NFL: Is the Judge Trying to Punt? (Part 2)

(Blog written by: Jay Lewis)

An initial hearing was held on April 6, 2011 regarding the injunction sought by the players against an NFL owner imposed lockout. For background on how we got here, see my previous post below. As for the hearing, US District Court Judge Susan Richard Nelson questioned the sides for over 5 hours but did not make a ruling. She said she wants to take a couple of weeks to make a decision to ensure a fair ruling for both sides. This may allow time for the litigants to negotiate their own resolution. Additionally, the National Labor Relations Board (“NLRB”) is separately investigating whether the players legitimately decertified and the Judge may defer to them as to whether or not the decertification was a sham. If the NLRB makes a determination the players are still a union, the players will lose anti-trust standing in the Brady case.

This preliminary injunction is a fairly straightforward civil matter-- the Plaintiffs have the burden of proving four factors: 1. The Plaintiffs will suffer irreparable harm if they are locked out by the Defendants or not allowed to sign freely with teams in a competitive market. 2. The Plaintiffs are likely to prove the lockout and restrictions on employment are violations of antitrust law. 3. The Defendants will suffer less harm with an injunction than the Plaintiffs will suffer without one. 4. Public interest favors an injunction preventing the lockout.

The players must demonstrate not only irreparable harm but also monetary damages will not adequately compensate for the harm. Here the players argue that “due to the short length of NFL careers, the virtually constant need for NFL players to demonstrate their skill and value…and the difficulty in estimating and proving the amount of monetary damages…” their injuries are not fully compensable with cash. (Complaint ¶ 86). However, the NFL responded that the players would in reality be compensated with paid leave once the lockout ends and have the benefit of avoiding serious injuries because of the halt in activities. (Response p. 43).

The NFL suggests that the players are unlikely to prove the lockout violates antitrust law because the decertification was made within an hour of ending CBA negotiations. The NFL claims that until a point “sufficiently distant in time and in circumstances from the collective bargaining process” the labor exemption is still in effect. (Response p. 37, citing, Brown v. Pro Football, Inc., 50 F.3d 1041 (D.C. Cir. 1995)). The NFL alleges that the players were not negotiating in good faith and a lockout would force them back to the negotiating table. The NLRB’s decision on the legitimacy of decertification may be a game changer.

Additionally, the NFL argues that the balance of harms sway against them if the injunction is granted. They make a Catch-22 argument: If the league is enjoined from locking the players out and move forward with the season, they will be forced to further violate antitrust laws. By the nature of the sport, the teams must cooperate with each other by setting rules and schedules. Thus, the NFL argues, they are susceptible to additional antitrust actions. (Response pp. 45-47). The players The NFL suggests that the public interest favors applying federal labor laws over antitrust laws. (Response p. 47-49). The league claims that the Norris-LaGuardia Act prevents the court from intervening in a labor dispute, arguing that the Act prevents any court from issuing an injunction against a lockout. Check back for analysis of the Judge’s eventual decision.

NFL: A Different Type of Play (Part 1)

(Blog written by: Jay Lewis)

On March 11, 2011, the National Football League’s (“NFL”) Collective Bargaining Agreement (“CBA”) expired between the players’ association (NFLPA) and the individual league owners.  The CBA sets rules for free agency, player compensation, the salary cap and player benefits. Although such price-fixing and restraint on employment violates United States antitrust law, courts have carved out exceptions to the law based upon the uniqueness of the NFL and non-statutory labor exemptions.  Because the players were unionized, the NFL was exempt from antitrust liability. 

After extensive negotiations, the NFLPA and the owners failed to extend the CBA resulting in the expiration of the salary cap and restrictions on player movement.  To prevent the 2011 season moving forward without salary restrictions, the owners agreed to lockout the players’ union until a new CBA is in place.

In response to the lockout the NFLPA decertified or dissolved the union.  Decertification eliminates the non-statutory labor exemption and clears the way for individual players to file suit against the NFL and owners for antitrust violations.  The players filed on March 11, 2011, in Minnesota Federal District Court.

Tom Brady, Drew Brees, Peyton Manning, and other NFL players have brought a class action complaint against the NFL and the individual franchises.  (Brady v. NFL, Case no. 11-cv-639 D. Minn. 2011).  The players have moved for an injunction against the league to prevent a lockout and anticompetitive restrictions on player contracts.   Judge Susan Nelson will hear the Preliminary Injunction on April 6, 2011.