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Volume 21 No. 2

Labor and Agents

Liz Mullen
Former NHL Players’ Association Executive Director Paul Kelly said he doesn’t think players will try to get rid of the salary cap and expects NHL owners to seek a greater share of revenue in negotiations for a new collective-bargaining agreement this summer.

“I don’t think there is any chance you are going to abandon or get rid of the salary cap in hockey,” Kelly said in a telephone interview last week. “So I think the big issue becomes really what percentage of the total revenues flow to the players — and whatever that number is dictates how high the salary cap is.”

The NHL CBA expires on Sept. 15, and the two sides are expected to begin bargaining after the NHL postseason. So far, neither the union nor the league has publicly stated what changes, if any, it is seeking in a new labor deal.

Kelly, who was NHLPA executive director for about two years, noted that in the new NFL and NBA CBAs reached last year after the leagues locked the players out, the percentage of revenue going to the players went down. Kelly expects that to influence the NHL negotiations.

Former NHLPA chief Paul Kelly thinks the salary cap is here to stay in hockey.
Kelly also noted that the same law firm that represented the NBA and NFL in collective bargaining and during the lockouts in those sports, Proskauer, also represents the NHL.

“Under the current agreement, [the players’ share] is 57 percent, but based upon the precedent that has been established in football and in basketball, where those numbers are down around 48 or 50 percent, there is no question that the management in the NHL will be looking to a similar level in the high 40s or somewhere around 50 percent,” Kelly said.

The NHLPA declined to comment on Kelly’s statements.

NHL Deputy Commissioner Bill Daly, asked whether the NFL and NBA lockouts had produced a new standard on how players should be paid, said via email, “I’m not prepared to comment on whether there is an established ‘industry standard.’ Those leagues and the players in those leagues did what they did in collective bargaining. At the appropriate time, our League and our Players will do what we need to do, and I’m sure that there will be many factors — both internal and external — that may play into that.”

Daly added that no formal bargaining sessions have been scheduled. “As we have repeatedly made clear, we are prepared to engage whenever the Players’ Association wants to — whether that’s before the Stanley Cup is awarded or after is really up to the Players and their representatives,” he said.

Both Daly and NHLPA Executive Director Don Fehr said in September that they expected to begin formal negotiations for a new CBA over the winter. Later in the year, Fehr said he expected to begin negotiating after the All-Star Game in late January.

Said Kelly, “They appear to be waiting a little bit late in the day to start the dialogue — which if they don’t start the discussion until when the playoffs have concluded … they are not leaving themselves … a lot of wiggle room in terms of the calendar.”

Kelly was NHLPA executive director from October 2007 until August 2009, when he was fired by the players. He resigned in February as executive director at College Hockey Inc., a group that aims to raise awareness about college hockey for the sport’s elite players. Kelly had been with that group since late 2009.

Last week, Kelly started a new job as a partner in the sports law practice in the Boston office of national law firm Jackson Lewis. Prior to working at the NHLPA, Kelly was a trial lawyer and a former assistant U.S. attorney.

“Jackson Lewis typically represents larger employers and in the sports industry would represent teams, leagues, prospective franchise owners, colleges, and individual arenas and facilities,” Kelly said. “Basically, they do the opposite of unions: representing management on the professional level.”

Gregg Clifton, a longtime MLB agent, left the former Gaylord Sports Management (which was acquired by Lagardère Unlimited earlier this year) in 2010 to become chairman of the then-fledgling sports practice of Jackson Lewis. “We are doing arbitration for two major league [team] clients [and] a lot of immigration for NHL as well as MLB clubs,” Clifton said. “We are thrilled to add someone with his experience in sports and law to our team.”
WASSERMAN SIGNS GOLFERS: Wasserman Media Group has signed new pro golfers Kelly Craft, who made the cut at this year’s Masters as an amateur, and reigning British Amateur champion Bryden Macpherson. Terry Reilly will represent Craft, who recently signed a multiyear, full equipment and head-to-toe apparel deal with Callaway Golf. Agent Bud Martin will represent Macpherson.

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

NFL clubs historically have waited until July to start signing first-round picks. This year, that process was starting early last week, only a few days after the draft, with a few general managers, agents said, looking to get their top picks signed.

“A club called me and said ‘Let’s get started on [a first-round pick],’” said one veteran NFL agent. “He was aggressive. He said, ‘I want to get my guys done. I am going to have my other guys done this week. Let’s try to get them done before the mini-camp.’”

This agent, who asked not to be identified, said he had never received a call from a club general manager about a contract for a first-round pick so early.

The agent for No. 1 overall pick Andrew Luck is already in talks with the Colts.
Will Wilson, Wasserman Media Group agent for No. 1 overall pick Andrew Luck, said, “We are in contact with each other and discussions have begun,” regarding a contract for Luck with the Indianapolis Colts.

Not all agents, however, had heard from NFL clubs about first-round picks as early as last week. One agent, after saying he hadn’t been contacted, added, “There’s no reason they shouldn’t all be signed now.” This agent said there is a lot less to negotiate for first-rounders under the new collective-bargaining agreement than there was previously — with first-round player deals limited to about half of what they were under the old CBA. Additionally, with the NFL having expanded rosters from 80 to 90 players this year, agents as well as a general manager said one of the effects of the increase is that clubs could move to sign high draft picks earlier than in the past.

CAA NO. 1 AGAIN WITH NO. 1s: In the six years since Tom Condon and Ben Dogra joined CAA Sports, the agency has led all others in representing the most first-round picks. The firm did it again this year, with seven picks — but with some help from new partner Jimmy Sexton, who joined CAA Sports in November.

Sexton represented four of CAA Sports’ nine overall picks. “He has been a great partner,” Condon said. “He was really productive. He was the lead guy on four of our draft choices.”

CAA Sports holds the record of first-round picks represented by a single agency, with nine in 2009. Both Condon and Dogra said they were not trying to break their own record this year and were happy with their draft.

CAA Sports also represents Joe Long, brother of client Jake Long, the Miami Dolphins offensive tackle who was picked No. 1 overall in 2008. Joe Long signed a deal as an undrafted free agent with St. Louis last week.

“I think we had a good draft because we represent some really high-quality guys who we think have a chance to be some really high-quality football players,” Dogra said.

SPORTSTARS LEADS IN OVERALL COUNT: Sportstars represented the most overall draft picks this year with 20. It was one of the best drafts for the agency, which represents about 100 players in the league.

Founder Alan Herman said he thinks the overall quality of his agency’s draft this year may be better than it was in 2006, when it had 22 players drafted, but the real answer won’t be known for several years.

“Quality is, Where are we four years from now and how many of these guys are starting players in the National Football League, commanding significant salaries?” Herman said.

Wasserman Media Group is expanding its golf business by forming Wasserman Golf, giving the practice its own balance sheet while pressing forward with new hires and potentially new lines of business within the sport, such as event management and ownership, media rights and content creation.

In the last month, Wasserman Golf has made three key hires for newly created positions, including Barry Hyde, who was lured over from the U.S. Golf Association after seven years as CMO of the governing body. More hires are coming, both in the U.S. and internationally.

Wasserman Golf President Malcolm Turner, who is spearheading the new moves in the space, said the agency is “doubling down on that commitment to golf,” which over the last five years largely has been built with acquisitions in the consulting and player management business, where the agency has established a foothold in the sport.

Turner, who came over with the OnSport acquisition five years ago, will continue to oversee the golf consulting, while John Mascatello, executive vice president of player management, will oversee the agent business.

Hyde, also an executive vice president, will be in charge of business development, seeking new lines of revenue for Wasserman’s golf practice.

“Golf has been a significant part of our business and, given the opportunities we see in the marketplace, we’re looking to assert ourselves even more,” said Turner, who did not discuss details about the size of Wasserman’s golf business.
Wasserman’s “doubling down” comes at a time when the agency landscape in golf is changing.

The longtime leader in the space, IMG, is going through changes that have many in the industry wondering where the company’s golf division is headed. In the past year, IMG has parted ways with three longtime key players: Mark Steinberg, Bart Kendall and most recently its co-chief of IMG Golf Americas, Jon Wagner.

CAA Sports, like Wasserman, charged into golf last year with the addition of former USGA executive Pete Bevacqua and the October acquisition of MG Sports, which immediately gave it a deep stable of consulting clients in the sport.

GMR Marketing, another agency that has played on the fringe of golf, also has expressed an interest in moving deeper into the space. GMR is scheduled to host an industry party during The Players Championship this week as a way of proclaiming its desire to do more in golf.

“There is a significant opportunity right now in the agency space for somebody to take advantage of these changing times,” said Tom Knapp, senior vice president at Golf Channel. “There’s no question the sphere of influence has shifted.”

Wasserman’s Turner said the move to a specific golf division follows the successful model the agency created for action sports and soccer.

“We have a very strong core foundation within [player] management and consulting, but we believe there is a lot of room for growth in other areas,” said Turner, who cited media rights, events, licensing and unique content as areas where Wasserman Golf will forage for new business. “As we build our team, we’re also going to be active in exploring growth opportunities internationally.”

One event already is emerging from the broader focus. Wasserman will manage the new Suzann Pro Challenge, a four-player event in Oslo, Norway, in September. Wasserman is selling the title sponsorship and other sponsorship packages. Proceeds from the event will benefit Right To Play, an international humanitarian organization for disadvantaged children. Tournament host Suzann Pettersen is an ambassador for the nonprofit.

“We expect a variety of business development initiatives to grow out of this new structure,” Turner said.

The projected growth in events, media rights, content and other lines of business is intended to take Wasserman Golf beyond its core strengths in consulting and player representation.

Wasserman’s golf practice was built primarily through the acquisition of Gary Stevenson’s OnSport in 2007 and SFX’s agent business last year, giving it a stronghold in consulting and player management. Through the SFX acquisition, Wasserman brought about 20 new employees on, and three new positions have been created and filled in the last month in New York.

Wasserman continues to build out the practice by realigning certain executives internally and making “both strategic and opportunistic hires,” the agency said.

The consulting business in golf — clients include Northern Trust, Nationwide, Travelers and American Express, among others — used to roll into the larger Wasserman consulting practice. Similarly, the agency’s golfers — Rickie Fowler, Hunter Mahan, Kyle Stanley, Zach Johnson and more — formerly rolled into the larger athlete representation portfolio.