Gunter Harz Sports, Inc. v. United States Tennis Ass'n

MEMORANDUM OPINION

Plaintiff brings this action under the antitrust laws of the United States, seeking permanent injunctive relief and treble damages pursuant to Sections 4 and 16 of the Clayton Act, 15 U.S.C. §§ 15 and 26, for defendant’s alleged violation of Section 1 of the Sherman Act, 15 U.S.C. § 1. The Court has jurisdiction of the action and the parties under 28 U.S.C. §§ 1331 and 1337 and 15 U.S.C. §§ 15, 22 and 26. The suit was tried to the Court without a jury. This memorandum shall constitute the Court’s findings of fact and conclusions of law pursuant to Fed.R.Civ.P. 52(a).

The present controversy grew out of the decision of the United States Tennis Association (USTA) to honor a temporary ban imposed by the International Tennis Federation (ITF) on the use of “double-strung” tennis rackets, and the USTA’s subsequent adoption of a new rule of tennis defining a tennis racket, which was promulgated by the ITF and replaced the temporary ban. The plaintiff alleges that the USTA’s actions constitute a conspiracy with various others, not made defendants to this action, to restrain competition in the sale of tennis rackets and tennis racket stringing systems in the United States and abroad, in violation of Section 1 of the Sherman Act.

The facts are these. The plaintiff, Gunter Harz Sports, Inc. (Harz Sports), originally incorporated under the name Werner Fischer Sports, Inc. of America (Fischer-America), is a corporation organized under the laws of the State of Nebraska, with its principal place of business in Omaha, Nebraska. Harz Sports is engaged in commerce in the business of manufacturing and distributing tennis rackets and tennis racket strings and stringing systems in the United States, as well as internationally. The president and incorporator of Harz Sports is Gunter Harz.

The defendant USTA is a Type A not-for-profit corporation, organized under the laws of the State of New York, with its headquarters located in New York, New York. The USTA is a voluntary membership organization made up of Sectional Associations, Member Clubs, Individual Members and Honorary Members from all over the United States. The avowed purposes of the USTA include: the promotion of the development of tennis as a means of recreation and physical fitness; the establishment and maintenance of rules of play and high standards of amateurism and good sportsmanship; and encouraging, sanctioning, and conducting local, national, and international tennis tournaments and competitions under the best conditions possible so as to effectively promote the game of tennis with the general public.

The USTA is the recognized sanctioning organization governing tournament tennis, both amateur and professional, in the United States. Sanctioning indicates that a particular tournament is an official USTA approved tournament and insures that the international Rules of Tennis, promulgated by the ITF, and the Tournament Regulations of. the USTA will be followed. The results of sanctioned events are the input for a multi-level ranking system administered by the USTA which ranks every person who participates in sanctioned events in the United States, whether amateur or professional.

The USTA is a member of the ITF, an international body made up of 104 national tennis associations from all over the world. The ITF is a democratic body and is managed by representatives of the member national associations who assemble in an Annual General Meeting and are referred to as “The Council.” Every two years, the Council appoints a Committee of Management (COM), consisting of eleven persons, which has administrative powers to carry on the work of the ITF between Annual General Meetings, and to administer the finances of the Federation.

The primary purpose of the ITF is to foster and promote the integrity of tennis *1108 competition internationally. One of the ITF’s objects in pursuing that purpose is to uphold the uniform, international Rules of Tennis promulgated by the ITF and to make such alterations and additions to such Rules as may appear necessary or desirable. Changes in the Rules of Tennis can be effected only by resolution, carried by two-thirds majority of the votes cast by the delegates from member nations when the Council meets at an Annual General Meeting. Such resolution must be received by the General Secretary of the ITF at its headquarters in London not later than three months before the date fixed for the Annual General Meeting, and must be included in the written agenda for that meeting sent to all the member nations.

As a condition of membership in the ITF, all member national associations agree that the ITF Rules of Tennis will be obeyed in all tournaments sanctioned by the national associations. Accordingly, official USTA Tournament Regulation No. 1 provides in relevant part:

The Tournament Regulations herein contained and the international Rules of Lawn Tennis shall be observed throughout all tournaments held by clubs, associations or organizations belonging directly or indirectly to the USTA.

During the early 1970’s, a novel method of stringing a tennis racket, dubbed “double-stringing,” was developed in West Germany by a Bavarian horticulturist, Werner Fischer. The main and cross strings of a conventional tennis racket are interlaced or interwoven, and are all on the same plane. In contrast, Fischer’s double-strung racket has two layers of main strings, one layer on each side of the cross strings, and the main strings are independent, and not interlaced or interwoven with the cross strings. Short lengths of protective nylon tubing are placed on the main strings at each intersection with the five double cross strings, and each layer of main strings is tied together with five tie cords, one knotted directly below each of the five rows of protective tubing. Epoxy (adhesive coating) is used to keep the short nylon tubes and the tie cords in place.

The double-strung racket was first brought to the attention of the ITF by a May 2, 1977, telex from the Swiss Tennis Association asking whether the ITF accepted a new tennis racket with double strings which was being marketed. Other inquiries and comments from member associations, players and the press followed. At its meeting at Wimbledon in June, 1977, the ITF COM examined and discussed a sample of the double-strung racket, provided by Dr. Grimm, the General Secretary of the European Tennis Association. Deciding the matter deserved attention, the COM took the matter a week later to the Annual General Meeting of the Council of the ITF in Hamburg, where the President of the ITF reported • that a new type of tennis racket was on the market which was strung to give far more spin to the ball and told the delegates of member associations that the COM was interested in receiving reports from associations and players on the racket.

Between the July, 1977, Annual General Meeting in Hamburg, and October, 1977, the ITF office in London received a number of reports of player reaction to the double-strung racket, including written reports from the Swiss, German and Austrian federations where the racket had become widely used.

On October 1-3, 1977, the COM met in Barcelona, Spain, to consider, among other items on its agenda, the double-strung racket. At the Barcelona meeting, the COM witnessed a demonstration game using both the double-strung rackets and conventional rackets, and considered written reports regarding double-strung rackets from the German, Austrian and Swiss tennis federations, and oral reports concerning the racket from representatives from France and Spain. The COM also considered press reports concerning the threatened boycott of the 1977 French Championships by players to protest the use of the double-strung rackets, and “strange” results at the Coupe Poree Grand Prix tournament on September 19-26, 1977, in Paris, the Gold Racquet Grand Prix tournament in Aix-en-Provence, *1109 France, on September 26-October 2, 1977, and the U. S. Open in Forest Hills, New York, in September, 1977, where several top-ranked world class professionals were upset by lower ranked players using double-strung rackets.

After consideration of the evidence before them, and acting under their emergency power under ITF Rule 57 to settle all urgent questions subject to confirmation at the next Annual General Meeting, the COM issued a temporary ban on the use of rackets with double strings or protuberances. The COM approved a statement for distribution to national associations and the press, stating that from October 3, 1977, only single-strung rackets would be accepted at official tournaments and competitions, including club and regional events sanctioned by national associations. The stated purpose of the temporary “freeze” was to enable the ITF to collate research on the effects of the racket on match play. The release noted that the “Committee of Management does not want to stand in the way of technological progress, but it must be sure that new developments benefit the game.” The COM appointed a Technical Sub-Committee to investigate and forward suggestions to the COM on the standardization of rackets. This press release was also published verbatim in the ITF “President’s Newsletter” dated October 6, 1977. The President’s Newsletter is the main vehicle for presentation of the news and views of the ITF and is distributed worldwide to member nations, people involved in the promotion and organization of tennis, members of the trade and journalists. The October 6, 1977, newsletter stated that the COM would again meet in Paris in January of 1978 and would receive any comments or suggestions that member nations would send to the ITF office in London for discussion at that meeting.

On October 18,1977, the USTA distributed USTA Press Release No. 120-77, announcing that the USTA would honor the ITF’s temporary prohibition on the use of tennis rackets with double strings or protuberances, in order to permit an in-depth study by the ITF, technical groups, and the USTA. The USTA’s stated reasons for honoring the ban were that “the USTA, as a member of the ITF, believes uniformity of rules is especially important in tennis because of the worldwide tournament schedule” and that “in addition * * * it has been suggested that the use of double stringing may result in a ‘double hit.’ ” The press release stated that the ban would be in effect until further notice and would apply to international team matches such as the Davis Cup and all ITF sanctioned tournaments, as well as to all USTA sanctioned events, whether amateur or professional.

At the COM meeting held in Monte Carlo on April 13-16, 1978, the COM heard reports from the Technical Sub-Committee on its studies to date on double-strung rackets and considered all comments and information that had been collected by the ITF office in London. The COM adopted a formulation of a proposed rule for tennis rackets, 1 and a procedure whereby tennis rackets could be submitted to the ITF for a ruling on whether or not they complied with the proposed rule. 2 Included in this *1110 procedure was the right to appeal an adverse ruling.

In a statement dated May 12, 1978, the ITF gave notice that it was proposing to introduce a rule on the definition of a tennis racket, which would become effective from July 13, 1978, in a final form if approved at the Annual General Meeting in Stockholm on that day. The notice contained the text of the proposed rule and approval procedures and solicited comments on the proposed definition from players, administrators and manufacturers of tennis equipment. It was announced that such comments would be taken into account by the COM when it made its final recommendation to the annual meeting. All national associations were asked to circulate this request as widely as possible.

The notice also included the following statement of purpose:

The purpose of this rule is to standardize conditions under which the players, national federations, equipment manufacturers, and other interested parties may foster and encourage improved performanee in technology in racket design and manufacture, without resulting in alteration in the character of the game. We encourage progress but want it to be in the best interests of the game as a whole. We want all designers and manufacturers of rackets to have the same rule to work within, and welcome their comment, and test results in the formulation and implementation of these rules.

Designers and manufacturers were encouraged to seek advance ruling or approval on any questionable racket designs or prototypes.

This statement was distributed worldwide to numerous manufacturers of sporting goods, including Werner Fischer in West Germany, as well as to the rest of the tennis world. Also, on May 12, 1978, the agenda for the July 13,1978, Annual General Meeting of the ITF, to be held in Stockholm, was mailed to the member nations. As required by ITF rules, the new rule for tennis rackets was included on the agenda. The agenda item on the racket rule contained a committee report which noted that further study of this rule and any testing *1111 procedures which might be required were being made and that a supplementary report would be put before the Annual Meeting.

After the May 12, 1978, statement and agenda were released, the Technical SubCommittee recommended that a revised draft of the proposed rule be put before the Annual General Meeting on July 13, based on further study done by the sub-committee and suggestions and comments made by a number of manufacturers and stringers. A statement dated June 29, 1978, was prepared by the ITF office in London, containing the revised draft 3 of the proposed rule. The statement was immediately distributed to a number of people, including Werner Fischer and other equipment manufacturers, who had contributed to discussion of the proposed rule or who had particularly asked to be kept informed. The ITF office' asked to receive comments on the revised draft prior to July 10, 1978, when the ITF staff would leave for the Stockholm meeting.

At its meeting in Wimbledon on July 6 and 7, 1978, the COM approved the revised draft and voted to submit it to the Council of national associations at the Stockholm Annual General Meeting, with the COM’s recommendation that the rule be approved.

At the Annual Meeting in Stockholm on July 13 and 14, 1978, the revised draft of the rule was presented to the Council and approved by the requisite two-thirds majority of the votes cast. All of the votes of the USTA were cast in favor of the proposed rule. On approval at the Annual Meeting, the revised draft of the proposed rule became Rule 4 of the Rules of Tennis. Therefore, as a condition of membership, all national associations belonging to the ITF, including the USTA, agreed from that date on that the new Rule 4 would be obeyed in all tournaments sanctioned by the national associations.

The ITF announced the approval of Rule 4’s definition of a tennis racket in the President’s Newsletter dated July 31, 1978. The text of Rule 4 and the procedures for ITF approval or disapproval of a racket were printed in separate documents distributed with the newsletter. The newsletter stated that the question of the definition of a racket was not yet closed and that

The I.T.F. already has close liaison with many manufacturers. We should like to continue to hear from them as well as from national associations and players throughout the world on the subject of the new rule. As we have said often before on this subject: we do not want to stand in the way of progress, but only to make sure that new developments in racket technology are beneficial and do not alter the character of the game of tennis.

At the time the new rule was passed, ITF Rule 57 made clear that once a rule was enacted, it was still subject to alteration by a vote of two-thirds majority of the votes cast on the matter at an Annual General Meeting of the Council as long as notice of a resolution embodying such alteration was received by the General Secretary at the Office of the ITF in London not later than three months before the date fixed for the next Annual Meeting, and was included on the agenda for such meeting.

*1112 The president of plaintiff corporation, Gunter Harz, became a business associate of Werner Fischer in the summer of 1977. Prior to the temporary ban of the double-strung racket in October of 1977, Harz was employed by Fischer’s German company, Fischer Besaitungstechnik GMBH (Fischer GMBH), as its international sales manager, to find licensees to market the double-strung racket. It was agreed that Harz would receive thirty per cent of the license fees resulting from his efforts. No licensee had been found prior to the enactment of the temporary ban. Shortly after the ban went into effect, the agreement between Harz and Fischer was altered to give Harz exclusive world-wide rights to market the racket himself with Fischer to receive a percentage from sales of the racket, as well as from sales of any modifications of Fischer’s original design conceived by Harz. In a written agreement dated January 14, 1978, it was agreed that Harz was given the right to use Fischer’s name in forming a corporation in Omaha, Nebraska, to manufacture and distribute double-strung rackets and stringing systems. Pursuant to this agreement, Harz in January, 1978, formed the plaintiff corporation under the name Werner Fischer Sports, Inc. of America. Harz then assigned his exclusive rights in the double-strung systems to that corporation.

During the period Harz was employed by Fischer GMBH he began working on improving the Fischer double-strung racket to decrease the topspin imparted to the ball and to give the ball more speed, in response to comments from tennis players at the club level in Southern Germany where the Fischer racket had the widest exposure. By the time Harz left Fischer GMBH to come to the United States, he had developed a modification of Fischer’s double stringing. In place of nylon tubing and knotted tie cords used in Fischer’s stringing system, Harz’s modification uses four rows of pre-molded plastic pieces per layer of main strings to both encase the main strings in tubes and bind the main strings of a layer together. Harz’s variation also uses six single cross strings between the layers of the main strings, in contrast to the five double cross strings of Fischer’s racket, and uses a different gauge of string for the mains and crosses. Fischer-America began to market both rackets and stringing kits using Harz’s modification of Fischer’s double stringing under the name “Play Spaghetti” prior to the July, 1978, approval of Rule 4.

After the temporary ban of double-strung rackets, Harz and Fischer began private lobbying to build up support in the tennis community for the double-strung racket. However, the first contact between Fischer GMBH and the ITF was actually initiated by the General Secretary of the ITF, David Gray. Gray wrote Fischer on December 28, 1977, after seeing an article in the December 16, 1977, International Tennis Weekly, describing the reaction of Fischer and Harz to the temporary ban. The article stated that in the opinion of Fischer and Harz, the racket was not given a fair trial by the ITF and the circumstances under which the ITF banned the racket were totally fraudulent. Gray’s letter mentioned the article and expressed surprise that Fischer had not contacted the ITF office in London concerning the investigations and tests being conducted by the ITF into racket specifications and noted that a number of other companies had submitted ideas and suggestions. Gray asked Fischer to submit some of his rackets to the ITF, as the ITF was about to begin formal tests on experimental rackets, concluding that since a number of unconventional double-strung rackets were on the market, it would be unfair if the ITF did not look closely at the rackets being produced by Fischer GMBH.

Gray’s letter marked the beginning of a stream of correspondence between the ITF and Fischer GMBH. Included in that correspondence was a January 6, 1978, letter to Gray on Fischer GMBH stationery, in which Harz voiced Fischer GMBH’s objections to the ban and its opinion that a fair trial period of twenty-four months should be given for testing, since for technical reasons the product couldn’t be placed on the market in less than twenty-four months. Harz asked that their position be considered at the COM meeting in Paris on January 14, *1113 and 15, 1978. Harz also met personally with Gray at the Masters’ Tournament in New York in January, 1978, where Gray again asked that Fischer GMBH submit sample rackets to the ITF. That request was again repeated in letters from Gray to Harz on January 10 and January 25, 1978. Four of Fischer’s double-strung rackets were received from Fischer GMBH by the ITF office in London on February 10, 1978.

On March 28, 1978, Gray received a request from Harz on Fischer-America stationery that he be allowed to speak to the COM at its April meeting in Monte Carlo. The ITF office staff informed Harz’s wife by telephone that COM meetings were closed to outsiders and that Harz would not be allowed to appear. Harz made several personal visits to the ITF office in London concerning the double-strung racket prior to the adoption of permanent Rule 4, and on two occasions met personally with Derek Hardwick, the then-chairman of the Technical Sub-Committee. Fischer met with Hardwick and Gil De Kermadec, another member of the Technical Sub-Committee, concerning the proposed rule during June of 1978, in Paris.

While various Fischer rackets were submitted to the ITF, Harz never submitted samples of his “Play Spaghetti” rackets or stringing kits to the ITF for testing or formal approval or disapproval, nor did he submit his own test results on the rackets or stringing kits. Werner Fischer submitted written comments on the proposed rule, as well as suggesting a revised draft of the rule by telex to the ITF office in London. No written comments or suggestions on the proposed rule were submitted by Harz or Fischer-America.

Neither Fischer nor Harz made any official contact with the USTA office in New. York about the temporary ban of the double-strung racket nor the proposed rule on racket specifications prior to the July, 1978, approval of Rule 4. However, Harz and Fischer met personally with Stan Malless in November of 1977 to discuss their views of the racket and put on a playing demonstration for him. Malless at the time was the immediate past president of the USTA and, therefore, a member of its management committee, as well as a member of the ITF COM. Subsequent to the November, 1977, visit, Harz talked to Malless about the double-strung racket on several occasions, as well as corresponding with him by letter. Neither Fischer nor Harz submitted written comments nor any sample rackets to the USTA office in New York.

No written request to appear before the USTA concerning the double-strung racket was made by either Fischer or Harz until Harz, through his attorney, requested in an August 8, 1979, letter to the General Counsel of the USTA that Harz be given a hearing at the Annual Meeting of the USTA to be held later that month in Flushing Meadows, and that, in addition, he be permitted to provide a demonstration on the use of the “Play Spaghetti” racket. In a letter of August 20, 1979, the USTA, through its General Counsel, responded that Harz might wish to apply to the ITF for further testing and demonstration, commenting that because of the international character of the game, it is important that the USTA and the other national bodies follow a uniform set of rules. The letter stated that the rules Harz complained of are reasonable and well within the discretion of, the governing sports body. The letter also stated that while the Executive Committee of the USTA was to meet in New York City, the Annual Meeting was not scheduled until February, 1980. On December 28, 1979, plaintiff filed the present suit.

APPLICABLE LAW

Plaintiff characterizes the actions of the defendant USTA, and those of the ITF and its member nations who were not made parties to this suit, as a group boycott of double-strung tennis rackets, having the express purpose as well as the effect of restraining competition in the manufacture and distribution of tennis rackets and tennis racket stringing systems in violation of Section 1 of the Sherman Act. Section 1 of the Sherman Act provides, in relevant part, that

*1114 Every contract, combination * * * or conspiracy in restraint of trade or commerce among the several states, or with foreign nations, is declared to be illegal * * *. 15 U.S.C. § 1.

Relying on the Eighth Circuit’s recent decision in Missouri v. National Organization of Women, 620 F.2d 1301 (8th Cir. 1980), cert. denied, — U.S. —, 101 S.Ct. 122, 66 L.Ed.2d 49 (1980), the defendant contends that the actions of the USTA are exempt from the jurisdiction of the Sherman Act under the circumstances of this case because the USTA bears no competitive or other business relationship to Harz Sports or to any other manufacturer of tennis equipment and, therefore, has no commercial or profit motivation for restraining trade by banning plaintiff’s racket. Defendant would draw from the NOW opinion the requirement that plaintiff be a competitor of the defendant before the Sherman Act can be applied to a group boycott situation.

NOW involved the applicability of Section 1 of the Sherman Act to the National Organization of Women’s convention boycott against all states that had not ratified the proposed Equal Rights Amendment. It is true that the court, in examining the Supreme Court’s decisions under the Sherman Act, found an indication that'" * * * the activities that were meant to be covered are competitive activities by competitors with some self-enhancement motivation.” NOW, supra, 620 F.2d at 1309. However, the Court finds defendant’s reliance on that case misplaced. Despite the broad dicta in the NOW decision, the specific issue involved in the case was “the applicability of the Sherman Act to a politically motivated but economically tooled boycott participated in and organized by noncompetitors of those who suffered as a result of the boycott.” Id. at 1302. The case posed serious questions concerning the First Amendment right to petition the government and the court’s holding that Section 1 of the Sherman Act did not apply to the boycott was based on the well-established exemption to the antitrust laws for group solicitation of governmental action contained in Eastern Railroad Presidents Conference v. Noerr Motor Freight, Inc., 365 U.S. 127, 81 S.Ct. 523, 5 L.Ed.2d 464 (1961).

Controlling for the purposes of this case is a footnote in the NOW opinion in which the court acknowledged that the State of Missouri had cited a number of cases for the proposition that the Sherman Act applies to noncommercial and non-economic boycotts, but explicitly rejected any suggestion that the court was addressing that issue:

We do not decide thát issue. The Sherman Act may apply in some situations to non-commercial and non-economic boycotts. However, we do not rest our decision in this case upon the basis that the boycott was noncommercial and non-economic. Our decision is based upon the right to use political activities to petition the government, as was the underlying factor in Noerr. None of the cases cited above involved the political right to petition the government, thus it is not necessary in this case to distinguish them. 620 F.2d at 1315 n. 16.

Accordingly, the Court declines to grant the activities of the USTA a blanket exemption from the Sherman Act based on NOW. The present controversy in no way involves the right to use political activities to petition the government. Therefore, NOW is not dispositive. While the Sherman Act is primarily aimed at conduct which has commercial objectives, ample authority exists for finding the activities of the USTA subject to Section 1. Non-profit voluntary associations which sanction and regulate professional sporting tournaments, races and other contests have been held subject to the antitrust laws in the exercise of their rule-making authority. See, e. g., Hatley v. American Quarter Horse Ass’n, 552 F.2d 646 (5th Cir. 1977); Blalock v. Ladies Professional Golf Ass’n, 359 F.Supp. 1260 (N.D.Ga.1973); Heldman v. United States Lawn Tennis Association, 354 F.Supp. 1241 (S.D.N.Y.1973); STP Corp. v. United States Auto Club, Inc., 286 F.Supp. 146 (S.D.Ind.1968); Deesen v. Professional *1115 Golfers’ Ass’n of America, 358 F.2d 165 (9th Cir.), cert. denied, 385 U.S. 846, 87 S.Ct. 72, 17 L.Ed.2d 76 (1966), rehearing denied, 385 U.S. 1032, 87 S.Ct. 738, 17 L.Ed.2d 680 (1967).

Similarly, non-profit amateur athletic associations formed for the primary purpose of promoting amateur athletics have been found subject to the prohibitions of Section 1 of the Sherman Act. Hennessey v. National Collegiate Athletic Ass’n, 564 F.2d 1136 (5th Cir. 1977); Tondas v. Amateur Hockey Ass’n, 438 F.Supp. 310 (W.D.N.Y.1977). See also, Amateur Softball Ass’n of America v. United States, 467 F.2d 312 (10th Cir. 1972). Courts have proceeded on the theory that while each such sanctioning organization has the primary noncommercial purpose of promoting organized sports in an orderly fashion, “its subsequent actions in carrying out its laudable objectives could trigger the applicability of the Sherman Act if such conduct restrained interstate trade or commerce in an unreasonable manner.” Tondas, supra, 438 F.Supp. at 313.

The Court does specifically find that the USTA as a non-profit sanctioning organization for professional and amateur tennis does not compete at any level with plaintiff as a manufacturer or distributor of tennis rackets or stringing systems. While the Court finds that fact insufficient to remove the case from the jurisdiction of Section 1 of the Sherman Act, it does dictate against plaintiff’s invocation of the Section 1 doctrine of per se unreasonableness as applied to group boycotts in Fashion Originators’ Guild v. Federal Trade Commission, 312 U.S. 457, 61 S.Ct. 703, 85 L.Ed. 949 (1941) and Klor’s, Inc. v. Broadway-Hale Stores, Inc., 359 U.S. 207, 79 S.Ct. 705, 3 L.Ed.2d 741 (1959).

The term “group boycott” can be used as a “very broad label for divergent types of concerted activity,” but to outlaw certain types of conduct by merely attaching the “group boycott” and “per se” labels “obviously invites the chance that certain types of reasonable concerted activity will be proscribed.” Worthen Bank & Trust Co. v. National Bank-Americard Inc., 485 F.2d 119, 125 (8th Cir. 1973), cert. denied, 415 U.S. 918, 94 S.Ct. 1417, 39 L.Ed.2d 473 (1974). The type of group boycott that has traditionally elicited invocation of the per se rule of illegality “is a concerted attempt by a group of competitors at one level to protect themselves from competition from non-group members who seek to compete at that level,” Smith v. Pro Football, Inc., 593 F.2d 1173, 1178 (D.C.Cir. 1978), and, therefore, has been an agreement “between business competitors in the traditional sense,” Mackey v. National Football League, 543 F.2d 606, 619 (8th Cir. 1976), cert. dismissed, 434 U.S. 801, 98 S.Ct. 28, 54 L.Ed.2d 59 (1977).

The Supreme Court has recently cautioned that while it has held that certain agreements or practices are so “plainly anti-competitive,” National Society of Professional Engineers v. United States, 435 U.S. 679, 692, 98 S.Ct. 1355, 1365, 55 L.Ed.2d 637 (1978) , and so often “lack * * * any redeeming virtue,” Northern Pacific R. Co. v. United States, 356 U.S. 1, 5, 78 S.Ct. 514, 518, 2 L.Ed.2d 545 (1958), that they are conclusively presumed illegal without further examination under the rule of reason generally applied in Sherman Act cases, “easy labels do not always supply ready answers.” Broadcast Music, Inc. v. Columbia Broadcast System, Inc., 441 U.S. 1, 8, 99 S.Ct. 1551, 1556, 60 L.Ed.2d 1 (1979).

The actions of the USTA in this case clearly cannot be characterized as the traditional type of group boycott to which the per se doctrine has been applied. The Court accepts plaintiff’s contention that the USTA entered into a Sherman Act “agreement” when it joined other member nations of the ITF in the adoption of Rule 4 of the Rules of Tennis, and when it agreed to follow the temporary ban of double-strung rackets. However, the Court rejects any suggestion of “agreement,” as that term is used in the Sherman Act, between the USTA or the ITF and any distributors or manufacturers of tennis equipment to prevent the plaintiff from competing in the sale or distribution of rackets or stringing *1116 systems. Totally lacking in this case is an agreement between “business competitors in the traditional sense.” Nor can the actions of the USTA in adopting a rule defining tennis rackets be labeled as lacking in “any redeeming virtue.” .

Where the purpose of a “group boycott” has been to protect fair competition in sports and games, courts have eschewed a per se analysis in favor of an inquiry into the reasonableness of the restraint under the circumstances. Hennessey v. National Collegiate Athletic Ass’n, supra, 564 F.2d at 1152. The Court agrees that the rule of reasonableness should govern the analysis of the present controversy. As noted in Hatley v. American Quarter Horse Ass’n, supra, 552 F.2d at 652:

In an industry which necessarily requires some interdependence and cooperation, the per se rule should not be applied indiscriminately. In some sporting enterprises a few rules are essential to survival.

Since the need for collective action is inherent in organized sports, in analyzing the rules and regulations of sanctioning organizations under the rule of reason, courts have relied on the Supreme Court’s analysis in Silver v. New York Stock Exchange, 373 U.S. 341, 83 S.Ct. 1246, 10 L.Ed.2d 389 (1963). In Silver, the defendant Stock Exchange ordered the termination of direct wire connections to certain non-member security dealers. Because the Securities Exchange Act of 1934 established a statutorily imposed duty of self-regulation on the exchange, which involved the obligation to formulate rules governing the conduct of exchange members, the Court found the defendant’s “group boycott” should be, judged under the rule of reason so that the policy in favor of self-regulation could be accommodated. However, the Court found the defendant’s actions to be unreasonable under Section 1 of the Sherman Act because the Exchange could offer no justification stemming from its statutorily imposed duty of self-regulation for its collective action in denying the non-members the private wire connections without notice and an opportunity for a hearing.

Courts have extended the reasoning of Silver beyond situations involving statutorily created duties of self-regulation to areas where a need for self-regulation is inherent in an industry. See, Comment, Trade Association Exclusionary Practices: An Affirmative Role for the Rule of Reason, 66 Colum.L.Rev. 1486, 1499 (1966). Professional and amateur sports have been included in this extension. Under the reasoning of Silver the inquiry under the rule of reason focuses on (1) whether the collective action is intended to accomplish an end consistent with the policy justifying self-regulation; (2) whether the action is reasonably related to that goal; (3) whether such action is no more extensive than necessary; and (4) whether the association provides procedural safeguards which assure that the restraint is not arbitrary and which furnish a basis for judicial review. See, e. g., Linseman v. World Hockey Ass’n, 439 F.Supp. 1315, 1321 (D.Conn.1977); Denver Rockets v. All-Pro Management, Inc.,