SBD/July 3, 2012/Leagues and Governing Bodies

One Law Firm Settles With NFL Retirees, Second Firm Moves To Have Deal Stopped

Dallas-based law firm McKool Smith has settled with a group of NFL retirees, who claimed the firm failed to adequately represent them, but a second firm is moving to have the settlement stopped. McKool and Manatt Phelps represented a class of over 2,000 retirees in a class action lawsuit brought against the NFLPA over group licensing. A jury trial in '08 found the NFLPA liable on one count and the union ultimately paid the class $26.25M. The retirees sued the two law firms, arguing they had not arranged for an expert report that could have resulted in a much higher award. A lower court threw out the lawsuit, and the retirees appealed to the Court of Appeals for the Ninth Circuit, where the case currently awaits a ruling. Oral arguments occurred on April 18. Last week, according to court filings, McKool and the retirees reached a settlement for an undisclosed sum. “McKool has concluded, despite it’s belief that it is not liable for any claim asserted against it that it is in McKool’s best interests to enter into the settlement in order to avoid further expense, inconvenience, uncertainties of litigation, and the distraction of burdensome and protracted litigation,” the law firm said in a joint motion to the Ninth Circuit.

CERTIFICATION PROCEDURES NEEDED: Manatt in a filing the next day asked the appeals court to reject the proposed settlement because it would complicate its own efforts to have the case dismissed. The settlement, Manatt argued, would require time consuming and expensive class certification procedures at the lower court level where the suit would be remanded. That would "inevitably result in complicated and fact-intensive litigation in the District Court, even though the principal issue on appeal is whether the District Court’s dismissal of the underlying putative class action should be affirmed based on principles of finality and thus bar all further proceedings in the case,” Manatt said in a counter motion. The retirees in '07 sued the NFLPA, claiming a cut of active player licensing fees. The jury in '08 did not find for the retirees on that charge, but did rule the union did not do enough to market the ex-players. The law firms, however, had not supplied an expert report on what the retirees’ market worth could have been with more NFLPA marketing. In fact, the NFLPA initially appealed the jury decision, largely on that issue. But as the appeal was pending at the Ninth Circuit, NFLPA Exec Dir DeMaurice Smith settled the case in April '09 in part to soothe tensions between the union and retirees.
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