This is apparently pecked-to-death-by-ducks week for the Sacramento Kings arena proponents: After a series of minor setbacks over the previous few days, yesterday it was learned that one of the prospective purchasers of the team, Pittsburgh Penguins co-owner Ron Burkle, will have to back out because his film studio owns a player agency that represents several NBA players, which represents an unacceptable conflict of interest according to league rules.
Sacramento Mayor Kevin Johnson was quick to say, “We’re comfortable where we are” in terms of remaining prospective investors in the team, and as Burkle’s exit was apparently in response to questions raised at last week’s NBA meeting, you could interpret this as a positive move for Sacramento, clearing an obstacle to the city’s plan, albeit one that nobody was aware of. (Though anybody with Wikipedia should have been aware of it.) As with the previous news, it depends on what the mood of the room is around the Kings sale talks: If NBA owners are looking for an excuse to let the team go to Seattle, this can be pointed to as evidence of a shaky and ever-changing Sacramento plan; if they’re looking for an excuse to reject the move, this can be seen as a willingness on Sacramento’s part to do whatever it takes to win league approval.
At this point, the NBA is sitting pretty, with no bad answer to its problem of two cities battling over one team. Unless, of course, the losing city decides to sue, as Stanford economist Roger Noll says they’d have grounds to do:
“Whichever city is going to lose has an antitrust case against the NBA for not having a team in that city,” Noll said.
Noll says either city would have a case to make because both cities are viable locations for the team and either one could argue the league is illegally restricting the number of teams. He says it’s kind of like the railroad cartels more than a century ago.
“The crucial issue is whether the purpose and effect of the restriction is simply to enhance the monopoly power of the existing set of teams,” Noll said.
It would be a risky move on the one hand, as threatening to sue the people who you’re hoping will grant you a franchise isn’t usually the best way to get them on your side. On the other hand, it worked for Florida when the San Francisco Giants were denied the chance to move to Tampa Bay in the early 1990s — incidentally, do you think the team’s current owners are thrilled now that that never happened? — and the mere hint of an antitrust suit was enough to get MLB to create the expansion Devil Rays as compensation.
Noll, who knows a little something about antitrust law, says he expects expansion to be the ultimate result here as well, and he has a pretty good case: While MLB is more defensive of antitrust suits thanks to wanting to protect its special antitrust exemption, the NBA is going to want to have this resolved out of court as well. Which means that in the long run, we could be going through all this sturm und drang around the fate of the Kings for nothing. Well, nothing except getting both sides to up the ante as far as possible before the NBA decides who gets an existing crappy team and who gets a new one.