[00:00:00] Speaker 01:
Yes, I am, Your Honor.

[00:00:01] Speaker 01:
Good morning.

[00:00:02] Speaker 01:
My name is Jeffrey Kessler.

[00:00:04] Speaker 01:
I represent the swimmer plaintiff appellants in this case.

[00:00:09] Speaker 01:
We're going to reserve three minutes for rebuttal, and I'm also going to share three minutes on opening with my colleague, William Isaacson, who represents ISL.

[00:00:20] Speaker 01:
So I will watch the clock.

[00:00:21] Speaker 01:
Okay.

[00:00:22] Speaker 03:
Uh, well, so actually, can we, can we reset the clock so that we, um, you have 12 minutes, um, and then we'll, we'll give, um, Mr. Isaacson a separate three minutes.

[00:00:32] Speaker 03:
So.

[00:00:33] Speaker 03:
Oh, thank you.

[00:00:33] Speaker 03:
Yeah.

[00:00:34] Speaker 03:
Um, but very good.

[00:00:37] Speaker 01:
Uh, this case, your honor presents a number of issues.

[00:00:41] Speaker 01:
I will focus on the main fundamental defects first.

[00:00:46] Speaker 01:
With regard to the failure to apply either the quick look rule or the per se rule, there were two errors that the district court made.

[00:00:57] Speaker 01:
One was resolving a genuine issue of material fact to say this was not a boycott.

[00:01:04] Speaker 01:
And two was a legal error to believe that these rules could not apply in the context of a sports association.

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With respect to the first factual error,

[00:01:16] Speaker 01:
The court found erroneously and resolved that the rule, GR4.5, did not actually require swimmers to be suspended from the Olympics.

[00:01:31] Speaker 01:
That that was the boycott if they participated in an unsanctioned event.

[00:01:36] Speaker 03:
Can I just ask a clarifying question?

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Your case is just about the rule as it existed prior to 2019.

[00:01:44] Speaker 03:
Is that right?

[00:01:46] Speaker 01:
That is correct.

[00:01:47] Speaker 01:
That is the focus.

[00:01:49] Speaker 01:
They changed the rule the following year in response to the litigation, but our case was based on the original rule.

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We believe there were continuing anti-competitive effects after that.

[00:02:02] Speaker 01:
But the second rule got rid of the boycott regarding the swimmers.

[00:02:08] Speaker 03:
In your view, does the case really turn on who's right about what the rule was?

[00:02:13] Speaker 03:
That is to say, if your friends on the other side are correct, and the rule did not in fact say that swimmers competing in unsanctioned events could lose their eligibility for the Olympics,

[00:02:29] Speaker 03:
Would you still have a claim?

[00:02:33] Speaker 01:
I think we would, Your Honor, because even the boycott of the national federations could put us at a—not put us, but put ISL and other competitors at a competitive disadvantage.

[00:02:47] Speaker 01:
And if you look at clause or other boycott cases, even if it just puts you at a significant competitive disadvantage, but doesn't preclude you from competing, that's not required.

[00:03:01] Speaker 01:
Because the rule did preclude the swimmers, because it did do that, we qualify even if you believe it had to absolutely preclude you.

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And this has to be the disagreement between us and council has to be an issue of fact.

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If you look at the documents and the ones I would refer you to in particular is ER 465, which is board minutes of FINA, which specifically says the rule will preclude swimmers from Olympic eligibility.

[00:03:33] Speaker 01:
That was in 2018.

[00:03:35] Speaker 03:
I looked at that part of the minutes and it was, I forget the name of the person who said it,

[00:03:41] Speaker 03:
Mr. Neuberger, okay, and and what was what was his position with he was in it?

[00:03:47] Speaker 01:
I believe either an executive vice president or a board member.

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He was one of the key FINA people right in terms of that and he was pointing out that

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that specifically there also was discussions by Mr. Mark Hulesko who was I also believe had the legal position on the board.

[00:04:05] Speaker 01:
Those were the two key board members and they made it very clear that this would apply to the Swimmers and all of the Federation documents believe that and told their members so the American Federation and

[00:04:19] Speaker 01:
the Swiss Federation, the British Federation.

[00:04:22] Speaker 01:
They all wanted to do this, but warned their members, if you participate, you will be excluded.

[00:04:29] Speaker 01:
Now, they raise another fact against that, and this is very important.

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They do this in their reply brief in particular.

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They go, well, that's not true, because we put in this Neuberger Declaration

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and we took this testimony showing there are all these events that weren't, they were non-FINA events, they called them, where we didn't punish the swimmers earlier.

[00:04:54] Speaker 01:
What's wrong with that?

[00:04:56] Speaker 01:
They didn't tell the court that in exhibit seven to the Neuberger Declaration, he goes through each of those events, every one of them,

[00:05:08] Speaker 01:
was either approved by FINA and in their calendar.

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So in other words, they go, this is a non-FINA event, but we approve it and it's in our calendar.

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So of course they didn't punish the swimmers for those events.

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or they're like NCAA events in which there's no compensation and they don't consider amateur events to be an issue.

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So frankly, they are wrong on those facts and these are fact issues.

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This isn't frankly for your honors to resolve.

[00:05:42] Speaker 01:
They weren't for the judge below to resolve.

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This should go to a jury as to whether or not this boycott rule in fact precluded the swimmers because if it did,

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The only defense they're left with on applying this is it's a sports association.

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And the problem they have there is that I go with Justice Gorsuch's unanimous decision in Alston.

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And this is now the law of the United States Supreme Court, clearly, because all nine justices are behind that decision.

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And what they make clear when he reviews the state of the law going from border regions forward is that if it is a horizontal restraint, which is not a league rule, it doesn't have any competitive balance justification.

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It's not a jointly produced product rule.

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And you can tell it's going to restrict output, then at a minimum, it's quick look.

[00:06:41] Speaker 01:
At a minimum, it's quick look.

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And it is clear that quick look, if you look at Indiana Federation of Dentists and you look at the PSC

[00:06:50] Speaker 01:
case in this circuit, that does not require market definition or market power.

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They tend to say, well, maybe it's just market power.

[00:06:59] Speaker 01:
No, if you look at the Ninth Circuit decision most recently on this, it is clear, you know, unequivocally, and I'm reading from the case in PLS, this is, I'm sorry, you're on a PLS.com.

[00:07:11] Speaker 01:
When you have this, no inquiry into market definition and market power is required.

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That is the law of the Ninth Circuit.

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So if this fact issue, if we are right,

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then this has to be reversed, this is a genuine issue of fact regarding that, as to whether it would apply.

[00:07:29] Speaker 01:
Again, when you read these documents, it's hard to understand how this was not a fact issue.

[00:07:37] Speaker 01:
This is another one I would call your attention to, which is 3ER 653.

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This is important, and some of the same Mr. Neuberger.

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What happened is on June 5th, 2018,

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They sent a memo to all the federations warning them about the ISL events and saying there would be consequences.

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Mr. Neuberger then sends a follow-up email.

[00:08:03] Speaker 01:
The follow-up email is to remind them, well, he forgot to include 4.5.

[00:08:10] Speaker 01:
What is 4.5?

[00:08:13] Speaker 01:
GR 4.5 is the one that applies to the swimmers.

[00:08:17] Speaker 01:
And he ends by saying, remember this, and this is his words.

[00:08:22] Speaker 01:
This is serious, not just for the swimmers.

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and not just for USA swimming, but for USAS, which is another US entity here.

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So basically, he is directly threatening the US Swimming Federation.

[00:08:38] Speaker 01:
If you allow this to happen, your swimmers are at risk, you are at risk, and your honor, again, I think it's undisputed, if you can't be eligible for the Olympics, you are not gonna be able to go.

[00:08:50] Speaker 01:
And it's obviously, without the elite swimmers,

[00:08:53] Speaker 01:
you can't compete, which is why the evidence also shows ILS was planning three different events in 2018.

[00:09:02] Speaker 01:
It could do none of them despite the fact that the independent associations wanted to do this.

[00:09:08] Speaker 01:
So this law is very important to not allow an organization like FINA says to be able to exercise this power

[00:09:17] Speaker 01:
to suppress any competition from emerging in this market.

[00:09:21] Speaker 01:
And it's clear there are at least genuine issues of material fact which go to that.

[00:09:26] Speaker 01:
I'm about to get to three minutes, so I think I need to give that to my colleague unless you have a question for me.

[00:09:33] Speaker 03:
You can reserve the remainder of your time.

[00:09:41] Speaker 03:
Mr. Isaacson.

[00:09:42] Speaker 02:
My name is Bill Isaacson, your honor, and I represent the International Swimming League.

[00:09:47] Speaker 02:
Mr. Kessler represents the swimming plaintiffs.

[00:09:51] Speaker 02:
And so I represent the party that was ultimately boycotted and paired by what happened here.

[00:09:57] Speaker 03:
Oh, so if I had a question about class certification, I should have asked your colleague.

[00:10:03] Speaker 02:
Yeah, he'll be back up here for rebuttal, and you can ask then.

[00:10:06] Speaker 02:
Yes, I have no class to represent here.

[00:10:12] Speaker 02:
The minutes that were read to you from Mr. Markalescu, he at that time was the executive director of FINA in 2018, in which he said during this meeting, or the minutes say, he highlighted that the FINA goal in this matter is to keep the structure of the sport intact.

[00:10:28] Speaker 02:
It starts with clubs affiliated to the national federations.

[00:10:31] Speaker 02:
He underlined that athletes participating in competitions or having relations with bodies not recognized by FINA are exposed to sanctions, namely the non-participation at Olympic Games or World Championships.

[00:10:45] Speaker 02:
So FINA was applying 4.5 in the way that we are reading it.

[00:10:51] Speaker 02:
And then the federations were warned about this and told their swimmers, if you participate, you are at risk of sanction and not participating in the Olympics.

[00:11:01] Speaker 02:
That's ER 650 from Mr. Unger, who told the ISL, we do not want to put our athletes or US swimming at risk.

[00:11:11] Speaker 03:
But there's no evidence that anyone was ever actually declared ineligible under that rule.

[00:11:18] Speaker 02:
Because the events then could not happen.

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and no one went.

[00:11:22] Speaker 02:
Instead, once they were threatened, they said, we are not going.

[00:11:27] Speaker 02:
That was both the swimmers and the federations that were interested.

[00:11:30] Speaker 02:
The evidence is very strong that the federations include several federations, including USA Swimming, wanted to do this.

[00:11:39] Speaker 02:
The evidence is strong that swimmers wanted to do this.

[00:11:42] Speaker 02:
But they did not want to risk the sanction, both the swimmers and the federations.

[00:11:49] Speaker 02:
There's also evidence in the record

[00:11:51] Speaker 02:
of FINA saying, once we punish the Italian Federation, no Federation will want to conduct an ISL event because they know we will kill them too.

[00:12:05] Speaker 02:
That's ER 770, right?

[00:12:08] Speaker 02:
The threats worked, so they did not actually have to implement anything in 2018.

[00:12:15] Speaker 02:
No events happened, swimmers lost compensation, competition was reduced, and meeting all the standards under the Ninth Circuit for a per se illegal boycott.

[00:12:28] Speaker 02:
And the law of sports is, following Alston, is there's not special rules for sports.

[00:12:36] Speaker 02:
You look at whether the rules that exist apply.

[00:12:40] Speaker 02:
And if the Ninth Circuit standards, which are written out and established,

[00:12:44] Speaker 02:
for per se illegal boycotts are applicable here, the fact that you are in a federation that runs swimming events doesn't change that law.

[00:12:54] Speaker 02:
I have 10 seconds left.

[00:12:56] Speaker 03:
Thank you.

[00:13:02] Speaker 03:
Ms.

[00:13:02] Speaker 03:
Sherry.

[00:13:04] Speaker 00:
Good morning, Your Honors, May it please the court, Melissa Arbiceri here on behalf of the defendant, Appellee Fina.

[00:13:10] Speaker 00:
I want to start with the facts because the problem is the plaintiffs continue to ally a really critical distinction that the district court recognized when it comes to 2018 version of 4.5.

[00:13:23] Speaker 00:
What the district court held, and this is page 21 of the excerpts of record, was that this mantra that they keep pushing saying that swimmers were going to be sanctioned for participating in independent events was simply not true.

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It wasn't just undisputed.

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It was completely unsupported by the record.

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Now, the district court said in the same breath,

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Okay, a finder of fact could conclude that FINA's rule threatened swimmers if they were going to participate in a member event, a member federation event that was not sanctioned.

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But the evidence did not at all show that there was any threat at all against swimmers when it came to independent events.

[00:14:05] Speaker 00:
So ISL absolutely could have put on an independent event in 2018 and there was zero threat to swimmers.

[00:14:13] Speaker 00:
How do we know that?

[00:14:15] Speaker 00:
I was going to turn first to the text of the rule.

[00:14:22] Speaker 03:
Before getting to that, what about the statement from the 2018 meeting?

[00:14:26] Speaker 00:
They go through a number of different sites in their brief, including that statement.

[00:14:33] Speaker 00:
That one is in July 2018.

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This is at a time where the only events that ISL

[00:14:38] Speaker 00:
excuse me, was trying to put on at the time, they were all member events.

[00:14:43] Speaker 00:
So all of these conversations and the reason you have so much email correspondence with the federations is because ISL was going to USA swimming, was going to British swimming, ultimately was going to the Italian Federation saying, will you host an event?

[00:14:57] Speaker 00:
Will you organize an event?

[00:14:58] Speaker 00:
Will you team up with us?

[00:14:59] Speaker 00:
to do the event.

[00:15:01] Speaker 00:
And the rule that we're talking about is about member federations.

[00:15:04] Speaker 00:
It's about member federations associating with unaffiliated bodies, which is exactly what ISL was trying to get the member federations to do.

[00:15:13] Speaker 00:
So that statement along with every other one, and the other ones are actually quite explicit in this respect, when you look through all of the sites they have on page 29 of their opening brief,

[00:15:23] Speaker 00:
where they try to say that the district court got this wrong.

[00:15:27] Speaker 00:
If you walk through all of those sites, these are all instances in which they're talking about member federation events, member federation participation,

[00:15:36] Speaker 00:
Specifically, once you get to torrent, it's all about the torrent event.

[00:15:41] Speaker 00:
And the reason there's no evidence in the record to show that there's any threat to swimmers at all when it comes to an independent event is, number one, ISL never tried to do that.

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Instead, they were trying to free ride off the member federations.

[00:15:54] Speaker 00:
And number two, because the rule never would have allowed that.

[00:15:57] Speaker 00:
And so just to spend a moment on the text of the rule, we talked about 4.5.

[00:16:01] Speaker 00:
If you look at that rule, what it says is that there can be sanctions

[00:16:06] Speaker 00:
when this rule is being violated, this rule.

[00:16:10] Speaker 00:
So look at 4.1.

[00:16:11] Speaker 00:
4.1 talks about affiliated members.

[00:16:15] Speaker 00:
A swimmer is not an affiliated member.

[00:16:17] Speaker 00:
A swimmer can't violate that rule.

[00:16:19] Speaker 00:
Their only response to that is to look at 4.2.

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and say that 4.2 talks about the exchange of competitors.

[00:16:28] Speaker 00:
Well, a swimmer can't exchange himself or herself.

[00:16:31] Speaker 00:
That entire rule is directed at member federations, and it doesn't stand alone.

[00:16:35] Speaker 00:
It's part and parcel of a set of rules that exist to govern the relationship between member federations.

[00:16:42] Speaker 00:
And you look at bylaw 12.3.

[00:16:45] Speaker 00:
Member federations, when they organize their own competition, so without any third parties, they have to get permission from FINA.

[00:16:52] Speaker 00:
They have to submit an application six months in advance.

[00:16:55] Speaker 00:
They have to provide certain information, the dates, the program, anti-doping, and the like.

[00:17:01] Speaker 00:
And really, GR4.

[00:17:03] Speaker 00:
is an adjunct to that rule, at least when it comes to competitions.

[00:17:06] Speaker 00:
It says if you're going to do your own competitions, you have to come through us.

[00:17:10] Speaker 00:
If you're going to organize a competition with a third party, an unaffiliated entity, you have to go through the same process.

[00:17:17] Speaker 03:
So what about the 4.5 that provides for sanctions on any individual or group?

[00:17:24] Speaker 03:
And so the individuals wouldn't be the member federations.

[00:17:27] Speaker 03:
The individuals would be swimmers.

[00:17:30] Speaker 00:
So two points on that.

[00:17:32] Speaker 00:
There is an argument that individuals was actually just meant to refer to member federation employees and management and the like, and was never intended to refer to swimmers, because swimmers were referred to in the preamble as competitors.

[00:17:44] Speaker 00:
But what the district court said is, OK, a finder effect might read 4.5, might see what was going on at the time.

[00:17:51] Speaker 00:
and say maybe there was a threat when it came to swimmers participating in member federation events, and so to your interpretation, okay, if you look at 4.5 and think it could be read that way, it's still only for member federation events.

[00:18:05] Speaker 00:
It still requires a violation of this rule.

[00:18:07] Speaker 00:
And if you would imagine an event put on by ISL by itself as a competing league,

[00:18:13] Speaker 00:
You would never be able to find a violation of the rule in the first place to sanction because the member federations aren't involved at all.

[00:18:21] Speaker 00:
And that really is the problem here.

[00:18:23] Speaker 00:
And I think you asked the question does Miller at the beginning.

[00:18:26] Speaker 00:
If you're wrong about this interpretation is that

[00:18:28] Speaker 00:
your entire case.

[00:18:30] Speaker 00:
It really is because their whole case is premised on this group boycott theory and the key to that theory is that they were completely denied access to the swimmers.

[00:18:39] Speaker 00:
They couldn't get an input they needed to compete.

[00:18:42] Speaker 00:
Well, if swimmers could compete in independent ISL events, that entire theory falls away.

[00:18:49] Speaker 00:
And that's exactly what the district court said.

[00:18:51] Speaker 00:
It looked really closely at the record and I encourage, you know, go through each piece of evidence they point to.

[00:18:57] Speaker 00:
The only thing it's talking about are these member federation events because everything else is a hypothetical.

[00:19:02] Speaker 03:
Well, and then what about the, they have a number of statements from different federations, member federations warning their swimmers not to compete in various unsanctioned events.

[00:19:16] Speaker 03:
And you're saying that if we look at those, those are all events involving members.

[00:19:21] Speaker 00:
Absolutely.

[00:19:22] Speaker 00:
They're either explicitly, they're saying don't compete in Turin, for example, the Swiss Federation.

[00:19:27] Speaker 00:
One is one that they point to and it's specifically about the Turin event.

[00:19:31] Speaker 00:
The Turin event was going to be put on by the Italian Federation.

[00:19:34] Speaker 00:
All of the earlier ones that come in June around the time of the June memorandum.

[00:19:39] Speaker 00:
These are times where USA swimming is part of the conversation, is going to host, is going to send their swimmers.

[00:19:46] Speaker 00:
ISL didn't try to go at it alone in 2018.

[00:19:49] Speaker 00:
They have done so since then and successfully.

[00:19:52] Speaker 00:
But they didn't try to go at it alone.

[00:19:54] Speaker 00:
And that's really the issue with this group boycott theory.

[00:19:57] Speaker 00:
I mean, really, their theory is not that we couldn't compete, not that we couldn't have access to swimmers.

[00:20:03] Speaker 00:
It's just we couldn't do it under the FINA banner.

[00:20:05] Speaker 00:
We couldn't do it under the member federation banner.

[00:20:08] Speaker 00:
That's the problem.

[00:20:09] Speaker 00:
But that is so contrary to general antitrust law, where there's no obligation to help your competitor out

[00:20:16] Speaker 00:
There's no obligation to give membership benefits.

[00:20:18] Speaker 00:
The Hollywood Foreign Press case, I think, is quite on point when it comes to that.

[00:20:22] Speaker 00:
And so they were really trying to operate with the member federations instead of going out and doing it on their own.

[00:20:30] Speaker 00:
And that's all the facts.

[00:20:32] Speaker 00:
It turns into the legal question, too.

[00:20:34] Speaker 00:
I mean, they are coming here asking this court for a variety of different shortcuts, whether it's per se or quick look or we don't have to prove market definition.

[00:20:42] Speaker 00:
I was surprised to hear them rely on Alston for the idea that it should be quick look here.

[00:20:47] Speaker 00:
Of course, Alston applied the full-blown rule of reason in this context.

[00:20:51] Speaker 00:
And if you look at cases from regions onwards, I mean, no case in the sports governance context at all has ever applied a per se rule since regions.

[00:21:02] Speaker 00:
So really what we're talking about is whether or not a quick look is appropriate.

[00:21:07] Speaker 00:
And the only cases in this context that have applied quick look, they all look just like regions.

[00:21:12] Speaker 00:
These are horizontal price fixing cases, absolutely naked restraints.

[00:21:17] Speaker 00:
Here, even if you look at group boycott law, this court has been clear that only a very limited subset of quote unquote group boycotts are actually subject to abbreviated per se treatment.

[00:21:29] Speaker 00:
It's the NWS categories, there's three factors.

[00:21:33] Speaker 00:
They don't satisfy any of those factors.

[00:21:35] Speaker 00:
And so the idea that you would take the shortcut, you would avoid the presumptive full-blown rule of reason in this case

[00:21:41] Speaker 03:
Doesn't work because we're talking about a sports governance rule because this doesn't fit within the mold of the type of group boycott that would qualify and so that I mean I just You know to go back for a moment to where we started I mean this requires us to agree with you that there's no genuine factual dispute about how to read the rule, right?

[00:22:02] Speaker 00:
I think this argument does.

[00:22:05] Speaker 00:
I still think you end up in rule of reason world, because I think when you go through the three factors that exist when it comes to group boycotts, the first one is whether or not access has been cut off or effectively cut off.

[00:22:17] Speaker 00:
That's not true, because the swimmers were available.

[00:22:19] Speaker 00:
And they did, by the way, compete in independent events.

[00:22:22] Speaker 00:
I think they say if you go through the list, there's no independent events on there.

[00:22:26] Speaker 00:
That's not true.

[00:22:27] Speaker 00:
There's a TYR Derby.

[00:22:28] Speaker 00:
which is an event that the former name plaintiff, Andrew, said he competed in.

[00:22:32] Speaker 00:
It was a completely private event.

[00:22:33] Speaker 00:
It was not on the calendar.

[00:22:35] Speaker 00:
So that's not true.

[00:22:36] Speaker 00:
But that would maybe make the cutoff question harder at the first factor.

[00:22:42] Speaker 00:
But there's still two other factors.

[00:22:43] Speaker 00:
You look to see if there's market dominance.

[00:22:45] Speaker 00:
The whole reason we're here is because they don't think they have to prove market at all.

[00:22:49] Speaker 00:
So they certainly haven't showed market dominance.

[00:22:51] Speaker 00:
And then you get to the third factor, which asks whether or not there's efficiencies, whether there's pro-competitive,

[00:22:57] Speaker 00:
justifications and for the same reasons you wouldn't apply per se in the first place, what the court said in Regents, what it repeated in Austin.

[00:23:04] Speaker 00:
You don't have judicial experience in this area.

[00:23:07] Speaker 00:
You need horizontal restraints.

[00:23:09] Speaker 00:
There's very good reasons why you need horizontal restraints when it comes to this type of organization.

[00:23:15] Speaker 00:
You need rules that govern competition.

[00:23:17] Speaker 03:
And in your brief, you referred to, I think the phrase you used was maintaining a coherent calendar of competitions.

[00:23:25] Speaker 03:
And I'm not sure I understand why somebody else organizing competitions that swimmers presumably could decide to participate in or not would interfere with your ability to set your own calendar.

[00:23:42] Speaker 00:
So I think that's the key, the somebody else, right?

[00:23:44] Speaker 00:
Again, the rule was never that an independent organization couldn't have their own events.

[00:23:50] Speaker 00:
It was never that ISL couldn't have its own events.

[00:23:53] Speaker 00:
The cohesive calendar is needed when it comes to the member federations and having calendars where the events are spaced out enough so that the swimmers can train, can rest.

[00:24:05] Speaker 00:
that have uniform rules that apply to those so the results can count.

[00:24:09] Speaker 00:
So once it's on the calendar, the times count, the results count, the records count.

[00:24:14] Speaker 00:
And so in order for the product to maintain its integrity, in order for competition

[00:24:20] Speaker 00:
to maintain its integrity, you have to have the same rules applying to all.

[00:24:24] Speaker 00:
I mean, just to give an example that maybe helps, you know, at least help me understand it better.

[00:24:30] Speaker 00:
I mean, think about the NBA, the idea that the LA Lakers could go and team up with, I don't know, the Harlem Globetrotters and do an exhibition game in the middle of the season and that the NBA couldn't have any rules.

[00:24:43] Speaker 00:
governing that or controlling that in any way.

[00:24:45] Speaker 00:
It just seems fanciful to me.

[00:24:47] Speaker 00:
Any sort of organization like this needs to have rules that govern its members.

[00:24:52] Speaker 00:
They need to have rules that control competition.

[00:24:54] Speaker 00:
And that's really all this is.

[00:24:57] Speaker 03:
FINA, or World Aquatics, isn't exactly a league in the way that the NBA is, is it?

[00:25:09] Speaker 03:
The competition can exist in some sense outside of FINA in a way that NBA basketball can't outside of the NBA.

[00:25:16] Speaker 00:
They say it's not a league.

[00:25:18] Speaker 00:
I think that actually helps us.

[00:25:20] Speaker 00:
This is an international sports governing association and what we're looking about in deciding what standard applies for per se or quick look.

[00:25:29] Speaker 00:
You need judicial experience in the area, right?

[00:25:31] Speaker 00:
You need to be able to sit there at the outset and say, we are just so sure and we can predict with such confidence that all or most all in this area are going to be invalid.

[00:25:41] Speaker 00:
These rules are going to be invalid.

[00:25:43] Speaker 00:
And so, yeah, you have all these sports league cases and you look through them.

[00:25:48] Speaker 00:
There's not cases that involve international governance associations.

[00:25:52] Speaker 00:
Even if you look at the sports league cases, again, these are naked restraints.

[00:25:56] Speaker 00:
The ones that are closest to our facts are the tennis case, the ATP case out of the Third Circuit that we cite in our brief, and then an older Seventh Circuit case involving horses.

[00:26:06] Speaker 00:
It's the United States trotting.

[00:26:08] Speaker 00:
association.

[00:26:10] Speaker 00:
And so because there isn't that judicial track record, there isn't that judicial experience, that's another reason why it's inappropriate to skip over the rule of reason.

[00:26:19] Speaker 00:
And so to be clear, we're not saying there's no review at all.

[00:26:24] Speaker 00:
It's just this is the presumptive rule of reason case where you go through the analysis, you look for anti-competitive effects, and you put the burden on the plaintiffs to prove them up.

[00:26:33] Speaker 03:
Can I ask you to maybe repeat what you said about how this rule works?

[00:26:42] Speaker 03:
Even under the pre-2018 rule, if a bunch of American swimmers and some French swimmers decide we're going to go have a meet somewhere, they can do that.

[00:26:54] Speaker 03:
They can do that, but what they can't do is have USA swimming say Yeah, we're sponsoring this event without Fina's authorization

[00:27:05] Speaker 00:
without FINA's authorization.

[00:27:07] Speaker 00:
And authorization is available.

[00:27:09] Speaker 00:
It's given all the time.

[00:27:10] Speaker 00:
If you look at the events calendar, for example, there's like 200 plus events that are scheduled, a very small percentage of FINA.

[00:27:17] Speaker 00:
The member federations host events all of the time.

[00:27:20] Speaker 00:
They do so alone.

[00:27:21] Speaker 00:
They do so with others.

[00:27:23] Speaker 03:
And to go back to your explanation of the justification for this and maintaining the coherent calendar and the integrity of competition,

[00:27:31] Speaker 03:
What is it about all that that would be threatened by

[00:27:36] Speaker 03:
a USA swimming event, but not by the event that happened to have a bunch of American swimmers in it?

[00:27:43] Speaker 00:
I think it's in part the branding.

[00:27:44] Speaker 00:
I mean, one of the things that the Supreme Court talked about in regions is it's pro-competitive to try to do something to preserve your brand.

[00:27:51] Speaker 00:
I mean, you have NFL football.

[00:27:52] Speaker 00:
You have the NBA draft.

[00:27:53] Speaker 00:
You have FINA events.

[00:27:54] Speaker 00:
These are member federations of FINA.

[00:27:57] Speaker 00:
And so if a member federation associated, for example, with a disreputable organization and put on some event that is completely contrary,

[00:28:05] Speaker 00:
to the FINA product, that would have an impact on the product.

[00:28:09] Speaker 00:
I mean, the sort of irony here when we're talking about competition is what would be pro-competitive is for ISL to go ahead and start its own independent league and offer a different product, a distinct product that increases consumer choice.

[00:28:24] Speaker 00:
That would be the competition.

[00:28:26] Speaker 00:
They didn't do that.

[00:28:27] Speaker 00:
I mean, they've done, they tried to do it since then.

[00:28:29] Speaker 00:
But instead, they didn't want to, you know, they said they wanted to do something different.

[00:28:34] Speaker 00:
But instead of going off and doing it on their own, they were trying to free ride and piggyback off the member federations.

[00:28:40] Speaker 00:
Why?

[00:28:40] Speaker 00:
Not because it was impossible for them to do that.

[00:28:43] Speaker 00:
In fact, I was surprised to hear them say that they would still have a challenge even if the swimmer sanction didn't exist at all.

[00:28:51] Speaker 00:
The testimony is clear.

[00:28:52] Speaker 00:
They were able to do this without FINA.

[00:28:54] Speaker 00:
They were able to do it without the member federations.

[00:28:56] Speaker 00:
It just made it easier.

[00:28:58] Speaker 00:
But I see my time is up.

[00:29:02] Speaker 03:
Thank you very much.

[00:29:09] Speaker 01:
So with all due respect to my friend, she makes my points.

[00:29:14] Speaker 01:
First, she argues the NBA.

[00:29:17] Speaker 01:
The NBA is a sports league.

[00:29:20] Speaker 01:
What the court found below,

[00:29:22] Speaker 01:
is that each of the national federations are separately owned and run organizations that are competitors with each other.

[00:29:32] Speaker 01:
They are not together in a sports league and should therefore be free to make independent decisions.

[00:29:39] Speaker 03:
That's number one.

[00:29:44] Speaker 03:
They do need to work together in a way that competitors in other kinds of industries don't in order to put on competitions.

[00:29:50] Speaker 01:
With respect to things like the size of the pools, maybe with respect to international doping tests,

[00:29:59] Speaker 01:
not with respect to their ability to put on any competition they want, and most importantly, for their swimmers to make independent decisions.

[00:30:10] Speaker 01:
This is the fact issue.

[00:30:12] Speaker 01:
The words of it, and the person I want to quote now is their executive director of FINA.

[00:30:19] Speaker 01:
This is Mr. Mark Hulescu.

[00:30:25] Speaker 01:
This is what he said at the board meeting, the exact words.

[00:30:30] Speaker 01:
Athletes participating in competitions or having relations with bodies not recognized by FIFA are exposed to sanctions, namely the non-participation at Olympic Games or World Championships.

[00:30:50] Speaker 01:
There's nothing here about only if they're sponsored by a national federation.

[00:30:56] Speaker 01:
It was every single one.

[00:30:58] Speaker 01:
That's why ISL couldn't compete.

[00:31:01] Speaker 01:
Be very clear.

[00:31:03] Speaker 01:
We are not asking for any ruling that FINA is required to approve them or endorse them.

[00:31:11] Speaker 01:
We want them not blocking the swimmers and the resource or even the federations from making their own decisions.

[00:31:21] Speaker 03:
Other than the statement you just read from the 2018 meeting,

[00:31:25] Speaker 03:
What's the best evidence you have that this rule applied to independent competitions, as opposed to competitions involving one of the national member federations?

[00:31:39] Speaker 01:
The best evidence I have are the statements by the Swiss Federation and the USA Federation, which we cite in our brief, where they tell their own swimmers

[00:31:52] Speaker 01:
that they believed that even if they didn't participate, if they were warning the swimmers, if you go ahead and do this because we're not participating, you could lose your Olympic eligibility.

[00:32:06] Speaker 01:
So we advise you, you shouldn't do this because we want you on our Olympic teams in terms of this.

[00:32:13] Speaker 03:
You shouldn't do this, where this is participating in an ISL event.

[00:32:17] Speaker 01:
Oh, ISL event.

[00:32:17] Speaker 03:
And was that an event that had the involvement of a member federation?

[00:32:21] Speaker 01:
Correct, because what was happening is the federations were

[00:32:24] Speaker 01:
After they were told by FINA that they would be punished, the federations told their swimmers, we can no longer do this because we've been told by FINA.

[00:32:35] Speaker 01:
And then they went on to say that the following, and are now actually reading from, well, I'll get to this in a second.

[00:32:44] Speaker 03:
Well, maybe quickly.

[00:32:48] Speaker 01:
They were told by the Federation, so we're not going to do it.

[00:32:51] Speaker 01:
And then they told their swimmers, you shouldn't do it either, even if we don't sponsor the event, because you could be punished.

[00:32:58] Speaker 01:
That's what they believe.

[00:32:59] Speaker 01:
And here's a very important one.

[00:33:00] Speaker 01:
This is document ER-495.

[00:33:04] Speaker 01:
This involved another event called the World Swimming Association, which was not affiliated with any

[00:33:11] Speaker 01:
Federation at all.

[00:33:12] Speaker 01:
So this didn't have that issue.

[00:33:15] Speaker 01:
This is what was said.

[00:33:16] Speaker 01:
FINA would most definitely enforce FINA-ruled GR4 unauthorized relations if any athletes competed in WSA events.

[00:33:27] Speaker 01:
This was called the Ring of Fire Tour.

[00:33:29] Speaker 01:
This is before ISL.

[00:33:31] Speaker 01:
This was not affiliated with any single association, and they were threatening to do this.

[00:33:38] Speaker 01:
So this is a critical document on this issue.

[00:33:40] Speaker 03:
And the point is you ought to- You're over your time, but I think we have your argument.

[00:33:45] Speaker 03:
Thank you so much.

[00:33:46] Speaker 03:
I appreciate the extra time.

[00:33:48] Speaker 03:
Thank all counsel for their helpful arguments and the cases submitted.

[00:33:51] Speaker 03:
And we are adjourned for the week.