USFL – The Trial

This summer marks the 25th anniversary of the USFL’s $1.69 billion antitrust suit against the NFL. The NFL was found guilty of using it’s monopoly power to damage the USFL, but jurors awarded the USFL only $1 after four days of deliberations.

The damages were trebled, so the USFL owners received $3 from the NFL. The check remains un-cashed in the desk of former Memphis Showboats executive, Steve Ehrhart, who is currently head of the Liberty Bowl.

What was at stake besides the billions of dollars? A possible merger with at least two USFL teams – one was Donald Trump’s New Jersey Generals.

Many fans don’t remember the impact the USFL had: Instant replay and the two-point conversion are just a few contributions the NFL adopted from the spring league. The USFL had success in cities like Phoenix, Jacksonville and Memphis, opening the door for future NFL franchises. Even and the now-controversial 18-game schedule was the norm in the USFL’s three-year run.

Oh by the way, just a few future Hall-of-Famers played in the USFL: Jim Kelly, Steve Young and Reggie White got their start in the fledgling spring league.

In my book, USFL- The Rebel League The NFL Didn’t Respect but Feared, I had the chance to interview several former USFL players, general managers and broadcasters.

Read how Howard Cosell testified against the NFL and a young Trump “bullied” other owners to move the league to a fall schedule, which ultimately doomed the USFL.

This four-part series is nostalgic and informative. Enjoy the trip down memory lane.

Part 1 – The Fall of the USFL

Part 2 – The Trial

The USFL developed a loyal following in its three-year existence. The league had TV deals in place with ABC and ESPN worth over $240 million and leases with stadiums that housed NFL teams.

But if the league decided to move from a spring to a fall schedule, all that would change – and it did. Certain stadiums like the Vet in Philadelphia squashed their agreement with the Stars.

“The Vet kicked us out of our offices, and we had to move to the ROTC building at the University of Pennsylvania,” said Stars coach Jim Mora in 2005, with a note of disdained in his voice. “All the coaches were in one classroom, in separate corners, coming up with the game plans.”

More importantly, a fall move created a conflict with ABC – which carried the crowning jewel of NFL programming in the 1980s – Monday Night Football.

The NFL controlled the networks like a puppet on a string. The USFL never had a chance going head-to-head against the NFL.

Despite’s the league’s popularity, several teams were losing money.  A renegade owner, named Donald Trump, didn’t help matters as he ignored the mandate to remain fiscally conservative and stay away from the big-time players.

Trump, who bought the New Jersey Generals a season into the USFL’s existence, ignored the cries for financial temperance. Trump had two Heisman Trophy winners (Herschel Walker and Doug Flutie) and at least six well-established former NFL veterans on his 1985 team.

“The Donald,” knew the value of star power and had a bigger plan in mind for his USFL team. Trump wanted to make a push to the more traditional fall schedule and force a merger with the NFL. If a merger or more likely an amalgamation of a few USFL teams by the NFL occurred, this would drastically raise the value of the franchises.

But the NFL didn’t like to be forced into things. “This is when the NFL really battled back, they didn’t want a competitor to come in and take away attention, airtime and revenue,” said Steve Ehrhart in 2005, part of owner of the Memphis Showboats. “The NFL started using its power, pushing ABC not to put the games on if we moved to the fall.”

Before the USFL came around, Trump was just another real estate tycoon in New York. “By buying the Generals he bought the back page of the New York tabloids, from ‘Page Six’ of the New York Post, to the front page — he was everywhere,” said Charley Steiner in 2006, who was the play-by-play voice of the New Jersey Generals.  “This was his foray into the New York spotlight.  He thought let’s go to the ‘big time’ and they [NFL] swatted him away like a fly at a picnic.”

ESPN, with no allegiance or contract with the NFL at the time, was prepared to televise a fall schedule by the USFL. ABC was getting pressure by the NFL to “pull-the-plug” on their TV contract with the USFL if the spring league wanted to play in the fall.

Shootout at the O.K. Corral had nothing on the USFL v. NFL

The fall move depended solely on the success of the $1.69 billion antitrust suit against the NFL.  It was a star-studded trial of names: Oakland Raiders’ owner Al Davis, legendary sportscaster Howard Cosell, Sen. Al D’Mato, Trump and NFL Commissioner Peter Rozelle.

“It was the ‘Bonfire of the Vanities,’” said  Bob Ley in 2005, a veteran ESPN sportscaster who covered the trial in the summer of 1986. “It was a ‘Who’s Who’ of American football owners, tycoons and media. It was the perfect paradigm of the moment – rich guys suing rich guys.”

Despite the “red carpet” names that highlighted the trial, it was the USFL’s lead counsel who stole the show – Harvey Myerson.

“The day he [Myerson] had Rozelle on the stand, it was a ‘high-noon’ shootout,” Ley recalls with a sound of amusement in his voice. “Pete’s face was flushed and became so angry at Myerson’s theatrical line of questioning. At one point, Myerson pointed at Rozelle and called him ‘this monopolist.’  It was great theater and very entertaining.”

Rozelle, who was offered $13 million to be the commissioner of the USFL in 1982, but turned it down, was now the center of Myerson’s line of questioning.

Myerson threw in a final jab before the lunch break, and inquired about Rozelle’s salary from the NFL. Rozelle didn’t want to divulge his earnings from the NFL which was assumed to be enormous. “Everyone in the press was eager to hear this, but he never answered,” said Ley.

But there was more to come as Davis was set to take the stand as a witness for the USFL. Ley, who interviewed Davis the day before he testified in the summer of ’86, said, “When Davis showed up as a USFL witness, that really ticked off the NFL. His testimony was ‘treasonous, treasonous’ to the NFL.”

Davis, a maverick owner going back to the old AFL, won an antitrust lawsuit in 1982 after the league wouldn’t allow him to move from Oakland to Los Angeles. The NFL lost in court and Davis moved to Los Angeles.

When Davis was cross- examined by the NFL, he became upset at the line of questioning from the NFL’s counsel. Ley recalls that during a recess in the trial, Davis said to NFL executives, “Be careful questioning me here because there’s a lot I’m not saying.”

According to court documents, USFL v. NFL, Federal Court Judge Peter Leisure excluded Davis’ testimony about what Davis called “the NFL’s ‘habitual disregard’ of antitrust advice.”  The judge also shot down the idea that the NFL had a pattern of breaking antitrust laws. “Because testimony as to three or four episodes over a 20-year period was hardly sufficient to conclude that a pattern of behavior exists with respect to the conduct at issue here,” said Leisure.

“The NFL has been denying monopoly status for years,” said Lester Munson, a sports legal analyst for Sports Illustrated in 2006. “The NFL is not exempt from being a monopoly, only baseball is exempt. The NFL is clearly, obviously, and has been adjudicated many times as a cartel – a monopoly.”

NFL thought about taking in two USFL teams

Rozelle and the rest of the NFL were rattled enough that they discussed a possible “taking in” of a few USFL teams according to Carl Peterson, general manager of the Philadelphia Stars.

There was rumor of a backroom deal with Trump, A. Alfred Taubman and Tad Taube, owners of the Oakland Invaders and the NFL. Word had it that Trump just wanted a football and he didn’t care in what city. The trial revealed there was a meeting between Trump and Rozelle at the Plaza Hotel in New York City.

“The NFL did talk about the possibility of acquiring two teams from the USFL, but this wasn’t enough for some owners,” said Peterson in 2006. “They [NFL] said, ‘We’ll win this litigation,’ which they were right on that.  The NFL violates the antitrust [law] in regards to TV rights, but we didn’t anticipate the decision. The NFL counsel convinced the jurors that these wealthy USFL owners knew what they were doing and the NFL didn’t harm them financially.”

The NFL knew they were in violation of Sherman Antitrust Act, so they tried to “feel out” the USFL owners according to Peterson’s account. “There were settlement talks, but unless they [NFL] made it financially rewarding to all of the USFL owners, a deal wouldn’t be reached,” he said.

The NFL flexes their muscles on the TV networks

Pete Rozelle hugs attorney Frank Rothman after the verdict

When plans were made to move to the fall in 1986, Rozelle buckled down, saying any network that showed their games would not be permitted to cover the NFL. ABC, which owned Monday Night Football, chose to terminate its contract with the USFL.

USFL Commissioner Henry Usher testified that he was told by Roone Arledge, the president of ABC Sports  , that Arledge “had a negative reaction from the NFL for putting the USFL on initially.” ABC sportscaster Howard Cosell testified that he was told by Arledge that Commissioner Rozelle was “all over” Arledge because ABC was televising the USFL in the spring (Arledge denies he made such a statement to Cosell).

Jim Spence, a senior vice-president at ABC, testified that he believed that the NFL was “less than enamored” of the network’s dealings with the USFL.

“The USFL couldn’t prove that the NFL’s behavior injured the USFL,” said Munson. “The jury didn’t like the USFL’s his clients: Donald Trump, Herschel Walker and such, they were unappealing individuals. They were very difficult to present as victims of anything. You need an appealing plaintiff to win an anti-trust suit. When Trump testified they lost all the emotional appeal of the case.”

“The NFL has the ability to dominate the networks, which they ultimately did and still do,” said Ed Garvey, the former head of the NFLPA from 1971 thru 1983. “If a new league came along, the NFL would either kill it or absorb it, that’s its history.”

Garvey, who left the NFLPA to run for office in Milwaukee in 1983, and testified against the NFL during the antitrust suit, said, “If the networks hadn’t been in collusion with the NFL, going to the fall season would have worked for the USFL. But the networks got the word from the NFL that if they fooled around with a competitive league they weren’t going to get any more games. It was a clear power-move by the NFL.”

In retrospect, it seems ludicrous that the USFL turned down so much money and pursue the antitrust suit and turndown the guaranteed TV money.

This decision to move to a fall schedule and leave major markets like Detroit, Philadelphia, Chicago, Pittsburgh and Washington, damaged the USFL’s relationship with ABC and ESPN.

ABC was so angered about these relocations, they withheld a significant portion of the USFL’s rights fees for the 1985 season. ESPN demanded a renegotiation of its proposed 1985-87 USFL contract.

Television ratings declined to 4.1 on ABC and 2.0 on ESPN during the “lame duck” 1985 season. Despite the negative publicity the USFL faced, the league’s rating of 4.1 is higher than hockey, college basketball and football, and competitive with the NBA ratings of today.

“The NFL knows it’s a monopoly; they thrive on it; they glory in it,” said Munson. “If Myerson had succeeded and won $800 million [trebled would have added up to $2.4 billion], each team would have to pay their portion. But the commissioner views trebled damages as a way of doing business — they don’t care. When it comes to a monopoly like the NFL, antitrust laws don’t work.”

Despite being out of the league by the time the trial took place in 1986, Garvey was informed of the “back-door-dealings” between the NFL and the networks by Cosell. “I wasn’t there when the conspiracy was hatched  – they didn’t invite me to those meetings,” said Garvey with a wry tone in his voice. “They are the most powerful industry in this country because they have the male demographics from 19 to 49. They have enormous market power and they don’t hesitate to use it.”

According to Garvey, Cosell, who testified against the NFL, felt it would be healthy for football to have another league. Cosell, an attorney before becoming the legendary ABC sportscaster, was in favor of two leagues, “because the owners and coaches would have to respond differently to players in the way they were treated, not just from a salary perspective.”

Is Trump to blame?

“They [USFL owners] got greedy and tried to move to the fall a year before they should have,” said Steiner in 2006. “It was headed in the right direction.  If they wanted to go to the fall, they should have waited until 1987, the year of the NFL strike.  With the threat of the strike, they would’ve had NFL players who were panicking about playing the season, they could have brought more players over there [USFL], and this would have ended the strike and facilitate some sort of a merger.”

“If they had stayed in the spring, with the TV contracts in place, and the revenue streams, places like Birmingham and Jacksonville were huge opportunities,” said Dave Lapham in 2006, former Cincinnati Bengals and New Jersey Generals lineman. “In the fall you’re not only competing against the NFL in the big cities like New York and Chicago, but in the South you’re going against college football.  SEC football is religion. You can’t win.”

“Donald was right in a lot of respects to get over the top, we had to go head-to-head against the big guys,” said Ehrhart. “We could have stayed in the spring, but when we were compared to the NFL, there was a natural push to move to the fall. Do you stay in the spring and be branded a second league, and continue to be mocked by the NFL? ”

“One mistake they made was in ’84 when Trump wanted to move the league to the fall, that led to the fall of the league,” said Dan Jiggetts in 2005, who was an offensive lineman for both the Chicago Bears and Blitz. “I don’t blame Trump, but competing with the NFL is like competing against Godzilla in a stone-crushing match. It just didn’t make sense, even if they thought the USFL might merge with the NFL, they [NFL] would never play by those rules.”

“Once Trump bought the Generals, he changed the economics of the USFL,” said Ley. “He was going to ‘big time it’ - spend the money!”

“There were a few owners who could pay the big bucks to the big stars, but I think the league made a mistake in trying to go to the fall,” said Marv Levy in 2006, former coach of the Chicago Blitz. “It might have forced a merger like the AFL.  I saw some cities where it was picking up tremendous momentum.  It was a grave mistake to try and compete in the autumn.”

Ehrhart, who kept a skeletal staff in place, said, “When the crazy verdict came in, we thought we would win the appeal. Then we decided to suspend play. The greatest mistake was not ever playing the fall schedule. We could have carved out enough of a market share. If we would have played in ’86 it would have forced a merger.”

“The thing most frustrating is that period of time was about as much fun as any of us had ever had,” said Steiner, now broadcasting games for the Los Angeles Dodgers. “It was new, a revolutionary spirit that we could do whatever we wanted like the sideline reporting.” It was so much fun, this rogue, revolutionary spirit.  Whenever I see any of the players or coaches, it’s like an alumni club.”

“I think if the league would’ve stayed to the original plan like in 1983 with 12 instead of 18 teams, the league would have succeeded,” said Bobby Hebert, former quarterback for the Michigan Panthers and Oakland Invaders, in 2005. “But when Donald Trump got involved and forced his hand to go head-to-head with the NFL, that wasn’t a wise decision on the league’s part.”

Trump was considered a bit of a misfit when it came to his sports knowledge and his “love” for football.

“Donald was always about Donald. When he first bought the Generals, at the first meeting he was like a panther in the back of the room,” said Peterson in June 2006, with a note of amusement in his voice. “He got up and showed everyone at the meeting all the press coverage he got from buying the Generals. He said, ‘My great USFL partners, it would have cost him a million dollars to get this kind of coverage in the real estate industry. This is the greatest thing that has ever happened to me.’ We all looked at him each like, ‘this is a real football oriented guy.’”

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