Sports Law Blog
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Saturday, April 29, 2006
 
Leinart's Folly? Knowing When to Say When

Had USC quarterback Matt Leinart declared for the 2005 NFL Draft, it is widely-presumed that he would have been the first overall selection, with the San Francisco 49ers taking him instead of Utah quarterback Alex Smith. In that alternative history, Leinart would have signed for at least what Smith received (6 years, $49.5 million, including a $24 million signing bonus, which is guaranteed money).

But instead, Leinart chose to stay for a fifth year at USC, which had just won a national championship. He reasoned his decision on how much he loved it at USC and the opportunity to win another Heisman Trophy. Many fans praised him for his loyalty. Plus, having grown up in the middle class Californian community of Santa Ana, Leinart may not have had the same immediate financial demands that many similarly-situated players have (although, other than location, I don't know of Leinart's particular upbringing).

Today, while watching the 2006 NFL Draft on ESPN, I watched an increasingly-dejected Matt Leinart sitting in the "Green Room," staring away in disgust as other players were selected ahead of him. ESPN might as well have called it the "Matt Leinart Cam," since it devoted more attention to his reaction than to reaction of those players selected ahead of him. Even worse, Chris Berman & friends had a field day commiserating over Leinart's plight, especially when the Tennessee Titans--whose offensive coordinator, Norm Chow, coached Leinart at USC--took Vince Young instead. And then there was Suzy Kolbern's awkward interview with Leinart's obviously-dispirited agent, Tom Condon, who repeatedly spoke of "getting it over with." The whole escapade may have made for compelling TV and good ratings, but it was done at the expense of a 22-year old and his family. And it lasted until Leinart was chosen 10th overall by the Arizona Cardinals, some 100 minutes after the draft began. But the humilation didn't end there: as ESPN's national audience watched, Leinart then had to answer Kolbern's uncomfortable, skeptical questions about why he may have dropped so far in the draft.

But more than embarrassment, Leinart lost a lot of money. Instead of signing at least a $50 million contract with a $24 million signing bonus, Leinart projects to earn slightly more than what the 10th pick from the 2005 Draft, Mike Williams, signed for ($13.5 million and a signing bonus of about $1.5 million). Plus, instead of playing in San Francisco, where his endorsement income might have been extraordinary, he now goes to a more obscure setting in Arizona. And instead of playing for the storied 49ers and following in the footsteps of Joe Montana and Steve Young, Leinart will instead play for the Cardinals, which have had one of the worst yearly attendance records in the NFL and do not enjoy an inspiring history from which to draw. One might also argue that Leinart's pro career will be one year shorter, although that is speculative for a number of reasons.

Now, I'm sure Matt Leinart enjoyed his last year at USC. He was the proverbial Big Man on Campus, and since he only took one class (ballroom dancing), he undoubtedly had a lot of time to enjoy that status. He also hung out with A-List celebrities and allegedly dated Alyssa Milano. Donald Trump even took a personal interest in him, and Nick Lachey wanted to be his roomate. So life was probably quite good, and he therefore did obtain "value" in a subjective sense by remaining in school.

But was it worth a $40 million difference in contract value, and perhaps $23 million in guaranteed signing bonus money? And was it worth his star falling so hard and so publicly in today's draft? And was it worth passing up an opportunity to play in San Francisco? I'm as much of a fan of Alyssa Milano as any guy, and I'm sure it would be cool to hang out with Jim Carey and Muhammad Ali, but . . . Matt Leinart gave up a lot today.

Thursday, April 27, 2006
 
DePaul Sports Law Symposium

The 2006 Annual Sports Law Symposium will be be held tomorrow at DePaul University College of Law in Chicago. It will be hosted by the DePaul Journal of Sports Law and Contemporary Problems. I am happy to be speaking at the Syompsium, and here is the speakers' schedule:

Morning Panel 10:00 a.m. – 12:00 p.m.

Legal Issues Surrounding Professional Sports Venues


MODERATOR

Robert Buch, Seyfarth & Shaw


Panelists:

G. Kevin Conwick, Holme Roberts & Owens

Adam Klein, Katten Muchin Rosenman

Frank Mayer III, Buchanan & Ingersoll


Afternoon Panel 1:30 p.m. – 3:30 p.m.

An Examination of Recent Collective Bargaining Agreements in Professional Sports


MODERATOR

Lester Munson, Legal Analyst and Writer for Sports Illustrated

Panelists:

Dennis Cordell, Former Counsel for NFL Coaches Association and President of Coaches, Inc.

Michael McCann, Law Professor at Mississippi College School of Law, member of Maurice Clarett's Legal Team, contributor to the Sports Law Blog

Robert McCormick, Law Professor at Michigan State University, member of Maurice Clarett's Legal Team

Alan Milstein, Sherman Silverstein Kohl Rose & Podolsky, member of the Maurice Clarett Legal Team

Michael Wall, Chief Legal Officer for Delaware North Companies, Inc - Boston and Boston Bruins


Breakout Sessions 12:45 p.m. – 1:15 p.m.

Anatomy of a Stadium Deal: Frank Mayer III

Breaking Into the Industry: G. Kevin Conwick, Dennis Cordell, Michael Wall

Hosting Public Golf Tournaments: Robert Markionni, Chicago District Golf Association


Thanks to Nick Wurth, Symposium Editor of the DePaul Journal of Sports Law and Contemporary Problems, for organizing this event.

Tuesday, April 25, 2006
 
Ballpeace: Doug Mientkiewicz and Red Sox Reach Agreement on Baseball

The year-and-a-half long legal battle between the Boston Red Sox and former first baseman Doug Mientkiewicz over the ball from the final out of the 2004 World Series is over. Mientkiewicz and the Sox have agreed that the ball will go to the Baseball Hall of Fame, where it will remain, forever.

Last November, the Sox filed a lawsuit against Mientkiewicz, claiming that the team owned the ball. The Sox dropped the lawsuit after Mientkiewicz agreed to an independent mediation of the dispute.

The New York Times' Murray Chass (a Yankees fan) believes that Mientkiewicz had the strongest claim to the ball, while the Red Sox had the weakest:
The [Sox] claim of ownership was highly questionable. The commissioner's office supplied it, and the game was not played at Fenway Park. It was in St. Louis. Selig did not want the used ball back, and the Cardinals certainly did not want it as a reminder of their ignominious sweep by the Red Sox. Based on precedent, Mientkiewicz had every right to the ball.
My take: the ball was supplied by Major League Baseball for purposes of a particular game or games, and it, presumably, was under the control of both the home team, the Cardinals, which served a function akin to an implied or possibly express licensee, and the umpiring crew. In between games, the ball either goes back to Major League Baseball or remains under the control of the home team. It is never "given" to anyone. Nor does it go with the visiting team when they leave.

Moreover, Mientkiewicz worked for the Red Sox, and typically employees' works belong to the employer. So even if Mientkiewicz believed that by capably handling the throw from Keith Foulke to record the final out he somehow obtained creative ownership in the ball, that ownership claim would presumably rise to his employer, the Red Sox.

Now, one might argue that Mientkiewicz was like a fan catching a home run ball or a foul ball, and the fan gets to keep the ball. But the difference here seems to be in the abandonment of the ball. A baseball is designed for play within the confines of the playing field and when it leaves the confines--such as when it goes into the crowd--it may be considered abandoned. The ball Mientkiewicz took was never abandoned, as I assume that the either the umpires or the Cardinals' grounds crew collect the balls at the end of every game at Busch Stadium.

So here's my list for ownership claims, from strongest to weakest:

1. Major League Baseball
2. St. Louis Cardinals
3. Boston Red Sox
4. Doug Mientkiewicz

Update: Ariel Reck in the comments mentions a recent and relevant law review article by Brian E. Tierney: A Fielder's Choice: How Agency Law Decides the True Owner of the 2004 Red Sox Final-Out Baseball, 3 Willamette Sports Law Journal 1 (2006). Tierney's conclusion:
Through baseball custom, Doug Mientkiewicz should be allowed to keep the 2004 World Series final-out baseball. Although the gift may have arisen out of his employment relationship with the Red Sox, the baseball industry’s long-standing tradition of allowing players to keep final-out baseballs would effectively negate the Sox’s claim of ownership. This unique situation of a team requesting a sentimental ball back has given notice to MLB that some guidelines must be established. The potential outcome of this controversy may seem disappointing to many fans who believe that the ball represents an entire team’s effort over a 176 game season.
I haven't yet had a chance to read the article, but it seems like a good read.

Sunday, April 23, 2006
 
The Enemy of My Enemy is My Friend: Hunters and Environmentalists

Christina Larson of Washington Monthly has an engaging piece on the growing political alliance between hunters and environmentalists, and how that alliance may affect the sport of hunting (Larson, "The Emerging Environmental Majority," Wash. Monthly, May 2006). Traditionally, these two groups have gravitated towards very different political channels. Hunters have usually been associated with the Republican Party, which tends to favorably advance the interests of the National Rifle Association, while environmentalists have often leaned on the Democratic Party for a more welcoming audience.

And on the surface, hunters and environmentalists would seem to embrace very different philosophies about Earth management. Hunters like to kill animals; environmentalists like to save them. But as Larson writes, both groups lose out when mining, oil, and gas companies gain access to public lands and begin extracting resources. Environmentalists get upset because the animals die; hunters get upset because they didn't get to kill them.

Larson reports that these two groups have now found a common enemy:
Over the past five years, Bush administration policies in the west—accelerating drilling on public lands and waiving protections on water quality and wildlife—have given this odd couple a common enemy. "The White House's pillaging of public lands has driven hunters and ranchers into the trenches with environmentalists," says David Alberswerth of the Wilderness Society. "There's absolutely no question about what's brought us closer together," agrees Oregon hunter and prominent outdoor columnist Pat Wray. "It's the Bush administration."
With their target set (no pun intended), hunters and environmentalists are now co-sponsoring "save the land" letters sent to Congresspersons, and they are beginning to adopt each others' viewpoints. For instance, according to a 2005 National Wildlife Federation poll, 75 percent of hunters agreed with the statement "the U.S. should reduce its emissions of greenhouse gases like carbon dioxide that contribute to global warming and threaten fish and wildlife habitat." Larson's terrific article offers other anecdotes suggesting that the sport of hunting should no longer be viewed as a "Republican sport."

And a union of hunters and environmentalists would seem to offer an incredibly powerful lobbying group, and one, interestingly enough, that would represent the more harmonized environmental/hunting views of President Theodore Roosevelt from almost a century ago. On that note, consider that the polar-opposites characterization I posited above concerning hunters and environmentalists is misleading: a hunter is an environmentalist, because he relies on a continued existence of animals found in the wild.

But even with this burgeoning relationship and understanding, will hunting continue as a viable sport? In January, we discussed another article by Larson, and it explored the contraction of available hunting land and how the percentage of American hunters has dropped steadily in recent years. Hunters have traditionally relied on Republicans to protect their gun rights, but are those same Republicans now rendering their guns useless? And will hunters--who obviously can't match the massive GOP fundraising contributions of big corporations who want their land--be able to fend off a shrinking terrain?

Saturday, April 22, 2006
 
Professional Hockey Player Sues for Workers' Comp

In the interest of full disclosure, an article about this post appeared this week on the pages of Massachusetts Lawyers Weekly (humbly written by one of your bloggers). The case involves an interesting workers’ compensation claim brought by a professional hockey player against his team.

Daniel Focht was a forward for the Springfield Falcons of the American Hockey League, a minor league team affiliated with the Phoenix Coyotes of the National Hockey League. He later went on to play a few years in the NHL. In December 1999 and September 2000, he was injured during games and sustained facial disfigurement while playing for the Falcons. He was paid $15,000, the maximum amount available under Mass. law.

During two different games in the 2001-2002 playing season, he then sustained additional facial scarring and sought additional workers’ comp payment. At a hearing before an administrative judge, the insurance carrier contended that Focht had already reached the $15,000 cap based on the prior payments and was not entitled to additional money. The administrative judge sided with the player and awarded him the benefits claimed.

The decision was appealed and a Massachusetts court ruled that Focht was entitled to a separate workers' compensation payout for each facial scarring injury that he received during the four separate games — even if the total payout exceeded the workers' comp cap of $15,000.

The insurance carrier’s lawyer, who represents the insurance company that insures most of the teams in professional hockey argued that by the time the most recent set of facial injuries had occurred, the player had already been awarded $15,000, which is the maximum amount allowable under the statute governing recovery under workers' compensation for facial scars.

But in upholding the decision in Focht’s favor, the court wrote that to the extent that different injuries caused different bodily disfigurements, the court considered that each one was subject to its own $15,000-per-injury maximum. "We see no legislative intent that the employee be subject to an omnibus disfigurement accounting between various insurers covering various injuries," the judge said.

She added that the statute makes clear that the Legislature contemplated specific compensation for an injury and contained no language that attempted to cap the amount an individual player could obtain. The statute provides compensation to any employee "[f]or bodily disfigurement, an amount, which … is a proper and equitable compensation, not to exceed fifteen thousand dollars."

"If the [L]egislature in 1991 intended to change the application of the [statute's] cap from injury to employee, by virtue of its change in the method of calculating the maximum entitlement, it easily could have said so," the judge stated, adding that the review board was not inclined to infer such an intention.

For those having difficulty accessing the link, the full decsion be found at http://www.mass.gov/dia/PUBS/REVIEWS/06B/DanielFocht.pdf.

 
Hefty Fine (but no suspension) for Penn State Coach

We would like to thank Michael and Greg for once again including us on the esteemed guest blogger roster. As a matter of background, we do not yet have the good fortune to practice or study legal issues in the world of sports on a full-time basis. Our current involvement in this growing area is limited to our weekly radio talk show. Sadly, during the rest of the week, our legal “acumen” focuses on other topics – although occasionally we are able to include some sports topics in our during-the-week jobs. Generally, in preparing for our show, we will find cases or stories of interest to us, raise appropriate questions, and then reach out to guests who can further educate our audience. With this background in mind, we hope this weekend to raise some questions about current cases and news items. Finally, an apology to our esteemed bloggers for being tardy with our posts as those pesky during-the-week jobs demanded a significant amount of time. Enough background, on to the substance. . .

Tuesday, Penn State University disciplined its women’s basketball coach. A former Penn State player had accused coach Rene Portland of discriminating against her on the basis of race and sexual orientation. The curious note to the story is the punishment handed down by University President Graham Spanier. Rather than suspend or even dismiss the coach, the school levied a substantial fine ($10,000) for her actions. President Spanier noted the need for a remedy that would have a more immediate impact than a suspension for next season. Did the university look to the courts for such a remedy? We are not aware of many cases (although perhaps the readers are) where an employer has fined an employee for an employment related discretion. Governmental agencies often fine companies and individuals for various actions. In the sports arena, we frequently observe a league fine its teams, coaches, and players. We have seen teams fine players for reporting late to training camp or refusing to play. However, these team fines generally appear to be limited to players who are not meeting the requirement to practice or play with the team. It does not seem common for teams to fine players or coaches for an act of commission. So, the next time that one of us is in violation of company policy (for example, reading Sports Law Blog during business hours), should we be concerned that a bill from our employer might arrive in the mail?

Friday, April 21, 2006
 
Larry Bird and Legends Wine: Exceeding the Limits of Plausible Endorsement Deals?

Dan Shaughnessy of the Boston Globe scripts a humorous column today on Larry Bird endorsing an $80 bottle of wine called "Legends." (Shaughnessy, "It's Vintage Bird," Boston Globe, 4/21/2006). Shaughnessy finds it ridiculous that Bird would claim any expertise in wine, and particularly wine from Napa Valley:
I removed the bottle of red (Meritage) from the box, looked at the label (2003 Napa Valley), and started to giggle. Napa Valley? Please. The closest Larry ever got to Napa Valley was when the Celtics played the Warriors at the old Oakland Coliseum. It's truly impossible to imagine him doing the ''Sideways" thing, twirling wine in his mouth, then announcing, ''Quaffable, but not transcendent."

This is a guy who would not know oakey from Charles Oakley. It's simply more proof that our pal Larry will do anything for money (which, by the way, makes him OK in my book). Who can forget the day back in the 1980s when Larry was spotted wearing a hideous short-sleeve shirt -- a shirt your mother might have bought you for the first day of first grade -- and acknowledged, ''I'll wear anything if it's free."

And now the all-time beer guy has put his name on a bottle of wine. Can't fool us. We know better. Colleague Bob Ryan, Bird's official biographer, said, ''I never saw him drink anything but beer." Larry and beer were always the best of friends. Like Ryan, I know this firsthand. Back in his MVP years in the mid-1980s, he caught me drinking a Molson one night and said, ''I never drink beer that comes in a green bottle. It all goes back to a party one night in college. I picked up the wrong bottle, a green one, and started chugging and didn't know what was happening until that third cigarette butt went down my throat. That was it for me and green bottles."

Eighty bucks per bottle. That killed me. I mean, we're talking about Larry Bird here. This is the man who refused to leave a tip when he went out to eat in New York his rookie year. He just couldn't believe the price of lunch in Manhattan in 1979. In 1992, when he was in Monte Carlo with the Olympic Dream Team, he walked out of a lounge when the barkeep told him he owed 7 bucks for his bottle of beer.
Shaughnessy's column brings to mind how becoming a product endorser does not require any credible expertise or even interest in the product. Along those lines, you might ask, is George Foreman really an expert on grills, or might his endorsement be more motivated by a $137 million contract? Does Maria Sharapova drive Ford Land Rovers on a regular basis, or have any idea how they compare to similar cars? Lance Armstrong clearly knows a lot about bicycles, but should we assume the same to be true about jets?

That's not to say that all athlete endorsements are suspect. Michael Jordan and Olympic swimmer Michael Phelps probably do drink Gatorade, and the idea of Kevin Garnett drinking Red Bull seems believable. I also find it believable that David Ortiz and Shaquille O'Neal would regularly play baseball and basketball video games, and to bolster that point, they appear to be intricately involved in the making of those games. Many athletes also endorse shoe companies, and Lebron James, Allen Iverson, and Venus Williams obviously know a thing or two about sneakers.

But as we see with Larry Bird and "Legends" wine, sometimes the product endorsement seems completely unrelated to the endorser, and those kinds of endorsements almost invite a plug for Consumer Reports Magazine. Of course, that magazine won't help us when athletes endorse politicians, but it's probably a good start.

Thursday, April 20, 2006
 
Throwing Games and the NBA Draft Lottery

True Hoop discusses an interesting post by Craig Kwasniewski regarding lottery-bound NBA teams seemingly attempting to lose games in order to secure more ping-pong balls in the forthcoming lottery. Other writers have observed the same phenomenon. For instance, Celtics Blog recently chronicled "Operation Shutdown," the sudden rash of "injuries" experienced by the Celtics, which closed out the season by losing 5 of their last 6 games--games started by bench players, while Paul Pierce & Co. sat out. Many Celtics fans, myself included, were disappointed to see the team win last night and thus tie the Minnesota Timberwolves for the NBA's 6th worst record, meaning fewer ping pong balls for the Men in Green. Speaking of ping pong balls, I calculated the following probabilities chart, based on a variety of sources, for the 2006 Lottery. I think it is right, but let me know if it needs any changes (my last statistics class was in college . . . and it's been 10 years since I took that class):

2006 NBA Draft Lottery Probabilities (now reflecting tie-breakers)

Ping-Pong Balls

1st Pick Likelihood

2nd Pick Likelihood

3rd Pick Likelihood

Likelihood of 1st, 2nd, or 3rd Pick

Portland Trailblazers, 21-61

250

25.0%

21.6%

17.8%

64.4%

New York Knicks, 23-59

199

19.9%

18.8%

17.0%

55.7%

Charlotte Bobcats, 26-56

138

13.8%

14.3%

14.5%

42.6%

Atlanta Hawks, 26-56

137

13.7%

14.1%

14.2%

42.0%

Toronto Raptors, 27-55

88

8.8%

9.7%

10.6%

29.1%

Minnesota T-Wolves, 33-49

53

5.3%

6.4%

7.1%

18.8%

Boston Celtics, 33-49

53

5.3%

6.4%

7.1%

18.8%

Houston Rockets, 34-48

23

2.3%

2.7%

3.4%

8.4%

Golden State Warriors, 34-48

22

2.2%

2.4%

3.0%

7.6%

Seattle Supersonics, 35-47

11

1.1%

1.3%

1.6%

4.0%

Orlando Magic, 36-46

08

0.8%

0.9%

1.0%

2.9%

New Orleans Hornets, 38-44

07

0.7%

0.8%

1.0%

2.6%

Philadelphia 76ers , 38-44

06

0.6%

0.7%

0.9%

2.2%

Utah Jazz, 41-41

05

0.5%

0.6%

0.7%

1.8%























The chart seems to show that non-playoff teams could, in fact, perceive an interest in losing
games, particularly since most drafts have three or four outstanding prospects, and then a sharp drop-off in talent. While players have no apparent reason to play poorly, an owner or general manager could seemingly instruct or pressure the head coach to give more minutes to bench players.

Perhaps the most recent and egregious example of purposeful losing by an NBA team occurred in the 1996-1997 season, when teams were jockeying for the worst record, in hopes of securing the coveted first pick in the draft, which would be used to select Tim Duncan. At the time, the Celtics were coached by M.L. Carr, who was also the team's general manager. The team lost 67 games, thus securing the worst record (but it didn't win the lottery). Having watched a number of their games that season, it seemed that they always found a way to lose. Five years later, Carr would assert that he was indeed trying to lose games:
Carr suggested his last season as Celtics coach in 1996-97, during which the team suffered through a franchise-worst 15-67 record, was a tank job designed to deliver the incoming coach (Rick Pitino) with strong draft position.

"That was part of the orchestration," said Carr, an obvious indictment of the entire organization and its part in encouraging a losing season in an attempt to get the first overall pick (Tim Duncan). As it turned out, the Celtics lost out on Duncan and settled for the third and sixth overall picks.

Mark Cofman, Celtics Dismiss Outspoken Carr, Boston Herald, Feb. 1, 2001, at 84.
Do we believe Carr when he says that he was trying to lose games--with the obvious implication that the team's record didn't reflect his talents as a coach or GM--or did he lose games simply because he wasn't very good at coaching or team management? We'll probably never know. But what's interesting is that the lottery system was seen as a way of deterring teams from tanking games. As I wrote in Illegal Defense: The Irrational Economics of Banning High School Players from the NBA Draft:
The NBA Draft has possibly created incentives for teams to lose games in order to secure better draft position. Such a concern was amplified at the end of the 1983-84 season, when the Houston Rockets were alleged to have deliberately lost games in order to secure the worst record in their conference, thereby giving them a 50 percent to chance to win the top pick and select Hakeem Olajuwon, who starred at nearby University of Houston. After this scenario played out, the concept of the “Lottery” was adopted during the 1984 NBA owners’ meetings, whereby all seven non-playoff teams would have an equal chance to secure picks one through seven.
The lottery system has evolved quite a bit over the years. But does it need further adjustment in order to deter apparent purposeful losing? Kwasniewski proposes several solutions, including giving every non-playoff team an equal chance at winning the lottery. Interesting idea, and it would likely eliminate purposeful losing, but it seems to go against the talent re-distributive purpose of the draft: supply the most potential help to the weakest teams. But does the current lottery system work? And do teams actually try to lose games or is that more conspiracy and hindsight bias than truth?

Saturday, April 15, 2006
 
Show Me 97 Percent of The Money: NFL Agent Maximum Fee to Remain at 3 Percent

Street and Smith's Liz Mullen reports that the NFLPA's Board of Player Representatives (which is comprised of this Executive Committee) has decided against lowering the maximum agent fee from 3 percent to 2 percent for most player-agent agreements, although did lower the fee for franchised and transitioned players. (Mullen, "NFL Union Keeps Maximum Agent Fee," Street and Smith's Sports Business Journal, Mar. 27, 2006 (registration required)). A number of players had advocated that the maximum fee be reduced for all contracts, contending that some players, and particularly new NFL players, unknowingly and hastily agree to the 3 percent fee without exploring other representation options (such as hiring a lawyer to do their contract representation on an hourly rate basis, or simply finding an agent who would agree to 2 percent). To illustrate this concern, Kellen Winslow Sr. recently opined that agents are duping young players into signing player-agent contracts with 3 percent fees:
Anyone who is paying 3 percent for contract negotiation I can tell you is being ripped off. [Eligible draft picks] decide to sign with an agent because agents have sold them a bag of goods of what they can do for them. All an agent can do for you at the combine is to run around and use your name so they can recruit other players.

Winslow also argued that while many agents promise to help players secure loans, top draft prospects could save themselves the commission by simply going to a bank and easily obtaining a loan on their own.

Nevertheless, a group of agents convinced the NFLPA that a reduction in the maximum fee would prove disastrous to their practice and also severely impair their ability to provide players with certain services, such as training to prepare for the NFL combine and the NFL draft. But their persuasion only went so far, as the NFLPA passed a resolution that lowers maximum fees from 3 percent to 2 percent for franchised and transitioned players, and agreed to futher reductions when a player is franchised or transitioned a second and third time.

Rick Karcher has written extensively about player representation and agent fees. For a preview of his forthcoming article in the Willamette Law Review on that subject, check out his post from February:
As players' salaries keep increasing, so do the agents' fees because they are paid on a commission basis. Simply, the agent's fee far exceeds the legitimate legal work and negotiation involved with a player contract, and the players are essentially funding the solicitation expenses incurred by agents. With such a huge commission at stake, agents have an incentive to invest an incredible amount of time and resources in client solicitation. And many of the reasons or justifications typically cited for paying a fee on a commission basis in other industries are not applicable to the player-agent relationship.
We look forward to Rick's law review article. And are players being duped by certain kinds of agents or do they simply lack personal responsibility in pursuing representation? Or both?

Thursday, April 13, 2006
 
Perjury Investigation of Barry Bonds: More Bark than Bite?

According to Ted Rowlands of CNN, the United States Attorneys' Office in San Francisco is investigating whether Barry Bonds perjured himself while testifying before a grand jury in 2003. During that testimony, Bonds admitted that he had used a clear substance and a cream provided by trainer Greg Anderson, but stated that he believed they were flaxseed oil and arthritis balm. He also disclaimed any knowledge of substance-usage records, such as doping calendars from BALCO which indicated that he had used banned drugs, and denied ever paying Anderson for steroids or knowingly using them. As we discussed last month, the new book "Game of Shadows" paints Bonds as a knowing and habitual user of steroids and performance-enhancing substances.

Keep in mind, perjury charges are typically very difficult to prove. Perjury is the act of knowingly, intentionally, and materially lying to a court after taking an oath to tell the truth. So the prosecution must establish that a defendant knowingly and intentionally misstated a material fact, rather than having merely suffered from 1) a faulty recollection while answering a question; 2) a misunderstanding of the question being asked; or 3) a misunderstanding of his own response to the question. Moreover, an intentional lie must have a consequential effect on the case's ultimate outcome, a hurdle which can also be difficult to establish.

On the other hand, and assuming that Bonds did in fact lie under oath, his reputation for being meticulous about what goes into his body would seem to undercut any faulty recollection defense. But then again, did he understand the questions being asked of him? And did he fully understand his own answers? And how can the prosecution show that he did?

 
The $35,000 Question: Will Lower NBDL Age Limit Matter?

The National Basketball Development League (NBDL), which in part serves as the NBA's minor league system, announced today that it will lower its minimum age requirement from 20 years of age to 18 years of age, effective next season (note: the current 20-year old NBDL rule exempts players who are at least 18, had been drafted by an NBA team, and who were later cut or re-assigned by the NBA team). The NBDL age limit is different from that of the NBA, which now requires that an amateur American player be at least 19 years old on December 31 of the year of the NBA draft and that at least one NBA season has passed from when he graduated from high school, or when he would have graduated from high school, and the NBA draft.

The lowering of the NBDL age limit may reflect criticism that the NBDL's 20-year old limit is in violation of federal antitrust law, and specifically Section 1 of the Sherman Act, which prohibits agreements that unreasonably restrain trade, such as those impairing a relevant labor market (in this case, players). Back in 2002, sports agent Chris Brown of Orpheus Sports & Entertainment (and also adjunct sports law professor at Boston College Law School) wrote in the Metropolitan Corporate Counsel:
Under federal court precedent, the NBDL Rule most likely constitutes a “group boycott” that is illegal under Section 1 of the Sherman Act, exposing the NBDL to a potential fine of Ten Million Dollars ($10,000,000.00).

The harm resulting from the application of the NBDL Rule is threefold. First, teenage athletes not drafted by the NBA will be excluded from the market they seek to enter, the NBDL. Second, competition in the NBDL will suffer due to the fact that potentially superior athletes will not be afforded an opportunity to play in the NBDL. Third, by pooling their economic power, the individual member teams of the NBDL, like the NBA, have, in effect, established their own private government, and the NBDL possesses market power in a degree approaching a shared monopoly.

The NBDL will be hard pressed to convince a federal court that the NBDL Rule excluding athletes from trying out for a team based on the fact that the athlete is under twenty years of age does not constitute a group boycott under the Sherman Act . . . Utilizing a strict age requirement over merit will eventually lead to judicial scrutiny.
It will be interesting to see if the lower NBDL age rule attracts any star 18-year old high school basketball players who would otherwise have jumped for the NBA but can't because of the new NBA age limit, and who don't want to play in college (perhaps because they would rather make money for themselves and their families than for the NCAA/CBS/ESPN/Nike/videogame companies etc. which profit considerably from college hoops). But keep in mind, the average NBDL salary is about $35,000 (in comparison, the average NBA salary is about $4,900,000 or 139,000% more than the average NBDL salary), and NBDL players travel by bus and stay in motels. And perhaps save for a few, nobody knows who they are. In other words, life in the NBDL is nothing like life in the NBA, and they are obviously not comparable employment opportunities.

But for some players, the NBDL might still seem like a better option than going to college (similar to how for some persons, going into a trade out-of-high school is a better option than going to college). After-all, while $35,000 a year might not seem like a lot to most, someone from a family below the poverty line (which, for a family of four, is one that earns just under $19,000 a year) might have a very different reaction to that salary.

We'll see.

Wednesday, April 12, 2006
 
The Case for Banning Smokeless Tobacco in Major League Baseball

As we know, Major League Baseball is determined to eradicate steroids and performance-enhancing drugs from the game. Both politicians and fans have expressed disgust at the thought of players cheating, especially when those players break or threaten to break storied records. Politicians and fans are also worried that young people will watch their baseball heroes gain success and acclaim by bulking up through illegal means, and will thus feel that they should do the same. I discussed that latter topic in an article published last year in the American Journal of Law and Medicine.

But where is the uproar over young persons watching ballplayers chew and spit smokeless tobacco, especially when over 70 percent of ballplayers do so? After-all, long-term users of smokeless tobacco increase their risk of mouth cancer by 400 percent, and approximately 50 percent of those who use smokeless tobacco developed the habit before they were 13. Just as troubling, 20 percent of high school males use it and a higher percentage of high school athletes do. Smokeless tobacco is also known to discolor teeth and to cause gum recession and tooth decay.

So why not the same uproar over smokeless tobacco? Is it because steroids are about cheating while smokeless tobacco is about personal habit? Is it because many steroids and performance-enhancing are illegal while smokeless tobacco is not? Is it because too many players chew and it is thus too widely-used to stigmatize? The explanation doesn’t appear to be about health concerns, as smokeless tobacco is arguably more harmful and its use among young persons appears to be more prevalent. Even worse, we've already seen baseball players greviously harmed by smokeless tobacco (e.g., former Anaheim Angles minor leaguer Rick Bender; former high school baseball player Gruen Von Behrens), but bursts of outrage directed toward it don't seem to last. **Note: the photos of Bender and Von Behrens show horrifically-saddening consequences of smokeless tobacco, so be warned before clicking on their links.**

These are questions implicated by a new study authored by Harvard Professor Gregory Connolly on tobacco use during the 2004 World Series between the Boston Red Sox and the St. Louis Cardinals. (Stephen Smith, “Team of Destiny had a Dirty Habit,” Boston Globe, Apr. 11, 2006). Professor Connolly and his researchers analyzed videotapes of Game 4, and found that the Sox and Cardinals provided what amounted to $6.4 million in free advertising to the smokeless tobacco industry. So no, not a good example for impressionable kids.

Professor Connolly calls on Major League Baseball to ban smokeless tobacco, but Major League Baseball claims it cannot do so without consent from the Major League Players' Association (does that explanation ring a bell?). It would be great to think that Congress would show the same resolve in tackling smokeless tobacco that it has in combating steroids--particularly since the threats of Senators John McCain and Jim Bunning clearly had an effect on both Bud Selig and Donald Fehr--but given the lobbying and political-fundraising strength of the tobacco industry, I'm a tad skeptical that we’ll see the same Congressional willpower this time around.

Thanks to Bill McCann for alerting me of the Connolly study.

Tuesday, April 11, 2006
 
The Power of Situation: Joakim Noah's Decision to Stay at Florida

After leading the Florida Gators to an NCAA title, many thought that sophomore Joakim Noah would declare for the 2006 NBA Draft. A number of draft experts, including Aran Smith of NBA Draft Net and Chad Ford of ESPN (and Brigham Young University-Hawaii) predicted that Noah would be the first or second player selected, especially given the unusual absence of premiere talent in this year’s draft. In contrast, because of what appears to be deeper class in the 2007 NBA Draft, Noah might struggle to be a top 10 pick next year. And keep in mind, the economic difference between being the first pick in 2006 and the 11th pick in 2007 is the difference between a guaranteed, three-year contract worth $14.4 million and one worth about $6.2 million, plus the difference between being one year closer to NBA free agency and one year farther away.

But Noah passed up what would likely be a top two selection in this June’s draft to stay at Florida. And by doing so, he received the predictable praise from those who advocate that players stay in school: by staying an extra year in college, Noah will better develop his game and position himself for another championship. He also appears loyal to his school at a time when stars are leaving as early as possible, a phenomenon which some believe is attributable to the greed and immaturity of young basketball players.

But Noah's choice appears to say more about his situation than about loyalty. His father is Yannick Noah, a former tennis star who won the French Open in 1983. Yannick Noah is now a rock star in France and is worth tens of millions of dollars. Joakim's mother is actress Cecilia Rhode, a former model who was Miss Sweden in 1978. I don't know how much she's worth, as she later divorced Yannick Noah, but I'm going to go out on a limb and say she's probably doing alright.

So Joakim Noah's decision, like the decision of any amateur player contemplating whether to declare, is more about the situation than about the individual. And for most amateur basketball stars, the decision to turn pro is deeply affected by the systemic poverty around them. Indeed, many players turn pro because they are from impoverished families--families who have been poor since they arrived in America centuries ago (or, more technically, were forcibly taken to America centuries ago). A son turning pro may be the only opportunity for a family to end its cycle of poverty, and it is an opportunity that may never come again--especially given the potential of being injured at any time on the court. And although we like to latch onto endearing narratives and vignettes of those Americans who intrepidly rose from poverty to wealth, aggregate statistics confirm the more common difficulty of moving out of poverty in spite of work ethic. In other words, when the chance is there get out of poverty, it's probably a good idea to take it, because income mobility may be as much about serendipity as about anything else.

But Joakim Noah was not faced with that situation. He's from a very wealthy family, and the millions he would obtain from his first NBA contract probably aren't as meaningful as they were to guys like Jonathan Bender and Al Jefferson and others similarly-situated, along with their families. And if God-forbid Noah blows out his knee next year, he'll still be from a very wealthy family. That is not to begrudge his decision, but before we condemn as disloyal and greedy those who decide to leave school early, it would probably be helpful to first look at the circumstances surrounding their decision. Doing so would probably tell us a lot more about them than does their actual choice.

Monday, April 10, 2006
 
The Beauty of Bets: Wagers as Compensation for Professional Athletes

Professor Jeffrey Standen of Willamette University College of Law has posted on SSRN a fascinating article that will be published in a forthcoming issue of the Willamette Law Review. The article is entitled "The Beauty of Bets: Wagers as Compensation for Professional Athletes." It may be downloaded at this link (the link goes to the abstract, and you can download the article for free through "Document Delivery" -- all you will need is an SSRN account, which is free). The article examines athletes betting on games and it concludes that such betting is a good thing.

Here is the article's abstract:
Professional and amateur leagues prohibit athletic participants from wagering on the outcome of the games in which they play. Most also prohibit wagers on any aspect of the sport; some even prohibit wagers on any sporting contest. At the same time, these leagues typically allow teams to compensate players based on individual performance outcomes and team victories and championships. Certain non-league tournament sports, particularly professional golf, even allow players to bet on pre-tournament practice contests.

This paper outlines the advantages of allowing athletes to bet on their games. Betting aligns player incentives with team incentives, encourages team-oriented play, helps sustain fan interest, lessens the nominal costs of owning teams or ticket purchases, and reduces the likelihood that players will conspire to throw games or beat the point spread. In light of this advantages of betting, the widespread prohibition on participant gambling seems problematic.
And here is an excert from the article's introduction that rings so true:
Some fans also appear to enjoy financial aspects relevant to professional sports as much as they might enjoy the sport itself. For instance, some fans enjoy playing general manager, filling web sites with their analyses of how potential player trades or free agent acquisitions would comport with salary cap limitations. Likewise, many fans consume their taste for sports fantasy leagues, gambling on fictitious games made up of fictitious teams populated by real players playing in real games. Finally, some fans consume their sports viewing enjoying through gambling directly on the games themselves. Presumably, these fans’ taste for “financial sports,” such as fantasy trades, fantasy leagues, or wagers, shifts these spectators’ attention away from the pure competition of the sports themselves. Despite this possibility, the American professional leagues appear to tolerate side action by fans and fantasy league participants, and indeed welcome the added attention these financial fans bring to their players and leagues. The sports leagues produce the product that these financial sports fans consume; the leagues, however, do not capture the gains from their product.
Jeff delivered an excellent talk on this article at the Future of Sports Law symposium held at Willamette Law last month.

This is fascinating topic. Should athletes bet on games? And is it a good thing for the parties involved?