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Volume 20 No. 42

Labor and Agents

On the same day last month that the NFL Players Association announced it would create its own event to replace the NFL Rookie Symposium, IMG reached out to the players group and began talks about hosting it.

Last week, every player selected in the NFL draft in April was sent an email, inviting them to the NFLPA’s first Business of Football: Rookie Edition event, to be held June 28-29 at IMG Academies, the 450-acre athlete training facility in Bradenton, Fla., owned by the sports, entertainment and media company.

“The IMG Academies has always had a relationship with the players, and they approached us once we made the announcement that we intended on hosting our own program for the incoming rookie class,” said George Atallah, NFLPA assistant executive director, external affairs. “They reached out and said they wanted to partner with us, and we determined an association with them would be the best experience for these young professionals.”

Atallah would not reveal financial details of the deal but did say, “They offered us a really good opportunity and are working with us as partners.”

The NFLPA announced that it would create its own event to educate players entering the NFL on May 31, about a week after the league announced it was canceling its annual NFL Rookie Symposium because of the league lockout.

The NFLPA event won’t be the first occasion this year that players have visited the IMG facility. More than 20 NFL athletes, both rookies and veterans, have trained at IMG Academies since the lockout began, including No. 1 overall draft pick Cam Newton.

Trevor Moawad, director of the IMG Performance Institute at IMG Academies, said IMG Academies saw this as an opportunity to host a large group of elite athletes and help them with the tools to be well-rounded professional athletes.

Although all the details of the event’s schedule were not worked out as of last week, a number of experts are expected to talk to the rookies about matters such as security, financial planning, media training and nutrition.

Moawad said the presenters would be from IMG as well as other companies. Atallah said active players will also speak.

NFL player agent Drew Rosenhaus, in a text message, said, “It’s a great move by the NFLPA and all of my rookie clients will be there.”

Liz Mullen
For the third year in a row, agent Scott Boras was the adviser to the No. 1 overall pick in the Major League Baseball draft, which was held last week. Boras also tied for advising the most first-round picks in this year’s draft.

Boras and his Newport Beach, Calif.-based Scott Boras Corp. advise right-handed UCLA pitcher Gerrit Cole, selected No. 1 overall by the Pittsburgh Pirates. He also advised outfielder Bryce Harper, the No. 1 pick last year, and 2009 No. 1 pick Stephen Strasburg, both drafted by the Washington Nationals.

Scott Boras advises No. 1 pick Gerrit Cole, the third top selection in a row for Boras.
Boras is advising four other 2011 first-round picks: outfielder Bubba Starling (No. 5 / Kansas high school), third baseman Anthony Rendon (No. 6 / Rice), left-handed pitcher Chris Reed (No. 16 / Stanford) and right-handed pitcher Alex Meyer (No. 23 / Kentucky). Additionally, Boras is advising supplemental first-round picks Brian Goodwin (No. 34 / Miami Dade C.C.), Zach Cone (No. 37 / Georgia) and Jackie Bradley (No. 40 / South Carolina), each of whom is an outfielder.

Legacy Sports Group had a big MLB draft as well, also advising five first-round picks: outfielder George Springer (No. 11 / UConn), left-handed pitcher Jed Bradley (No. 15 / Georgia Tech), left-handed pitcher Tyler Anderson (No. 20 / Oregon), right-handed pitcher Taylor Guerrieri (No. 24 / South Carolina high school) and catcher Blake Swihart (No. 26 / New Mexico high school). Additionally, Legacy, which is also based in Newport Beach, advises supplemental first-round picks outfielder Keenyn Walker (No. 47 / Central Arizona College) and third baseman Travis Harrison (No. 50 / California high school).

CAA SIGNS STUCKEY: CAA Sports has signed Detroit Pistons point guard Rodney Stuckey, who is scheduled to be a free agent this summer. He will be repped by a team of agents led by Leon Rose.

NBA PROSPECTS, PART 1: BDA Sports has signed a number of prospects for this year’s NBA draft, including Washington State guard Klay Thompson.

Additionally, BDA has signed Florida State forward Chris Singleton, USC center Nikola Vucevic and Purdue forward JaJuan Johnson. projects Thompson as the No. 15 pick in the draft, with Singleton No. 17, Johnson No. 31 and Vucevic No. 40.

There’s an interesting connection between Thompson and BDA founder and agent Bill Duffy. Thompson’s father, Mychal, was a teammate of Duffy’s at the University of Minnesota. Mychal Thompson went on to be the No. 1 pick in the 1978 NBA draft.

NBA PROSPECTS, PART 2: Wasserman Media Group also has signed some NBA draft prospects, including Texas guard/forward Jordan Hamilton. Los Angeles-based WMG also is representing Morehead State forward Kenneth Faried, Georgia forward Trey Thompkins, Duke forward Kyle Singler, Syracuse forward Rick Jackson and Jeremy Tyler, a forward who bypassed his senior year of high school in California in favor of playing professionally overseas the past two seasons. projects Hamilton as pick No. 20 in the draft, Faried No. 22, Thompkins No. 25, Tyler No. 28, Singler No. 29 and Jackson No. 50.

NBA PROSPECTS, PART 3: Priority Sports & Entertainment signed Florida forward Chandler Parsons. Additionally, Priority signed Wisconsin forward Jon Leuer, Boston College guard Reggie Jackson, Purdue guard E’twaun Moore and San Diego State forward Malcolm Thomas. projects the players to be drafted in the second round, with Parsons No. 32, Leuer No. 34, Jackson No. 39, Moore No. 44 and Thomas No. 52.

The players will be represented by Priority agents Mark Bartelstein, Aaron Mintz, Reggie Brown and Brad Ames.
Mintz said he believes the players may surprise some draft analysts.

“Every year for the last six years, we have had at least one guy be a surprise first-round pick,” Mintz said. “We feel at least a couple this year will hear their names called in the first round.” n

Liz Mullen can be reached at Follow her on Twitter @SBJLizMullen.

Shortly before oral arguments June 3 in St. Louis federal appeals court over whether to end the NFL lockout, NFL Players Association Executive Director DeMaurice Smith strode into the spacious courtroom. He walked by packed rows of seats before he stopped behind two NFL in-house lawyers, Dennis Curran and Ed Tighe, patted them on their backs, and, as they turned, shook their hands.

That seemingly simple display of courtesy between rivals spoke to a much greater development: The NFL and players are showing signs of civility and appear ready to get down to the business of saving the season.

Smith, unlike his predecessor, the late Gene Upshaw, has prided himself on not being cozy with owners and league executives. His often-strong rhetoric has inflamed tempers within the league. Asked at the Super Bowl which owners he knew, Smith, who assumed his post in March 2009, replied that his job was to represent the players (see related story).

But with recent not-so-secret meetings occurring far from Minnesota federal court, the players’ preferred venue, and with no counsel present other than Smith himself, insiders late last week seemed downright giddy that a new labor deal is now possible.

After the hearing in St. Louis, Smith, who just weeks earlier publicly blasted the NFL for the lockout, barely stopped on the steamy courthouse steps for questions on the sudden resumption of face-to-face talks, respecting the confidentiality of the process.

“Anything which has conversations going is better than no conversations,” said one NFL source. “Any deal in any league takes weeks and weeks to reach. Is it possible before preseason games must be canceled? Possible, but very tough.”

Still, that is a far cry from losing regular-season games, if not the whole 2011 season.

Commissioner Roger Goodell, questioned the day of the hearing and just after the first round of the “secret” meetings, said both sides appeared committed to getting a deal done. While again a seemingly simple and courteous response, it’s a significant change from prior league comments. For months before the union decertified on March 11 and the players filed an antitrust lawsuit against the NFL, the league strongly suggested the NFLPA was not committed to bargaining, a charge the then-union denied. Just three weeks ago, Green Bay Packers President Mark Murphy, a key negotiator for the league, said about the two earlier rounds of mediated talks in Minnesota federal court, “The players have not negotiated since they decertified.”

To be sure, the momentum could turn on a dime, but a significant factor is driving both sides: What will the St. Louis-based 8th U.S. Circuit Court of Appeals rule?

It seems preordained that the judges will allow the lockout to stand, a position that likely motivates the players to get a deal done now, before any binding decision from the court that could restrict their decertification options. The judges in their May 16 stay decision argued that they thought a lower court erred in enjoining the lockout, and their questioning on June 3 of the players’ lawyer, Ted Olson, echoed that earlier ruling.

But for the league, there are potential pitfalls, as well. Could the court limit the length of the lockout? Or, might the court rule that the league’s exposure to the U.S. antitrust rules begins six months after the union’s March 11 decertification, leaving the NFL vulnerable to treble damages?

Judge Duane Benton sparred with NFL lawyer Paul Clement over when the players should be allowed to seek antitrust protections. The players have argued that the league’s labor exemption from antitrust should have ceased instantaneously on March 11, when the union decertified. The league, through Clement, argued for the first time that the protection should exist until at least March 2012.

Benton suggested six months. Dating from March 11, the resulting Sept. 11 date would fall on what would be the first Sunday of the regular season. That means while the judges could allow the lockout to continue, after six months, if the work stoppage is ruled an antitrust violation, the league could face steep damages.

Judge Kermit Bye, who dissented in the 2-1 stay decision, warned both sides at the close of the 69-minute hearing that neither might like the outcome of a ruling. Some NFL insiders viewed that simply as Bye trying to balance the leverage that has tilted toward the owners since the stay decision. He argued in his stay dissent that the players are suffering irreparable damages now. Perhaps, this theory went, knowing that he was outvoted, he was trying to scare the NFL into a deal.

But beyond the legal tea-leaf reading, each side is now staring at the reality of lost games and paychecks just months away. Perhaps more than any suggestive judicial comments, that could be enough to get the parties to the negotiating table.

NFL Players Association Executive Director DeMaurice Smith’s contract is due to expire March 14 next year, according to the organization’s annual report filed recently with the Department of Labor, meaning Smith could be up for re-election of the group not long after the labor strife between the league and players is settled.

The NFLPA paid Smith $1.53M and NFL Players paid him $920K in his first full year.
The NFLPA paid Smith $1.53 million in the year ended Feb. 28, 2011, his first full year as head of the organization, the report filed late last month with the Labor Department revealed. The group’s licensing arm, NFL Players, paid him $920,000, the annual report shows, for a total of $2.45 million. Like his predecessor, the late Gene Upshaw, Smith’s pay is shared between the NFLPA and the for-profit licensing unit.

The NFLPA decertified as a union March 11 after collective-bargaining talks with the league broke down. The next day, the league locked out the players. The league and players, with Smith serving as an outside counsel, were in secretive talks last week (see related story).

“His contract was obviously framed around these negotiations. He has to prove himself,” said Bill Gould, former National Labor Relations Board chairman and a Stanford Law School professor. “This whole process is a big test for him.”

The NFLPA, which is now operating as a trade association, did not reply for comment.

The decertification was designed to allow the players to legally challenge a lockout by the owners. An appeals court has allowed the now-three-month-old work stoppage to remain in place.

The players voted Smith to his post in March 2009, and he served for at least six weeks without a contract while he negotiated terms. The length of the contract had not previously been disclosed. A source familiar with that six-week period said Smith wanted a longer term, but the players did not wish to replicate the longer contracts that were held by Upshaw that they felt did not give them enough chance to review performance.

At the time of his death on Aug. 20, 2008, Upshaw held a five-year contract, according to the then-union’s 2006 annual report. Upshaw’s previous contract was a seven-year deal, according to the 2000 annual report.

The most recent annual report also shows that the NFLPA in the 12 months ended Feb. 28, 2011, paid former Smith employers Patton Boggs and Latham & Watkins $3.8 million in total for issues related to labor and public policy. Latham & Watkins earned more than $3 million, which is more than the $2.87 million paid to longtime outside counsel Dewey & LeBoeuf.

Latham & Watkins worked on the NFLPA complaint against the NFL that it had violated the CBA by requiring broadcasters to guarantee payments during a lockout. A federal judge agreed with the players.

The NFLPA under Smith also has engaged in extensive lobbying efforts in Washington, D.C. Patton Boggs, Smith’s employer at the time he won the NFLPA post, is a D.C.-based law firm with a specialty in lobbying.

The NFLPA spent $8.9 million across 25 firms in the 12-month period for matters related to the CBA, an analysis of the annual report shows.

Because the NFLPA decertified, it will no longer be required to file with the Department of Labor because it is not operating as a union. What is therefore perhaps the NFLPA’s last public annual report shows that the NFLPA’s commercial revenue rose to $129 million over the 12-month period, up from $119 million, largely because of a jump in video game and trading card fees.

The report also underscores how much of the NFLPA’s revenue is tied to the NFL. The league paid the NFLPA $50 million under contractually agreed terms for sponsorship and licensing rights as well as an annual payment from the 1993 settlement of that year’s antitrust case. Not including NFLPA proceeds from the sale of securities, the NFL payments represented 30 percent of NFLPA revenue.

Mark Steinberg, agent to Tiger Woods, said last week he plans to spend the next several weeks mulling myriad options for the next stage in his career, including joining an established agency, starting his own company, or joining with others to build a multisport agency.

Steinberg left IMG, where he started his career and was most recently head of the global golf division, on May 24. Under the terms of his contract, which had been set to expire June 30, he was not allowed to speak to any potential suitors until June 1.

“I abided strictly by the terms and covenants of my agreements,” Steinberg said in a telephone interview last week. “I didn’t talk to anyone until last Wednesday [June 1]. In the last week, I have been fielding calls. … It’s been very flattering.”

Steinberg said he has not made a decision on what he will do and may take several weeks investigating what kind of business structure he wants to work in as well as what kinds of people he wants to work with.

“I am going to listen and talk with all the potential suitors, and you know, I feel as though there is going to be a decision that just feels right, and when that time comes, I will make the decision,” he said.

Steinberg said media reports speculating about his next move, as well as dollar figures reported about his and Woods’ earnings and the circumstances under which he left IMG, have not been accurate.

IMG sent out a press release May 24 stating the golf division, which Steinberg headed, had been reorganized. IMG later confirmed that Steinberg was no longer an employee. Sources told SportsBusiness Journal that he met with IMG Chief Executive Ted Forstmann earlier that day in a 30-minute meeting in Forstmann’s office.

Steinberg said he did not want to get into the blow-by-blow details of what happened out of respect for the situation. “It was simple,” he said. “IMG put an offer on the table. We could not come to terms on a new deal. That was it. We parted ways.”

He did not offer any details about his and Woods’ earnings.

IMG declined to comment further on Steinberg last week.

Steinberg, 43, has worked his entire professional career at IMG. Woods revealed last week, via Twitter, that he would continue to be represented by Steinberg, tweeting, “Staying with Mark Steinberg. Total confidence in him. Excited about the next stage in my professional life. Fond memories of [IMG’s late founder] Mark McCormack.”

Steinberg said last week he was grateful for Woods’ loyalty and would consult with him on what he plans to do in the future.

Steinberg’s other well-known golf client is retired LPGA legend Annika Sorenstam. She has not yet decided about her future representation, Steinberg said. “Annika wants to wait and see where I end up,” he said.

Much of the speculation about where Steinberg may go has centered on CAA Sports and Excel Sports Management.
SportsBusiness Journal reported in 2008 that Steinberg had met with Creative Artists Agency President Richard Lovett then, before opting to sign the 2 1/2-year employment deal with IMG that was set to end June 30. Excel Sports is a New York agency formed by NBA agent Jeff Schwartz that recently added MLB agent Casey Close as a partner. Schwartz and Close both formerly worked at IMG.

Schwartz was unavailable for immediate comment about Steinberg. Officials from CAA Sports also were unavailable for immediate comment.

Steinberg said that he knows and likes Schwartz and Close but would not comment on speculation that he might go to that company or another company. He did acknowledge that he is looking at the potential of building a multisport representation practice in partnership with others.

Steinberg also said that in addition to the traditional sports representation firms, he has been contacted by entertainment firms without a sports practice, as well as private equity firms that could help him start his own firm.