Each team owner is given a rating. This rating is based on who you've played, whether you've won or lost and by how much. It is similiar in concept to the RPI ratings used for college basketball or Jeff Sagarin's ratings.
Each team owner is given a initial rating of 1400. This rating is adjusted after each league game, based on the final score and the rating of the opposing team owner. For example, if the 'Fence Crushers' beat the 'Flame Throwers' 5-2 and the Fence Crushers came into the game with a rating of 1480 and the Flame Throwers came in with a rating of 1420, the new ratings would be:
Fence Crushers: 1488 (calculation: 1480 + (5-2) + 5 : +5 points for the victory plus the margin of victory)
Flame Throwers: 1412 (calculation: 1420 + (2-5) - 5 : -5 points for the loss plus the margin of victory)
The maximum points awarded for a regular season is 10, even if the margin of victory is 20. In addition to regular season wins/losses, you will receive additional bonuses to your owner rating by performing well in the playoffs: