In what could be a game-changer for the agency business, a federal court judge has been asked to rule on NBA agent Dan Fegan's contention that his non-compete provision in his contract is not enforceable by a court, but only by the NBPA. Michael Kump, Fegan's attorney, told a federal judge in L.A. yesterday only the NBPA can decide whether or not Fegan can act as an agent under federal labor law. However, attorney James Fogelman, who is repping Independent Sports & Entertainment, called that notion "nonsense." ISE is seeking to have the case remanded to state court, or, in the alternative, to have a federal court put a preliminary injunction on Fegan, preventing him from competing with the agency that fired him in March. Fegan is seeking to have ISE's complaint against him, which seeks a preliminary injunction, dismissed. Judge Andre Birotte Jr. said he would try to make a decision as soon as possible, but needed time after hearing heated arguments from both sides. ISE fired Fegan on March 10 and convinced a state court judge to place a temporary restraining order on him. That TRO began on March 17 and expired on April 7, preventing Fegan from competing against the agency in the sports business. ISE had planned to get the TRO turned into a preliminary injunction from the state court. However, Fegan moved to dismiss the state court judge who granted the TRO and moved the case to federal court, saying that it was a federal matter because it involved federal labor laws. Fegan is able to act as an agent for NBA players under federal labor law and his ability to act as an agent flows from the NBPA, Kump told the judge. ISE is also pursuing monetary and other claims against Fegan in two separate arbitrations, but went into court for an injunction, because the agency could not get that injunctive relief that fast in arbitration.
UNION DUES: Kump said the one place ISE "didn't go is to the players union." He said ISE could ask the NBPA to suspend or decertify Fegan, but no court or arbitrator could give ISE the injunctive relief it is seeking. The NBPA yesterday declined comment, but NBPA General Counsel Gary Kohlman in March as part of a declaration submitted in the case said, "The NBPA believes ... that only the NBPA has the authority, under federal labor law, to determine whether Mr. Fegan (or anyone else) may or may not serve as an NBPA certified agent for any individual NBA players, including rookies." Fogelman said what Fegan was seeking was "unprecedented," noting that Fegan agreed not to compete with ISE when he sold his business and good will to the company for $20M. If an agent sells his company to another, but is still allowed to compete with that business during the term of the contract, "You are buying it for nothing," Fogelman said.
