This is what the rule change was made for and I really hope the NBA stands firm on this. Being held back doesn't count as an excuse to be eligble for the draft. Do you know how many prospects around the country each year that would make eliible? Have we forgotten the point of prep schools in the first place?

 Ron Jumper -- 7/11/2006 3:55 PM  

I think the fact that Mayo was playing high school ball in 7th grade says more about what the school though about his basketball talent than his class.

I also get the feeling that Mayo and Walker would have a better chance at gaining eligibility for the Draft if they discussed it with agents and NBA officials (while proving what they could be worth to the NBA) rather than in court.

 WMUpsci_student -- 7/11/2006 7:50 PM  

Thank you both for these excellent comments.

Ron,

I believe that you are only referring to O.J. Mayo's eligibility, as Billy Walker's eligibility concerns an error by different schools in how they counted his credits when he transferred.

So in reference only to Mayo, you and the NBA certainly have a reasonable argument that being held back changes your graduating class. But given the CBA's lack of clarity on how to actually measure graduating class, a court would likely try to determine the original purpose of the provision.

And if the intent of the provision was more about creating a proxy for physical development or emotional maturity than about academic progress, then perhaps Mayo could argue that "graduating class" should most pertain to "life experience"--to borrow one of David Stern's favorite phrases--while in school (and being on the high school basketball team as a 7th grader would seem to go to that). I'm not necessarily agreeing with that interpretation, but the point is that there may be some ambiguity there.

Western Michigan University Student,

That Mayo was playing high school basketball as a 7th grader actually says a lot about him. As you note, it unquestionably speaks to his basketball talent. But it probably also speaks to his emotional maturity, intellect, willingness to work hard, professional aspirations, and many other human attributes. In other words, his experience does not solely reflect his sports talent; it also tells us something about him, as a person, and his capacity to embrace challenges normally reserved for older persons.

As to whether Mayo and Walker would be better off discussing their pursuit of the 2007 NBA Draft with NBA officials than bringing a lawsuit, I'm sure they would first ask the NBA if they could be allowed in; for a multitude of reasons, litigation is never the first option for resolving a dispute. However, in light of the comments by NBA spokesman Tim Frank, it seems that the NBA is, at least as of now, opposed to the idea. And should that remain the case, and should Mayo and Walker seek to enter the 2007 NBA Draft, they would then have to consider whether the NBA is violating federal antitrust laws in not allowing their entrance, and if so, whether it is in their interests to bring a lawsuit.

 Michael McCann -- 7/11/2006 8:59 PM  

It seems to me that the NBA is skirting the fundamental issue of importance, namely that of what constitutes an appropriate barometer and indicator of future NBA success; age or education.

Both Billy Walker and O.J. Mayo clearly satisify the age requirement of the CBA and the supposed emotional and physical maturity that age brings an athlete. In my view, if the entire intent of the NBA is to make sure that not-yet-ready prep to pro players permeate the NBA and dilute the quality of the product then age is the only barometer that should be in play (aside from athletic ability and, to a lesser extent, character).

However, the NBA clearly seems to prefer that prep athletes get some education before entering into the league for a variety of factors. This is clearly an arbitrary precondition to entering the league. It is perfectly acceptable that poor students who repeat multiple grades be able to enter into the NBA if they satisfy the necessary age requirement (agreed upon by the league and NBAPA) and possess desirable athletic ability. The stipulation that one should be only considered for entry into the NBA after completing the proper educational level is absurd as the NBA is a professional sporting league where education is largely irrelevant and unnecessary for success. The NBA's ambiguous stance, if not corrected immediately, will leave the bad aftertaste of paternalism.

 Jason Chung -- 7/11/2006 9:20 PM  

This rule isn't about maturity or education. The league wants it in place so that they don't need to spend millions scouting high school players in hundreds of high schools across all the 50 states. It's also less risky (overall) if the clubs get to see the players in college playing against much better competition than high school competition. So the league is definitely going to fight this because, otherwise, it will set a precedent for high school players avoiding having to go to college for a year.

 Rick Karcher -- 7/11/2006 10:20 PM  

Wow, some more great comments. Thanks guys.

Jason,

I think you are exactly right. We have to identify, as you note, the correct barometer of future NBA performance: age or education (to the extent there actually exists a correct barometer, and I'm sure there is). And I want to highlight your last two sentences because they are so good: "The stipulation that one should be only considered for entry into the NBA after completing the proper educational level is absurd as the NBA is a professional sporting league where education is largely irrelevant and unnecessary for success. The NBA's ambiguous stance, if not corrected immediately, will leave the bad aftertaste of paternalism."

Rick,

I agree that scouting is important, but if we go by what the NBA has recently said and done, it seems that they perceive "maturity" (or, more correctly, "fans' perception of maturity") as highly relevant. Along those lines, David Stern has explicitly referred to the lack of "life experience" of prep-to-pro players as a rationale for banning their entrance. That particular comment appears to be part of a larger agenda by the league to appeal to whom I'll euphemistically call "mainstream fans," and is also reflected in the NBA Dress Code (and, perhaps less detectably, efforts to force Eddy Curry to take a DNA test last year).

Also, I'm not certain that a one-year delay will affect the behavior of NBA scouts. Although we don't know yet, I would bet that they or close surrogates will still be at the McDonald's High School All American game next year and all of the other major high school tournaments. And that begs the question: Is a one-year delay really going to lower NBA scouting costs? Isn't it still very much in their interests to evaluate the players while they are high school seniors?

As to the point on competition, on the surface I would agree, but if high school players are indeed more risky because of their relative competition, why have they, on average, averaged more points, rebounds, and assists than the average player of any other age group? Alternatively considered, did evaluating college performance help the teams that expended first round picks on Rafael Araujo, Trajan Langdon, Ed O'Bannon, Mateen Cleaves, Kirk Haston, Brandon Armstrong, Dahntay Jones, Marcus Haislip, Reece Gaines, Luke Jackson--guys who comprise a rather long list of college juniors or seniors who failed or who have thus far failed in the NBA? I suspect prep-to-pros have done so well because (for the most part) only the very best ones have pursued the NBA, making it less difficult for teams to evaluate them, which would seemingly diminish the effect of differences in levels of competition between high school and college.

 Michael McCann -- 7/11/2006 11:13 PM  

Something I was thinking about earlier when I emailed Professor McCann - my question regards scouting.

Rick - does the NBA in fact spend millions scouting all over the country? Isn't the presence of schools like St. Vincent - St. Mary's and Oak Hills Academy evidence that there is a large degree of selection even before the pro scouts see the players?

I'm not an expert in scouting patterns, so I would appreciate someone with more insight on the matter. But it seems to me that these prep schools with strong basketball programs give a huge aid to talent evaluators, on a pre-college level.

To give a comparison, it's like high schoolers in NYC applying to college. Even before you apply, if you're at a school like Stuyvesant or Bard, you've already to a certain extent proven yourself by association, since you got in my virtue of a rigorous testing and application process. This doesn't mean colleges don't have to evaluate applications, but upper echelon colleges do historically take more students from these schools.

Would the age-floor de-emphasize the early scouting (from pros), make it more important (for giving a sample larger than the first year of college), or not affect it at all? Would there be an economic impact on the efficacy of scouting?

 Satchmo -- 7/11/2006 11:24 PM  

Michael and Satchmo,

I think you have to take Stern's media comments with a grain of salt. Stern is not going to say, "We want this rule so that we can reduce scouting expense as well as the risk associated with picking high schoolers." And I do firmly believe that the overall reduction in expense is pretty significant. Of course scouts will always attend the McDonald's all-star game because it's simply one game where they can see the top high school talent. But the scouting of high school players is simply not going to be at the same level and extent when they are not going to be drafted for over a year later, as opposed to when they are going to be drafted only a month or two later. You also have to keep in mind that each team is competing against all the other teams and thus each would be responsible for scouting all high school seniors in the U.S., which would include multiple visits by representatives of the same team to see the same players. Basically, the pool of "eligible" talent is substantially reduced because of the draft age rule. As an example, if there are 50 top college programs that have legitimate prospects and 50 high schools that have legitimate prospects, the scouts now only needs to go see the 50 college teams because the high school players that would have been drafted if they had been eligible are now instead most likely going to be other college players from pretty much the same 50 top college programs.

You can't compare this situation at all to college applicants at NYU because there is so much more that is unknown and risky about draft picks (be it high school or college draft picks), and different variables and dynamics involved in a draft as opposed to a college application process. With high school players, the top prospects come from all over the place (not just schools that have good basketball tradition). And the schools that produce the top picks vary year by year, which also makes it different from the college draft prospects who more often tend to come from the powerhouse collegiate basketball programs.

As far as the risk involved with high schoolers, you have to look at it from a league perspective as opposed to the individual team perspective. Cleveland obviously wants Lebron immediately out of high school. But what does the league care if Lebron comes into the league and plays one year later? This rule isn't really about Lebron. It's more about having to choose between 1) a high schooler who is less of a sure thing than Lebron but has more potential upside on the tools side, and 2) a college player who is more of a sure thing but has less of an upside on the tools side. The majority of teams obviously want an age rule or else the league wouldn't have pushed for it -- How do you explain that? My explanation is that these teams are businesses, and I don't believe they are pushing a "larger agenda," nor do they necessarily care about maturity or education.

 Rick Karcher -- 7/12/2006 11:09 PM  

Rick,

Thank you for your very detailed and thoughtful response.

However, I don't see the empirical support for the "choice" you posit between, "1) a high schooler who is less of a sure thing than Lebron but has more potential upside on the tools side, and 2) a college player who is more of a sure thing but has less of an upside on the tools side." Sure, if you are referring to an isolated choice between, say, Kendrick Perkins and Shane Battier, then I would agree with you. But in the aggregate, if college players are indeed "more of a sure thing" why have they underperformed relative to prep players? If anything, the data suggests that college players are neither more talented nor more skilled; they're just not as good.

Also, while I understand that you don't believe that the NBA has a larger agenda, others, including myself, disagree, and we disagree because there appears to be a clear pattern of behavior. In the last year, the NBA has fought for a higher age floor, a dress code, and through one its franchises (the Bulls), the right to condition a player contract upon passage of a DNA Test. I would argue that these actions are connected and reflect an effort by the NBA to change its image. In my view, the league is seeking to appeal to the traditional fans that it has lost in recent years, fans who have certain, largely erroneous and perhaps prejudicial views of modern NBA players. Along those lines, I believe, the NBA is attempting to noticeable exert control over the players in order to respond to these fan perceptions (or misperceptions) about what has ailed the NBA-- namely players being "immature" and "out-of-control." My forthcoming article in the University of Pennsylvania Journal of Labor and Employment Law details examples of related commentary and supplies empirical evidence of these points. And back to the heightened age floor, I think it's worth asking the following question: Did the NBA want it because they believe that it will actually help the game, or did they want it because fans mistakenly perceive that high schoolers are ruining the game and that the game would be better off and more polished if they attended college? I'm not going to assert a conclusion, but I think that's a very debatable question.

So perhaps the NBA, and as you contend, does not genuinely care about maturity, education, or style in the abstract. If that is your argument, then I would agree with you; I doubt, for instance, that David Stern cares whether Gerald Green might like to wear gold medallions. But I would argue that Stern & Co. do care about prep-to-pro players and gold medallions etc. when fans (and corporate seat holders and television networks and related merchants) believe that they are problems that need to be "fixed" (even if they are not really problems, bur rather manifestations of underlying prejudices).

But the discussion shouldn't end there, in my view. We should then explore why fans harbor certain perceptions and prejudices of the modern NBA player, because those perceptions and prejudices may speak to broader societal prejudices, a very real concern to some legal scholars and social scientists. We should also explore whether the NBA's remedies to these purported "problems" violate the law (a topic that we've discussed quite a bit on this Blog and both of us seem to agree on).

 Michael McCann -- 7/13/2006 12:34 AM  

Michael,

I fully agree that perceptions and prejudices are all valid concerns that we need to discuss and that need to be addressed. Where you and I disagree is whether the draft age rule is the league's way of trying to respond to those issues. I'm not convinced that the two are connected. I would be interested in knowing what types of empirical evidence (other than commentary) you have that suggests that the dress code, the DNA test and the draft age rule are connected as part of an agenda. I understand that it's a theory and it's one that we can debate and I look forward to reading your article, but (just as you asked me in your last comment): Where's the empirical data that supports that theory?

Now, regarding college players being more of a "sure thing". What that means is that the scouts have seen the player one year later in physical development (or more years if the age floor is increased over time which is very likely) and they have seen the player perform in a much higher level of competition and in higher pressure situation, as well as functioning in more of a "team player" evironment. What significance does that have? -- they are more of a "known" quantity with respect to these types of things. Don't confuse that statement with me arguing that drafted college players as a whole perform better than drafted high school players in the NBA -- because that is not at all what I'm saying. I'll be the first to say that any draft is a crapshoot.

But here's the issue. You have to look at it from a league vs. individual team situation. If everybody is draft eligible, then each team is FORCED to make that choice (between high upside high schooler and lower risk college pick) with each pick they have in the draft. If no team is permitted under the rules to make that choice, then all the teams are in the same boat on equal footing, and then they'll all be on equal footing again when the high school phenoms are draft eligible a year (or years) later. By doing this, have they eliminated competition among themselves? -- absolutely. Is it an illegal restraint on trade? -- absolutely. Should the labor exemption protect the rule? -- absolutely not. At least we are in agreement on that! :)

 Rick Karcher -- 7/13/2006 7:32 AM  

So if a HS player dropped out after his Jr year and obtained a GED over the summer (a type of HS diploma), he still could not enter the NBA draft so long as his age... meet the current criteria?

 BLAZER PROPHET -- 7/13/2006 11:41 AM  

Rick,

All fair and good points (and thanks for your time on this). In terms of evidencing the social and psychological connection that I posit between the age rule, the NBA Dress code, and DNA testing, my article does it far better than I can do in a reply to a comment on blog, but I'll still give it a shot. The evidence in part reflects relatively new and what I think are fascinating socio-psychological findings on the situational influences and unappreciated cognitive biases that afflict all persons, including us and including NBA fans. Let's take the NBA Dress code as an example (and I am going to borrow generously from my article). Data indicates that the dress code has attracted broad social support, with supporters frequently supplying what can be considered "paternalistic" rationales. This is true even among young persons: a recent survey of readers of the youth-oriented Inside Hoops found that 51 percent support the dress code; more broadly, recent public opinion polls and data observed in NBA focus groups indicate that NBA players are the least popular athletes among the major professional sports leagues, and data also suggests that many fans are uncomfortable with the hip-hop culture prevalent in the NBA, automatically and erroneously associating that culture with gangs, violence, truancy, and other nefarious dynamics.

Why is that significant and how does it pertain to a broader paradigm? It's because public sentiment in favor of the dress code and making NBA players "more mature" appears remarkably harmonious with social-psychological findings on how humans interact and determine choices. And let me back-up to be clear (if also long-winded for a blog comment!). Take the heuristic of availability, which leads us to "to evaluate the frequency or likelihood of an event on the basis of how quickly instances or associations come to mind." In other words, images that are easily imagined and particularly vivid tend to enjoy heightened salience in our decision-making and opinion-making, while we tend to ignore the situation, the pressures, the context of those images (this is part of the fundamental attribution error). For that reason, we tend to regard risks as more serious and more likely when an incident is readily called to mind (e.g., dying in a plane crash) and, conversely, why we tend to regard risks as less serious and less likely when they are gradual or are presumed subsequently-modifiable (e.g., developing cancer from smoking).

This heuristic also reveals why we often use appearance as a proxy for other persons' characteristics or traits (e.g., work ethic, ambition, law-abidingness), even when those characteristics and traits have nothing to do with appearance: as proven in numerous experiments, we tend conceptualize a certain persona--say, a "hard-working" person--as resembling an unmistakable physical archetype--often someone who is "clean-cut" and "well-dressed"--and that image proves animating in how we regard and treat others. Troublingly, and as with other cognitive biases and heuristics, we often fail to appreciate the effect of availability on our thinking. Perhaps that is why "casual" or "non-conformist" attire irks many persons, but why those same persons cannot express why they are irked. In other words, public advocacy for "proper attire" may better reflect cognitive distortions and simplified-thinking than anything about "poorly-dressed" persons.

So what it is about gold medallions that irks NBA fans so much? Well, there is data suggesting that well-publicized legal troubles of prominent hip-hop artists like the late Tupac and the Notrious B.I.G, as well as 50 Cent, have stigmatized hiphop culture-including music, clothing, and other cultural manifestations-as crimeinducing, even though the vast majority of hip-hop artists appear to be law-abiding (a point raised also by Hofstra law professor Eric Freedman: the comparatively few, but infamous arrests of hip-hop artists "have heightened concerns that some of these performers, particularly the stars of gangster rap, have become dangerous emblems for an immensely popular, primarily black musical genre that celebrates violence, gangs, guns, and sexual conquest"). As a result, when we apply these empirical findings to the NBA, hip-hop's unique popularity among many NBA players, who likewise tend to be African-American, may mislead fans into associating those players with crime, or propensity to crime. Social-psychologists have evidenced that very same deduction in numerous other settings, and while I fully acknowledge that I can't "prove" it in the NBA setting (although would love to if someone wants to fund me), the parallel is unmistakably there and would be statistically unique if it were not there.

But to make matters worse, a separate heuristic--anchoring and adjustment--impairs our capacity to adjust sufficiently from initial conclusions. That is, once we form an opinion, we tend to anchor it, and fail to adjust for new information. So when NBA fans associate hip-hop with crime, they often associate NBA players' hip-hop predilections as evidence of their interest in crime, even when presented with contrary data. Assuming the NBA is trying to appeal to as many fans as possible, then it would seem that the league would then care a great deal about player image, and thus seek policies that comport to fans' expectations--however wrongly surmised and cognitively-impaired--of players.

But what makes this so interesting (as write in my article) is how the NBA has also hired Da Ali G to do television commercials and how now all 30 teams have scantily-clad cheerleaders. What does that say about fans' expectations and biases, and how they guide the NBA?

And how does this dress code analysis relate to the heightened age floor? It's because it appears to go to the same phenomenon of fan perception of players, and more specifically how fans assume that younger NBA players are more likely to commit crime, to be problems off-the-court, to be immature--it all fits a paradigm of fan expectations that would worry social-scientists. Those expectations also appear to worry the NBA, but for obviously different reasons: declining fan interest, especially among those that can pay for game tickets and who can afford expensive merchandise, hurts league revenue. So to get the game "back on track," the NBA seeks out policies that attempt to diminish player autonomy, not because the NBA are bad guys, but because they want to appeal to fans who think the players are immature out-of-control.

Is this analysis correct? As I fully acknowledge above and in the article, I cannot "prove" it, but there is empirical support, as well as a basis of analysis for further examination. But there is even greater empirical support for the fact that I have written way too much in this response, and my eternal thanks to anyone who has actually read it!!

 Michael McCann -- 7/13/2006 5:26 PM  

Blazer Prophet,

Thanks for your question. If a player picks up a high school degree or its equivalence, that would then begin the clock on the 2nd prong of the eligibility requirement--meaning there would then have to be a one-year delay between that degree and the draft for him to be eligible. In terms of his age, which goes to the 1st prong of the test, he have to turn 19 during the year in which the draft is held. If he meets both prongs, he's eligible.

 Michael McCann -- 7/13/2006 5:35 PM  

Prof. McCann,

You've been an ardent critic of the expansive interpretation given to the nonstatutory labor exemption in the context of professional sports leagues, but to what extent is that interpretation a substitute for the failure to recognize sports leagues as single-entities under the antitrust laws?

Reviewing the academic articles from the 1980's and early 90's on the single-entity theory, it seems to me at least that the Roberts/Grauer argument in support of single-entity status is much more persuasive than the Goldman/Lazaroff argument against it. Nevertheless, the courts have rejected the single-entity theory, but have acheived essentially the same result by expansively interpreting the nonstatutory labor exemption.

Under the current (Clarett) interpretation of the nonstatutory labor exemption, leagues and players unions combined can essentially make any internal restrictions they want. This arrangement addresses one common critique of the single-entity theory - that it would give owners too much power vis a vis players - but retains the single entity theory's desire to avoid judicial interference in internal league rulemaking, in this case joint player-owner rulemaking rather than unilateral owner rulemaking as the single entity theory would allow.

In short, in the professional sports league context, you can't look at the scope of the nonstatutory labor exemption in a vacuum but must also take into account the sports leagues' unique status under the antitrust laws before decisions in this area make any sense.

 PK -- 7/13/2006 5:35 PM  

PK,

Wow, fantastic comment! I hope people read it carefully, it's excellent. As you outline, a good argument can be made that the 2nd Circuit in Clarett applied what may be considered "single-entity analysis" in reaching its decision, particularly since those affected by the eligibility rule had no representation at the bargaining table and their interests were arguably at odds with both the NFL and NFLPA. To the extent that decision is representative of a broader judicial interpretation of the nonstatutory labor exemption in relation to the NFL (and perhaps also the NBA and MLB), then your point would be even more engaging, and a great topic for a law review article or a student note.

As an aside, I wonder how the merits of treating sports leagues as single-entities has changed in light of the rise of sports leagues which were actually established as single-entities (e.g., the WNBA and Major League Soccer) and which then--at least initially--operated with the league owning all of the teams, the league paying salaries of coaches and players etc.? Is there a sufficient distinction between those leagues and the NFL for not considering the NFL as a single entity? But then again, as you note, it seems that the NFL enjoys the fruits of single entity status regardless, at least with respect to age eligibility in the 2nd Circuit.

Very engaging analysis, to say the least, and thanks for taking the time to write it.

 Michael McCann -- 7/13/2006 6:25 PM  

Regarding the single-entity defense, a league should be considered a single entity when another league or another form of entertainment is alleging that the league did something anti-competitive because the league competes against them for the consumer dollar. But a league should not be considered a single entity when a player is alleging that the league did something anti-competitive because the league isn't in competition with the players. To me it's a strange concept to argue that the defense should protect anti-competitive behavior directed towards individuals that it doesn't compete against.

 Rick Karcher -- 7/13/2006 7:06 PM  

Prof. Karcher,

Imagine GM creates essentially autonomous divisions for each of its brands. Initially the brands compete to get the best suppliers, but then they begin to collude when dealing with suppliers. Do the suppliers have an antitrust claim against GM?

I presume your answer is no, but it's not because GM and the suppliers are "competitors," but because GM is a single-entity and thus incapable of colluding with itself under Section 1 of the Sherman Act.

Likewise, the single-entity defense would say that the leagues are incapable of colluding with themselves under Section 1. Therefore, no antitrust violation under that provision would occur when they, for instance, unilaterally impose a salary cap on their players, just like GM was not liable when its brands unilaterally imposed a "salary cap" on their suppliers.

 PK -- 7/13/2006 8:01 PM  

PK,

I understand the single-entity defense and you're right that the suppliers don't have an antitrust claim against GM in your hypo.

As you know, courts have rejected the SE defense with sports leagues because, unlike the automotive divisions in your GM example, the teams are separately owned. But courts have struggled with its application because sports leagues contain attributes of both separately-owned entities and one entity that produces a single product (i.e. each team needs the other teams in order to produce a product - GM doesn't need Ford to produce a product).

If, in your example, GM's separate divisions agreed on a salary cap, there's no antitrust claim because (aside from the labor exemption issue), a single employer can obviously choose to pay people whatever they want. Also, prospective employees can choose to go work for GM's competitors (i.e. Ford, Chrysler, etc.). In the sports industry, however, prospective players don't have other options (except maybe to go play in a foreign country for much less pay). The suggestion I made in my last comment about bifurcating the SE defense is merely a proposal that addresses the unique attributes of sports leagues -- team separate ownership and a single entity producing a single product.

 Rick Karcher -- 7/13/2006 8:57 PM  

Prof. Karcher,

I was responding to your comment that "To me it's a strange concept to argue that the defense should protect anti-competitive behavior directed towards individuals that it doesn't compete against." I thought you meant that as a general matter, not as a rebuttal specific to the monopsonized labor markets of professional sports leagues.

But I don't see how the fact that leagues are de facto monopsonists really answers the single entity question. It may be "unfair" to athletes that's there only one league, but that only means that we should break up the monopsony leagues that exist and prevent new ones from forming. It does not mean that leagues shouldn't be treated as single entities.

Also, relying solely on separate ownership seems to contradict both Copperweld and antitrust economics. Copperweld holds that you shouldn't elevate form over substance in the single-entity analysis. In addition, under the separate ownership theory, the MLS would be treated as a single entity. But what is the real difference between MLS and a soccer league composed of independently owned teams, especially when the main reason for independent ownership is to increase the appearance of legitimate competition on the field, a pro-competitive benefit.

All that being said, I believe John Wiestart endorsed your bifurcated approach to the single entity theory in a mid-80's law review article and Judge Easterbrook hinted at it in the Seventh Circuit's second opinion in the Chicago Bulls case. In addition, as I noted earlier, it seems to be nearly identical to what the law is now given the expansive reading given to the nonstatutory labor exemption. The issue, however, seems to be much more important if the labor exemption is more narrowly construed, as you and Prof. McCann advocate.

 PK -- 7/13/2006 9:25 PM  

PK,

We should "break up the de facto monopsony leagues"? How? Section 2?

In my opinion, you are over-simplifying the significance of separate ownership of teams in sports. I also think you have to acknowledge that the "unfairness" to the labor market in sports that you seem to be dismissing is a much, much greater level of unfairness than that of labor markets in other industries. We're talking about a workforce that has unbelievable negotiating power and earning potential -- unlike your typical union worker. You may say, so what. I'm saying that the courts should recognize such uniqueness when they apply any area of law to this industry. For example, for the Second Cir., in applying the labor exemption, to simply treat prospective players in the NFL like prospective employees of hiring halls is ludicrous. I could write 10 paragraphs why that's ludicrous but I'm going to bed.

 Rick Karcher -- 7/13/2006 10:40 PM  

PK,

One more thing. I believe it was the Chicago Bulls case (not positive it was that one), which acknowledged that sports leagues should probably NOT be considered as single entities with respect to the labor market. Isn't that contrary to your position that the current state of the law seems to be that courts are effectively implementing the single entity defense when applying the labor exemption? And how is it in fact the "current state of the law" as you say, when we really only have one opinion out there from one circuit (Clarett) construing the labor exemption so broadly? [It's way past my bed time]

 Rick Karcher -- 7/13/2006 10:55 PM  

Prof. Karcher,

Breaking up the monopoly/monopsony leagues under Section 2 would be very difficult for any private plaintiff and probably even for the government due to problems of proof (and the fact that the AFL/NFL merger was specifically authorized by statute). The most likely solution (and I don't think it's very likely at all) would be a legislative one. I think there's a very good analysis of the issue in Stephen F. Ross, Monopoly Sports Leagues, 73 Minnesota L. Rev. 643 (1989).

You say that I'm underemphasazing the unfairness to athletes that would come from a single entity theory, but I disagree. As you state, athletes are "a workforce that has unbelievable negotiating power and earning potential." Given that they can unionize and their unions are very effective, they would continue to wield this bargaining power whether or not the single entity theory is adopted with respect to leagues' dealings with their players. The main difference would be if athletes take the radical step of decertification. Under current law, decertification would end the collective bargaining process and that protection of the statutory labor exemption that comes with it, leaving teams in a league subject to some level of Rule of Reason inquiry for any intraleague rules that attempt to implement to control the players market. Under a single entity theory, decertification would allow the owners to unilaterally adopt any policies they wanted, subject only to the constraints of Section 2. I do not find this change from current law to be very significant. That is why I've been claiming that Clarett's interpretation of the nonstatutory labor exemption effectively recreates the deference to intraleague rulemaking that the single entity defense would create, while addressing one of its perceived (wrongly in my view) flaws - stripping players of their bargaining power.

As for the Bulls case, Judge Easterbrook makes the following observation in his opinion, "Sports are sufficiently diverse that it is essential to investigate their organization and ask Copperweld's functional question one league at a time--and perhaps one facet of a league at a time, for we do not rule out the possibility that an organization such as the NBA is best understood as one firm when selling broadcast rights to a network in competition with a thousand other producers of entertainment, but is best understood as a joint ven- ture when curtailing competition for players who have few other market opportunities." This seems quite similar to the approach you advocate. The holding of the case iself doesn't have much to do with this issue, though, because it dealt with fees the NBA charged to a team and its broadcaster, rather than how the NBA dealt with its players.

Finally, as for whether Clarett alone is the "current state of law" on the nonstatutory labor exemption, we'll probably find out soon enough. I think the main point is that in the major cases construed the nonstatutory labor exemption, e.g., Clarett, Brown v. Pro Football, courts have interpreted it very broadly. One reason this makes sense is that courts rightly do not want to get involved in internal league decisionmaking. Since decertification is very rare, giving the nonstatutory labor exemption a broad interpretation accomplishes that.

 PK -- 7/14/2006 8:47 AM  

PK,

You are knowledgeable about the subject matter and I really appreciate your insights. I was hoping you would answer my section 2 question the way that you did, because you are absolutely right -- the claim would fail (and you can forget about legislative response on this issue). However, I completely disagree with a couple of your assertions.

You say that the players have the negotiating power through the union. That may be true, but only with respect to EXISTING players. Can you honestly say that there is legitimate bargaining when the owners offer benefits to existing players in return for an age rule that doesn't affect them one bit?

And how can you say that the S. Ct. "broadly" interepreted the labor exemption in Brown? That was clearly the right result because the issue involved practice squad salaries (wages) of players already under contract (parties to the CB relationship) that was negotiated between the union and owners. Clarett is apples and oranges from Brown because it involved age eligibility of the draft, which doesn't impact the wages of existing players.

So I guess I disagree with your point that the current state of the law is interpreting the labor exemption broadly with the same effect of applying the SE defense. In other words, courts should continue to reject the SE defense, and the three prongs of the labor exemption should not be supplanted by "legislation from the bench".

 Rick Karcher -- 7/14/2006 9:38 AM  

I'm going with PK on all these issues for no other reason that it is impairing the sleeping patterns of RK and causing MM to write blogs entries the length of law review articles.

 Anonymous -- 7/14/2006 10:07 AM  

Prof. Karcher,

You ask: "Can you honestly say that there is legitimate bargaining when the owners offer benefits to existing players in return for an age rule that doesn't affect them one bit?" Yes, I think there is because I think it is "legitimate," as the Second Circuit held in Clarett, for unions to "seek to preserve jobs for current players to the detriment of new employees and the to the exclusion of outsiders." I believe this is an accurate statement of federal labor law and applies across all industries.

If by "legitimate" you mean that bargaining over the age restriction was fully arm's length in that the union had the under-19 year old players best interests at heart, then no. But I do not think this is the standard by which CBA's or the labor exemption should be judged. If your standard, which I think is the Mackey standard, is used, how is the draft itself and the rookie salary cap within the nonstatutory labor exemption? Those rules deal only with the rights of players who are not yet within the bargaining unit and existing players have the same incentive to give away in-coming players rights, yet there does not seem to be any dispute about those agreements falling within the exemption.

I do agree with you that I probably used the wrong word in describing the Brown decision as a "broad" interpretation of the exemption. You and I both agree that it was fair and correct. I just meant to indicate that there are others who disagree with the decision, namely the district court judge, 1 judge on the D.C. Circuit panel and Justice Stevens. So I should have said Brown gives the exemption a "broader" interpretation than some would give it, just the Second Circuit gave the exemption a broader reading in Clarett than others would give it.

To sum up my position, I would say that Clarett's interpretation of the nonstatutory labor exemption recreates, to a large extent, the level of judicial interference in intraleague rulemaking that the single entity defense would allow. For example, if the single entity defense were recognized, high school players would have no claim under Section 1 regarding the age restriction, just as they have no claim now under Clarett.

Another point of disagreement between us is that you seem to want to limit the scope of the nonstatutory exemption to prevent union malfeasance, or at least nonfeasance, with respect to the rights of incoming members. I think those issues should be dealt with under the labor laws based on the union's DFR obligation. Admittedly, a union's DFR obligation is weak with respect to non-members, but I think that is appropriate. By limiting the scope of the exemption, you're making an end run around DFR law.

 PK -- 7/14/2006 11:45 AM  

PK,

See, this is why the Clarett decision is wrong. You're making blanket statements about prospective union members generally, without thinking about how it applies in sports. If you really think about what you're saying in your first paragraph (and what was also stated in Clarett) regarding the age rule "preserving jobs of current members", it doesn't really make any sense. The issue of whether it's a high school player or a college player that enters the league has nothing to do with preserving jobs of current members. If anything, veteran players' jobs might be better preserved if only high school players are drafted because an argument could be made that they are likely to sit on the bench for the first couple of years. To put it another way, X number of new players are going to come into the league at draft time each year. How does the fact that some are 18 and/or some are 19 have anything to do with preserving jobs? I could see a possible argument about job preservation if the issue was about roster size or even the NUMBER of draft picks.

I concede that the draft and salary cap are mandatory subjects that deal with wages. Now, tell me how the age of an entering player impacts wages. Does an 18 year old player make more money than a 19 yr. old player? If 18 year olds are drafted, does that mean that Shaq's salary is going to be affected or that he needs to stay up all night worried about whether his job is going to be "preserved"? These issues in other industries might have an impact on wages and job preservation -- but in the sports industry? -- Give me a break!

Finally, you keep suggesting alternative solutions for the prospective players on this issue, but then you seem to acknowledge that they are not practical or viable solutions (i.e. Section 2 and Duty of Fair Representation).

 Rick Karcher -- 7/14/2006 7:57 PM  

RK says,"are likely to sit on the bench for the first couple of years." What?

You know, after further review, I think the score right now is as follows:

2nd Circuit and PK: 1

MM, RK, Sheindlin and all others similarly situated around the world who exclaim the Clarett decision was wrong: 0

That will remain the score, for now.

 Anonymous -- 7/14/2006 8:09 PM  

Anonymous,

You know, after further review, I'm starting to think that you're a judge on the 2nd Circuit -- you have such intellectually stimulating things to say.

 Rick Karcher -- 7/14/2006 8:32 PM  

After watching both A.J. Mayo and Billy Walker on tape, I realized that this is a perfect case of why the rule was made. Mayo is the 1% that can go straight to the NBA and be perfectly fine. Walker just isn't quite ready. I know if you read about him he sounds amazing but watch tape of him and you can see plenty of missing components. I hope for the Walker's sake he gets denied the option of going straight to the draft because he just simply isn't ready.

As far as saying college players aren't as good as prep players, the style is different and the talent is more or less unappreciated. When will people realize how important a Udonis Haslem or a Derek Fisher can be to a team trying to win championships?

 Ron Jumper -- 7/15/2006 12:07 PM  

Prof. Karcher,

I had a longer response typed out but the comments ate it so here is the shortened version.

You're absolutely right that in terms of merely preserving jobs for existing union members the age restriction will have no long term effect. However, there are at least 2 other reasons why the union might support it. First, the players could think that the distribution of earnings among them is fairer the closer it correlates with expected performance on the court, rather than simply potential. As you admit, "an argument could be made that [high school players] are likely to sit on the bench for the first couple of years." If so, then instituting an age limit will create a "fairer" distribution of salaries in the eyes of current players. Second, the players clearly have in interest in long-term league revenue growth, not least becuase the salary cap is tied to league revenues. Therefore, if the rule will lead to greater fan support and more revenue (admittedly very contestable), players should support it.

More importantly, as the Clarett court noted, Mackey derives its test for the scope of the nonstatutory exemption from cases involving CBAs designed to have anti-competitive effects in the product market. This is the Allen Bradley/Pennington problem. It makes sense to be wary of this problem because unions and employers could conspire to create a monopoly for the employer and then split the resulting monopoly rents. Here, there's no claim that the age restriction has anti-competitive effects in the product market. In fact, if anything it strenghtens a competing product by increasing the quality of college basketball. Instead, you have to argue that a restraint that only effects the labor market presents the same dangers, but I don't see how you can do that. Where are the monopoly rents being extracted from in this case? It simply does not seem likely that there's any danger of collusion. Instead, it seems much more likely that the NBA owners are seeking restraints in the labor market because fans want them or for some other efficiency-enhancing reason. Therefore, I think the Second Circuit was correct to reject Mackey's and say solely labor market restraints are within the nonstatutory exemption.

I pointed out alternative remedies, particularly the union's DFR obligations, to point out that the problems you're concerned about, namely union's bargaining away the rights of people who have conflicting interests, are already dealt with by other areas of the law. That those areas of the law don't offer much relief is because unions need flexibility in negoitating CBAs. That flexibility should not be reduced by going through the back door of limiting the nonstatutory exemption.

 PK -- 7/15/2006 2:30 PM  

PK,

I think you are over-analyzing this thing. The union and current players haven't given the overall impact of this issue nearly as much thought as you have. Here's what most likely happened: The owners said to the players, we'll give you huge benefit X if in return you agree that new players must be 19 instead of 18, and the players said, "Where do I sign!"

I look at Mackey and the exemption as simply saying that if the subject at issue meets the three prongs, then don't scream antitrust violaton in federal court because the NLRA protects you by giving you a remedy in front of the NLRB in the form of an unfair labor charge. Conversely, if it's a permissive subject, then federal courts will hear the antitrust claim because the NLRB would tell him to "get lost" since the issue isn't required to be negotiated and the league could unilaterally implement it under the labor laws.

I'm assuming you would acknowledge that prospective players basically have no recourse in front of the NLRB. If that's the case, the policy rationale behind applying the exemption here is not met. Where you and I disagree is that I just want to give them a shot to at least try to prove their case in federal court, but you don't even want to give them that. You want to tell them to get lost at both the NLRB level as well as the federal court level -- which is simply not what the exemption is supposed to be doing.

That's my opinion. Good talking with you. I'm out.

 Rick Karcher -- 7/15/2006 4:58 PM  

i have a story about the NBA age restriction. my story is called the minimum age draft for the NBA has just changed.

recently the NBA has changed, and what i feel is this age limit is very insane. highschool prospects no longer cxan jump directly to the NBA and most of them don't like it. After Amare Stoudemire was the only player drafted out of high school in 2002, five players went preps-to-pros in 2003. then, a record- setting eight high schoolers were selected in the first round in 2004, which also marked the third time in 4 years that a prep player was no.1 pick in the NBA draft since Kwane Brown in 2001, Lebron James in 03 and DWight Howard in 04.
Despite the success preps-to-pros players have experienced, basketball purists cried that something had to be done. Which NBA commissioner, David Stern had agreed. The reason why they changed the age limit to my understanding was because, players are getting to good and the number of high school players was increasing each year. when the NBA and it's players association negotiation a new collective bargaining agreement this past summer which NBA commissioner got his way and the age minimum was instituted.
so beginning in 2006, a player must be 19 and one year removed from high school before he can be drafted. in the 2005, the last to allow the preps to go pros jump, a record of nine basketball players were taken, but only three went in the first round.

so ideas i feel about this is, i think it's unfair because if you have the opportunity to do something you should be able to do it. I FEEL that if it's occuring in one sport that it should occur in all variety of sports. also i'm very against O.J AND bILL HAVING TO EVEN challenge NBA AGE restriction.''i don't see why you have to be 19 to play a game of basketball when you can be 16-18 and go to war for our country and die". which been quoted by star Bill Walker. MY OPINION HAS BEEN DISCUSSED ABOUT IT AND IT'S RIDICULOUS, IT'S UNFAIR. BUT IT'S OVER WITH NOW, SO THERE'S NO REASON TO COMPLAIN ABOUT IT.

 Donnie -- 7/21/2006 10:49 PM  

Personally, I think the limit isn't enough. One year to me is like a slap in the face to the fan. It's saying "Here's what you could have. But guess what, it's going to be gone at the end of the year. Sit there and wonder what if." People will like to talk about other reason why the league has been declining in domestic popularity, but I think you can look at the college game. Over the last few years, it's looked pretty weak as far as overall talent goes. Games have gotten less dynamic and the magnitude of high school players that have left to go straight to the NBA has seriously hurt college basketball.

I believe that you can use the college sport to enhance the pro sport. Colleges are such a community thing. I'm from Columbus, Ohio and I've seen first hand how much people are willing to get behind the college team, whether or not they really like the sport, and how much they feel like they identify with the players. With high school players going straight to the league, or only sticking around one year, there's not that connection. Lebron James is from Ohio, but how many people can you say from Ohio identify with him, feel like he's one of their own. That he represents their cities and state? There aren't many. Now think of how many more people would feel that closeness to him and want to watch more of his games if he went to, say Ohio State.

. I think if you keep the star players in the colleges for 3 years minimum, it would lead to a bigger college support, which could lead people that weren't fans of the sport previously to gain a more in depth liking for it.

In short, I think that while the the age limit is a start, a longer one would be beneficial to basketball, overall. People will argue that kids that come straight from high school half success in the league, but to me that's not what it's about. The reason these players even make the money that they do is because of the fans. Who's really in charge here? We're the reason they can go out and drive a hundred thousand dollar cars and have shoe deals. The fans should be put first, and extending the NBA age limit would help basketball as a whole.

These players need to understand who's putting them where they are and that they're just entertainers.

 Patrick -- 1/26/2007 3:22 PM  

Something I was thinking about earlier when I emailed Professor McCann - my question regards scouting.

Rick - does the NBA in fact spend millions scouting all over the country? Isn't the presence of schools like St. Vincent - St. Mary's and Oak Hills Academy evidence that there is a large degree of selection even before the pro scouts see the players?

Wayne Mansfield, Editor
Gary Carvolth Voice of the Common Man
www.garycarvolth.com

 Wayne Mansfield -- 6/11/2007 10:41 PM  

I recently came accross your blog and have been reading along. I thought I would leave my first comment. I dont know what to say except that I have enjoyed reading. Nice blog. I will keep visiting this blog very often.



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