Sports Law Blog
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Friday, August 26, 2016
 
The Business of Amateurs: Suffering Student-Athletes and a Thriving NCAA



The NCAA frequently lauds amateurism and the ideal of the “student athlete.” But in contrast to this idyllic conception, college football is big business. And it is built on the backs of gladiators, football (and basketball) players who are often forgotten, disposable cogs in big-time college sports.
Such is the story Bob DeMars masterfully weaves in The Business of Amateurs. The former USC football player takes viewers on a tour of the college football machine—its gold-plated, garish facilities and its coaches with million-dollar contracts and reimbursed country-club fees.
On the other side of this excess, however, is the players’ penury. More than 80% of student-athletes live below the federal poverty line. While the fair market value of a Division I football scholarship is $137,000 and a basketball scholarship is $290,000, the average scholarship a student receives is $23,000. The players who never play after college (or have short professional careers) have their highest value when they are in college. But beyond educational expenses, the NCAA prohibits payment. In fact, the ongoing O’Bannon case against the NCAA famously was triggered by the UCLA basketball star’s seeing a near-exact replica of himself in a video game, not receiving a penny from the resulting significant revenues.
If not money, what does the student get in return for filling the school’s coffers? Often, not an education. DeMars highlights UNC, with its fake classes, spoon-fed answers, and predetermined majors, which are selected not because of a student’s interest but because they fit the athletic schedule. Although NCAA rules prohibit student-athletes from spending more than 20 hours per week on their sport, they often spend double that. Yes, there are successful student-athletes. But as these individuals attest in the movie, they are the exception, not the rule.
Surely, the student-athlete at least gets the certainty of knowing they have a scholarship for four years and their health-care costs covered, right? Well, not really. DeMars recounts the players who have had scholarships revoked for being injured, as well as those who are ungraciously denied health-care coverage for injuries suffered during practice or games. Yes, even those practices in which (despite serious injuries) they are forced to participate. Perhaps in response to recent developments like the O’Bannon lawsuit and Northwestern unionization attempt, these practices are changing. But it should not be controversial to apply them to all student-athletes.
The greatest harms appear in the former student-athletes in their 40s, and even sometimes 20s and 30s: the ones addicted to pain medicine; those not able to hold a steady job; the alcoholics; those suffering from dementia; and those who are depressed and even take their own lives. DeMars talks with leading doctors who explain the science behind the degenerative “CTE” disease from repeated blows to the head, ALS (Lou Gehrig’s disease), concussions, and the 900-1500 “subconcussions” football players suffer each season.
As a result of these findings, the NFL has limited hits in practice. But the NCAA, ironically enough founded as an organization to promote safety, has not, “den[ying] that it has a legal duty to protect student-athletes.”
In the past few years, stories about student-athletes as impoverished cogs in the NCAA’s billion-dollar big business machine have spread. DeMars adds to these stories. And he offers a particularly sobering perspective by focusing on the former players whose lives have been upended—if not ended—by injuries. It doesn’t seem right for these gladiators to become a shell of themselves while the NCAA is exploiting their successors for billions. Reform is desperately needed. For everyone who benefits from the gladiators in the ring every week, that is the least we can do.

Thursday, August 25, 2016
 
The Future of College Athlete Players Unions

With today marking the start of the new semester at Baruch College and my first day as a tenured, full Professor of Law, it is my great pleasure to release my newest law review article, "The Future of College Athlete Players Unions: Lessons Learned from Northwestern University and Potential Next Steps in the College Athletes Rights Movement."  The article will be published in Volume 38 of Cardozo Law Review.
  
Here is the abstract:
This article explores the future prospects for organizing Football Bowl Series football and Division I men’s basketball players after the National Labor Relations Board’s decision in Northwestern University.  Part I of this article provides a brief overview of U.S. labor law and introduces the unique labor dynamics of big-time college sports.  Part II explores labor organizers’ recent attempts to unionize the grant-in-aid football players on the Northwestern University college football team.  Part III describes potential strategies for unionizing alternative bargaining units of elite college athletes.  Finally, Part IV analyzes the interplay between unionizing college athletes and challenging the NCAA’s restraints on college athlete pay under Section 1 of the Sherman Act. 
And here is a link to the full article.

Wednesday, August 17, 2016
 
More sports rules and perverse incentives

Good stories in Slate and NY Mag about the zero-tolerance false-start rules in Olympic track, under which a racer is disqualified if he false-starts. This is the third version of the Olympic rule. Pre-2003, each runner was allowed one false start and was disqualified only on the second. In 2003, the rule was changed to give the entire field one false start, with a DQ imposed on whoever does the second false start. The current rule was enacted in 2010, making this the second Olympic games under that rule; we have seen two DQs this week, although not by any favorites. Usain Bolt wass DQ'd under the rule at the 2011 World Championships, the only Olympic or world championship final he has lost since 2008. French hurdler Wilhem Belocian was DQd earlier this week and was seen falling to the track in tears, but he had qualified seventh out of eight runners.

The 2010 rule change was designed, at least in part, to eliminate perverse incentives. Slower runners would intentionally false start, using up the "freebie" for the field. This forced faster starters and runners to be a bit more cautious, and thus to hesitate just a bit off the blocks, lest they pick up that second false start that would disqualify them. The new rule eliminates the intentional false start by eliminating the benefit, and thus the incentive, for the slower runner to do this.


This sounds a bit like the logic behind the Infield Fly Rule: 1) Runners were gaining a potentially big advantage (slowing down the fast starters/runners) through the intentional false start; 2) The faster runners could not really counter this move, except perhaps by not false-starting following the intentional freebie; 3) slow runners were intentionally acting contrary to expectations (you do not want to false start); and 4) the advantage offered a perverse incentive to the slower runners to intentionally false-start (although not a great one--the trick did not work very often). The second prong is weak--the faster runners could counter the strategy by not false-starting, something they could do more easily than runners can avoid a double play on an uncaught infield fly. But this is an interesting comparable situation that is worth including in my discussion of similarly justified rules in other sports.

This situation shows the role that aesthetics play in creating sports rules. Rulemakers could have disincentived intentional false starts by returning to the old rule of giving every runner one freebie. But that old rule created problems of multiple false starts by multiple runners, causing long delays, fan boredom, and television overruns. So the new rule, while harsher, is aesthetically favorable to the sport.

Finally, runners and rulemakers have minimized the effect of the harsh rule. All runners slow down their starts a bit to avoid the risk--Bolt, never a fast starter, has slowed his start even more, relying on his remarkable ability to dominate the last 30-40 meters (as he did in winning gold in the 100m this week). And the rulemakers narrowed what qualifies as a false start to exclude flinches and twitches, so a runner false-starts only if his feet leave the starting blocks or his hands leave the track.

Tuesday, August 16, 2016
 
Further Thoughts Midway Through RIO 2016

Despite all the naysayers, including me, and dire predictions, the Rio Olympics thus far seem to be rather successful. Michael Phelps and Usain Bolt surely will be remembered 84 years from now when Sports Illustrated opines as to who was the greatest athlete of the 21st Century. (Assuming SI still exists in one form or another.) And Simone Biles demonstrated how far women athletes have come in the last quarter century in demonstrating not just grace but strength and power on a par with any of her male counterparts.

Still, there have been a few low points. First, was the action of the Olympic Committee punishing non-offending Russian Athletes for the sins of their predecessors. Even worse was the despicable behavior of certain athletes from Arab countries manifesting everything the Olympics is not by refusing to either shake the hands of or even compete against Israeli athletes.

I cannot remember any prior games where coaches and athletes complained of being mugged, or of contracting illness from the polluted water venues, or of having to wear protection six weeks after the games to ensure they don’t pass on the Zika virus to their mates when they return home.

Speaking of which, pole vaulter Hiroki Ogita is certain to replace Eddie “the Eagle” Edwards as the athlete achieving the most fame for Olympic failure. In the first round of the competition, on his attempt to clear the bar at 17 feet, 3 inches, it seems Mr. Ogita brushed the bar off its moorings in a rather impressive fashion:

 

Let’s avoid the junior high humor and not even mention this is why Milton Berle gave up pole vaulting for a television career.

Thursday, August 11, 2016
 
New York May Be The Perfect PASPA Challenger

I met New York Assemblyman J. Gary Pretlow at a gaming industry conference in Boston last week. Mr. Pretlow, the chair of the Assembly's Racing and Wagering Committee, moderated a panel at the National Conference of Legislators from Gaming States (NCLGS) Summer Conference devoted to two subjects near and dear to my heart -- sports betting and daily fantasy sports. Over the course of a long weekend, Assemblyman Pretlow and I indulged in a shared passion--cigars (he brought his own bag of hand-rolled cigars to the conference!). He invited me to join him for cigars on his hotel room balcony, and, inevitably, the conversation turned (or, rather, I steered it) to sports betting. I explained why I believed that New York State--which was on the verge of legalizing daily fantasy sports--would be the perfect state to challenge the federal ban on state-sponsored sports betting. Assemblyman Pretlow was listening intently to my pitch, and I could tell he was interested in the topic. Fast forward eleven days later, and Assemblyman Pretlow, who was in attendance at another gaming conference at which we both spoke (the Saratoga Institute on Equine, Racing and Gaming Law) told GambingCompliance reporter Sara Friedman that he would be "looking at challenging the feds" on the Professional and Amateur Sports Protection Act, the 1992 federal law which prohibits states from legalizing sports betting. He told Sara not to be "surprised if you see a state like New York put through legislation on this very shortly," but that he had "more homework to do." Hey, homework is my specialty!

In many ways, New York is the perfect state to challenge PASPA. As Ms. Friedman notes, New York lawmakers have already agreed to legalize sports pools at the state's racinos and casinos if PASPA is overturned by a court or a new federal law is enacted by Congress. New York's status as one of nine states to have legalized daily fantasy sports may provide it with a litigation advantage that New Jersey lacked. Ironically, the recent state measures to legalize daily fantasy sports may be the catalyst for legalizing sports betting, but not in the way that many envision. One unintended consequence of the new DFS laws is that it may have provided states that have enacted such laws with a "winning argument" in future PASPA cases. Since PASPA in my view (see here and here) also encompasses state-authorized wagering schemes on "athlete performance" (not just game-level outcomes), the recent state laws authorizing daily fantasy sports create a true PASPA quandary for the professional sports leagues and the U.S. Department of Justice (the likely plaintiffs in any lawsuit to enjoin a state from legalizing sports betting). A colorable argument can be made that the leagues and the DOJ are "selectively enforcing" PASPA by opposing state efforts to legalize traditional sports betting, but "looking the other way" on state DFS laws, which in the leagues' case, could be seen as entirely self-serving (and self-interested) given their financial partnerships with (and equity stakes in) FanDuel and DraftKings. They can't have it both ways. Either PASPA applies to both or to neither.

At a minimum, this duality could serve to undermine the leagues' argument in future cases that they would be "irreparably harmed" by expanded legal sports betting when they have neither suffered nor asserted any such harm from other supposed violations of PASPA in the DFS context. The ideal plaintiffs to advance such an argument would be those states that have already legalized daily fantasy sports. These states (which include New York, Mississippi, Indiana, Virginia, Colorado, Missouri, Massachusetts and Tennessee) are perfectly situated to advance a selective enforcement, waiver, or other equitable defense against the four major professional sports leagues, the NCAA and the DOJ. (By contrast, New Jersey, which has no DFS law on the books, was limited to an "unclean hands" defense based on the sports leagues' financial investment in DFS, and that argument was rejected by the Third Circuit since it did not involve the type of "reprehensible conduct" necessary for an unclean hands argument to succeed). These additional equitable arguments, if successfully advanced, could prevent the leagues from securing an injunction against states in future cases, thus serving as a possible "tipping point" for expanded legal sports betting. While such an argument is not guaranteed to succeed, it provides another possible tool in the legal arsenal for states to utilize in toppling PASPA. New York, by virtue of its status as a DFS state, could be well-positioned to advance this argument.

Friday, July 22, 2016
 
More on athlete speech in the WNBA (Second Update)

Second Update (Saturday evening): The WNBA, about to enter a month-long break for the Olympics, has rescinded the fines against several teams and players and will use the break to negotiate with the players' union about rules for player protests.

Original Post:

Following on my post about protests by WNBA players: Claire McNear at The Ringer wonders when the WNBA became apolitical, given the league's reactions to previous tragedies such as the Orlando shooting (when the league gave the players official memorial t-shirts), to say nothing of the league's general promotion of LGBTQ and women's issues. It also departs from the NBA's response both to the Lynx protest (NBA Commissioner Adam Silver praised their efforts) and to individual NBA players who have spoken out in similar ways the past few seasons (notably in wearing "I Can't Breathe" shirts during warm-ups). McNear questions whether the line really can be about who made and distributed the t-shirts.

Unfortunately, I fear a different explanation. The recent deaths of police officers has made them untouchable in the realm of public debate. You no longer can criticize or protest police officers, as by memorializing the victims of police-involved shootings (even as part of a general statement against all violence by memorializing everyone). The Orlando memorials no longer work as analogue, because the shooter there was a terrorist, not to mention an "other," so honoring those victims does not implicate police. We may be entering a time in which athletes can speak through the game, but only to express certain messages or certain positions on an issue.

As I said in the prior post, this is playing out on a smaller stage. The question is whether the same limitations are imposed on NBA or NFL players.

Update (Saturday afternoon): In my prior post, I argued that the key question is the extent to which athletes should be able to use the game, on the field/court, as a platform for their expression. The answer from the WNBA, according to this ESPN story, is that the players should keep their activism off the court. The league and the union have been trying to negotiate some arrangements, such as allowing players to wear what they want during early warmups (until, say ten minutes before the game), then change into official shirts for the national anthem; so far, they have been unable to reach an agreement.
The story includes comments from USA Coach Geno Auriemma, who seems to expect some players to attempt to speak out during the Olympics, which would become a matter for Olympic and basketball authorities. I hope we have come far enough in 48 years that the USOC would not respond as it did to Tommie Smith and John Carlos, by kicking them out of the Olympic Village.

I am more surprised by the following from Auriemma:
"I respect Tina (Charles) and the players in the WNBA for their concern and their voices and the passion that they have and for their beliefs. I really do," he said, citing the former UConn player and Liberty star for wearing her warmup shirt inside-out before Thursday's game. "I'm really proud of some of my former players and the way they've stepped forward and spoken their conscience and express their feelings."
This is a change in tone from Auriemma. In 2003, a small-college basketball player named Toni Smith began protesting the Iraq War by turning her back on the flag during the pre-game playing of the national anthem (what I described as "symbolic counter-speech"). Her coaches and teammates accepted her protest. But coaches and commentators criticized her actions, if only for distracting from the team. Auriemma, among others, insisted that whatever a player's right to speak, she did not have right to be part of the UConn women's basketball team (or to speak through her participation in the UConn women's basketball team). I am happy to see he has come around on this.

 
Athlete speech and team dynamics

Last week, NBA stars Carmelo Anthony, Chris Paul, LeBron James, and and Dwyane Wade kicked off the ESPY Award telecast with a call for athletes to become politically engaged, particularly around the issues of violence by and against police. Players on the Minnesota Lynx wore black warmup shirts with white lettering commemorating Alton Sterling, Philando Castile, and Dallas shootings, which prompted four off-duty police officers to walk-off their security jobs there. Several other teams followed suit by wearing plain black warmup shirts, which prompted the league to fine each team $ 5000 and each player $ 500, citing its uniform policy. The league president praising and expressed pride in the players' "engagement and passionate advocacy for non-violent solutions to difficult social issues," while demanding that they "comply with the league's uniform guidelines." This, of course, is a classic example of how neutral policies can be used to restrain speech, while allowing those doing the restraining to claim to support the speech. Players responded today with a media blackout, refusing to answer basketball-related questions and only talking about the political issues at the heart of their protests. Since the league no doubt has rules about speaking with the media, expect the WNBA to follow with more praise for the players' political courage, more citation to "neutral" rules, and more fines for that political courage.

This is playing out on a smaller stage than if it were male athletes in football, basketball, and baseball. But this story illustrates important issues about athlete speech for team, as opposed to individual, sports. The athletes we remember as being most politically engaged played individual sports--Muhammad Ali, Arthur Ashe, John Carlos, Billie Jean King, Jesse Owens, Tommie Smith. A lot of the activism from Jackie Robinson and Jim Brown came after each had retired and, in any event, rarely came out on the field (except to the extent Robinson's very presence on the field was political). All athletes risk their standing with the public and fans who may object to their speech (recall Michael Jordan's apocryphal "Republicans buy shoes, too"). But team-sport athletes face another hurdle--their expression implicates the financial, business, and other concerns of teams and leagues, who have their own incentives to limit this speech. Neutral rules designed to promote the sport (speaking to the media) or to promote team unity (uniform rules) provide the perfect weapon of control, allowing leagues or teams to shut the players down without appearing to be stopping them because of their message.

The question then becomes the extent to which "athlete speech" includes (or should include) the liberty to speak through the game itself and the platform the game provides. In other words, the extent to which LeBron James not only should be able to rely on his fame to get his message out, but also the platform of the game itself to do so.

Friday, July 15, 2016
 
Why Tom Brady Was Smart to Not Seek a Stay from the Supreme Court

Update: Shortly after this post was published, Tom Brady announced that he will not be seeking a stay of his suspension at the Supreme Court, and will not litigate the DeflateGate case any further. For the reasons noted below, this was probably a smart decision, as receiving a stay could have backfired for Brady given the likely briefing schedule for his case at the Supreme Court.

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With the Second Circuit Court of Appeals having denied Tom Brady and the NFLPA a rehearing in the DeflateGate case, attention has turned to whether the U.S. Supreme Court will stay his four-game suspension in time for him to suit up for the Patriots week one of the NFL season. And as Alan Milstein noted yesterday, because the Supreme Court is currently in recess, any request by Brady for a stay would be decided by Justice Ruth Bader Ginsburg.

While I think the odds that Justice Ginsburg would grant Brady a stay are quite a bit lower than Alan, in some respects Brady may actually, surprisingly, be better off without a stay. Indeed, if Brady's suspension were to be stayed, only to have the Supreme Court ultimately deny his cert petition, then Brady could instead find himself sitting out the Patriots' final four regular season games, or even, potentially, the team's first playoff game.

Specifically, Brady's petition for certiorari is currently due October 13th. Once that brief is filed, the NFL would then have 30 days to file its opposition brief. However, under Supreme Court Rule 30.4, parties opposing a cert petition are entitled to one extension as a matter of right. This means that the NFL could, if it wanted, receive an additional 30 days to file its opposition brief.

Assuming the NFL does not, in fact, request an extension, then its opposition brief would be due November 14th. At that point, the Supreme Court would give Brady 14 days to file a reply brief, before submitting the case to the full Court for consideration.

This means that, should Brady receive a stay of his suspension, the Court could decide whether to grant his cert petition during its conference of Friday Dec. 9th, with a decision expected to be announced on Monday Dec. 12th. And if the Court were to deny Brady's petition -- the most likely scenario, in my opinion -- then his four-game suspension would presumably go into effect immediately.

That means the Patriots would find out they'd lost their star QB only hours before their Monday night game against the Baltimore Ravens. He'd then also miss New England's final three regular season games as well (at Denver, vs. the Jets, and at Miami).

Alternatively, while less likely, if the NFL didn't reinstate Brady's suspension in time for Monday Night Football, then his suspension could potentially run into the first week of the playoffs instead.

Either way, then, while receiving a stay from the Supreme Court would certainly be a short-term victory for Brady, it could ultimately backfire should the Court eventually deny his cert petition. In that case, Brady may well wish he'd just sat out the season's first four games.

Thursday, July 14, 2016
 
One Last Gasp


If you are old enough to remember Johnny Carson, you can picture him as Carnac the Magnificent holding an envelope to his forehead saying: “Tom Brady, Ruth Bader Ginsburg, and Donald Trump.” After Ed repeats the unlikely threesome, the audience starts laughing because in what universe could these three be mentioned in the same sentence?

Welcome to the world of Deflategate, the Super Bowl of Sports Law, the never-ending litigation that shattered the myth that arbitrations were just as fair as court hearings but were speedier because they ensured finality.
            
Now that the Second Circuit has denied the Petition for Rehearing filed by the NFLPA and Brady, the only recourse is a Petition for Certiorari to the Supreme Court. But since the season starts September 8th, the case would be moot if Brady has to serve his four game suspension. The obvious next play is to ask the Court for a stay pending this Hail Mary pass for one last hearing. The Court, however, is in recess, so the Petition for Stay goes to the Justice assigned to the Second Circuit, none other than the Notorious RBG, as she is affectionately known by her legions of fans.
            
Tom Terrific, as Brady is known by his own legions of equally rabid fans, has been rumored to be a Trump supporter, though the reasons for that support are unclear. And Justice Ginsberg, of course, has had a recent run in with The Donald, who responded in his inimitable fashion by calling for her resignation. This has led some Patriot fans to question whether Justice Ginsburg might hold his support for Trump against Brady in deciding the Petition for a Stay.
            
There. Did you catch that? Brady, Justice Ginsburg, and Trump all in the same sentence without too much of a stretch.
            
I don’t think Patriot fans have anything to worry about. I predict Justice Ginsburg will issue the stay, pushing any suspension into the 2017 season and allowing the Brady Bunch to make one more run at an NFL Championship and one more attempt at reversing Goodell.
          

Wednesday, July 13, 2016
 
NBA changes rules to stop Hack-a-Shaq

The NBA on Tuesday announced rule changes designed to limit the "Hack-A-Shaq" strategy of intentionally fouling bad free throw shooters away from the ball. Beginning next season, all fouls away from the ball in the final two minutes of every quarter will result in one free throw and the ball out of bounds for the offensive team (this has been the rule for the final two minutes of the fourth quarter). The same rule will apply to fouls on inbounds plays (the new rage was jumping out of bounds to foul the inbounder). And jumping on a player's back during a free throw (a recent development used in the final two minutes) will be deemed a flagrant foul, punishable by one free throw and the ball, plus possible future punishment of the fouling player for repeated violations.

Unfortunately, I am not sure this gets the NBA where it wants to be, because it does nothing to deter Hack-a-Shaq outside the last two minutes of a quarter. Perhaps the league had statistics showing that the strategy was more prevalent in those times. But the rule change does nothing to stop the reductio of the strategy--a January 2016 game in which the Houston Rockets intentionally fouled Andre Jordan of the Los Angeles Clippers twelve times in a row (four times, using an end-of-the bench player, to put them in the bonus and eight times to put Jordan on the free throw line) at the beginning of the third quarter. I still believe the better rule would be to give the offense the choice of shooting the free throws or taking the ball out of bounds for off-the-ball fouls. Presumably, teams will choose the latter option for all but their best free throw shooters, thereby eliminating the perverse incentive to intentionally foul, at least away from the ball. But the NBA went a different way, given us temporal, if not complete, relief from this eyesore.

Tuesday, July 05, 2016
 
The Second Circuit Doubles Down On Its Deflategate Ruling in a New Opinion Overruling Judge Berman (Yet Again!), But It Could Help Brady This Time

As June turns into July (with no decision from the Second Circuit), this is fast becoming the "Summer of Deflategate." With so much additional time to ponder the fate of Brady's petition for reheating en banc, I have resorted to the legal equivalent of reading tea leaves. In recent weeks, I have analyzed other rehearing grants (a potentially positive development for Brady and the NFLPA) and also broke the story of two Second Circuit judges assuming "senior" status this summer and what that means for Brady's chances of success.

And now in the third installment of "Waiting for Deflategate," I present a new Second Circuit opinion involving judicial review of a labor arbitration award (and Judge Berman too!). And while the result in that case may be deflating to Brady's supporters, portions of the Court's decision could also be seen as boosting (inflating?) Brady's slim chances for success. In New York City & Vicinity District Council of the United Broth. of Carpenters & Joiners of Amer. v. Association of Wall-Ceiling & Carpentry Indus. of New York, Inc., Case No. 15-574, 2016 WL 3383737 (2nd Cir. June 20, 2016), the Second Circuit, in an opinion authored by Judge Gerard E. Lynch, concluded that a labor arbitration award "was properly grounded" in the arbitrator's application of the parties' collective bargaining agreement, and, consequently, reversed an earlier order entered by Judge Richard Berman (yes, the same judge who sided with Brady at the district court level!) which had vacated the arbitration award on the basis that it did not "draw its essence" from the CBA.

In so holding, Judge Lynch quoted extensively from the Second Circuit's Deflategate decision, reiterating that "'[a] federal court's review of labor arbitration awards is narrowly circumscribed and highly deferential--indeed, among the most deferential in the law.'" Opinion, p. 17 (quoting Nat'l Football League Mgmt. Council v. Nat'l Football League Players Ass'n2016 WL 1619883, at *1 (2d Cir. 2016)). Judge Lynch, quoting from Deflategate, described the limited role of the judiciary in reviewing labor arbitration awards as follows:
A court is "not authorized to review the arbitrator's decision on the merits"; its role is simply to determine "whether the arbitrator acted within the scope of his authority as defined by the collective bargaining agreement." Id at *6. Thus, as long as "the arbitrator was even arguably construing or applying the contract and acting within the scope of his authority and did not ignore the plain language of the contract," the award should ordinarily be confirmed. Id.
(Opinion, at pp. 17-18). Potentially troubling for Brady and the NFLPA is Judge Lynch's statement that "for our [the Court's] purposes, the CBA means what the arbitrator said it means" and that a court "may not" replace the arbitrator's interpretation of the CBA "with its own." (Opinion, at p. 22) (emphasis added)

But Judge Lynch Acknowledges Several Critical Exceptions to Judicial Deference

Despite reaffirming the legal principles underlying the Court's Deflategate decision AND reversing Judge Berman's vacatur of a labor arbitration award (the second time that's happened in less than two months), Judge Lynch's opinion in New York City & Vicinity District Council offers some potential silver linings for Brady and the NFLPA. This is because Judge Lynch identified several circumstances (none of which are identified in the Deflategate ruling) where a federal court "should" vacate a labor arbitration award. He wrote:
Conversely, a court should vacate an award if it "contradicts an express and unambiguous term of the contract or . . . so far departs from the terms of the agreement that it is not even arguably derived from the contract," United Bhd. of Carpenters v. Tappan Zee Constructors, LLC, 804 F.3d 270, 275 (2d Cir. 2015)--in other words, if the award does not "draw[] its essence from the collective bargaining agreement" but reflects instead "the arbitrator's own brand of industrial justice." NFL, 2016 WL 1619883, at *6 (internal quotation ,arks omitted)
(Id., at p. 18)

Judge Lynch also acknowledged that the United States Supreme Court recognizes a "public policy" exception to the traditional judicial deference to labor arbitration awards, stating:
The Supreme Court has also recognized a second circumstance warranting vacatur of a labor arbitration award: "[i]f the contract as interpreted [by the arbitrator] violates some explicit public policy," such as obedience to judicial orders." W.R. Grace & Co. v. Local Union 759, Int'l Union of the United Rubber, Cork, Linoleum & Plastic Workers, 461 U.S. 757, 766 (1983). 
(Id.)

But Judge Lynch cautioned that the "public policy" ground for vacatur is "extremely limited," characterizing the reviewing court's task in applying that principle as "limited to determining 'whether the award itself, as contrasted with the reasoning that underlies the award, creates aexplicit conflict with other laws and legal precedents and thus clearly violates an identifiable public policy.'" Id. (citing Local 97, Int'l Bhd. of Elec. Workers, A.F.L.-C.I.O. v. Niagra Mohawk Power Corp., 196 F.3d 117 (2d Cir. 1999)). [In the Niagra Mohawk Power case, the Second Circuit explained that "[p]ublic policy . . . is to be ascertained by reference to the laws and legal precedents and not from general considerations of supposed public interests." Id. at 125]

What Judge Lynch's Recent Opinion Could Mean for Brady and the NFLPA

While Judge Lynch's opinion in New York City & Vicinity District Council may be viewed in some quarters as implicitly agreeing with the Court's Deflategate ruling (a perception no doubt bolstered by the favorable citation to Deflategate and the involvement of Judge Berman), it is important to remember that Judge Lynch's reiteration of the general legal principles invoked in Deflategate is not quite the same thing as applying those principles to a specific fact-pattern. The similarities between Deflategate and New York City & Vicinity District Council really do begin and end with the utilization of the same standard of judicial review and the coincidental involvement of Judge Berman (who may not be inviting any Second Circuit judges out to the Hamptons anytime soon!). But apart from that, the two cases could not be any more different. In contrast to Deflategate, the New York City & Vicinity District Council case did not involve workplace discipline. Rather, it concerned the more esoteric issue of whether a particular collective bargaining agreement between a regional council of a local unions and an employers' association was "superseded" by a separate agreement between the union and the employers' association's parent company. Given the dramatically different factual setting in New York City & Vicinity District Council, there were quite understandably no issues raised in that case concerning the scope of a labor arbitrator's appellate authority (as in Deflategate), whether principles of "fundamental fairness" were violated by virtue of an arbitrator's evidentiary rulings (as asserted in Deflategate), and whether a labor arbitrator was "evidently partial" (as asserted in Deflategate). Therefore, the precedential effect of New York City & Vicinity District Council (at least factually) may be limited at best.

Nonetheless, the New York City & Vicinity District Council decision could be helpful to Brady and the NFPLA on rehearing, and, ironically, could be interesting fodder for a Rule 28(j) notice of supplemental authority (by Brady and the NFLPA). At first blush, it would seem counterintuitive for Brady and NFLPA to rely on a case which overruled a district court's vacatur of an arbitration award, particularly where it is Judge Berman being reversed. But the real value (at least to Brady and the NFLPA) of New York City & Vicinity District Council lies in the "exceptions" to arbitrator deference recognized by Judge Lynch. As identified by Judge Lynch (and discussed briefly above), the two exceptions requiring a vacatur of a labor arbitration award are where the award: (1) contradicts an express and unambiguous term of the CBA or so far departs from the terms of the agreement that it is not even arguably derived from the contract; or (2) violates public policy.

The "public policy exception" may be the real key here. While the Second Circuit has previously addressed the parameters of that exception in a 1999 opinion (Local 97, Int'l Bhd. of Elec. Workers, A.F.L.-C.I.O. v. Niagara Mohawk Power Corp., 196 F.3d 117 (2d Cir. 1999)), and in several earlier opinions, it has not applied (or discussed) the exception in any post-2000 case. Judges Chin and Parker were not even on the Second Circuit bench the last time the "public policy exception" came into play. Thus, Judge Lynch's invocation of the "public policy exception" (while ultimately not applicable in the New York City & Vicinity District Council case) could serve as a revival of that doctrine in the Second Circuit. Might as well start with Deflategate.

One can easily envision a number of identifiable public policy considerations contravened by Commissioner Goodell's arbitration ruling; i.e., the right to cross-examine material witnesses; the right of access to material, non-privileged evidence in the possession of the other side; the right to a fundamentally fair arbitration proceeding; the right to present evidence to an unbiased tribunal; and the requirement that an arbitrator act impartially and in a manner consistent with the collective desires of both parties, to name just a few. While these policies are encapsulated in case-law or rules of procedure, they may still properly serve as a recognized "public policy" (for purposes of the "public policy exception") under Supreme Court and Second Circuit precedent. See Local 97, Int'l Bhd. of Elec. Workers, A.F.L.-C.I.O. v. Niagara Mohawk Power Corp., 196 F.3d 117, 125 (2d Cir. 1999) ("Public policy . . . is to be ascertained ‘by reference to the laws and legal precedents and not from general considerations of supposed public interests." (citing W.R. Grace, 461 U.S. at 766, 103 S.Ct. 2177 (quoting Muschany v. United States, 324 U.S. 49, 66, 65 S.Ct. 442 (1945)).

While the "public policy exception" was not raised in Brady's and the NFLPA's petition or in any of the amici curiae briefs, its recent mention by Judge Lynch in the Court's first post-Deflategate labor arbitration decision is an intriguing development in a controversy that has no shortage of intriguing developments. It may ultimately be a long-shot, but everything about this case has bucked the odds and defied convention.



Friday, July 01, 2016
 
The New Deflategate Math at the Second Circuit

And then there were eleven. Buried in a little-noticed "State of the Circuit Report" released on May 26th, Second Circuit Chief Judge Robert Katzmann announced that two of the "active" judges on the court--Gerald E. Lynch and Richard C. Wesley--would be assuming "senior status" sometime "this summer." The Report does not state exactly when. But I later learned that Judge Wesley would be taking senior status on August 1st, and no information is yet available as to when Judge Lynch will assume senior status.

This is a potentially significant development in the  NFL vs. Brady case, otherwise known as "Deflategate." The success of Tom Brady's and the NFLPA's petition for rehearing en banc depends on a majority of the "active" members of the court--currently 13--voting to rehear the case. In late April, a three-judge panel of the court (consisting of Judges Denny Chin, Barrington Parker and Katzmann) reversed the decision of U.S. District Judge Richard Berman vacating the arbitrating ruling of NFL Commissioner Roger Goodell which had upheld the four-game suspension of Brady. Under the current composition of the court, Brady would need at least 7 of the 13 judges to vote in favor of rehearing the case. The Court has not yet acted on the petition, ether by denying it outright (one possibility) or ordering the NFL to file a response brief (a more likely possibility).

August 1st is more than four weeks away, and the Second Circuit will likely weigh in before either Judges Lynch or Wesley assume senior status. But what if no decision has been reached by then (either because the Court has not yet decided whether to entertain rehearing en banc or, alternatively, has issued a briefing order to the NFL, which would likely push the decision past August 1st since the NFL would be given a minimum of 15 days to file a response)? Under that scenario, Brady and the NFLPA would need the votes of at least six judges, constituting a majority of the reduced 11-judge active court to secure rehearing en banc. And, by the way, a rehearing grant would automatically "vacate" the April 25th decision of the original three-judge panel.

Another possibility is that Judges Lynch and Wesley may voluntarily remove (or "recuse") themselves from the initial determination of whether to rehear the case, knowing that they will soon become senior judges and, therefore, would not sit on the eventual en banc panel if rehearing is granted. They are under no compulsion to do that, but it is a possibility with so little time (e.g., a matter of weeks) remaining on their active tenure.

How Will the Impending Senior Status of Judges Lynch and Wesley Impact Rehearing?

Looking further ahead, if rehearing en banc is granted (a rare occurrence, but the Court did rehear a case recently, as I wrote earlier this week), how would the removal of Judges Lynch and Wesley from "active" status affect Brady's chances? First, the en banc panel would not consist of the same group of judges that entertained the rehearing request. Judge Barrington Parker (a senior judge who sided with the NFL in the April 25th ruling) would be part of the en banc panel since he participated in the original panel decision). The addition of Judge Parker (who cannot participate in the initial decision whether to rehear the case since he is a senior judge) would add a twelfth judge to the en banc panel, creating an even number of judges. But, interestingly, if 12 judges rehear the case en banc, Brady would not need to carry a majority (seven or more) because in the event of a tie vote, the decision of the district court would be AFFIRMED. And since Judge Berman ruled in favor of Brady and the NFLPA, his decision would stand and the four-game suspension would be wiped out. Of course, the NFL would then ask the Supreme Court to review the case, but, in the unlikely event that review were granted (less than 1% of all petitions are granted), the earliest that the Supreme Court would hear the case is in 2017, long after the 2016 NFL season has ended. In that scenario, Brady would not miss any games during the 2016 season (and, potentially, the 2017 season as well).

But, as a practical matter, Brady would need to carry at least a majority (seven judges) of the 12-judge en banc panel in order to prevail on rehearing. This is because it is highly likely that the three judges who participated in the original panel decision (Parker, Chin and Katzmann) would vote the same way they did in the April 25th ruling. Both Parker and Chin ruled in favor of the NFL, 'and Katzmann sided with Brady and the NFLPA in a dissenting opinion. Assuming that the judges do not change their votes on rehearing (a highly likely scenario), the NFL would be staked to a 2-1 lead going into the en banc rehearing, meaning that Brady and the NFLPA would need to persuade at least five out of the remaining nine judges in order to prevail on rehearing. Thus, as a practical matter, the removal of Judges Lynch and Wesley from the en banc process would not lessen Brady's need to convince a majority of the judges on the panel. It would only mean that instead of persuading 7 out of 13 judges, he would need to persuade 6 out of 11 (or, assuming the votes of Parker, Chin and Katzmann remain the same), 6 out of 11. An equally daunting, but not an impossible, task.

Judge Lynch's Recent Opinion REVERSING Judge Berman's Vacatur Of An Arbitration Award and Citing the Second Circuit's Deflategate Decision Approvingly

It is difficult to predict how Judges Lynch and Wesley would vote if they participated in the en banc panel in Brady (and we now know it is a virtual certainty that neither will be participating due to their impending senior status). Since Judge Lynch was appointed to the Second Circuit by a Democrat (President Obama), and before that, to the district court by President Clinton (also a Democrat), and Judge Wesley was nominated by a Republican President (George W. Bush), they probably cancel each other out in terms of political ideology. However, federal judges do not always vote along party lines, and there are many prior examples bearing that out (Justice John Roberts as the deciding vote saving Obamacare immediately comes to mind).

A recent Second Circuit decision may provide a hint as to how Judges Lynch and Wesley might view Brady's request for a rehearing. In New York City & Vicinity District Council of the United Broth. of Carpenters & Joiners of Amer. v. Association of Wall-Ceiling & Carpentry Indus. of New York, Inc., Case No. 15-574, 2016 WL 3383737 (2nd Cir. June 20, 2016), the Second Circuit, in an opinion authored by Judge Lynch (and joined in by Judge Wesley), concluded that a labor arbitration award "was properly grounded" in the arbitrator's application of the parties' collective bargaining agreement, and, consequently, reversed an earlier order entered by Judge Richard Berman (yes, the same judge who sided with Brady at the trial court level!) which had vacated the arbitration award on the basis that it did not "draw its essence" from the CBA.

In so holding, Judge Lynch quoted extensively from the Second Circuit's Deflategate decision, reiterating that "'[a] federal court's review of labor arbitration awards is narrowly circumscribed and highly deferential--indeed, among the most deferential in the law.'" Opinion, p. 17 (quoting Nat'l Football League Mgmt. Council v. Nat'l Football League Players Ass'n, 2016 WL 1619883, at *1 (2d Cir. 2016)). Judge Lynch, quoting from Deflategate, described the limited role of the judiciary in reviewing labor arbitration awards as follows:
A court is "not authorized to review the arbitrator's decision on the merits"; its role is simply to determine "whether the arbitrator acted within the scope of his authority as defined by the collective bargaining agreement." Id at *6. Thus, as long as "the arbitrator was even arguably construing or applying the contract and acting within the scope of his authority and did not ignore the plain language of the contract," the award should ordinarily be confirmed. Id.
(Opinion, at pp. 17-18). Potentially troubling for Brady and the NFLPA is Judge Lynch's statement that "for our [the Court's] purposes, the CBA means what the arbitrator said it means" and that a court "may not" replace the arbitrator's interpretation of the CBA "with its own." (Opinion, at p. 22) (emphasis added)

But Judge Lynch Acknowledges Several Critical Exceptions to Judicial Deference

Despite reaffirming the legal principles underlying the Court's Deflategate decision AND reversing Judge Berman's vacatur of a labor arbitration award (the second time that's happened in less than two months), Judge Lynch's opinion in New York City & Vicinity District Council offers some potential silver linings for Brady and the NFLPA. This is because Judge Lynch identified several circumstances (none of which are identified in the Deflategate ruling) where a federal court "should" vacate a labor arbitration award. He wrote:
Conversely, a court should vacate an award if it "contradicts an express and unambiguous term of the contract or . . . so far departs from the terms of the agreement that it is not even arguably derived from the contract," United Bhd. of Carpenters v. Tappan Zee Constructors, LLC, 804 F.3d 270, 275 (2d Cir. 2015)--in other words, if the award does not "draw[] its essence from the collective bargaining agreement" but reflects instead "the arbitrator's own brand of industrial justice." NFL, 2016 WL 1619883, at *6 (internal quotation ,arks omitted)
(Id., at p. 18)

Judge Lynch also acknowledged that the United States Supreme Court recognizes a "public policy" exception to the traditional judicial deference to labor arbitration awards, stating:
The Supreme Court has also recognized a second circumstance warranting vacatur of a labor arbitration award: "[i]f the contract as interpreted [by the arbitrator] violates some explicit public policy," such as obedience to judicial orders." W.R. Grace & Co. v. Local Union 759, Int'l Union of the United Rubber, Cork, Linoleum & Plastic Workers, 461 U.S. 757, 766 (1983).
(Id.)

But Judge Lynch cautioned that the "public policy" ground for vacatur is "extremely limited," characterizing the reviewing court's task in applying that principle as "limited to determining 'whether the award itself, as contrasted with the reasoning that underlies the award, creates an explicit conflict with other laws and legal precedents and thus clearly violates an identifiable public policy.'" Id. (citing Local 97, Int'l Bhd. of Elec. Workers, A.F.L.-C.I.O. v. Niagra Mohawk Power Corp., 196 F.3d 117 (2d Cir. 1999)). [In the Niagra Mohawk Power case, the Second Circuit explained that "[p]ublic policy . . . is to be ascertained ‘by reference to the laws and legal precedents and not from general considerations of supposed public interests." Id. at 125]

What Judge Lynch's Recent Opinion Could Mean for Brady and the NFLPA

While Judge Lynch's opinion in New York City & Vicinity District Council may be viewed in some quarters as implicitly agreeing with the Court's Deflategate ruling (a perception no doubt bolstered by the favorable citation to Deflategate and the involvement of Judge Berman), it is important to remember that Judge Lynch's reiteration of the general legal principles invoked in Deflategate is not quite the same thing as applying those principles to a specific fact-pattern. The similarities between Deflategate and New York City & Vicinity District Council really do begin and end with the utilization of the same standard of judicial review and the coincidental involvement of Judge Berman (who may not be inviting any Second Circuit judges out to the Hamptons anytime soon!). But apart from that, the two cases could not be any more different. In contrast to Deflategate, the New York City & Vicinity District Council case did not involve workplace discipline. Rather, it concerned the more esoteric issue of whether a particular collective bargaining agreement between a regional council of a local unions and an employers' association was "superseded" by a separate agreement between the union and the employers' association's parent company. Given the dramatically different factual setting in New York City & Vicinity District Council, there were quite understandably no issues raised in that case concerning the scope of a labor arbitrator's appellate authority (as in Deflategate), whether principles of "fundamental fairness" were violated by virtue of an arbitrator's evidentiary rulings (as asserted in Deflategate), and whether a labor arbitrator was "evidently partial" (as asserted in Deflategate). Therefore, the precedential effect of New York City & Vicinity District Council (at least factually) may be limited at best.

Nonetheless, the New York City & Vicinity District Council decision could be helpful to Brady and the NFPLA on rehearing, and, ironically, could be interesting fodder for a Rule 28(j) notice of supplemental authority (by Brady and the NFLPA). At first blush, it would seem counterintuitive for Brady and NFLPA to rely on a case which overruled a district court's vacatur of an arbitration award, particularly where it is Judge Berman being reversed. But the real value (at least to Brady and the NFLPA) of New York City and Vicinity District Council lies in the "exceptions" to arbitrator deference recognized by Judge Lynch. As identified by Judge Lynch (and discussed briefly above), the two exceptions requiring a vacatur of a labor arbitration award are where the award: (1) contradicts an express and unambiguous term of the CBA or so far departs from the terms of the agreement that it is not even arguably derived from the contract; or (2) violates public policy.

The "public policy exception" may be the real key here. While the Second Circuit has previously addressed the parameters of that exception in a 1999 opinion (Local 97, Int'l Bhd. of Elec. Workers, A.F.L.-C.I.O. v. Niagara Mohawk Power Corp., 196 F.3d 117 (2d Cir. 1999)), and in several earlier opinions, it has not applied (or discussed) the exception in any post-2000 case. Judges Chin and Parker were not even on the Second Circuit bench the last time the "public policy exception" came into play. Thus, Judge Lynch's invocation of the "public policy exception" (while ultimately not applicable in the New York City & Vicinity District Council case) could serve as a revival of that doctrine in the Second Circuit. Might as well start with Deflategate.

One can easily envision a number of identifiable public policy considerations contravened by Commissioner Goodell's arbitration ruling; i.e., the right to cross-examine material witnesses; the right of access to material, non-privileged evidence in the possession of the other side; the right to a fundamentally fair arbitration proceeding; the right to present evidence to an unbiased tribunal; and the requirement that an arbitrator act impartially and in a manner consistent with the collective desires of both parties, to name just a few. While these policies are encapsulated in case-law or rules of procedure, they may still properly serve as a recognized "public policy" (for purposes of the "public policy exception") under Supreme Court and Second Circuit precedent. See Local 97, Int'l Bhd. of Elec. Workers, A.F.L.-C.I.O. v. Niagara Mohawk Power Corp., 196 F.3d 117, 125 (2d Cir. 1999) ("Public policy . . . is to be ascertained ‘by reference to the laws and legal precedents and not from general considerations of supposed public interests." (citing W.R. Grace, 461 U.S. at 766, 103 S.Ct. 2177 (quoting Muschany v. United States, 324 U.S. 49, 66, 65 S.Ct. 442 (1945)).

Despite the Recent Opinion, Judges Lynch and Wesley May Still Sit Out Deflategate

With their impending senior status, Judges Lynch and Wesley are unlikely to ever be part of an en banc panel in Deflategate. But Judge Lynch's recent opinion in New York City & Vicinity District Council (which was joined in by Judge Wesley) suggests that Brady and the NFLPA might not be overly upset if these two judges excused or recused themselves from voting on whether to even entertain rehearing en banc, given the favorable references to the Deflategate opinion and the fact that Judge Berman was reversed in that case. Despite being only a few weeks away from assuming senior status, Judges Lynch and Wesley still get to vote on whether or not to grant rehearing en banc provided it occurs before August 1st, since they would still be "active" judges before that date. Perhaps one reason for the delay in the rehearing decision, as suggested by one of my Twitter followers, is that Judge Katzmann may be waiting for Judges Lynch and Wesley to assume senior status before polling the Court, knowing that they may vote against rehearing and thereby reduce the already-slim possibility of a "majority" of the active judges voting to rehear the case. I doubt that's the reason.

Regardless, this game of judicial musical chairs at the Second Circuit is a fascinating development at a time when there has otherwise been "radio silence" on the court docket and we overanalyze every twist and turn while we wait for the Court's decision. Ultimately, it may turn out to be a non-factor, but it is a noteworthy development in a case where everything (including a letter from a World War II veteran) is closely scrutinized.






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