:18:06.800 the federal judge who greenlighted the lawsuit to go ahead 0:18:07.600 --> 0:18:11.639 said that US Soccer in twenty seventeen waived twenty one 0:18:11.840 --> 0:18:17.320 standards for second Division and Favored League USL, but denied 0:18:17.359 --> 0:18:22.199 two waiver requests for NASL. So would that sort of 0:18:22.240 --> 0:18:25.879 discrimination and treatment demonstrate something. 0:18:26.440 --> 0:18:29.720 Yeah, exactly. That seems to me to be central to 0:18:29.800 --> 0:18:33.120 why the judge allowed this case to go forward. This 0:18:33.160 --> 0:18:36.280 is a tricky thing because in theory, once there it's 0:18:36.320 --> 0:18:40.440 a factual dispute, it's supposed to be decided by the jury. 0:18:40.840 --> 0:18:45.960 In anti trust cases, judges are more proactive. They've got 0:18:46.000 --> 0:18:51.760 to decide that a reasonable jury would find this claim 0:18:52.200 --> 0:18:56.920 sufficiently plausible, that it could reach a verdict of liability 0:18:57.240 --> 0:19:00.639 that the judge would feel comfortable upholding. The judge is 0:19:00.680 --> 0:19:04.960 actually doing some weighing of the evidence, even though the 0:19:05.280 --> 0:19:08.760 constitutional law since no judge you can't do that. In fact, 0:19:08.800 --> 0:19:12.479 they do it. And so what he's saying here, as 0:19:12.560 --> 0:19:17.160 best I can tell you, is this doesn't look quite right. 0:19:17.320 --> 0:19:19.920 This is the kind of thing, at least until there's 0:19:20.080 --> 0:19:27.440 much more explanation by the Federation of why these cases 0:19:27.520 --> 0:19:31.560 were treated similarly. And even though it was two waivers, 0:19:31.600 --> 0:19:35.480 those were two really important waivers, whereas the twenty one 0:19:35.560 --> 0:19:42.440 waivers were relatively minor bookkeeping matters or whatever. But that's 0:19:42.440 --> 0:19:45.320 going to be for the jury to decide. But what 0:19:45.440 --> 0:19:49.679 the judge was saying, this looks sufficiently suspicious, but I'm 0:19:49.720 --> 0:19:51.680 gonna let it go to a jury. Now, these have 0:19:51.800 --> 0:19:54.800 gone to juries with mixed results in some of the 0:19:54.840 --> 0:19:58.960 other sporting cases, and in some other cases judges have 0:19:59.080 --> 0:20:03.680 said no, I'm going to decide that it's sufficiently unlikely 0:20:03.760 --> 0:20:08.919 that you can prove your claim. You know, I'm not 0:20:09.000 --> 0:20:12.800 convinced that a jury should be convinced by this evidence. 0:20:13.160 --> 0:20:18.600 We've had litigation on tennis, on swimming, soccer, and it's 0:20:18.720 --> 0:20:22.119 all very similar. That is, there's a gatekeeper, and the 0:20:22.240 --> 0:20:27.440 question is whether the gatekeeper has behaved in a reasonably 0:20:27.560 --> 0:20:33.520 legitimate fashion. And that distinction between the twenty one waivers 0:20:33.560 --> 0:20:38.760 on one side and two waiver requests rejected on the other, 0:20:39.280 --> 0:20:42.720 that's the kind of thing that judge looks at and says, ah, hey, 0:20:43.440 --> 0:20:45.040 that could be a problem. 0:20:45.240 --> 0:20:50.400 Nas'll have to show there was an agreement between US 0:20:50.400 --> 0:20:52.640 Soccer and Major League Soccer. 0:20:53.320 --> 0:20:56.679 Ah. Yes, at least my impression is that this is 0:20:56.840 --> 0:21:04.240 a Section one conspiracy case, not a Section two monopolization case. 0:21:04.359 --> 0:21:09.159 It may be a conspiracy to monopolized, but it appears 0:21:09.640 --> 0:21:14.679 that the center piece of the plaintiffs case is that 0:21:14.760 --> 0:21:19.760 there was an agreement, an understanding of some sort between 0:21:20.240 --> 0:21:25.400 the established leagues and the regulator, the goal of which 0:21:25.560 --> 0:21:31.640 was to exclude this potential third rival league. So that 0:21:31.720 --> 0:21:36.200 requires evidence of some kind of an understanding. Now, anti 0:21:36.400 --> 0:21:42.040 trust does not require a written contract. It requires that 0:21:42.080 --> 0:21:47.680 there be some kind of an understanding between the parties. Again, 0:21:47.760 --> 0:21:51.560 this is where it gets complicated in terms of what 0:21:51.720 --> 0:21:55.600 does the evidence show. Sort of on one extreme, the 0:21:55.680 --> 0:21:59.200 evidence could show that there were no communications from these 0:21:59.280 --> 0:22:04.679 two legs to the federation, but that the leaders of 0:22:04.720 --> 0:22:08.680 the Federation felt that in terms of the best interests 0:22:08.680 --> 0:22:12.119 of soccer, they really needed to limit the number of 0:22:12.280 --> 0:22:16.400 leagues playing in Divisions one and two, so that they 0:22:16.680 --> 0:22:22.200 acted perhaps eighty competitively, but they did so without any 0:22:22.320 --> 0:22:28.119 kind of agreement or any overt understanding with the two leagues. 0:22:28.800 --> 0:22:33.160 And then you start going over to communications from these 0:22:33.160 --> 0:22:35.960 two leagues, Hey, we really think this is going to 0:22:35.960 --> 0:22:39.199 create a problem. You need to keep them from coming 0:22:39.240 --> 0:22:42.920 in regardless of their merit. Now that sounds a lot 0:22:43.040 --> 0:22:46.600 like lobbying to me, But what are their relationships. There's 0:22:46.600 --> 0:22:48.920 a joint marketing and so one of the things I 0:22:48.960 --> 0:22:51.679 would look for is, first of all, there's an economic 0:22:51.880 --> 0:22:56.840 interest on the part of the federation potentially to limit 0:22:57.080 --> 0:23:02.640 competition that could reduce the value of the promotion the 0:23:02.680 --> 0:23:05.360 revenues that come in. The more you could show an 0:23:05.359 --> 0:23:10.880 economic interest in doing what they did and lobbying, the 0:23:10.920 --> 0:23:13.040 more it begins to look like, yeah, there came to 0:23:13.080 --> 0:23:16.800 be an understanding that they would do whatever was necessary 0:23:16.840 --> 0:23:19.720 to exclude. But that's why you have a trial. These 0:23:19.760 --> 0:23:25.000 things are challenging sometimes to establish what the facts are, 0:23:25.200 --> 0:23:29.119 what the communications were, what emails were sent to whom, 0:23:29.240 --> 0:23:33.240 what was their economic interest? And that's going to be 0:23:33.440 --> 0:23:38.160 I think central here. If you move it over from 0:23:38.320 --> 0:23:43.560 section one, which it requires the conspiracy, to section two, 0:23:43.880 --> 0:23:48.639 that is monopolization. You could make a different argument, which 0:23:48.720 --> 0:23:54.200 is if you could show that the federation's economic interests 0:23:54.240 --> 0:23:58.800 were to exclude competition at divisions one and two. That's 0:23:59.040 --> 0:24:01.320 not what it is supposed to be doing. It's supposed 0:24:01.359 --> 0:24:05.159 to be making decisions about who's qualified to play. But 0:24:05.280 --> 0:24:11.400 because it's got an economic relationship with one or two leagues, 0:24:12.240 --> 0:24:16.119 it comes to have an economic interest that causes it 0:24:16.240 --> 0:24:20.200 to use its monopoly power. And the monopoly power here 0:24:20.880 --> 0:24:23.880 is in some way unavoidable because somebody has to make 0:24:23.920 --> 0:24:27.800 these decisions and they're going to control access to professional soccer. 0:24:27.880 --> 0:24:31.560 But if they're doing it to protect their economic interests 0:24:31.760 --> 0:24:35.360 rather than in the best interests of the overall program 0:24:35.400 --> 0:24:38.760 of soccer, that would also create an anti trust problem. 0:24:38.800 --> 0:24:42.280 And this trial is expected to take two weeks coming up. 0:24:42.480 --> 0:24:43.520 Could there be a settlement? 0:24:43.800 --> 0:24:44.520 This is bloomber. 0:24:44.920 --> 0:24:49.040 I've been talking to anti trust expert Peter Carstonsen other 0:24:49.240 --> 0:24:53.600 University of Wisconsin Law School about US Soccer and Major 0:24:53.680 --> 0:24:57.920 League Soccer facing off against the now defunct North American 0:24:58.080 --> 0:25:02.600 Soccer League in an anti trust trial in Brooklyn Federal Court. Peterborough, 0:25:03.080 --> 0:25:08.840 US Soccer stripped in ASL even of its original Division 0:25:08.880 --> 0:25:11.919 two status. I understand why they didn't want it to 0:25:11.920 --> 0:25:14.000 be Division one, but why did they strip it of 0:25:14.240 --> 0:25:15.200 even Division two? 0:25:15.920 --> 0:25:19.880 Indeed, is that a really interesting question, because you move 0:25:19.960 --> 0:25:22.760 them down to three, as best I can tell, you 0:25:23.040 --> 0:25:28.200 essentially make them a really low level farm league. And 0:25:28.960 --> 0:25:32.320 that's not going to attract audience. It's not going to 0:25:32.320 --> 0:25:36.879 attract good players. So it's it's a way of killing 0:25:37.040 --> 0:25:40.520 the enterprise, which effectively they did. Because this is a 0:25:40.600 --> 0:25:43.440 damage case, not an injunction case. 0:25:43.520 --> 0:25:48.000 At this point, speaking of damages, they're asking for treble damages, 0:25:48.040 --> 0:25:50.359 which you get under anti trust law. Do you know 0:25:50.400 --> 0:25:53.000 how they're estimating their damages? 0:25:53.920 --> 0:26:01.000 I'd say creatively. There's a whole special business of economists 0:26:01.000 --> 0:26:05.960 who work for plaintiffs figuring out how to estimate the loss. 0:26:06.560 --> 0:26:09.320 I guess they were for a while the vision two, 0:26:10.280 --> 0:26:12.399 so they've got some kind of a track record. So 0:26:12.480 --> 0:26:17.080 you take that, you look at what the other leagues 0:26:17.800 --> 0:26:22.680 had by way of audience and more specifically revenue, and 0:26:22.720 --> 0:26:28.760 then you create an economic model that predicts what revenues 0:26:28.800 --> 0:26:32.240 there would have been if they have been allowed either 0:26:32.359 --> 0:26:35.439 to remain as two or been allowed to move up 0:26:35.480 --> 0:26:39.479 to one, based on both their own track record and 0:26:39.600 --> 0:26:43.960 the performance of these other leagues in the United States. 0:26:44.440 --> 0:26:49.360 They may well have taken performance information from the various 0:26:49.760 --> 0:26:54.959 leagues in Europe and then compared those to the comparable 0:26:55.000 --> 0:27:01.000 American experience, and then again use this to draw an inference. 0:27:02.280 --> 0:27:06.480