players migrated to the cities with the richest teams/owners, to the "glamor" cities such as New York, Los Angeles, and Miami, and to the teams with the best winning records. According to this argument, the owners of the NFL franchises in Los Angeles, Kansas City, Dallas, and Detroit do not care if they lose money on the operation of their teams, as long as they win games, i.e. they do not conform to the principles of economic decision-making upon which the antitrust laws are premised. Defendants further argue that these owners would persist in this course of action, buying up all the best talent available, until they destroyed the league's viability. Finally, defendants contend that the draft is effective as a key element of maintaining a balance of player talent throughout the league.
The evidence on these points was at best equivocal. On the one hand, the Court is persuaded that in a free market for college players the wealthiest owners would indeed make an effort to buy up as much player talent as possible, and that factors such as the relative glamor of the cities and the playing-field success of the teams would influence player choices in favor of signing with such teams. On the other hand, there was abundant convincing testimony that many other factors play significant, often decisive roles in the desires of players to play in one city as opposed to another, and even the factors cited by the owners often appear to work at cross purposes with each other. More importantly, the defendants were unable to produce any credible evidence of a significant correlation between the opportunity to draft early in the draft (i.e. the preferred position) and improvement in team performance. In fact, the defendants' evidence in this regard indicates a correlation too low to be regarded as supporting their claim that the draft is essential to the survival of the league. For example, despite the existence of all the league's restraints on player movement, in the last three seasons nine teams have captured 22 of the 24 spots available in the playoffs leading to the Super Bowl. This shows neither competitive balance in division races nor effectiveness of drafting by early-selecting teams.
Finally, the defendants presented no experiential evidence whatever to substantiate their claim that in the absence of player movement restrictions the best players would move to the small group of teams offering money, glamor, and success. Indeed, the little empirical evidence available with regard to the movement of free agents and former World Football League players since the 1975 season ended does not show any such trend.
In any event, the Court need not fully evaluate the league's claims of necessity for a college draft because, even conceding the need for some such system, the current structure is significantly more restrictive than necessary. In fact, the current system is absolutely the most restrictive one imaginable. It leaves no room whatever for competition among the teams for the services of college players, and utterly strips them of any measure of control over the marketing of their talents. Because significantly less restrictive alternatives are available, the current system cannot be held to be protected by the Rule of Reason.
Questioning of most of defendants' witnesses, both on direct examination and by the Court, indicated fairly unanimous support for the proposition that in each crop of college players there are five to ten "blue chip" or virtually certain "all-pro" players, and another thirty to fifty players who will almost certainly make the team and have a good chance of making the starting lineup in their first year. The evidence also showed that the coaching staffs of the teams and the scouts employed by the four scouting combines serving some of the teams are able to identify these players with a high degree of agreement among themselves. The witnesses also testified that the value of the draft depends upon its predictive power, i.e. it can only distribute player talent if it can identify that talent. Given this predictive power, and given the principle purpose of the draft to distribute the top player talent, a less restrictive alternative than the present system would be to hold a draft consisting of just two "rounds". This would allocate the players generally considered to be the most talented, but would permit competition for the services of all other players. Since there are presently seventeen rounds in the draft, with twenty-eight teams picking in each round, a reduction of fifteen rounds would obviously be significantly less restriction on competition than the present system.
Another alternative drafting system shown by the evidence to be a possible acceptable method of player distribution is to allow more than one team to draft each player, while restricting the number of players any one team might sign. This alternative, not incompatible with the previous example, might for example have a draft of the current seventeen rounds, with each player to be drafted by as many as three teams, but with a requirement that a given team could sign only one player from each round. Obviously a number of variations on this theme are possible, but the significant point is that any variation on these examples would allow much more of a free market system for determining new-player salaries than is currently the case (or was the case in 1968, when the plaintiff was drafted). What is important to note is that the owners are wholly cognizant, and indeed virtually concede, that the current system results in lower salaries for some players than they would receive in a free market, and that they have taken no action whatever to attempt to reduce the maximally restrictive restraints imposed by the current system of player selection. Therefore, in light of the near-certainty that less restrictive alternatives are available to meet the alleged player distribution needs of the league, the current system cannot be regarded as "reasonable" within the meaning of the antitrust laws.
The damages suffered by plaintiff cannot be calculated exactly, since there is and has been no free market with which to measure the value of players' services. In such a case, however, a reasonable estimate of damages must be made. Bigelow v. RKO Radio Pictures, Inc., 327 U.S. 251, 66 S. Ct. 574, 90 L. Ed. 652 (1946); Espaillat v. Berlitz Schools Of Languages Of America, Inc., 127 U.S. App. D.C. 293, 383 F.2d 220 (C.A.D.C., 1967). In this case, a reasonable estimate may be made with a fair degree of logic and precision.
The premise with which this estimate starts is that plaintiff Smith was a "blue chip" player. The testimony without exception showed that he was one of those few college players confidently expected to become an "all-pro", and to start in his first year. His actual performance fulfilled those expectations. The Court has also concluded on the basis of all the evidence that the elimination of the draft would benefit primarily the most talented players, such as the plaintiff, who would then have considerably more bargaining leverage than players now selected on lower draft rounds. The salaries of these players could therefore be expected to increase from their current levels in a free market situation. These conclusions indicate that a fair minimum estimate of the value of plaintiff's services may be found by looking at the compensation received by other top players in the league at that time, particularly those playing his position or with the Redskins. In addition, it would be useful to look at compensation paid to players who were signed by the Redskins as free agents at that time, although it is true that the free agent market may be artificially high because of the restrictions binding most of the other players in the league at any one time. Also instructive would be the compensation received under the Rozelle Rule by teams losing free agents, if such players were comparable to plaintiff.
The evidence showed unequivocally that top players at that time were being offered long-term contracts by some teams, including at times the Redskins. The Court concludes that a player of plaintiff's talent would certainly have been able to negotiate a three-year contract on very favorable terms in the absence of the restraints imposed by the owners. The evidence also showed that such players were able to negotiate contracts which guaranteed payment for the full term of the contract even if the player were injured ("fully vested contract" or "injury protection clause"). On the basis of the evidence of the contracts being negotiated at times elsewhere in the league and by the Redskins during the relevant period, and considering that such protection was shown to be of great concern to players of plaintiff's caliber, the Court also concludes that plaintiff would have been able to include such injury protection in a long-term contract had it not been for the illegal restraints imposed upon him. The defendants have argued and tried to show at trial that Mr. Smith's failure to negotiate such a contract on favorable terms resulted from shortcomings of his negotiating agent, rather than from the draft system. Plaintiff has argued that there was a conspiracy among the owners to prevent the negotiation of injury protection clauses in particular. While the evidence does not sustain the contention that there was any understanding among the owners, overt or covert, that such clauses were not to be included in player contracts, neither does it sustain the contention that plaintiff's failure to secure such protection stemmed from causes wholly apart from the draft. While it is true that other players coming into the league at that time were able to negotiate such protection, and while the Redskins offered a long-term contract to their first draft choice the prior year, the testimony showed that the team had made a policy decision to resist offering such contracts at high pay levels to its 1968 draft selections. The only finding consistent with the evidence in this case is that, although plaintiff's agent was perhaps not as effective as he might have been, the primary reason that he was unable to negotiate a long-term contract with injury protection and other favorable terms was that he had been stripped of the bargaining power inherent in a free market, a market to whose advantages he was legally entitled. Consequently, the Court holds that plaintiff's damages are the difference between what he would have earned under a three-year contract containing an injury protection clause
and what he was actually paid by the Redskins.
The Court has already discussed certain criteria which could be used to arrive at an approximation of what plaintiff would have earned in a free market. Almost all of these indicators are found in the circumstances surrounding the signing of defensive back Pat Fischer by the Redskins. Fischer was recognized as an outstanding defensive back (plaintiff's position), and had twice been chosen to play in the Pro Bowl (i.e. he was "all-pro") during his first eight seasons with the St. Louis Cardinals (1960-1967). In the 1967 season he played out his option, and in 1968 signed a two-year, no-cut contract with the Redskins for the 1968 and 1969 seasons. He was compensated under that contract in the amounts of $30,000 salary for each year and a $48,000 additional sum, denominated as a "bonus",
for the two year period. The Cardinals sought compensation from the Redskins for the loss of Fischer's services, claiming under the Rozelle Rule that they were entitled to the contract of either the Redskins' premier receiver, Charley Taylor, or that of the plaintiff. The Redskins refused this request, and the matter had to be settled by Commissioner Rozelle under the Rule bearing his name. He determined that Fischer's services were not as valuable as those of either Charley Taylor or the plaintiff, and instead awarded the Cardinals compensation consisting of the Redskins' second round draft choice in 1969 and their third round draft choice in 1970. The Court has noted earlier that the compensation paid to Fischer when he was signed by the Redskins as a free agent is not a precise measure of his free market value, due to the comparatively few free agents in what was predominantly a player-movement-restricted market. On the other hand, Commissioner Rozelle -- who is charged by the league with being expert in such matters -- determined that plaintiff's services were worth more than Fischer's at that time. Whatever disparity results from the artificiality of the free agent market can therefore be neutralized for purposes of valuing plaintiff's free market worth by in effect setting off that inflation of price against the superior worth of plaintiff's services at that time. When these factors are netted out against each other, plaintiff's services are found to have been worth a total compensation of $108,000 for a two year period. Translating this into the three-year term found appropriate as an estimate of the contract plaintiff could have negotiated in a free player market, the Court adds the proportionate share ($54,000) for the extra year, for a total three-year figure of $162,000. This is, incidentally, quite close to the $150,000 that plaintiff's agent testified (by deposition) that he thought plaintiff should have been able to negotiate for a three year fully vested contract with the Redskins; the latter figure of course is premised on the lack of a free market at the time of the negotiations. Subtracting from the $162,000 that plaintiff's services would have brought in a free market the $69,800 he was actually paid, his actual damages amount to some $92,200. Judgment will accordingly be entered for treble damages in the amount of $276,600, plus the costs and attorney's fees (the latter to be submitted for approval of the Court) to which plaintiff is entitled under the Sherman and Clayton Acts.