SBJ/March 7-13, 2011/Labor and Agents

Deadlines and drama in push for deal

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NFL Players Association members, including New Orleans Saints quarterback Drew Brees (second from right) make their way into talks with the NFL in Washington, D.C., on Thursday.
The Federal Mediation and Conciliation Service building is a drab, nine-story, 1970s-era structure straddling 21st and K streets in Washington, D.C., the kind that too often populates a city’s downtown. It was a seemingly fitting locale late last week, and perhaps for this week, for negotiations between the NFL and NFL Players Association.

While the sport last Thursday night appeared on the brink of returning to the days of grim labor strife, a federal mediator won at least a 24-hour reprieve for the league and players to continue talking.

For continuing coverage of this developing story, visit www.sportsbusinessdaily.com.

It was unclear at press time whether another, longer extension to the expiration of the collective-bargaining agreement would be secured, but both sides were scrambling to avoid the litigation and potential work stoppages that would follow an expiration.

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NFL spokesman Greg Aiello (left); Jeff Pash (center), league general counsel and chief labor negotiator; and Carolina Panthers owner Jerry Richardson, co-chairman of the owners’ labor committee
The last-minute reprieve was won after more than 60 hours of federally mediated talks between the two sides over 10 days. The move came as the clock ticked down first on the NFLPA potentially decertifying, a move that would allow the players to file an antitrust lawsuit against the league, and then on the NFL potentially declaring a lockout.

Meanwhile, a source said that the Reggie White v. NFL 1993 settlement, which governs the expiring CBA, had also been extended. That meant the NFLPA could file an antitrust lawsuit in the courtroom of Minnesota federal Judge David Doty.

If the two sides, after the extended talks, cannot reach a deal, the path seemed clear as of Thursday night: The union seemingly would decertify, the league would lock out the players, and the new players trade association would file an injunction seeking to block a lockout. An antitrust lawsuit would follow.

Sources said the NFLPA had already prepared the lawsuit and that star quarterbacks Peyton Manning, Tom Brady and Drew Brees were among about 10 NFL players who are named as plaintiffs in that case.

Earlier last week, developments looked particularly grim, with a two-day owners meeting shaved to just more than two hours. Owners traveled to Chantilly, Va., just outside Washington, D.C., last Wednesday, with the possibility of being there for two days to vote on a new labor deal. Instead, they were told when they got there they were going home that night, so little progress had been made. Even league titans like Dallas Cowboys owner Jerry Jones and New England Patriots owner Robert Kraft, who with eight of their colleagues had met with the union earlier that day, were sent packing.


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As for those fans and observers who were hoping that a decision earlier in the week by Doty to block the NFL from using media fees during a lockout would force the NFL to bend, there would be no such development.

“We have been very clear the TV money was a loan. It’s not a payment; it was not anything we were counting on,” said an exhausted-looking Jeff Pash, the NFL’s chief labor negotiator. “It doesn’t alter our planning one iota.”

Indeed, on the day of the extension, Fitch Ratings wrote that the league could survive for
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Top photo: Players Mike Vrabel and Domonique Foxworth. Above: New York Jets owner Woody Johnson.
two years without playing games.

But beyond the blocking of the fees, something else Doty wrote in his decision might have served as an alarm for the league as the week progressed. In the opinion issued last Tuesday, Doty wrote in a footnote, “The facts underlying this proceeding illustrate another abuse of that market power wherein various broadcasters of NFL games were ‘convinced’ to grant lucrative work-stoppage payments to the NFL if the NFL decides to institute a lockout. … Whether the contract insuring these payments might ultimately be deemed unenforceable because of their potentially collusive nature is not an issue before this court, but the court does consider the abuse of the NFL’s market power when finding that it did not act in good faith to benefit both itself and the Players, as required by the [CBA].”

There was certainly concern within NFL circles that any new antitrust lawsuit filed by a decertified union could end up in Doty’s court, sources said.

The path to last week’s deadline drama began in earnest in May 2008. That’s when the league exercised its option to opt out early from the deal the league and players had agreed to in 2006, contending it was too onerous for clubs.

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The deal agreed to in 2006 marked one of the last actions of then-departing NFL Commissioner Paul Tagliabue, who announced his resignation weeks after agreeing to the deal. Roger Goodell was selected as Tagliabue’s successor months later.

Another significant event on the path to last week’s talks came on Aug. 20, 2008. Gene Upshaw, the longtime executive director of the NFLPA, died unexpectedly that day, severing the longstanding ties that the union and leaguehad enjoyed. Several ownership sources have said since then that the league
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Top photo: Houston Texans owner Bob McNair (in blue). Above: Judge David Doty.
might not have opted out had they known Upshaw would be gone, treasuring his ties to the league and his knowledge and savvy.

While many of the economic issues have received the majority of the attention in the dispute, and clearly they are key, the new league and union leadership is trying to forge a new working relationship.

DeMaurice Smith, Upshaw’s successor, did not have any of the longstanding relationships in the NFL and certainly didn’t share the same relationship with the commissioner that Upshaw had with Goodell’s predecessor, Tagliabue. The NFL has criticized Smith for going to the courts and the government instead of the bargaining table to get things done. Smith formerly worked for U.S. Attorney General Eric Holder, and perhaps it was no coincidence that while the two sides were negotiating Thursday, President Obama at a press conference made reference to the talks that were ongoing that day.

Smith’s insistence throughout the talks that the league open all of its financial books to prove its profit margins are shrinking has caused fierce resistance within the league. While it may have added to the level of distrust between Smith and the league, it has won him the allegiance of players throughout the league, who say that they are more informed about their union than they have ever been, under Smith’s leadership.

To that end, NFLPA members were ecstatic last week when Smith’s strategies led to the significant win in Doty’s court.

But both before and after that decision, much of the chatter last week leading up to the events of Thursday was not whether the sides would settle, but rather when announcements would be coming about decertification and lockouts.

The dour mood was a stark change from the sentiments that had been felt by many for months. Despite the long-established threat of a lockout that had been hanging over the NFL business, many of the people who make their living in pro football were sanguine. That had changed by last week.

“There was always optimism, even in the league offices. People thought they would get this thing done,” said one NFL insider last week. “This week, it’s like it’s sinking in. It is like a pall over the business. It’s depressing.”

Said one longtime agent of the mood, “You know what it feels like? It feels like ’87, right before the strike.”

That 24-day work stoppage resulted in one game being missed and three games being played with replacement players.

Anxiety was high last week among many people who feared losing their jobs or taking pay cuts.

“I have never seen coaches as anxious and mad in all the years I have been doing this,” said Larry Kennan, executive director of the NFL Coaches Association, a trade association that represents assistant coaches throughout the NFL. “In 95 percent of the contracts, they say you are going to take a cut in pay [with a work stoppage].”

But as some felt dread last week, others still clung to hope in the last hours before the expiration of the CBA.

“The majority of people I have talked to, from players to front-office people to coaches, they are optimistic that people are, at the end of the day, going to put their differences aside,” said Peter Schaffer, co-owner of All Pro Sports & Entertainment and who has been an NFL agent since 1989. “We are all hoping and truly believe at the end of the day we are going to resolve this.”

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