THE CASE AGAINST THE IBC
This case presents classic instances of violations of the antitrust laws. A group of men have banded together to seek domination of a field. In this, they have succeeded.
It is submitted that the equity powers of this Court should be invoked to dissolve that amalgamation of power and enjoin the illegal practices through which it was achieved.
So ends the government brief in the case of United States of America, Plaintiff, vs. International Boxing Club of New York, Inc., et al., Defendants. The et al., or the group of men who "have banded together" in the government's charge, are: International Boxing Club of New York, Inc., International Boxing Club, Inc. (Illinois), Madison Square Garden Corporation, James D. Norris (president of all three) and his partner, Arthur M. Wirtz of Chicago. Trial begins this week before Judge Sylvester J. Ryan in the skyscraper United States Courthouse in downtown New York's sprawling Foley Square. It could end with the International Boxing Club (James D. Norris, President) broken of both its stranglehold on championship boxing and resultant control of all other important boxing.
The government case rests on a 1955 decision of the Supreme Court of the United States, delivered by Chief Justice Earl Warren, that boxing is a business in interstate commerce and therefore comes under the antitrust laws.
That decision permitted the Antitrust Division of the Department of Justice to move against IBC on allegations that it had bought control of boxing championships, bought out competitors, acquired exclusive use of the big stadiums and forced championship contenders to agree that, if they won the championship, they would fight only for IBC. Through these means, the government contends, IBC has become boxing's colossus, promoting 80% of championship bouts in the period involved (June 1949 to May 1953, for purposes of the suit), with revenues in that period of more than $7 million. The extent of the IBC's control of champions—and the lucrativeness of that control—are set forth in the tables, from the government's brief, on the opposite page and on pages 28 and 29.
In addition to controlling the championships, of course, IBC promotes nonchampionship bouts, including the big television shows on Wednesday and Friday nights.
By controlling the champions—in all but the flyweight and bantamweight divisions, which are no longer important in the United States—IBC has been able to force the loyalty of lesser fighters, managers and copromoters. For if a fighter wants to get a crack at the championship some day he must be an IBC-pleaser as well as a crowd-pleaser. If a promoter or a manager wants an occasional IBC-TV fight he must be an amiable fellow.
But if the government wins its case, then championship fight promotion will be wide open to competition. Other promoters will be able to bid for the fighters' services and have access to the big indoor and outdoor arenas where such fights can be staged profitably. Fighters and managers will not have to consider IBC wishes when they sign for a fight in the hinterlands outside its domain. Some good fighters who have found it difficult and even impossible to win national recognition may at last have their chance.
The immediate result, if all this comes to pass, is likely to be the kind of confusion that comes with word of a gold strike in hitherto inaccessible territory. Managers of top fighters will be in the saddle (though the bridle in some cases may still be held by the likes of Frankie Carbo). Promoters and would-be promoters will doubtless join in a frantic scramble for fights. Television promotion will be affected, since managers will be able to drive hard bargains for more than the current $4,000 minimum, and the IBC, recently re-signed to its $962,000 Pabst-Mennen contract for 52 weekly TV fights (in addition to its similar Gillette contract), may have difficulty in guaranteeing schedules of acceptable matches to the sponsors. Competition, of a sort long since gone from boxing, will be restored.
A government-favored decision will have an effect, too, on the hoodlums who have infested the sport for many a long year but thrive best under monopoly conditions. Fight managers have long known that the man to see, if you want to be sure of getting fights for your boy, is the hoodlum and killer Carbo, who wants first to know whether the manager and his fighter are "businessmen." If they are (and "businessmen" is a hoodlum euphemism for those willing to do as they are told) they get fights. With independent promoters running loose, Carbo may be reduced to his stature of the '40s when, for the most part, though a big-time betting operator, he could offer only sporadic money bribes to a fighter or manager instead of a steady livelihood. As IBC took over more and more of boxing, Carbo's influence, whether real or pretended, mounted in managerial circles. He and Norris had known each other for 20 years. The Carbo name became a whispered byword. But his influence could now decline.
Of course, harassment of Carbo will be at most an alleviating effect, like taking in a reef when all sails should be down. The government's case is directed solely at IBC, not at gangsters. Summarized, this is it:
Early in 1949 Harry Mendel and Truman K. Gibson Jr. approached Norris with an idea. (Mendel is now an IBC press agent and Gibson is IBC secretary.) Then they talked with Norris' partner, Arthur M. Wirtz of Chicago. The idea resolved into an agreement that Heavyweight Champion Joe Louis would obtain exclusive rights to the services of the four leading heavyweight contenders (Ezzard Charles, Joe Walcott, Lee Savold and Gus Lesnevich). Louis would then resign as champion, assign his exclusive contracts to IBC and let IBC promote an elimination tournament to pick Louis's successor. The successor would then be the exclusive property of IBC.
It worked out fine. Louis signed up the challengers, announced his resignation on March 1, and on March 24, for $150,000, turned over the contracts to IBC. Madison Square Garden (of which Norris is now president) bought out Mike Jacobs' Garden lease for $100,000 and for another $10,000 took over Jacobs' lease to promote boxing at Yankee Stadium and St. Nicholas Arena in New York. The ailing Jacobs agreed to stay out of boxing for 10 years, actually an agreement to stay out for life. (He died in 1953.) IBC also acquired the Tournament of Champions, which had promoted some big fights, had an exclusive lease for boxing promotion at the Polo Grounds and agreements with Tony Zale, Marcel Cerdan and Sugar Ray Robinson.
By this time IBC was in a very strong position. It not only held the big New York arenas but Norris and Wirtz owned the Chicago Stadium, the Detroit Olympia and St. Louis Arena. These seven arenas were boxing's most important. In the preceding 11 years 50% of all championship fights had been held in one or another of them.
By 1951 every champion—except Joey Maxim, who held the light heavyweight title, and the bantam and flyweight champions—was under exclusive contract to IBC. Maxim's manager is Jack (Doc) Kearns, a loner. That failure was corrected in 1952 when Archie Moore won the title from Maxim and went into the IBC bag.
As the government points out in its brief, "control of the heavyweight championship is usually the most lucrative source of revenue in boxing." It cost IBC $165,000 to win control of those first four heavyweight contenders but, after all, the first Charles-Walcott fight alone brought in more than $179,000 in gate receipts, as well as $35,000 from home TV and radio and $2,500 from theater TV, then in its infancy. (By the time of the Marciano-Walcott fight in September 1952, theater TV brought in $108,000, movies $273,000, and even greater returns were realized in later fights.)
Since that Charles-Walcott fight IBC has promoted or participated in the promotion of every heavyweight championship bout held in the United States. In order to get a shot at the current champion the current contender had to agree to fight title bouts exclusively for IBC if he won.
And so it went through the other divisions. From Archie Moore to Sandy Saddler, IBC came eventually to own them all, under a system which almost assured perpetual ownership.
(Recently Rocky Marciano's exclusive contract with IBC expired and was not renewed. A fortuitous public feud between Norris and Rocky's manager, Al Weill, may or may not be genuine, but should provide a very timely portion of grist for IBC's defense. IBC can now claim that it no longer controls the heavyweight championship. But IBC certainly controlled Rocky's services during the lush years.)
Another technique by which IBC established control of boxing, the government contends, was by loans to fighters and managers. In a four-year period they totaled at least $451,367. IBC bookkeeping methods left the government unsure as to whether it was more. The loans were made mostly to champions and contenders. Sugar Ray Robinson, for instance, was lent $65,854 and Kid Gavilan received $55,830.
"In view of the substantial amounts of money involved," says the government brief, "the conclusion seems inescapable that boxers and managers owing such substantial amounts must be considerably more amenable and responsive to the wishes of their creditors—the defendants. Indeed, defendants do not gainsay this. Defendant Norris, when questioned as to whether such loans have the effect, inter alia, of cementing relationships between promoters and boxers, answered:
" 'Yes, I would have to think as in any other business, if you do a man a favor, he certainly, if he has an ounce of loyalty in him—he certainly appreciates it.'
"Mr. Norris also stated that the promoter who has been giving boxers 'their bread and butter for a long period of time and has been lending them money for taxes and so on...' would be more able to influence boxers than one who was not so engaged."
Thus in 1950 Hymie (The Mink) Wallman borrowed $12,500 from IBC so that he could purchase Welterweight Johnny Bratton's contract (SI, January 24, 1955), the money to be repaid from proceeds of Bratton's IBC fights. Thereby IBC gained the loyalty of Wallman and Wallman got control of Bratton, who won the NBA welter title. The government has a deposition from Truman Gibson Jr. that similar loans were made "in many other cases." (Around boxing it is believed that Lippy Breidbart became manager of Hurricane Jackson, No. 2 heavyweight contender, with an IBC loan.)
So runs the government brief. It argues that IBC grabbed control of the big fighters and the big arenas, eliminated the competition of other promoters and maintained control by requiring contenders to guarantee IBC their exclusive services. This, it holds, is a violation of the Sherman Antitrust Act.
Against this contention, IBC lawyers may perhaps argue that boxing is not in interstate commerce and hope that the Supreme Court will reverse its 6-to-2 decision to the contrary. Or it may, perhaps, offer a legalistic contention that championship boxing is not a field that can be monopolized, since it competes with nonchampionship boxing for the public's attention and money. But government figures point out the vast difference, in dollars, between championship and nonchampionship boxing. The IBC's average championship fight has produced gross revenues of $154,000, and the average nonchampionship IBC fight in bigtime stadiums like Madison Square Garden, Chicago Stadium, Yankee Stadium and the Polo Grounds has returned only $40,000. In lesser arenas the returns, naturally, are far less.
And, of course, if IBC controls the fighter's goal—the championship—its influence on him as to where and when and whom he fights is enormous. If it determines, as promoter-matchmaker for TV sponsors, who fights whom on television and what loyal copromoter shall share its fees in an occasional Washington, Miami, Los Angeles or San Francisco TV bout, its influence on boxing is greater than any promotional organization has ever enjoyed in the history of the sport.
What could happen to the IBC organization is problematical. The government has not indicated in its brief what recommendations it would make in the event of a verdict against IBC in the case of the United States of America vs. the International Boxing Club of New York, Inc., et at. Whoever wins, the possibility of prolonged appeal is high.
In other words, if IBC wants to promote a Hurricane Jackson-Floyd Patterson-Archie Moore series of elimination fights with an eye to a real solid gate for Rocky Marciano's final bow in the ring, the law's delays may well permit. After all, this suit was first filed, on recommendation of a federal grand jury, in March 1952.
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PHOTO
CLASSIC VIOLATIONS OF THE ANTITRUST LAWS ARE CHARGED AGAINST NORRIS AND HIS IBC ASSOCIATES IN THE GOVERNMENT BRIEF (ABOVE)
PHOTO
JAMES D. NORRIS POSES IN HIS MADISON SQUARE GARDEN OFFICE
ILLUSTRATION