Tuesday, April 28, 2009

NFL Draft Trifecta 

If Phil Miller's Saturday post on the NFL draft is Day 1, and Brian Goff's Monday post on the NFL draft is Day 2, let's finish this off the trifecta with a third post.

It is certainly the case that the non-statutory labor exemption to the antitrust laws places rookies and draft picks at a huge disadvantage when it comes to salary negotiations. While we are fond of talking about how the reserve clause in the major sports leagues died with the advent of free agency, in fact the reserve clause is alive and well today. It's just that it is only applied to players in the first few years of their career. Of course, given the relatively short careers of most professional athletes, the current reserve clause rules may cover a typical athlete's entire career.

That being said, let's not be too hard on the non-statutory labor exemption. Without this judicial understanding of the labor laws, most of the league rules put in place to promote competitive balance would be under constant threat of antitrust litigation. Without a union's consent, the reverse order draft, salary caps, luxury tax, roster limits, etc., all of which are the result of individual teams coming together and conspiring to limit player compensation, would clearly be, if not per se violations of the antitrust laws, at least subject to significant scrutiny under the rule of reason.

Without the ability to negotiate in good faith without the threat of impending antitrust action, it is unclear how modern sports leagues would be able to function efficiently, at least in terms of promoting competitive balance.

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Tuesday, June 17, 2008

Seattle vs. the Sonics 

The lawsuit brought by the city of Seattle against the Sonics began yesterday. The city is seeking to force the Sonics to play at KeyArena through the remaining two years of the contract. The Sonics want to merely pay the required rent, and get out of town to new and better digs. Three main issues in the case are (1) the ability of the city to demand "specific performance" rather than the monetary payment alone; (2) whether through KeyArena the city would provide an economically viable venue during the next two years, as required by the contract; and (3) whether both parties acted in good faith when negotiating over a new Seattle-based home for the Sonics, a negotiation that was ultimately abandoned when the Sonics decided to move to Oklahoma City.

Coverage from the Seattle Times on yesterday's hearing is here, and there is good commentary on the issues at the Sports Law Blog. The weakest part of Seattle's case rests on the economic impact of the Sonics leaving town. I expect our man Humphreys to carry the day on that point. But intangible values loom large, and I give the city a decent shot on points two and three above, as a means of keeping the Sonics around (in a contractual sense, at least) for another two years. What ultimately happens if the city wins the case is anyone's guess. Maybe they'll get a nice pot of money in a settlement and bribe the Kings to come to the Emerald (nee Queen) City ;) There are no angels in The Stadium Game.

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Sunday, March 11, 2007

NCAA sued (again) 

As a football player at UCLA, Ramogi Huma found there was always more month than money when it came to the reality of daily living.

His scholarship paid for tuition, books, food and housing, but didn't cover toothpaste, travel expenses or phone bills. When "people came peddling credit cards in front of the athletic department," Huma applied and accepted a sports water bottle as a free gift.

He charged what he needed to survive.

"I thought I could get a job in the summers to pay it off, but when I was playing, I wasn't allowed to work because the NCAA didn't allow it," said Huma, who owed $6,000 at 19 percent interest upon his 1998 graduation.

That experience -- and the National Collegiate Athletic Association's suspension of a teammate who accepted groceries when his scholarship money ran out -- led Huma in 2001 to found the Collegiate Athletes Coalition to improve conditions for student athletes.

Now, as the NCAA prepares for its annual "March Madness'' basketball championships, it is locked in a legal battle with the CAC that could change the future of college sports.
That's the opener from Robin Acton and Richard Gazarik's article. It's an important story that will slowly unfold over the next couple of years, so file it for future reference. Rod Fort and Steve Ross are quoted, among others.

The headline reads "NCAA: USW (United Steel Workers) trying to make athletes "paid employees." Well, that's certainly preferred to "unpaid employees."

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