Pete's Premonition

When asked for his thoughts about the May 1982 announcement that the United States Football League was forming and whether the older NFL was "ready for war," league commissioner Pete ("Alvin R.," above) Rozelle responded coolly:

"I wouldn't categorize this as war.  I'd downgrade it to a skirmish.  We have had four of those since I came into pro football:  the old All-America Football Conference, the original (Author's note:  actually, the fourth, but who's counting?) American Football League, the World Football League, and now this.  I can't predict what will happen (but) there are only two certainties in all of this:  one, an escalation of player salaries; and two, litigation."

The Verdict

Following 48 days of testimony before United States District Court judge Peter K. Leisure in Room 318 of that court in Manhattan, and the submission of over 10,000 total pages worth of testimony and exhibits; followed by 31 hours of deliberation over the next ensuing five days, on July 29, 1986 a jury of five women and one man would deliver their verdicts on nine civil counts lodged against the NFL, 27 of its 28 club owners, and Commissioner Rozelle.  Jury foreman Patricia McCabe would make those in attendance audibly gasp with two statements made as part of the verdict:

  • The first occurred when she advised that the jury had found the National Football League guilty of monopolistic practices "to control prices or exclude competition in the relevant market of professional football in the United States," thus violating Section 2 of the Sherman Anti-Trust Act.
  • The second came when McCabe announced that, as the aggrieved party in the case before them, the United States Football League and its co-plantiffs were entitled to punitive damages in the amount of $1.00.

The Allegations

In filing the suit, the USFL would make a number of allegations, most damning among them that the NFL had established a monopoly with respect to broadcasting professional football on television (which, at least with respect to fall season football, was and to this day remains true). 

Another count alleged was that the older league had conspired to thwart the USFL.  To support this point, USFL attorney Harvey Myerson cited what he called a "smoking gun:"  a presentation made to a gathering of 65 NFL executives in February 1984, by Harvard Business School professor Michael Porter.  Entitled "USFL vs. NFL" and colloquially referred to as the "Porter Presentation," it suggested various strategies the NFL could employ in an effort to put the younger league out of business, among them:

  • Making a concerted effort to persuade ABC to terminate its relationship with the USFL by offering the network a more attractive schedule of games for its weekly NFL telecast, "Monday Night Football;"
  • Offering the more powerful and influential USFL team owners the opportunity to acquire expansion or existing NFL franchises; and
  • Striving to bankrupt the weakest teams to reduce the league's size and credibility, in part by deliberately inflating the salaries of "mid level" players, which save a few marquee names were the lifeblood of the USFL.

The Evidence

The Porter Presentation did seem to support one of the charges made by the USFL, specifically that the NFL had interfered with the league's efforts to secure television rights agreements once it announced its intention to move its schedule to a fall season.  As the jury was digesting this information, Myerson would follow it up with another document, a memo entitled "Spending the USFL Dollar" that was written on August 4, 1983 by NFL Management Council executive director Jack Donlan.  This "Donlan Memorandum" suggested that:

With 'low-salaried' players making up the vast majority of USFL rosters it seems to me we can force the USFL to increase salaries of existing players or run the risk of losing them.  Each dollar spent on current players is one they cannot spend on a draft choice.

Along with financial damages of $440 million (which under federal anti-trust law would have been trebeled, to $1.32 million), the USFL sought an injunction preventing the NFL from having its games televised on all of the then-three major television networks.

Joseph Papin depiction of the testimony of Commissioner Chester R. "Chet" Simmons, USFL v. NFL

The Testimony

In total, Myerson would call 18 witnesses to testify as he built his case for the plantiffs.  First among them was Pete Rozelle, whom Myerson kept on the stand for five days.  Another witness, remarkably not a co-defendant in the case, was Los Angeles Raiders owner Al Davis, tho testified that he believed the NFL was conspiring to ruin the Oakland Invaders so another NFL team could move into the market at some future date.  Davis would be right about a team moving into the Oakland in 1995 - his own.

Myerson would call the network executives primarily responsible for negotiating television rights contracts for sports events.  Instead of persuading the jury that the NFL had influenced their respective decisions in not negotiating to air USFL games in the fall, it reinforced the defense the NFL would put up once the prosecution rested:  that the NFL was a "natural" monopoly that had achieved dominance through sound management and the uniqueness of professional sports as an industry; and that the USFL was in dire straits thanks to its own stupidity in failing to adhere to founder David Dixon's plans, overspending in pursuit of player talent and immediate parity with the NFL.

ABC's Roone Arledge and Jim Spence would testify that due to the USFL's relationship with the network to date, the network was "less than enamored" with the league under any circumstances, let alone as fall season programming.

The Donald

Inexplicably, rather than call to the stand past and present team owners such as the Washington Federals Berl Bernhard, Chicago Blitz/Arizona Wranglers owner Ted Diethrich or Jacksonville Bulls owner Fred Bullard - owners who could have positioned the USFL as the "little guy" against the big, bad behemoth NFL, Myerson would call Donald Trump, whose testimony included the following word salad, in which he claimed that in a telephone conversation Rozelle had told him:

"(The USFL) was going to be doomed to failure and that the League itself could not make it playing football in the spring because of television, and he went on to give me a very brief description of why it couldn't make it... that it couldn't make it based on the fact that you couldn't get the ratings to justify the cost of paying this number of people that a football team has, where you have 42 and 45 people, et cetera, that there just weren't enough people watching football in the spring, that they were out voting, playing tennis, playing golf or doing any one of thousands of other things, and there was no way that it could ever be economically justified, so that the League was doomed to failure, and if the League ever moved to the fall, which he heard was my basic contention, that if the League should even start in the fall against the NFL, if necessary, that there was no way we would ever get a television contract because he controlled, literally controlled, the television networks as far as the television is concerned, that we could never get a television contract."

And then...

"Well, Mr. Rozelle told me that I should be in the NFL, not in the United States Football League and that I should be in the National Football League."

Trump then testified that he had been close to buying the then-Baltimore Colts from Robert Irsay (Irsay died in 1997, having moved the team to Indianapolis in 1984; his family still controls the franchise).  Shortly thereafter and at least five times during his testimony, NFL attorney Frank Rothman asked the court to admonish Trump for not being responsive to USFL attorney Myerson's questions, or for veering off into speculation on various topics, or just in some cases incoherent rambling. 

At several other points, testimony would be stricken from the record as either hearsay or so obviously inaccurate that contradictory statements were uncontested as common knowledge.  Rothman couldn't stop it, Myerson couldn't stop it.  Judge Peter Leisure couldn't stop it.

During cross-examination, Rothman essentially tore everything Trump had just testified to down, brick by proverbial brick:

  • Trump claimed that he and Rozelle were friends.  In his cross, Rothman basically ascertained that Trump's idea of friendship was attending some of Rozelle's wife's charitable functions.  He would later bring Rozelle back onto the stand, at which point Rozelle refuted Trump's friendship claim.
  • Trump claimed he'd tried to persuade John Bassett and others "to not spend their money" on the USFL "because of what Pete Rozelle told me because maybe they were going to be right."  Rothman then pointed out that Trump, like Bassett, had been among the "seed investors" that funded work such as the Magid Study.
  • Trump claimed that Rozelle had told him the NFL held control over football on television to a point where the USFL wouldn't land a contract.  Rothman pointed out that the league had landed not one, but two such contracts within weeks of announcing its existence.
  • Trump claimed that based on the USFL's TV ratings compared to the NFL, he'd gained an impression that the league would move to a fall schedule, and sooner rather than later.  Rothman pointed out that during the exploration phase of the league's development, he was explicitly told that wasn't an option in the league's business plan.
  • Trump claimed that when he'd bought his USFL team, the New Jersey Generals, they were a "very, very sick franchise."  Rothman pointed out that in its first season, the team had ranked third in the league in attendance - and by far first in revenue.
  • Trump claimed that sportswriters and sportscasters were "clamoring for (the switch to a fall schedule) to happen."  Rothman would later cross-examine one person Trump identified in connection with that contention - ABC sportscaster Howard Cosell - who was testifying on behalf of the USFL.

And in a remarkably whatever-the-opposite-of-prescient-is comment, when asked if he had made notes of any of his conversations with Rozelle, Trump responded:

"People don't go around making notes of conversations in my opinion."

Evidently Trump hadn't met James Comey by July 1986.  All told, "the Donald's" testimony would represent 218 pages of the total trial transcript.  By most accounts, it was a circus.

The Damages

Despite the jury's unanimous verdict proclaiming the NFL guilty of violating Section 2 of the Sherman Act, it didn't actually specify what the NFL had done wrong.  On eight other counts alleged by the USFL, the jurors absolved the older league.

Despite the jury's unanimous verdict as to whether a violation of the Section 2 of the Sherman Act had occurred, but jurors weren't unanimous on the question of damages.  One juror, Miriam Sanchez, claimed in a post-trial interview that the decision to award $1 was based on judge Leisure's instructions to do so if the jurors deadlocked on an award amount, believing that Leisure could set the damage amount.  Another juror indicated a desire to award the USFL $300 million - which under federal law would be trebeled to $900 million.

The Aftermath

Outside the courtroom, Commissioner Harry Usher said the future of the league would be discussed at an owners meeting the following Monday (July 21), but that the league would obviously appeal the damage verdict.  There would be appeals and the legal machinations would go on well into 1988, and ultimately the USFL would receive $3.76 (representing the $1.00 damages award, trebeled, plus interest) and roughly $5.5 million in reimbursed legal fees and court costs in pursuing the matter, which losing the case made the NFL responsible for.

The unofficial time of death for the United States Football League, and all its remaining franchises, came at precisely 3:55 p.m., Eastern time, on July 29, 1986.  Jury foreman effectively made the pronouncement with just two words:  "One Dollar."