OT - Appeals Court Likely to Rule for the NFL Lockout to Continue

Submitted by Marley Nowell on

http://sportsillustrated.cnn.com/2011/football/nfl/06/03/labor.ap/index…

The arguments came before a three-judge panel of the 8th U.S. Circuit Court of Appeals whose two earlier 2-1 decisions have sided with the league and upheld the lockout.

Judges Steven Colloton and Duane Benton wrote for the majority then that "the league has made a strong showing that it is likely to succeed on the merits." Bye dissented both times, favoring the players.

Colloton and Benton - appointed by Republican President George W. Bush - were outspoken Friday, peppering Olson and Clement with requests to elaborate on legal points and precedents. Bye, an appointee of President Clinton, a Democrat, offered the opening welcome to the crowded gallery, but remained mostly quiet.

Clement (NFL lawyer) insisted the Norris-LaGuardia Act bars court injunctions in cases arising from a labor dispute, which he maintained was in play here. He said Nelson's decision ran afoul of that statute.

"Ultimately, collective bargaining is a much better way to resolve these disputes than antitrust litigation," Clement said.

Callahan

June 3rd, 2011 at 9:28 PM ^

Without going too far into it, I watch an awful lot of appellate oral arguments. While that may in fact be the result, going by who is asking questions is not a good way to predict. Some judges just have a better grasp of certain areas of law and know which questions to ask. Some judges simply don't ask questions. (Clarence Thomas hasn't spoken in court for five years.)

ixcuincle

June 3rd, 2011 at 9:41 PM ^

Although I am a college football fan, it would still be disappointing if the 2011/12 season was canned. Both college and pro football are highly entertaining.

 

UMfan21

June 3rd, 2011 at 9:54 PM ^

I'm new to the legalities of lockouts...is there anything preventing the players from just forming their own league (like the AFL)?

Vivz

June 3rd, 2011 at 10:20 PM ^

it would take an incredible amount of capital to secure stadiums, sell tickets, get coaching staffs.

The big kicker is money comes from the networks, who would be pressured by current owners to avoid entering any agreement with the startup league.

If 30 some new billionaires wanted to start a league it would be possible, just extremely difficult. The lockout would (should) be resolved before something like that would ever occur.

UMfan21

June 3rd, 2011 at 11:36 PM ^

I would think with the formation of a new league, stadiums would be DYING to give cut-rate deals so they don't sit there empty.

Networks and coaches may be pressured by the league, but in the end, all the NFL is really is a brand.  It's the players that people pay to see.  The money would follow the players.  If CBS/ESPN get pressured by the league to not do TV contracts, I'm sure a TBS or some other network would step up.  Yes, it would be a fraction of the current costs, but maybe the short term loss would be worth it for the long term reward of having these disputes every few years.

I agree the lockout will be resolved, but I just wondered if legally they could do this.  It seems to me the players hold more leverage than they are exercising.  But maybe that's my biased opinion since I side with the players, not the owners.

Vivz

June 3rd, 2011 at 11:51 PM ^

i disagree that players are the only things that put fans in the stands. Some people are simply fans of professional football, while others are tied to their hometown teams.

Take the lions of the past 10 years, at various times people went to games to see out of town teams, the new stadium, or merely support their traditional team. These teams had few identifiable players, and yet people still paid attention to the lions by going to games or investing 4 hours watching on the tv.

Stadiums would seek new tenants from the new league, but that would have to be after the NFL would dissolve, most are leased by their respective franchises, i merely was pointing out that there would be anumber of hurdles to starting a new league.

In short it takes money to make money, and professional sports is a business. I don't see players forking out their own money to try to start a new league.

wolverine1987

June 4th, 2011 at 10:49 AM ^

Your opinion is correct of the two IMO. While you can't deny that some fans come out to see certain players, team loyalty and other factors, along with simply watching great athletes play at the highest level, are much more of a reason for pro football's stature than a few star players. It's the same in college, to an even greater degree IMO. You could replace the entire starting lineup of Michigan's team with unknowns, and there would still be 105,000+ in the seats.

BluePants

June 3rd, 2011 at 10:49 PM ^

This is a really solid article from the National Law Journal explaining the legal issues and arguments in the case. I apologize for the copy & paste of an entire article- the article is only open to (free) subscribers. If a mod wants to drop it, by all means. Additional apologies for the lack of formatting (ipad). All-Pro quarterbacks Tom Brady, Drew Brees and Peyton Manning will play defense in St. Louis on June 3 as they face National Football League owners in a legal challenge that could decide the fate of the 2011 season. The players are defending on appeal a district court's preliminary injunction halting a lockout imposed by the owners. The lockout came after negotiations on a new collective-bargaining agreement fell apart, and players decertified their union. In Brady v. NFL, the players contend the lockout violates federal antitrust laws. Ten players in all are listed on the complaint, chosen because they collectively represent all of the subclasses — players under contract (like Brady), free agents (like Manning) and rookies (like Von Miller). A three-judge panel of the U.S. Court of Appeals for the 8th Circuit will hear arguments. The judges recently signaled that their sympathies may lie with the owners, ruling, 2-1, on May 16 to stay an injunction pending the outcome of the owners' appeal. The majority said the owners' arguments that the injunction was illegal were likely to succeed. However, the game is not over yet, said sports law scholars, many of whom agree that this legal fight, involving the intersection of antitrust and labor law, may be the most complex labor battle in American sports history. "What makes it so difficult is that the traditional rules and roles in antitrust and labor law don't apply in this context," said Robert Boland, an antitrust and labor law expert at New York University's Preston Robert Tisch Center. "Talk to management-side lawyers and tell them their union was going to decertify, and they would throw a party; they'd never protest it as done here," Boland said. "Second, in most antitrust situations, you never have management arguing that labor law is important. You've never had both these issues come up together in sports. Then you also have to balance the whole equity of any public interests that might be involved." At the courtroom tables for both sides will be their veteran, first-string lawyers and two all-stars. The league owners have long-time counsel Gregg Levy of Covington & Burling and Daniel Connolly of Faegre & Benson. David Boies of Boies, Schiller & Flexner also was signed for the dispute. On the players' side are Jeffrey Kessler of Dewey & LeBoeuf and James Quinn of Weil, Gotshal & Manges, with experience representing nearly every sports union. At the court lectern will be two former solicitors general of the United States: For the players, Theodore Olson of Gibson, Dunn & Crutcher, and for the NFL owners, his successor in office, Paul Clement of Bancroft. "Most sports cases never get to a decision on the merits," Boland said. "They usually begin as a battle about who has short-term control, and so an injunction becomes of heightened importance in a sports case. This is largely a game of leverage." SEEKING LEVERAGE The 8th Circuit panel faces the difficult question of whether labor law or antitrust law prevails. The district court found that the players' case did not involve or grow out of a labor dispute, because the players were no longer represented by a union. The union had been dissolved. If the collective-bargaining relationship was over, the main labor law, the Norris-LaGuardia Act, did not apply. That was bad news for the league because, once the labor relationship ended, it could no longer claim the protection of the so-called "nonstatutory labor exemption" from antitrust liability. The players' antitrust suit could move forward under the Sherman Act. But if the Norris-LaGuardia Act doesn't require the presence of a union for a labor dispute to exist, the law strips the district court of jurisdiction to enter an injunction. The antitrust suit would be stayed pending a decision by the National Labor Relations Board. And in turn the NLRB would decide the league's unfair-labor-practice claim that union decertification was a sham designed to gain leverage. "The big issue is: When can a union call a halt to themselves effectively, if ever?" NYU's Boland said. "That's always been left open by the Supreme Court in Brown v. Pro Football. There is a moment, but not a lot of guidance in the cases." Leading up to the "moment" for the players was the NFL's decision in May 2008 to exercise its right to opt out of the last two years of the collective-bargaining agreement. The players and the league unsuccessfully negotiated for two years prior to the March 11, 2011, expiration date. As the expiration date drew near, the league indicated it might use a lockout of the players as a bargaining tactic. The players, believing they would be at a disadvantage if they remained unionized because the league could impose anti-competitive restrictions on them, disclaimed the union at 4 p.m. on March 11. They filed a lawsuit on the same day contending that the threatened lockout would violate federal antitrust laws. They sought a preliminary injunction against a lockout. The next day — March 12 — the league imposed the lockout, prohibiting players from, among other things, entering team facilities and receiving compensation or health insurance benefits. The league also filed the unfair-labor-practice charge with the NLRB, alleging a sham union decertification. The district judge, concluding that harm to the players from the lockout outweighed any harm an injunction would cause the league, imposed the preliminary injunction on April 25. "Getting an injunction is really hard," said Michael McCann, director of the Sports Law Institute at Vermont Law School. "From that vantage point, the league has the stronger argument because the threshold is very high, and there are case precedents that lockouts are legal. On the other hand, there has to be irreparable harm. The players have the stronger argument on who is harmed." LABOR V. ANTITRUST Bolstering the league's appeal are amicus briefs from the U.S. Chamber of Commerce, represented by Stephen Kinnaird of Paul, Hastings, Janofsky & Walker, and the National Hockey League, represented by Shepard Goldfein of Skadden, Arps, Slate, Meagher & Flom. The players draw support from 32 local elected officials and small businesses that host NFL games and draw revenue from their offshoots. Their brief was authored by Mark Stancil of Robbins, Russell, Englert, Orseck, Untereiner & Sauber. The Major League Baseball Players Association, National Basketball Players Association and National Hockey League Players Association also weigh in with a brief by their association counsels. The Sports Fan Coalition, represented by Daniel Shulman of Minneapolis-based Gray Plant Mooty, and the NFL Coaches Association by Barak Richman of Duke Law School, filed briefs as well. THE LEAGUE'S ARGUMENTS In the NFL appeal, the league's lawyer, Clement, argues first that the Norris-LaGuardia Act, "in broad and unmistakable terms," strictly limits injunctions in cases "involving or growing out of" a "labor dispute" and prohibits injunctions against any lockout. The origins of this case, he wrote, "self-evidently" grow out of a labor dispute. The validity of the union's decertification, he also argues, is "squarely within the heartland" of the NLRB. The case, he wrote, satisfies the U.S. Supreme Court's criteria for deference to the primary jurisdiction of an administration agency. Finally, Clement wrote that the nonstatutory labor exemption from antitrust laws applies and continues to apply "unless and until there is sufficient distance in time and in circumstances from the bargaining process." There was no such distance here, he argues, adding that the antitrust suit was filed within minutes of a negotiating session. The exemption can only be ousted by a valid union decertification and that, he wrote, cannot be decided without the views of the NLRB. THE PLAYERS' CASE Olson, the players' counsel, counters that the labor act does not apply in the absence of organized labor activity. The collective-bargaining relationship here ended when the union was decertified. The players' case also does not "grow out of" a labor dispute, he wrote: "The statutory definition of 'grow out of' makes clear that the phrase expands the universe of parties who can invoke the [Norris-LaGuardia Act], but does not expand [Norris-LaGuardia's] reach to cases where no 'labor dispute' exists." Olson argues that the NFL demanded the formation of a new union in 1993 as a condition of settlement of antitrust claims in order to obtain the benefits of the nonstatutory labor exemption. The players, he wrote, reluctantly agreed but insisted that the NFL waive any challenge to the validity of any future dissolution of the union. That waiver is expressly set forth in the most recent collective-bargaining agreement. The players voted "unequivocally and unconditionally" to end the players association's status as a union at 4 p.m. on the day the bargaining agreement expired, Olson wrote. "The dissolution was complete and effective, and it left the players unprotected by a union but at liberty to protect their rights under the antitrust laws." The two lawyers disagree on which party faces the greater harm if a lockout or an injunction prevails. Michael LeRoy of the University of Illinois College of Law said the 8th Circuit panel was correct in its analysis of why the league is likely to prevail on the merits. "The players' weakest argument is the sham nature of the decertification," he said. "This is a bald attempt to use negotiating in a federal court in place of negotiating at the collective-bargaining table. "The NFL has a strong legal case; their problem is jurisdiction. They're in the wrong court," he said, adding that he has researched 80 different published cases of this nature in professional sports and the district court in Minnesota is "far and away the most congenial to players associations and individual members." NYU's Boland said he thinks the district judge "got it right. But it's a very close call. It's almost like a law school problem: It's 49-49, and you can tip it based on your own thinking. The NFL's argument is not the most compelling argument but it's a legitimate one. If the union had been decertified for six months to a year, I don't think there'd be much doubt. While I'm not convinced it's a sham, there may have been formalities that weren't observed. We're in gray areas on both sides." Experts and other observers, however, agree the dispute will settle. "The main issue is whether it settles at a collective-bargaining table or at a table in the courthouse," LeRoy said. "If at the bargaining table, the NFL gets a good deal; if it settles in a courthouse, the players get a good deal. That's the issue." Courtesy: National Law Journal

BluePants

June 3rd, 2011 at 11:52 PM ^

I SAID I WAS SORRY! /s I know it's an obnoxious wall, but it was the only way I could get the article onto the site without giving you access to my account. Basically, this case is kind of the antithesis to the standard labor dispute. Management is arguing that the decertification of the NFLPA was a "sham" and that the present situation thus stems from a "labor dispute.". By arguing this, the NFL is demanding that the decertification be reviewed by the NLRB. If they win the argument on a "sham decertification," it will mean the injunction is illegal according to Norris-LaGuardia. The players are arguing that the dissolution is legitimate, and that the NFLPA no longer is their sole representative. Thus, they're arguing that the NFL is a giant walking monopoly and is violating antitrust law by locking them out. The battle, ultimately, is over where the dispute is settled: if the NFL wins and the injunction is tossed, the lockout will continue and it will be negotiated at the mediation tables. If the players win, it'll be worked out in court.

Waters Demos

June 3rd, 2011 at 11:32 PM ^

A court won't inject itself into a labor dispute, i.e., a dispute between an employer and an employee, especially when there's a governing collective bargaining agreement.  The most a court will do in this scenario is construe that agreement.  So even if there's an antitrust issue (e.g., restraint of trade [though I'm not sure that this is the exact issue here]) lingering beneath the surface, the court will stay out of it.

The question here is whether there is an employer-employee relationship/dispute in light of the alleged dissolution of the players' union. 

If the employer-employee relationship persists, then a court will not hear the antitrust issue.  If not, then the court can hear the antitrust issue.  So right now, it's a threshold issue.  At least based on this article.

It's Friday - fuck this, I'm supposed to be forgetting about this kind of shit until Monday. 

JohnnyV123

June 4th, 2011 at 3:23 AM ^

I loved that amicus curiae briefs were filed from the NHL on behalf of the owners and the NHLPA on behalf of the union. NHL lockout on the way?

From all this I think with a strict interpretation I agree technically the owners should win. But I myself am more of the opinion that if you reach a ruling without considering the rational and actual consequences of a decision you haven't done your job as a judge at all. I would rule in favor of the players union because of the greater damage they receive from a lockout.

Still I can't really blame the two judges for thinking different than me. Hope it all gets worked out and we have a season.

DLup06

June 4th, 2011 at 8:10 AM ^

The waiver of challenging decertification tipped it the other way for me...I see the waiver stopping the owners from making a good faith argument to the NLRB. Without that, the Court should not presume that decertification was a sham. But like the article said, 49/49 with your decision swayed by your background. Damned law school hypotheticals coming true

illinoisblue

June 3rd, 2011 at 11:48 PM ^

This has gotten ridiculous. It has become a big pissing match between the rich and the richer. If this isn't resolved soon there will be a continued lack of interest by fans. There was already an article about fans not visiting NFL sites and lack of interest in this years draft. The longer it continues the more they will end up hurting themselves.

mtlcarcajou

June 3rd, 2011 at 11:59 PM ^

And their near-suicidal lockout. Fan interest is hard to rebuild.

Of course, the players can always say forget it and sign up in the CFL. Great...er, great...er...

Anyway it's football. Kind of.

foreverbluemaize

June 4th, 2011 at 12:06 AM ^

 I run a printing press that prints beer cartons for companies like Miller and Budweiser. Every year we make a large sum of money  printing several different  NFL team cartons. This morning I learned that due to the lockout the beverage companies may not be ordering these millions of dollars worth of cartons. Obviously you can't blame the beverage companies  but stuff like this does really upset me that  the NFL's minimum salary of $350,000 per year is just not enough. Not saying they haven't earned it but for crying out loud shut up and get out there and play some football or step aside and I'll do it for half that.

clarkiefromcanada

June 4th, 2011 at 12:31 AM ^

Sad to hear about your potential business loss.

That said, it's a lockout by the owners and not a strike by the players. I won't go through the rationale on the lockout other than to say that it was clear for about two years (given the timeline of the labour negotiation) that the league's intention was to lock out it's players and effect a new economic agreement more favorable to their smaller market teams. 

At this point, the owners do not have a uniform revenue sharing agreement and "secondary revenue" such as that accrued via stadium revenue streams is not shared. Accordingly, teams like Dallas with newer and flashier venues make money like crazy while teams with smaller markets and less local revenue opportunities make less money. Since the owners seem unwilling to work it out among themselves on these issues they have determined to look at solidifying their revenue streams via player compensation and making this more clear and more consistent with previous agreement(s).

At the end of the day, the average player's career is 4 years; even at $350k per year that's not a lot of time to earn a lot of money given the long term effects, physically, of an NFL career. As much as I feel for your business loss I think your anger is perhaps a bit misguided. It's not the players who appear to have chosen this road; rather, the owners saved a giant war chest to fund the lockout and essentially break the union (has worked out less well then their plans).

GWUWolverineFan

June 4th, 2011 at 10:22 AM ^

Dude. The lockout does have to do with compensation to players.
<br>
<br>And in a 4 year career making the minimum you would have roughly 1 million dollars after tax.
<br>
<br>That is absolutely plenty to pay for amazing health care for the rest of your life barring some major catastrophic issue. Not every 4 year bench warming dude is a cripple at 30.
<br>
<br>While those cases are sad I do not hear Drew Brees and Payton paying for medical care for the retired players. Their salaries are directly related to those old guys who worked off season jobs to play in the league just like how the owners profits increased because of those guys.
<br>
<br>The debate is getting silly, and the players would have gone on strike, the owners used a lockout to preempt it.

el segundo

June 4th, 2011 at 10:38 AM ^

I don't have much patience for the argument that the players should just take what the owners offer because they make plenty of money already.

This argument overlooks two things:  (1)  that the owners' current bargaining position is that overall player compensation should be cut; (2) the owners are making plenty of money too.

The labor dispute is about how to fairly allocate the enormous profits that the NFL generates -- not about whether NFL players' salaries are enough to live on (and buy lifetime health insurance with). 

Considering how much owners make and how much their franchise value continues to increase, I'd rather see the players keep the share of revenue that they're currently receiving.

mdm87

June 4th, 2011 at 1:22 PM ^

I'm not on either side here, but I don have some general thoughts. Both sides are greedy as hell (taking sides and arguing about which side is less greedy is pretty silly, in my opinion). I want to feel bad for the players and jump on their side, but they are making it extremely difficult. They already had an extremely favorable deal (which is why the owner's opted out as soon as they gained some leverage and the players just want things to stay the same) and seem unwilling to give anything. Now don't get me wrong, I don't think the owners are moving from their originial demands as much as they claim; but by all accounts, the players aren't moving at all on their demand that everything stays the same. There were rumors yesterday that the owner's were going to back off their demand for an extra $1 billion. Hopefully, that is true and we can get a deal sooner rather than later.