Dr Reid has taken the league to the Victorian Supreme Court, seeking an independent panel to hear his charge of bringing the sport into disrepute.
Dr Reid's barrister Ross Gillies QC told the court that the AFL Commission had failed in their obligation to give him natural justice and a hearing without bias.
Mr Gillies said the commission was effectively the investigator, prosecutor, judge and jury in the case against Essendon.
"It is conduct which we say is completely inconsistent with their role as independent arbiters," he told the court during a directions hearing on Thursday.
Justice David Beach asked AFL barrister Jeff Gleeson SC why the commission would not simply allow an independent body to hear the case.
Mr Gleeson said the commission took its role of upholding the AFL's rules seriously.
"It is with a heavy heart they feel the obligation of hearing whether there has been any breach of the rules," he said.
"If they jumped at that shadow every time someone made enough noise, they feel they would not be doing their job."
After two days of negotiations, the AFL Commission last month kicked Essendon out of this season's AFL finals, fined the club $2 million and docked them draft picks over their 2012 supplements program.
In addition it suspended coach James Hird for 12 months, banned football manager Danny Corcoran for four months and fined assistant coach Mark Thompson $30,000.
But Dr Reid held out and opted to take his case to court.
Mr Gillies said Essendon's official settlement of the charges with the AFL made it clear that Dr Reid was not involved in the supplements program.
"Essendon Football Club admit to failing to involve any of its key medical staff in its supplements program," he said.
"(Dr Reid's) case is that he was marginalised and that what was happening was going on without his knowledge."
Mr Gillies said the settlement was not fair as it included admissions by the club which were not accepted by Dr Reid.
"It is the equivalent of being led through Federation Square in chains, moaning an apology," he said.
Mr Gleeson said the commission had played no part in the investigation of Essendon.
"The evidence will quite clearly show that the nine commissioners, let alone the sub-committee, had nothing to do with the investigation or the drafting of the charges," he said.
He said Dr Reid had made serious allegations of bias without proof.
"It is not enough to say someone said something to a journalist," he said.
The case will be heard in full on September 19.
Mr Gillies said it would be pointless trying to mediate a settlement in the meantime.
"We have spent days speaking to this organisation fruitlessly," he told the court.