Sources: NFL Would Not Use Media Fees Until Lockout Season Two

The NFL is not budgeted to use the $4B in media fees that are at the center of a bitter dispute with the players union until a potential second year of a lockout, according to two well-placed sources. The NFLPA said it would appeal to a federal district court judge a special master’s decision this week allowing the NFL to use those funds in the event of a lockout, which could begin as early as March 4. However, the NFL is not planning to tap the media money until March '12, if necessary, the sources said, apparently making the outcome of the appeal largely moot in the context of the heated labor debate. Most observers expect the league and union to reach a new labor deal long before spring '12.

The NFL declined to comment for this story, but last month the league’s Exec VP/Business Operations Eric Grubman told reporters, “There are a lot of risks we account for, and to prepare for them, we line up sources of capital. (The TV money) is only one. We have other sources of capital that we lined up to account for any risk that we can think of that might face the league.”

The union has aggressively challenged the league’s control of the money, charging that the NFL negotiated below-market rates for the broadcast deals in exchange for a promise that the money would flow whether games are played or not. The league is required to maximize revenue under the CBA. Underlying the charge, of course, is that the money is critical for keeping the owners afloat during a labor disturbance.

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