E-Mail Discussing Lower Market Rates Enters NFL Retirees Trial
By Daniel Kaplan, Staff Writer, SportsBusiness Journal
Clay Walker, the former Senior VP of the NFLPA’s licensing arm Players Inc., boasted in an internal union e-mail that the group had secured retired players for Electronic Arts at a lower market rate than they deserved. A class of 2,067 retired players is suing the NFLPA for allegedly not paying them fair share of licensing income, and Walker’s e-mail was offered on Friday, the eighth day of the trial, to show the union did not have retired players’ best interests at heart. “I was able to forge this deal with Hall of Fame,” Walker wrote last year to Andy Feffer, the NFLPA’s COO, about a deal in which EA licensed through the HOF with the NFLPA’s help that season’s recent HOF inductees. “That provides them with 400K per year (which is significantly below market). … EA owes me a huge favor, because that threat was enough to persuade Take Two to back off its plans.” Take Two did eventually come out with a videogame featuring retired NFL players. Feffer in turn wrote to EA, which thought the NFLPA should pay for some of the rights, “I can tell you that Clay and Joe (Nahra, the union’s staff counsel) negotiation of these discounted terms was a significant contribution to EA as you more than likely would have paid in excess of $1[M].” Nahra testified Friday that he had no involvement with the negotiation and that he did not have a thorough discussion with Feffer about the situation.
PRODUCTIVE DAY: It was a productive day at a trial that has dragged on for the first week or so. The union’s former general counsel and current interim Exec Dir Richard Berthelsen testified, as did Nahra and the plaintiff’s economic witness, Daniel Rasher. NFLPA outside counsel Jeff Kessler subjected Rasher’s finding to withering cross examination. On Rasher’s conclusion that the union’s annual reports, or LM-2s, filed with the Department of Labor differed markedly from the NFLPA’s internal audited financials, Rasher conceded under examination that the LM-2s were accurate, and that he, Rasher, was unfamiliar with the DOL’s LM-2 disclosure rules.
RASHER GRILLED: Kessler also bored into Rasher’s contention that the NFLPA keeps a far higher percentage of licensing income than other sports unions. Rasher testified that the NFLPA keeps around 69% while a common range is between 10-40%. But Kessler got Rasher to concede under cross examination that the NFLPA percentage only included group licensing income, and not all licensing income. And when that was included, the players’ share rose significantly. Finally, on Rasher’s contention that the union has $68M of unrestricted assets that is growing by nearly $9M a year, separate and apart from a strike fund, Rasher said he did not know if it was only licensing income that was growing the unrestricted assets. The unrestricted assets are presumably being raised by the plaintiffs to demonstrate the union has significant licensing income that it could be sharing with retired players. The case is expected to reach the jury by next week.
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