The United States Football League: Or The Ultimate Crazy Rich Guy Dumpster Fire

Andrew Merklinghaus is a writer and former monorail conductor from Seattle.  You can listen to his American History podcast Kings of Democracy anywhere podcasts are a thing.  Also follow him on Social media on TikTok and Instagram. This is the second installment in Andrew's ongoing series about notable fails throughout history. Check out his first piece, “Waterworld: Or In Defense Of Rich Actor's Insane Self-Funded Passion Project."

There are a lot of ways to lose a lot of money, very quickly. You can play craps or date models with coke problems or buy a used Subaru. But there is one way to lose money so quickly that it’s become a regular pastime for insanely rich Americans-- starting a new sports league. However, in the early 80’s one plucky gang of underdog millionaires almost pulled it off.

The story of the United States Football League started with David Dixon, a New Orleans businessman who really wanted the Big Easy to have a football team. He tried to buy the Raiders for $2.1 Million, which failed because the NFL intervened. Dixon eventually got a team in the form of the Saints, but he got an inkling of a better idea. Most NFL teams played in MLB baseball stadiums, which everybody hated because they wrecked the grass and it made scheduling a nightmare. Dixon was friends with Lamar Hunt, an oil heir who had founded only successful NFL competitor, the AFL or American Football League. They’d quickly floundered, only saved by a buyout and merger from the NFL proving it was possible to start a league and make money. So, why not avoid competing directly and play in the Spring?

Dixon did his homework. In fact, he worked on it for 15 years, finding stadiums, investors, and TV deals. He was methodical and patient, and looked for like-minded investors. When the league debuted in 1983, fans went nuts. After the Boston Breakers pulled off a comeback, fans stormed the field for a team that had just been invented. The USFL used a territorial draft, so college stars like Hershel Walker and Doug Floutie played where they had huge fan bases. Other solid players who hadn’t made the NFL signed up and played their guts out for a chance to stay in the game. The average game saw 25,000 fans in the seats and solid TV ratings. The Denver Gold even made a profit.

But like comic-cons, Brooklyn, and life in general, rich guy ego took over and wrecked it. The league was supposed to have a salary cap, but owners got around it by paying players directly. Steve Young shattered the football contract record with $120 million from the LA Express. The money brought more elite players, but poorer teams had to spend money they didn’t have or become punching bags. The league plunged into debt and Dixon saw the writing on the wall, selling his shares in his brain child in 1984..

Without Dixon’s steady hand the league scrambled for cash and broke every rule. The owner of the Chicago Blitz lived in Arizona, so he convinced the owner of the Arizona Wranglers to swap franchises by trading their whole teams with each other. Then, the owner of the Blitz got sick of it and just abandoned his team. The San Antonio Gunslinger’s office was a double-wide trailer, the stadium was full of empty folding chairs and the team funded by an oil heir writing bad checks. Players had to wash their own uniforms. A team promised for San Diego ended up in Tulsa, Oklahoma. And then Donald Trump, you know the guy from TV, bought the New Jersey Generals.

By the middle of the 80’s Trump was pretty deep in debt with the casinos and airlines and licensed body pillows and whatnot. He needed something to turn a profit so he had the genius idea to sue the NFL for being a monopoly to the tune of $3.9 billion. Now on paper this was a pretty good idea, mostly because they clearly are. If they won they were rich, if they lost they still owned a league. But more likely, if the NFL didn’t want to fight they’d just arrange a buyout or merger.

But on the other hand, this was really stupid. The NFL is a monopoly, but they’re allowed to be. They have what’s called a “provisional exemption” to anti-trust law. That’s why there’s no NFL on Friday nights. Congress forbade it to protect High School football from being drowned out by a big NFL showdown. Likewise the NFL didn’t technically compete with the USFL, they played different seasons. In order for there to be damages they had to compete directly, so the USFL would have to switch to a Fall Schedule. Even with ABC offering a $175 million dollar TV deal they changed the schedule, then walked in to the court room.

By the time they got their day in court in 1986 the league was on the verge of death. Oakland Raiders owner and general crazy person, Al Davis, testified against the NFL as revenge for refusing to let him move to LA. With his testimony and a long paper trail the USFL had a slam dunk case and the jury agreed. The NFL was a monopoly that had harmed the USFL. But it also agreed that the NFL was legally a monopoly, had not harmed the USFL when it was playing in the Spring, and the USFL’s dumpster fire of money problems was their own darn fault. In layman’s terms they agreed with the crime but not the damages.

The USFL imploded on the spot. A lien was placed on the Tampa Bay Bandits. The Canadian Football League stopped returning their phone calls. The case was appealed and worked its way to the Supreme Court. But in 1990, the long dead USFL received a check for $1, tripped to $3 because of anti-trust law with $.76 added for interest and inflation. They managed to turn $389 million investment, 15 years of planning, 4 years of play, and $5.5 million in legal fees in to $3.76. To this day nobody has cashed the check.