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Monday, June 13, 2022

MLB, Teams, Fanatics Inc. Accused of Online Merchandise Monopoly

Major League Baseball is facing federal antitrust litigation in Manhattan over claims that the organization and its teams have conspired with Fanatics Inc. to corner the market for MLB products purchased through online platforms like Inc.‘s marketplace for third-party sellers.

The lawsuit, filed Thursday by a sports merchandise business, also targets Fanatics and the league’s 30 teams. It accuses MLB of tilting the scales in favor of Fanatics, which it partly owns, through restrictions on distribution of licensed products to other wholesalers and retailers.

Fanatics now “dominates” online MLB merchandise sales thanks to the restrictions, which require distributors and retailers to get league permission for any resales, according to the proposed class action filed in the U.S. District Court for the Southern District of New York.

The deals allowing “MLB and Fanatics to reach downwards to attempt to restrict the conduct of retailers that horizontally compete with them” have left Fanatics “in complete control of the commerce involving MLB licensed apparel” and products, “not only on Amazon but everywhere,” the suit says.

MLB and Fanatics didn’t immediately respond to requests for comment Friday.

The suit was filed by Casey’s Distributing Inc., which is leading similar litigation against the National Football League, another Fanatics part-owner.

RoyalsRetro (AG#1F) Posted: June 13, 2022 at 03:25 PM | 5 comment(s) Login to Bookmark
  Tags: fanatics, merchandise

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   1. winnipegwhip Posted: June 13, 2022 at 03:58 PM (#6081520)
This is interesting since there has been interesting rumors that Ebbets Field Flannels is being acquired from Lids/Fanatics. Some people's EFF orders are no longer being shipped from Seattle ( EFF's base) but rather Indiana where Fanatics orders are shipped.
   2. Pat Rapper's Delight (as quoted on MLB Network) Posted: June 13, 2022 at 06:00 PM (#6081541)
It accuses MLB of tilting the scales in favor of Fanatics, which it partly owns

Interesting spin in light of Fanatics getting the baseball cards license from Topps. Didn't realize MLB had an equity stake in Fanatics.
   3. Never Give an Inge (Dave) Posted: June 13, 2022 at 06:45 PM (#6081554)

I think all of the major leagues have an ownership stake in Fanatics, but they must be relatively minor owners given how many other deep-pocketed investors the company has brought on board.

That being said, MLB invested at a $1 billion valuation and the latest round was at $27 billion, so they've made a nice paper profit on their investment.
   4. Hombre Brotani Posted: June 13, 2022 at 06:50 PM (#6081556)
I thought the whole entire publicly stated point to Fanatics buying Topps was to corner the baseball merch market?
   5. ERROR---Jolly Old St. Nick Posted: June 14, 2022 at 07:21 AM (#6081643)
When we used to sell college football posters online after my book shop closed, our first distributor was a mom-and-pop outfit in Pennsylvania, which after a couple of years got bought up by a much larger group called Mounted Memories. Which in turn was bought by Fanatics. We never had any problems with them, but the Collegiate Licensing Company (CLC) and the colleges kept jacking up their percentage of the take to the point where Fanatics decided it just wasn't worth it, and we couldn't really blame them. The colleges and the licensing bureaus are just bloodsuckers.

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