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When word began to leak out in October that Columbus Crew SC owner Anthony Precourt was planning to move the Ohio franchise to Austin, Texas, the response from fans and press alike was intense and immediate: #SaveTheCrew, one of Major League Soccer’s charter franchises, the voices echoed.
Unfortunately, like many other aspects of American economic life, the soccer-consuming public was essentially powerless to go about actually doing the saving part of #SaveTheCrew. Would some billionaire Ohio native soccer fan swoop in and scoop the club away from Precourt and his band of greedy villains? Would the intense local fan and media pressure convince Precourt Sports Ventures that there really was a vibrant market for soccer in central Ohio? Would MLS step in and stop the relocation?
The answer to all of these questions looks more and more like a resounding, definitive “no.” If a soccer-obsessed Ohio-native billionaire wanted to buy the Crew, one would likely have come forward as savior by now. If MLS wanted to stop the relocation, they would have done that already as well, rather than actively collaborating with Precourt to plan the move.
Even the never-before-used Ohio law enacted after Art Modell decided to move the Browns to Baltimore would, at best, only delay the relocation (and even that is not a given, as the law is of unclear constitutionality). Like any everyday participant in American oligarchical capitalism, Columbus fans have no recourse when a wealthy person decides to take away something they care about.
Well, except one: Socialization. Ohio could, legally, use the power of American democratic institutions to seize control of their favorite MLS side through eminent domain.
I’m a lawyer specializing in regulatory and constitutional law with a personal interest in eminent domain. To my knowledge, nothing like this has been tried before in American professional sports.
While it is true that in the infancy of various American professional sports leagues, cities would occasionally sponsor traveling teams, these examples were few and far between, and have by now fallen into legend. Even the vaunted Green Bay Packers “shareholder” structure is not a public model — rather, the Packers function as a variation of a publicly traded private corporation, with a board of directors that makes all decisions. This model could be something that the Crew could pursue in the future, but it is not the discussion at hand right now.
However, while it is true that this form of public ownership is unheard of in American professional sports, American sports fans are very familiar with public ownership of amateur sports teams. The biggest names in college athletics — including the Ohio State Buckeyes — are state controlled.
So why is the prospect of public ownership of a professional sports team consistently pushed to the back pages of leftist political journals or given a Swiftian title like “A Modest Proposal for the NFL”?
The easy answer is: Government generally doesn’t want to be in the pro sports business. But stadium ownership often puts them into that business anyway, so why not go one step further?
The power of eminent domain — that is, for a state to seize private land for public use — is one of the fundamental, constitutive attributes of the modern state. In the English tradition, the power can be traced at least back to William the Conqueror, who, in 1066, seized almost all the land in England for the crown.
The notion that the state should, in theory, remunerate landholders when it seizes property can be traced back to the Magna Carta: Chapter 28 of the medieval code required that payment be made for any expropriations:
“No constable or other bailiff of ours is to take anyone’s corn or other chattels, unless he pays cash for them immediately, or obtains respite of payment with the consent of the seller.”
The American Founders enshrined this ancient code into the fabric of the state they set out to build in the new world: the right to fair recompense for state seizure of property was so important to the framers that they included it in the Fifth Amendment — one before the amendment that guarantees citizens accused of crimes the right to a trial by jury. The last clause of the Fifth Amendment (which guarantees other fundamental rights of the person) recognizes this medieval right to recompense: “Nor shall private property be taken for public use, without just compensation.”
All of this is to say that while currently we associate eminent domain with horror stories about family houses being seized for freeway construction (or worse), it is actually a fundamental part of the fabric of the modern state. The notion that “just compensation” is required is a requirement that came about significantly after the development of eminent domain — in fact, I think a fair interpretation of the original Constitution would allow for eminent domain without compensation, and that this requirement was only added after ratification.
But the Constitution doesn’t just grant this power to the federal government — state and local government has eminent domain power as well.
“While the federal government using eminent domain to acquire a sports team might be difficult to get past a court because the Federal government can only exercise eminent domain in furtherance of one of its enumerated powers in the Constitution, I see no reason why state or local governments would not be able to use eminent domain to do so under their own eminent domain law,” Noah Baron, a civil rights lawyer who litigates Constitutional issues in San Francisco, told SB Nation.
As Baron notes, then, in order for a state government to seize property for public use, the state must have its own eminent domain statute — in fact almost all states have eminent domain clauses in their own state constitutions (not just statutes) — and Ohio is no different. Ohio’s eminent domain constitutional provision closely follows the US Constitution:
Art. I Sec. 19: Private property shall ever be held inviolate, but subservient to the public welfare. When taken in time of war or other public exigency, imperatively requiring its immediate seizure or for the purpose of making or repairing roads, which shall be open to the public, without charge, a compensation shall be made to the owner, in money, and in all other cases, where private property shall be taken for public use, a compensation therefor shall first be made in money, or first secured by a deposit of money; and such compensation shall be assessed by a jury, without deduction for benefits to any property of the owner.
Additionally, Ohio’s courts have generally followed the Supreme Court when deciding how to interpret Ohio’s eminent domain provision. So, for purposes of this article, I’m going to refer to federal takings law to explain how the citizens of Ohio might go about seizing the Crew from Precourt.
Before we can determine whether Ohio can use eminent domain to take control of the Crew, we need to make sure that the Crew is something that would fall under the broad definition of “personal property” — that is “the tangible or intangible assets of a legal person.” Luckily, we can dispense with this step very quickly: the Crew is a set of legal entities, contracts, and other economic relationships that are broadly structured under the umbrella of a single corporation which is controlled by Precourt Sports Ventures, a legal person. Because the definition of “personal property” is so broad, then, the Crew would certainly be “personal property” that can be “taken for public use,” so long as the state pays the owners “just compensation”.
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So, what is “public use”? This, again, is an extremely broad category — so broad, in fact, that there has been a significant amount of controversy surrounding it.
“In fact,” Baron said, “as interpreted by the courts, the limitations on the use of this power are almost meaningless.”
He’s right. The most famous example of the breadth of the “public use” doctrine is a relatively recent case, Kelo v. City of New London, 545 U.S. 469 (2005). The case came about after the city of New London, Connecticut used its power of eminent domain to seize a number of homes and transfer the use of those properties (and the land on which they sat) to a private developer for the purpose of “economic development.” In a 5-4 decision, the US Supreme Court held that transferring private property from one owner to a separate private developer did not violate the takings clause because “economic development” is a “public purpose.” Writing for the majority, Justice Stevens that the Court “long ago rejected any literal requirement that condemned property be put into use for the general public.”
Kelo and its ilk serve as an example for how incredibly broadly the Court has historically interpreted the concept of “public use” — and while the Ohio state Supreme Court slightly narrowed the state definition in City of Norwood v. Horney, 853 N.E.2d 115 (Ohio, 2006), this distinction would not apply in the case of the Crew. “In light of the holding in Kelo,” Baron concludes, “a government could put forth nearly any justification for its exercise of its eminent domain power, and it could easily justify using it to force the sale of a sports team.”
Fundamentally, in socializing the Crew, Ohio would be taking a piece of private property (the legal entity owned by Precourt Sports Ventures) and giving it to its citizens for public use. This case would not even reach the complicated balancing test set out in Horney because the facts are much more like a traditional use of eminent domain — taking land and turning it into a park or a zoo. Public recreation is public use par excellence.
The only complicated question in this entire analysis, from a legal perspective, is how much money the State would be required to pay Precourt. In Ohio, as in most states, the statute requires that the municipality pay the property owner “fair market value,” which the Attorney General explains constitutes:
“The amount of money which could be obtained on the market at a voluntary sale of the property. It is the amount a purchaser who is willing, but not required to buy, would pay and that a seller who is willing, but not required to sell, would accept, when both are fully aware and informed of all the circumstances involving the value and use of the property. This should include every element that a buyer would consider before making a purchase, such as the location, surrounding area, quality and general condition of the premises, the improvements thereon and everything that adds to or detracts from the value of the property.”
Thus, the State would likely need to undertake a thorough analysis of the Crew’s finances, tangible property, intellectual property, and debts in order to come to a reasonable assessment of how much to give to Precourt. While this is a complicated task it is absolutely do-able and the kind of thing that would take an investment bank (or a venture capital firm) a month or so to finalize.
Ultimately, after Ohio takes the Crew from Precourt, the state could then decide how best to run the franchise: they could, for example, treat the club like the Buckeyes and run it through the state; or, to take another example, they could instead convert the club into a publicly traded corporation like the Packers and allow members of the public to purchase shares in the club.
The point is: legally there is very little preventing the state of Ohio (or even the city of Columbus) from socializing the Crew.
So then, why is the notion of socializing a sports team met with such scorn? Much like parks, museums and, yes, the athletic programs of state universities, professional sports teams serve an important state interest: building community by strengthening the social bonds between individuals who might otherwise feel isolated and disconnected from their fellow citizens.
By all accounts, sports teams exist in a nebulous world between public and private: sure, their owners use them as profit machines, but local and state governments invest hundreds of millions of dollars every year in these private enterprises because our state governments see them as crucially important cultural institutions. As a community building block, they’re rare in that they bring people together from all walks of life.
Like it or not, then, government is in the professional sports business, both as an active participant in the financial operations of the teams in their jurisdictions, and also as a passive beneficiary of the community-building effect of these institutions on the citizens they represent. Socializing the Crew through eminent domain isn’t just legal — for the citizens of Ohio and the Crew fans, it would be an appropriate response to the potential loss of this important institution.