The owners of several rooftop businesses overlooking Wrigley Field are down to their last strike in a lawsuit challenging the Chicago Cubs’ on-going renovation of the 100-year-old stadium. As previously detailed here and here, the rooftop owners filed suit in January asking a federal court to block the Cubs from constructing two new proposed scoreboards, structures that the rooftops claim were intended to block their views into the stadium.
Last month, Judge Virginia Kendall denied the rooftop owners’ request for a temporary restraining order (TRO) preventing the Cubs from erecting the scoreboards. As I explained at the time, although the judge was unwilling to issue a TRO – an emergency order that would have blocked the Cubs from building the scoreboards for only a few weeks – she left open the possibility of granting the rooftops a preliminary injunction in the case (a more permanent order that would have forbid construction of the video boards throughout the entire course of the litigation).
The rooftop owners’ hopes were dashed once again on Thursday, however, when Judge Kendall refused to preliminarily enjoin the Cubs from constructing the scoreboards. Kendall’s opinion (available here) was a resounding victory for the team, with the judge concluding that the Cubs were likely to prevail on both the rooftops’ antitrust and breach of contract claims. As a result, the Wrigley renovations will be permitted to continue unabated.
Although Judge Kendall had sidestepped the issue of baseball’s antitrust exemption in her earlier ruling, in Thursday’s decision she held that the doctrine shielded the Cubs from the rooftop owners’ antitrust claims. In particular, Kendall held that the exemption broadly protects “the business of providing public baseball games for profit,” a standard that she believed clearly encompassed the Cubs’ activities at issue in the case. At the same time, she also rejected the rooftop owners’ contention that the antitrust exemption only applied to the activities of Major League Baseball as a whole, concluding that the doctrine shielded individual franchises as well.
Setting aside baseball’s antitrust exemption, however, Kendall determined that the rooftop owners’ antitrust claims were flawed on an even more fundamental level as well. Although the rooftops had asserted that the Cubs were attempting to illegally monopolize the market for Cubs tickets, the judge held that the team was acting within its legal rights when exercising control over the market for its own tickets.
While Thursday’s decision sided with the Cubs on the antitrust claims, it dealt the rooftops a potentially even more significant blow with respect to their breach of contract claims. This part of the case is based on a 2004 agreement in which the Cubs agreed to provide some limited protection to the rooftops’ views into Wrigley Field.
In particular, as I’ve previously explained, although the 2004 agreement generally prohibits the Cubs from building any structures that would block the rooftops’ view of the stadium, Section 6.6 of the contract provides that “[a]ny expansion of Wrigley Field approved by governmental authorities shall not be a violation of this Agreement.” The Cubs had argued that because the new scoreboards were approved by the City of Chicago, they were authorized under this provision. The rooftops, meanwhile, contended that this language did not apply to the new scoreboards, but instead only covered projects that enlarged the stadium’s seating capacity.
Judge Kendall opted not to resolve this issue in her February opinion, finding that both sides had put forward plausible interpretations of the provision. On Thursday, though, she adopted the Cubs’ reading of the agreement.
In particular, Kendall ruled that the term “expansion” should be read to mean “any change to Wrigley Field that adds volume or mass, including the addition of components unrelated to seating capacity.” And because the scoreboards will “occupy a larger space and add to the volume of the stadium,” the judge determined that – having been approved by the city – their construction did not violate the 2004 agreement. This interpretation of the 2004 pact is a crushing blow to the rooftops’ hopes, rejecting their last, best hope of derailing the construction of the scoreboards.
Having ruled that the Cubs were likely to prevail on the merits of the case, Judge Kendall’s decision also went on to consider the second factor required to obtain a preliminary injunction: an “irreparable” injury (i.e., one that cannot be fully remedied by money). Although the rooftops had argued that they would immediately be forced out of business if the scoreboards were constructed, the judge speculated that they could remain viable business even without a view into Wrigley Field by converting their operations into open-air bars and restaurants. And if not, Kendall concluded, the rooftop owners could always be sufficiently compensated for their loss through monetary damages.
Although the rooftops have now sustained two critical losses in the case, the lawsuit technically isn’t over quite yet. Despite Judge Kendall’s refusal to enjoin the construction of the scoreboards, the rooftops could still move forward with the case in the hopes of ultimately being awarded monetary damages from the Cubs.
That having been said, at this point the rooftops’ odds of eventually winning the case are quite low. Judge Kendall has now twice ruled that rooftop owners are unlikely to prevail in the matter, so it is probably only a matter of time until she grants the Cubs’ motion to dismiss the suit, giving the team a final victory in the case.
It is also possible, of course, that the rooftop owners could opt to appeal Kendall’s latest decision in the case, in the hopes that an appellate court would overturn the ruling and force the Cubs to remove the scoreboards. That would require the court of appeals to reach a different conclusion than Kendall did on the merits of the lawsuit, however, a rather unlikely outcome.
So while yesterday’s decision may not be the final nail in the rooftops’ coffin, their lawsuit’s days appear to be numbered.
Nathaniel Grow is an Associate Professor of Business Law and Ethics at Indiana University's Kelley School of Business. He is the author of Baseball on Trial: The Origin of Baseball's Antitrust Exemption, as well as a number of sports-related law review articles. You can follow him on Twitter @NathanielGrow. The views expressed are solely those of the author and do not express the views or opinions of Indiana University.