Sports Law Blog
All things legal relating
to the sports world...
Tuesday, July 31, 2007
New Sports Law Scholarship
New this week:
Elisa M. Butler, Civil rights--no hitting back: schools have to play by the Title IX rules, 7 WYOMING LAW REVIEW 577 (2007)
Monday, July 30, 2007
Hancock Lawsuit Voluntarily Dismissed
The family of deceased St. Louis Cardinals pitcher Josh Hancock has voluntarily dismissed without prejudice the wrongful-death lawsuit arising out of Hancock's drunk-driving death in April. I previously wrote about the lawsuit when it was filed.
The family dropped the case just prior to a scheduled hearing on the defendants' motions to dismiss and/or to make more definite the claims. The family did not explain its decision to drop the case. The dismissal is without prejudice, meaning the family could reinstitute the action in the future.
Monday Evening Update:
From ESPN.com, Dean Hancock, Josh's father and the Administrator of Josh's Estate, issued a statement explaining the decision to dismiss the lawsuit. The statement in full:
"The subject of my son's death has been widely reported and discussed, as has my motivation to file the wrongful death lawsuit. Often, legal action has more to do with performing responsibilities and gaining control. This lawsuit was not filed for personal gain. Few know that Josh died without a Will, leaving multiple heirs in two separate families in different states. When I became the court appointed Administrator of his estate, I agreed to perform fiduciary responsibilities to protect the interests of his estate and all beneficiaries.
Taking the statement at face value:
1) The family filed the lawsuit on an initial belief that the restaurant and/or tow truck driver might be liable, with the hope that more would come out in the litigation process. Subsequent investigation and inquiry revealed new information and understanding, suggesting that none of the defendants would be liable and that the lawsuit should not go forward
2) The family's goal with the lawsuit was to draw attention to and change the way bars/clubs/restaurants dealt with intoxicated patrons. These changes were happening in the wake of Josh's accident, making further litigation unnecessary. Our tort system is one way that we do social engineering (making the law that changes how people act in the real world), so this make some sense.
Taking the statement not at face value:
3) The motion to dismiss was going to be granted because the dram shop claim could not succeed on any facts (as I argued in my prior post, linked above), because the statute prohibited first-person actions. So the family saved face (and left itself some options) by voluntarily dismissing.
4) I question the new-found concern for the "prolonged legal battles which we would have to fight" as a neutral basis for dismissing the lawsuit. I find it difficult to believe that Mr. Hancock did not realize that the lawsuit would involve a "prolonged legal battle" or that his attorneys did not inform him of that fact.
Disparate Treatment at the Soccer Field?
I first want to thank those at Sports Law Blog for giving me the opportunity to host for the next week or so. Hopefully, the topics, views and analyses expressed will contribute to the discussions in the fast-changing and fascinating field.
Last week, Newsweek published a special issue titled "Islam in America." devoted to the many facets and issues involving Moslems living in the United States. One of the articles, "Moslems and Soccer" caught my eye as it dealt with disciplinary actions late last year involving a high school soccer team of Yemeni-Americans, many of them second or third generation, in Lackawana, N.Y., an industrial town, outside of Buffalo. In 2002, six Yemeni-American men, were arrested, pleaded guilty and jailed for training in Al Qaeda terrorist camps.
The article states: "A flare up last October involving the Lackawanna High School varsity soccer team illustrates how the terror case still vexes the entire community. After losing a playoff match against Akron (a whiter, wealthier nearby town), Lackawanna players spit and swore at the other team, according to reports filed with the Lackawanna School District. Some of the players even turned on their own coach and athletic director, directing abuse at both. One team captain was arrested on harassment charges for allegedly shoving an official, but the charges were eventually dismissed. In November, the Lackawanna School Board voted unanimously to suspend both the varsity and junior varsity programs for a year, tacking on 3 years of probation after that.
On one level, this determination is based on egregious unsportsmanlike conduct. But things become cloudier. Questions arose because the school board decided to punish a junior varsity team that had nothing to do with the event. No reason was given and unless there were some other facts we do not know, it does seem arbitrary to impose a one-year ban and a three-year probationary period for actions that the younger team did not commit. And, one cannot escape the political realities of a team composed of Moslems at a time of underlying tensions caused by the convictions of the “Lackawana Six.”The team’s coach (and uncle to one of the Lackawana Six), was quoted as saying the punishment was more severe because of the terror case. But the superintendent for the school district said the incident was merely the “last straw” in a long history of bad behavior by the soccer teams. The superintended added that the school board's punishment was a pre-emptive action to avoid an even more severe sanction by the regional high school league.
The Newsweek article notes that these players have been the subject of anti-Moslem taunts during games, but referees noted that team has accumulated more red and yellow cards than any other program in its league over the past six years. Clearly, these boys play soccer with (take or your choice) more passion/aggression than other teams. As the team's coach stated, "Soccer is the only sport in Yemen,” he says. “Yemenite youth take it seriously because nobody wants to lose. We start them at age 5. We go hard to the ball.”
I checked the New York State Public High School Athletic Association's men's soccer handbook for Region Six (which encompasses Lackawana) to read about the disciplinary procedures for its member schools. The document only gives general discussion on the importance of sportsmanship, and, interestingly, about respecting the cultural and ethnic diversity of one's opponents. It does not give any guidelines about discipline. Therefore, the procedures rest with the local school district.
However, the school cleverly avoided what would have been a constitutional claim because the actions were extra-curricular and not part of the school day. In such cases, schools have greater discretion in punishing because it is a privilege, not a right to be a member of a sports team. Because the students were not suspended from their right to come to class, the school dodged the due process bullet. With a contrary result, a due process hearing would be required and in such an environment, any discrimination claims, such as the alleged disproportionality of the sanction would come up.
Although state sports associations encompassing public schools are generally state actors under the 2001 Supreme Court opinion in Brentwood Academy v. TSSAA, I don’t that the case pertains to disciplinary actions involving student-athletes. Even if state action would apply here, I do not see how a court would overturn a determination based on the facts such as those presented. The teams’ suspensions were a direct effect from of the on-field conduct, rather than the religion or ethnicity of the students.
But even as I write this, the suspension of the junior varsity team is troubling. I wonder if the decision was a disparate treatment or whether there were circumstances that we do not know that justified this action.
Morals Clauses and Michael Vick's Endorsement Contracts
Last Friday, Nike announced that it was suspending Michael Vick's endorsement contract, effective immediately, while Reebok, the NFL's official uniform supplier, and Donruss, a leading trading card company, both announced that they would no longer sell Vick-related items. As reported by Brent Hunsberger in The Oregonian, Nike's decision reflects a marked change in position from its immediate reaction to Vick's indictment, when the world's largest athletic wear maker stood by Vick, issuing a statement saying, "We do believe that Michael Vick should be afforded the same due process as any citizen."
Animal-rights groups, however, didn't react too well to Nike's position and staged well-publicized protests outside of Nike's headquarters in Beaverton, Oregon, as well as outside of numerous Nike stores. Nike may have also been motivated to reverse course due to news of several of Vick's co-defendants cooperating with prosecutors, and perhaps also civil rights activist Al Sharpton's arguably surprising lack of support for Vick.
Still, and as we've discussed on several occasions, there is a long way to go before Michael Vick is found guilty of any crime. And as we listen to myriad talking heads blast Vick for his alleged behavior, we should keep in mind that we have yet to hear his side of the story. And when he tells that story, he will be advised by Billy Martin, one of the nation's top litigators and whom Vick secured the services of last week. Although some facts concerning how the government obtained evidence against Vick remain unclear, I strongly suspect that Martin will have something to say about how that evidence was obtained, perhaps questioning how a warrant issued to search a premises for drugs turned into a dog fighting investigation, and how the incriminating evidence was found in a separate facility behind the home. Arguments over the admissibility of certain pieces evidence are often crucial in trials, and while it's unclear if issues of admissibility will be raised by Martin, they seem like a pretty good bet to come up.
But with endorsement contracts, we're typically not talking about proving guilt "beyond a reasonable doubt," like we do with criminal trials. Instead, we're usually talking about whether a company is better or worse off being endorsed by a particular person, and if worse off, whether that company has a legal right to suspend or terminate its relationship with an endorser. Along those lines, even if Vick is found not guilty, or if he pleads no contest to lesser charges or if the charges are dropped for whatever reason, his mere tacit involvement with underground dog fighting can be seen as morally reprehensible--a point raised by Geoffrey in a comment last week--and thus ill-suited for someone endorsing a product. Indeed, Vick's previous misbehavior (e.g., the Ron Mexico lawsuit; giving the finger to Falcons' fans) motivated several other endorsers, including Coca-Cola, EA Sports, and Air Tran, to not continue their endorsement relationships with him.
With respect to Nike in this instance, however, we see a company suspending an existing contract, rather than not continuing an expiring contract. As I discussed with Hunsberger for his story, Nike enjoys that right due to a morals clause in its contract with Vick. The type of behavior that can trigger a morals clause is often the subject of intense negotiation between an athlete's representative and the company endorsed by his client, and that is a point that Peter Carfagna and I discuss in an article written by Robb London in the October 2005 issue of the Harvard Law Bulletin:
A recent trend, [Harvard Law School lecturer on law] Peter Carfagna says, is an almost obsessive attention now paid to morals clauses in sports contracts, especially in the aftermath of the O.J. Simpson and Kobe Bryant criminal cases. "Morals clauses are now the most heavily negotiated terms," he said. "And the steroid scandal in Major League Baseball is putting even more pressure on sponsors to negotiate escape clauses in contracts with athletes who test positive for illegal performance-enhancing drugs."It will be interesting to see whether Vick will be able to not only defeat criminal charges, but also restore his image. I think we can safely say that his days of earning $7 million a year in endorsements are long gone, and most marketing experts seem to agree. Professor Bill Sutton of the University of Central Florida, for instance, artfully says, "He's going to disappear, like a magic act."
But let's say that Vick can overcome his legal problems. Can he then make a marketing comeback?
He probably won't have that opportunity with the Falcons, which seem poised to release him. And as CNBC's Darren Rovell examines on Sports Biz, it's unlikely that Nike will want him back.
But say, hypothetically, that the Oakland Raiders signed Vick and he thrived there, restoring a once feared, but now scorned, franchise to dominance--could Vick be great again in the eyes of fans, or would the memories of dog fighting linger on?
Kevin Garnett to Boston Celtics
A month ago, I wrote about Kevin Garnett using an opt-out clause in his contract as a de facto no trade clause. His goal was to discourage the Boston Celtics--the NBA's second worst team last season--from trading for him. His strategy worked, as the Celtics turned to other trade options.
But since that time, both the Celtics' situation and Garnett's situation have changed considerably. Namely, the Celtics traded for all-star Ray Allen, who joins Paul Pierce to give them two legitimate 25+ per game scorers (Allen averaged 26.4 points per game last year; Pierce averaged 25.0). In obtaining Allen, the Celtics also dispatched Wally Szczerbiak, whom played with Garnett for seven seasons in Minnesota, during which time the two apparently didn't like each other.
If we are to believe various media reports this morning, the Celtics are on the verge of trading for Garnett and signing him to a contract extension (Garnett is seeking a 5-year extension worth $125 million). The Celtics are apparently set to deal Al Jefferson, Gerald Green, Theo Ratliff, Sebastian Telfair, and a 2008 first round draft pick for Garnett, who has warmed to the idea of playing in Boston, particularly since Timberwolves GM Kevin McHale has been reluctant to deal him to a Western Conference team.
With a lineup featuring Kevin Garnett, Ray Allen, and Paul Pierce, the Celtics seem like the best team in the Eastern Conference, and a legitimate contender for an NBA title. They are certainly an older team (Pierce is 29, Garnett is 31, and Allen is 32), but they now have a 3-year window to go for it all. It's amazing how the fate of a franchise can change so dramatically in just one month.
Saturday, July 28, 2007
On Vick, Bryant, Bonds, and Rasmussen: Athletes (Allegedly) Behaving Badly
Michael Dorf at Dorf on Law is looking for explanations for the differential treatment of athletes accused of wrongdoing. This is true of sport-related misconduct (why was Tour de France leader Rasmussen kicked off his team and the Tour, while Barry Bonds will break baseball's most-hallowed record sometime next week) or off-field (why has Vick been suspended when Kobe Bryant was not). He asks for a "principle that rationalizes the treatment of these athletes," with the caveat that "different people, different organizations" does not work as an explanation. Some interesting comments, worth looking jumping to look at . My comment, made this morning, is reproduced below:
Unfortunately, the "different people in different organizations" explanation is unavoidable, at least in part.Am I onto something? Feel free to offer your own explanations and justifications, here and over at Dorf on Law. I think his offer of a gold star for the winning explanation still stands.
Judge Denies AP Access to Names of Players in Search Warrant Affidavit
Does the public have a "right" to the names of players who were blacked out by federal prosecutors in a search warrant affidavit? We debated this issue at length on the blog last month here. Yesterday, U.S. Magistrate Edward C. Voss rejected a request by The Associated Press to reveal names blacked out in a sworn statement by IRS special agent Jeff Novitzky, which was used to support a warrant to search the home of former major league pitcher Jason Grimsley. The AP argued that the public has a right to access the entire affidavit. However, Judge Voss ruled that the possible damage to the government's probe outweighed any First Amendment and common law rights to release the names. The judge also concluded that prosecutors have not in fact revealed the names to others, including George Mitchell who is heading MLB's steroid investigation. In his 7-page order, Judge Voss wrote:
Needless to say, I agree with the judge's ruling. As I said in the comments to my original post, "If I were the judge, I'd tell the AP to go interview people and do your own investigation." I have the same concerns as Judge Voss. The very nature of any governmental "investigation" means that there is speculation. A simple balancing of the harms here weighs heavily in favor of non-disclosure. The harmful impact that disclosure would have upon the individual players and the government is great and immediate, whereas the harm to the AP in waiting to disclose the names until the completion of the investigation is de minimis. Ironically, there is an assumption here that the AP speaks on behalf of the public and that the public interest is somehow better served through disclosure. However, the public does not benefit from compromising government investigations, including impeding the gathering of evidence as well as creating disincentives for people to cooperate. If there is enough evidence to charge these people with a crime, we will know about it....and we'll also know if there wasn't.
"Cooperation could be affected, investigation of named individuals could be compromised, leads developed from undisclosed information could be cut off, and evidence could be destroyed. When the investigation concludes, the weight of the government's argument against disclosure will change dramatically. Speculation concerning who is or is not named in the Novitzky affidavit is unfair."
Friday, July 27, 2007
Early Signs of Congressional Dissatisfaction with David Stern's Response to Scandal
U.S. Congressman Bobby Rush (Democrat-Illinois), who is chairman of the House Subcommittee on Commerce, Trade, and Consumer Protection, has formally requested that NBA commissioner David Stern meet with him to discuss how the NBA manages its operations, particularly in the context of the Tim Donaghy betting scandal. Perhaps based on whether Stern agrees to meet with him and how well that meeting goes, Rush makes clear that he may also call congressional hearings to examine NBA management and its role in the scandal. In a letter to Stern, Rush writes:
If the allegations prove true, this could be one of the most damaging scandals in the history of American sports. Unfortunately, fairly or not, the NBA, more than any other professional sport, has been consistently dogged with allegations that league referees needlessly affect the outcomes of games by making bad calls.Rush's reaction reflects the same disappointment that many of us had to Stern's press conference on Tuesday, when he paradoxically announced that while the NBA would conduct a thorough internal review, the problem was completely limited to Donaghy. As I wrote for ESPN.com yesterday, how can the NBA conduct a thorough review when the Commissioner has already established its conclusion?
Rush's request also highlights how Stern and many observers are likely missing the forest for a lone tree when they focus all of their attention on Donaghy's apparent bad choices. With humility and honesty, the NBA should also examine to what extent its own policies and practices enabled a situation in which Donaghy could engage in wrongdoing. Given Stern's comments on Tuesday, it doesn't appear that he is willing or perhaps even capable to conduct such an examination, which is why I argued that the NBA should instead hire an independent investigation agency or appoint an independent commission. For the NBA, either option would certainly beat Congress undertaking a highly-publicized, potentially embarrassing public query, which may garner even more attention that Mark McGwire and Rafael Palmeiro received in their less than glorious Congressional moment two years ago.
Thursday, July 26, 2007
Special Affinity Between Baseball and Law
A friend e-mailed me the following question and I thought I would pass it along to our readership for further discussion and comment:
What is the special affinity between baseball and law?
I long have believed (although I have no empirical support for this) that baseball is the most popular sport among lawyers (and especially law professors). Baseball seems like the most legalistic of sports; it is rule-bound and tradition-bound, just like law.
So what is going on here? What are some good explanations for this?
NFL Contract Negotiation Seminar
On September 14, Michael Huyghue, CEO of Axcess Sports & Entertainment, will be holding an all-day NFL contract negotiation seminar at Florida Coastal School of Law in Jacksonville, Florida. The seminar is titled, "An Insider's Guide to Negotiating Professional Sports Contracts & Fiduciary Duties," and the topics to be covered include NFL salary cap comprehension, the NFL collective bargaining agreement, contract negotiation strategies and fiduciary duties. This is a unique nuts-and-bolts practical skills seminar for sports lawyers and agents taught by highly experienced negotiators, and has been approved for Florida Bar CLE credit. The impressive list of speakers include:
More information about the seminar, including registration form, can be accessed here.
Wednesday, July 25, 2007
Is the NBA in Jeopardy?
The scandal involving NBA referee Tim Donaghy has certainly drawn considerable attention over the last week. In an excellent post here on our blog, Geoffrey examined whether there are persons who may be able to bring civil claims against Donaghy.
But what about the bigger question of where the NBA is going in the wake of this scandal? With that in mind, ESPN's Henry Abbott e-mailed several people earlier today with the following question:
There has been a lot of talk about the Tim Donaghy scandal as one of the most serious black eyes any professional sports league has had in recent years. At any point in this process, have you felt at all concerned for the future of the league? Why or why not?"Over on ESPN.com, Henry reveals some of the responses he received, including ones from Dallas Mavericks owner Mark Cuban, ESPN basketball analyst John Hollinger, Portland Tribune columnist Dwight Jaynes, and yours truly.
Henry posted most of my comments, but here they are in their entirety:
I believe the NBA will recover from this scandal. The league has too many fans, in the U.S. and abroad, and there is too much money on the line in television and other entertainment contracts for this scandal to sink the ship. Also, while the NBA's product may not be as good as it was in the 80s, it's still undoubtedly the world's best basketball league, and that will help it absorb the scandal's fallout. In addition, I don't know of any individual scandal that ruined a major American sports league or sports organization. Major League Baseball overcame the Black Sox scandal, Pete Rose's betting-on-baseball scandal, and the steroids scandal; college football has overcome a wide array of corruption scandals; and even little league baseball overcame Danny Almonte lying about his age. It doesn't seem that individual scandals have the staying power to destroy popular sports leagues and organizations, and I don't think this one will prove to be an exception.
Having said that, I do wonder about the NBA's leadership going forward. I find it odd how the commissioner has seemed so intent on policing the players--the "kids," as he's sometimes called them, even though they are grown men--when he has overlooked a number of harmful league and team behaviors, such as teams purposefully losing games and now a ref apparently betting on games with mobsters. It would seem that instead of waging a personal war against high school players, do-rags, and night clubs, he should take a closer look at the people in his own house, the ones who may look far more like him than Allen Iverson.
Along those lines, I question the value of the NBA's internal investigation into Donaghy's activities. Stern's basic argument appears to be that Donaghy is the NBA's bad apple, and once the bad apple is removed, the barrel is saved. This is fairly standard corporate behavior when individuals engage in wrongdoing, such as sexual harassment in the workplace or hazing that occurs on college campuses: once it's clear to an organization that defending the individual is no longer worth it, the individual will be characterized as unusually malicious and a disgrace--in effect, the individual, who was previously "one of the guys," suddenly transforms into an evil person, a "rogue, isolated criminal" as Stern put it yesterday (even though Donaghy hasn't even been charged with a crime yet).
By focusing on the disposition and apparent choices of Donaghy, however, the NBA may miss to what extent its own policies and practices enabled a situation in which Donaghy could engage in wrongdoing--just like how companies and schools often miss how their own decisions enabled, or even promoted, certain apples to go bad (think about hazing and how it occurs year-after-year, with completely different students--it's not about the students, it's about the situation that colleges allow to exist). Fault, then, often needs to lie farther and wider than merely the individual wrongdoer, including all the way up to the top of the tree.
But since Stern seems motivated to limit the controversy to Donaghy, I question whether the NBA's internal review can successfully identify how far fault should lie. Even though he pledged yesterday to "do everything possible to analyze our processes," he vehemently maintained that the problem was limited to Donaghy; how can the NBA now conduct a thorough review when the Commissioner has already established its conclusion?
I believe the NBA would be better served by hiring an independent investigation agency or appointing an independent commission to look into Donaghy's actions and related NBA practices and procedures. An internal review may be in the best interests of top NBA officials, but I don't think it's in the best interests of the NBA.
Tuesday, July 24, 2007
Can Roger Goodell Keep Michael Vick out of Training Camp?
NFL Commissioner Roger Goodell has told Michael Vick to not attend the Atlanta Falcons' training camp while the NFL reviews his indictment for allegedly participating in an interstate dog-fighting operation. Goodell cites the league's new personal conduct policy as supplying him with the authority to make such a demand.
As Rick examined in April, the new policy offers little in the way of specificity and much in the way of tough-sounded rhetoric. Many corporate conduct policies do the same, furnishing companies with significant latitude to discipline employees through open-ended, highly-interpretative phraseology.
In terms of the specific language allegedly empowering Goodell, one key phrase is, "Conduct that undermines or puts at risk the integrity and reputation of the NFL will be subject to discipline, even if not criminal in nature." That certainly sounds good, but what does it really mean? As Rick wrote, there will always be inherent concerns with disciplining players in the absence of a conviction:
Under the previous violent crime policy created and administered by former NFL commissioner Paul Tagliabue, punishment was triggered only by a conviction or its equivalent, including a plea of no contest or a plea to a lesser charge. That's obviously not the case under the new policy, but the same concerns surrounding disciplinary action before a conviction still exist. League officials seem to have forgotten when they suspended James Lofton for the last game of the season in 1986 because of a rape charge, which then backfired when Lofton was acquitted during the off-season.Bloomberg's Erik Matuszewski and Aaron Kirloff examined this issue as it relates to Michael Vick in an article today. I was interviewed for their story, and I wondered whether the NFLPA--which acquiesced to the new personal conduct policy, although not apparently through formalized collective bargaining--may want to defend Vick's contractual right to attend camp, if for no other reason than to avoid a precedent of players being shut out of work on grounds of an indictment. As I mentioned in the story, "Now we have someone accused of maiming and killing dogs, but let's say there's some less-awful situation in the future?" Not all indictments are the same, of course, and we have examined some of the limitations of an indictment (also examining them is FIU Law Student Adam Wasch in a very good Beacon article), and Rick's reference of James Lofton's suspension and subsequent acquittal is a good one.
Assuming the NFLPA stays on the sideline, will Goodell be able to use this de facto restraining order of Vick to say, in essence, an indictment of a player automatically empowers the Commissioner to prevent a player, for an indefinite period of time, from reporting for work? And is that a good or bad thing when the player's sole right to appeal entails an appeal to the very guy who came up with the penalty--the Commissioner--in a process that could produce documents eligible for subponena in a criminal prosecution?
The Influence of Fox v. FCC on Sports Broadcasts
We are pleased to announce that Mark Conrad will be guest blogging in early August. Mark is an associate professor of legal and ethical studies at Fordham University’s Schools of Business, and has written extensively on sports law and business.
Last week, he published an op-ed in the Sports Business Journal entitled "Court's Indecency Ruling a Relief to Sports Broadcasters." The piece examines Fox v. FCC, a decision handed down last month by the U.S. Court of Appeals for the Second Circuit that makes it more difficult for the Federal Communications Commission to fine broadcasters, including sports broadcasters, for broadcasting swears uttered by players and fans. Mark's piece is subscription only, but here is an excerpted version:
Mark concludes his piece by proposing that "if Congress enacts legislation expanding indecency to cable and satellite, let it create a special exemption, a legislative waiver of liability for live sports broadcasts."
For related posts on the FCC's regulation of sports, see Greg's "CBS Apologizes for Halftime Show Ending" (2/1/2004) and Howard's "New Sports Media v. Old Sports Media" (4/17/2007). For a number of related posts on free speech in sports, see this link. Howard also has an excellent law review article on that topic, "Free Expression and the Wide World of Sports."
Monday, July 23, 2007
Baseball Draft Bonuses Down This Year Despite Skyrocketing Revenues
In the June 25 - July 1 issue of Sports Business Journal (subscription only), Liz Mullen reports that the MLBPA is investigating complaints from agents that major league clubs are being threatened by MLB to negotiate "league-recommended" signing bonuses for this year’s amateur draft picks that are about 10 percent lower than last year’s bonuses ("Baseball union reviews complaints"). However, MLB executive VP Rob Manfred denied that clubs were being told that recommended amounts were mandatory and that clubs were being threatened with penalties if they didn't sign the player for the recommended amount. But he did tell Mullen that the recommended amounts overall were "roughly 10 percent" below last year's recommendations due to the changes in the CBA negotiated late last year, which increased clubs' leverage in negotiating contracts with draft picks. According to Manfred, "Because of that increased leverage, we fully expect that (clubs) would pay less." Last October, I discussed these negotiated changes, which include: (1) clubs that fail to sign their first or second round draft pick will receive the same pick in the subsequent draft as compensation, and (2) pushing the signing deadline back to August 15. [However, I reviewed the 220 plus page document and did not find these provisions. These changes can most likely be found in the Major League Rules, which are adopted by the league.]
I've always thought that the baseball draft operates like the "wild west" because there are rules in place that are consistently violated and nobody cares. For example, scouts and agents frequently violate the rules by engaging in "pre-draft dealing," meaning that the scout and agent verbally agree on a signing bonus amount prior to the draft. But then, these verbal agreements are not legally enforceable anyways. Also, the baseball draft is unique from the other sports because agents working on behalf of players don't even have signed representation agreements (the draft takes place during the college baseball post-season and signing agreements with agents jeopardizes their NCAA eligibility). In baseball, agents also consistently violate the NCAA rules by communicating and negotiating directly with the clubs before and after the draft.
And getting to the subject of this post, my "lawyer brain" has also never understood this concept of "league recommended bonuses" in baseball. These recommended bonuses are sometimes referred to as "slot money," meaning that the player gets the league recommended bonus amount for the slot (or pick) in which the player was drafted. Each year the league has discretion to set the amounts of these recommended bonuses, yet the clubs are not required to adhere to the league recommended bonus amounts. And if a club suffers adverse consequences by the league for paying a player more than the recommended bonus amount, it would constitute a violation of the CBA. So then in that event, do the league recommended bonuses have any teeth? By the way, is anybody asking themselves at this point, if the clubs have greater leverage this year as a result of the new CBA revisions, then why would it be necessary for the league to even reduce the recommended amounts from last year, let alone threaten the clubs?
Well, amazingly (sarcasm), bonuses are in fact down exactly 10 percent this year across the board! Baseball America reported last week that "all 15 first-round picks who have come to terms have signed for slot money or less, and all of those slots have represented a 10 percent reduction from the 2006 slots." [I think they should just rename recommended bonuses as "restraints on trade."] Mullen noted that "compensation for rookies in other major American sports has been increasing, but agents say that signing bonuses for baseball players selected in the amateur draft have been down or flat in the last few years despite skyrocketing MLB revenue." Although approximately half of the players in the first round have yet to sign and there is still three weeks left until the signing deadline, I wouldn't expect the remaining bonuses to be much more than slot money when clubs will now get an additional draft pick in the same slot next year if they don't sign them this year.
Sunday, July 22, 2007
Mark Alesia Honored for Empirical Study of Intercollegiate Athletics Financing
Congratulations are in order for Indianapolis Star reporter Mark Alesia, who was honored this week by the Society of Professional Journalists with its 2006-07 Investigative Reporting Award for the empirical study (Part I, Part II) he conducted in April 2006 on the extent to which schools and the NCAA profit from star players, how university general funds and students contribute to athletic departments, and the interplay of those contributions with the NCAA's tax exempt status as a non-profit entity. From the study, he built the NCAA Financial Reports Database, which is the most detailed, publicly available database of college athletic department financial information ever assembled.
Among Alesia's findings is that fewer than 1% of NCAA athletes generate more than 90% of the NCAA's money, which confirms the incredible economic value of basketball and football stars to colleges and universities. For instance, he found that 43 public schools in the 2005 March Madness tournament paid out a combined $12 million in expenses relating to the basketball players (including scholarships and tuition and other expenses), which proved to be a very good investment, as those same players generated $267 million in revenue for those schools. Where did the $255 million difference go? "The rest was used to pay for coaches, administrators and money-losing sports -- basically, all others except football."
Alesia also found that athletic departments at taxpayer-funded universities nationwide receive more than $1 billion in student fees and general school funds and services, and that without such outside funding, fewer than 10% of athletic departments would be able to support themselves with ticket sales, television contracts and other revenue-generating sports sources. In fact, most would lose millions of dollars.
The award committee at the Society of Professional Journalists praised other noteworthy aspects of Alesia's study:
What he uncovered is this: Taxpayers indirectly subsidize athletic departments because college sports are exempt from federal taxes, based on their tie to education. The exemption particularly benefits big schools, which receive up to 40 percent of their athletic revenue from donations, most of which are tax deductible. Critics believe college sports have largely become a business of mass entertainment and should no longer receive an education-based tax exemption, especially in an era of rising tuition and stagnant state support for higher education.Congrats again to Mark, whose work will undoubtedly assist those of us at the newly-formed College Sport Research Institute.
Saturday, July 21, 2007
Professor Darryl C. Wilson on Reaction to Michael Vick's Indictment
Stetson University College of Law Professor Darryl C. Wilson, who co-authored a leading sports law case book (with Robert McCormick and Matthew McKinnon) and has been certified as an NFL contract advisor, responds to my comments and those of several readers on Michael Vick's indictment. Among other points, he questions why so many of us care about the indictment and the underlying behavior that Vick is alleged to have committed, while we do not appear concerned about many other, arguably worse forms of behavior that many of us are routinely engaged in (e.g., we kill thousands of animals a day for meat, and yet dog fighting upsets us). Here are his comments:
Once again the sports community is awash in hypocritical hyperbole as they go out of their way to villanize an athlete for something that has nothing to do with his/her sport.
Making the NBA's Gambling Ref Pay
News broke this weekend of an ongoing FBI investigation into NBA referee Tim Donaghy. Donaghy, who seems to be a man of truly exemplary personal character, is accused of betting on NBA games (surely a violation of league rules), associating with low-level mobsters, and may have bet on games which he called as a referee. There are suggestions that he may have called games to enhance his prospects of beating the "spread." Of course, innocent until proven guilty and all that jazz. Donaghy may face serious criminal sanction, and has already resigned his officiating position, but might he also face civil liability? Some possible claimants:
1. Ron Artest, John Green, and the Palace of Auburn Hills. Donaghy was one of the officials calling the infamous "Basketbrawl" game between the Pistons and the Pacers. If he bet on that game (which was a blowout long before fisticuffs erupted), and allowed things to get out of hand in part to protect his wager, he might be on the hook to anyone who has suffered financially as a proximate result of his misconduct. That would include anyone sued as a result of those events.Even those who support relaxing bans on players or coaches betting on their own teams can hardly tolerate an official betting on games in which he may play a decisive role.
The only problem? By the time Donaghy gets done (unsuccessfully) fending of the FBI, his official residence will be the poor house.
The Legal Significance vs. Reputational Significance of an Indictment
ESPN columnist Mike Sando has an excellent column on how many have rushed to presume Michael Vick's guilt based on the indictment and its support documents, when there is a significant chance, based on the very demanding criminal conviction standard of "beyond a reasonable doubt" and on the fact that the government's evidence has not yet been studied or challenged, that Vick will be found not guilty.
As I wrote about a few days ago, grand jury hearings are typically secret and one-sided in favor of the government. The prosecutor decides which witnesses to call and which witnesses receive immunity. The basic questioning is done by the prosecutor, and the defendant doesn't even have a right to have his or her attorney present. Even worse for the defendant, an indictment only requires "probable cause," meaning more likely than not--a far cry from "beyond a reasonable doubt" for a criminal conviction. There has been much criticism of grand juries as unfair devices for the prosecution, and that they have been misused as tools to shame defendants, especially in high-profile cases.
Sando interviews a number of criminal lawyers for his column, including Maryland-based defense attorney Jonathan L. Katz, who tells him:
The prosecutor can get an automobile indicted. The prosecutor puts in the witnesses that he wants and then at the end he says, 'Look, here's an indictment, please agree to it. It just requires the grand jury members to find there is probable cause to believe that a crime occurred. Well, probable cause is not much more than a hunch.Sando also interviews Charlottesville, Va., attorney Neal Walters, a regular lecturer at the University of Virginia:
In point of fact, it's incredibly rare for a grand jury not to issue an indictment. It makes good drama on TV, but in that sense, if the U.S. attorney goes to grand jury, it's highly likely they are going to get an indictment.
My former criminal investigations professor, Charles Whitebread, is also interviewed by Sando (some of you may know Professor Whitebread from the BarBri videos, and for those of you taking the bar exam next week, good luck):
For the rest of Sando's column, click here. He also raises a number of good points about how Commissioner Roger Goodell has likely handled this situation well.
Friday, July 20, 2007
Deuce McAllister's Business Empire
In a week dominated by news of Michael Vick's indictment, it's nice to read a positive story about an NFL player.
In the Jackson Clarion-Ledger, Jack Mazurak has a feature article on New Orleans Saints running back Deuce McAllister, his successful business investments, and his goals to revitalize Jackson, Mississippi (the state's largest city and capital).
A native of Mississippi and a former star at Ole Miss, the 28-year-old McAllister has built something of a business empire in Jackson: he owns Deuce McAllister Nissan (the number 1 selling Nissan dealership in Mississippi over the last three months) and a used car dealership, and also has significant financial interests in Deuce McAllister Volkswagon Audi Jaguar, a forthcoming Land Rover dealership, and a company devoted to historical restorations of old property in Jackson and to commercial real estate endeavors. He also runs the Catch 22 Foundation charitable group, and has donated over a million to Ole Miss to help build an indoor practice facility for the football team.
I'm interviewed for the story, and I discuss how McAlister is unique among professional athletes in pursuing such an expansive and successful business career during his playing career. Certainly, many star players enjoy endorsement deals, but not too many own multiple car dealerships and other companies.
I also think it speaks well of McAllister to recognize that his NFL income won't continue indefinitely--although not germane to a 7-year veteran like McAllister, the average NFL career only lasts three and a half seasons, and we've already discussed serious concerns about the NFL's pension and disability benefits for retired players. Along those lines, I suspect foresight and long-term financial views are not easily obtained when one is a professional athlete, making millions of dollars a year and enjoying the superstar life that goes along with it; the fact that McAllister is preparing for a lucrative post-playing career in the business world (as some other pro athletes have accomplished, such as former NBA star Dave Bing and The Bing Group), likely distinguishes him from the vast majority of players in his league and from those in the other major pro sports leagues.
In addition to showing his own business acumen, McAlister shows the wisdom of teaming up with business experts and delegating day-to-day responsibilities to his CEO, Matt Bataille, so that he can remain focused on his NFL career,--which, after rushing for over a 1,000 yards last season with an average of 4.3 yards per carry on a team that made it to the NFC Championship game, also seems to be going very well.
Thursday, July 19, 2007
Baseball Quiz: Off-field and On-field Rules
Two nice tidbits from Jim Caple's Off-Base this week. Both relate to sports law, understood as the law governing sports.
First, Caple points out how San Diego's Chris Young manipulated the system in serving a 5-game suspension for throwing at the Cubs' Derrek Lee last month. Young pitched the Wednesday before the All-Star Game, then began his suspension with the next four games before the Break--games, Caple notes, in which Young almost certainly would not have pitched. Young then pitched in the All-Star Game, then sat out the team's first game after the Break--another game in which he likely would not have pitched. So Young was "suspended," yet in that time never missed a start, never missed a game in which he likely would have appeared, and got the honor of pitching in the All-Star Game (Motto: "This time, it counts, but not too much"). Caple argues, correctly, that this is a problem with MLB's system of suspensions as they apply to starting pitchers and to rules that allow the player to determine when he will serve his suspension.
Second, Caple presents the following pitching line for Oakland reliever Kiko Calero, last Thursday against the Twins.
2/3 IP, 1 H, 0 R, 0 ER, 0 BB, 0 K and one (1) pitch.
How could he pitch 2/3 of an inning (meaning he got two men out), give up one hit, and only throw one pitch?
Give your best guesses in the Comments (and no jumping to Caple's column for the answer). I will reveal the result tomorrow.
Wednesday, July 18, 2007
President Bush on Major League Baseball
ESPN's Karl Ravech snagged an interesting interview with President George W. Bush, who was managing general partner of the Texas Rangers from 1989 to 1994, during which time he turned an initial $800,000 investment into a $15,000,000 sale in 1994. As Howard discussed last December, Bush was a finalist for Baseball Commissioner in 1992, but the owners selected Bud Selig instead; obviously, history would be very different had Commissioner Bush run baseball and someone else run the country (for engaging "alternative histories," check out this account of Commissioner Bush and President McCain, and this one of Commissioner Bush rejecting inter-league play and limiting the 1994 baseball strike to only two weeks).
Here are some excerpts from Ravech's interview with the President, courtesy of Buster Olney's ESPN blog:
KR: When you were the owner versus today, are people more skeptical of the athletes now because of all the stuff that we hear about?I don't agree with the President on many issues, but I think he is right about the All-Star game: it starts too late, at least for those of us on the East Coast. Considering that the game now "counts" for home field advantage in the World Series, I suspect a lot of people would want to watch it but don't.
Tuesday, July 17, 2007
College Sport Research Institute
Earlier today, Dr. Richard Southall of the University of Memphis announced the creation of the College Sport Research Institute (CSRI). The CSRI will serve as a national clearinghouse for college sports research, and will encourage and support sustained crossdisciplinary, collaborative college-sport research, serve as a consortium for college-sport researchers from across the United States, and disseminate research results to academics, college-sport practitioners, and the general public. It will also be a strong advocate for college athletes’ rights and education.
I am honored to serve on the CSRI's Executive Board, which includes:
Director: Richard M. Southall of the University of MemphisCSRI will also publish an academic, peer-reviewed journal entitled Journal of Issues in Intercollegiate Athletics (JIIA). Dr. Kevin L. Burke, from East Tennessee State University will serve as editor of JIIA. Members of an Editorial Review Board will be announced shortly.
In addition, CSRI will host an annual national conference. The first of these conferences, the Issues in College Sport Conference, will be held April 16-19, 2008 at the FedEx Institute of Technology on the campus of the University of Memphis. Leading researchers, practitioners, and college administrators will be invited to attend. In addition to two prominent keynote speakers, and three invited panels, the conference will include two days of juried academic presentations. In order to encourage undergraduate and graduate student participation, a student research competition will be held in conjunction with the conference. If you are a student writing about college sports issues, we encourage you to submit a paper. Here are the details:
Michael Vick Indicted: Who Let the Dogs Out (of State)?
Atlanta Falcons' quarterback Michael Vick was indicted earlier this afternoon by a federal grand jury in connection with the alleged dogfighting ring at his property in Smithfield, Virginia. According to ESPN and the Associated Press, Vick and several others were indicted for conspiracy to travel in interstate commerce in aid of unlawful activities and to sponsor a dog in an animal fighting venture. Apparently, he faces a maximum of six years in prison and a fine of $300,000. The interstate commerce derives from participants and pit bulls traveling to Virginia from South Carolina, North Carolina, Maryland, New York, Texas and other states, for the express purpose of commercialized pit bull fighting. Had the fighting ring featured local participants and local pit bulls, Vick wouldn't be dealing with this charge.
The court documents also describe grotesque conditions at the property, including a "rape stand," used to hold dogs in place for mating; an electric treadmill modified for dogs; a bloodied piece of carpeting; and evidence of dogs not being fed as a way of making them angrier. Other details are available here, and you can read the indictment in its entirety here. In short, the dogs were badly abused.
Keep in mind, however, Vick's involvement with the dog fighting has been a source of great speculation, and he has denied any knowledge. Nevertheless, the indictment--take it for what it is--paints Vick as a very active participant, including:
9. In or about early 2002, Vick [and another defendant] purchased approximately four pit bulls from Cooperating Witness 1.One point of caution: an indictment by a federal grand jury is far from a conviction. I distinctly remember my criminal investigations professor, Charles Whitebread, making this point over and over again. Grand jury hearings are typically secret and one-sided in favor of the government. The prosecutor decides which witnesses to call and which witnesses receive immunity. The basic questioning is done by the prosecutor, and the defendant doesn't even have a right to have his or her attorney present. Even worse for the defendant, an indictment only requires "probable cause," meaning more likely than not--a far cry from "beyond a reasonable doubt" for a criminal conviction. There has been much criticism of grand juries as unfair devices for the prosecution, and that they have been misused as tools to shame defendants, especially in high-profile cases.
Still, it will be interesting to see what the NFL does in response to the indictment and how the NFLPA responds to the NFL, if it elects to suspend or otherwise punish Vick.
Monday, July 16, 2007
Should Baseball Stadiums Stop Selling Beer to "Large" People?
A gruesome story from Yankee Stadium likely to lead to a lawsuit. Paul Robinson, visiting the Big Apple from Washington state, was enjoying a game last week when a large unidentified fan sitting a few rows behind him fell onto his head, snapping Robinson's neck:
"It felt like my head had been ripped off," Robinson told the Daily News from his hospital bed. . . . The man who fell was dragged away by his friends and never bothered to apologize or check how badly Robinson was hurt. The family believes he was drunk.The AP notes the incident is similar to one at Shea stadium last spring, in which "a 58-year-old woman suffered a broken back when a very large drunk crashed into her during a fall."
Obviously, the torts teacher in me asks, "Are the Yankees / Mets liable"? This is more than an academic question, since the Mets fan has filed suit against the stadium and beer vendor and it would be quite un-American for Mr. Robinson not to do so.
While stadium-goers are typically barred from recovering for injuries due to batted balls (see Greg's post here), that's because batted balls are considered an "inherent" part of the game. While some level of rowdiness and contact are to be expected when attending a game, the risk that a "large drunk fan" will fall onto one's neck is hardly integral to the game of baseball. New York also has a "dram shop" law, which provides
Any person who shall be injured in person, property, means of support, or otherwise by any intoxicated person, or by reason of the intoxication of any person, whether resulting in his death or not, shall have a right of action against any person who shall, by unlawful selling to or unlawfully assisting in procuring liquor for such intoxicated person, have caused or contributed to such intoxication.Assuming the large fans at issue were served after reaching the point of intoxication (something that could probably be demonstrated by witness testimony or video evidence), the stadium and beer vendors seem clearly on the hook. Might this be a case where size matters, in the sense that an intoxicated person of substantial proportions poses a greater risk of causing serious harm to other fans?
NBPA's View of Commissioner Suspensions Opposite of NFLPA's
On Saturday, NBA players Ron Artest and Stephen Jackson were suspended by the league without pay for the first seven games of next season resulting from off-court legal issues. Artest pleaded no contest to a misdemeanor domestic violence charge involving a dispute with his wife, and Jackson pleaded guilty last month to a felony charge of criminal recklessness for firing a gun outside a strip club last fall. Jackson has publicly stated that he accepts his suspension. However, the union is comparing the penalties to other recent suspensions given to players for off-court misconduct and is considering appealing the suspensions. NBPA executive director Billy Hunter says, "Based on prior precedent, we think the suspensions are excessive. We plan to confer with the players and their representatives to consider all of our options for appeal." In 2001, Ruben Patterson received a five-game suspension after he accepted a modified guilty plea to third-degree attempted rape for allegedly forcing his children's nanny to perform a sex act on him, and Eddie Griffin was suspended three games in 2004 after pleading guilty to a misdemeanor assault charge in Texas.
Hunter's view of the union's role in defending the rights of players disciplined (or to be disciplined in the future) by the commissioner for off-field behavior is radically different from Gene Upshaw's view. A few months ago, I raised a number of questions that should be considered by all NFL players regarding disciplinary action taken by the commissioner under the NFL's new personal conduct policy, which was implemented by the new commissioner after consultation with a small committee of six players and affords the commissioner unfettered discretion in disciplining players without any review by an arbitrator. However, the NBA commissioner's disciplinary action is reviewable by an arbitrator mutually selected by the union and the league (as is the case with MLB and NHL commissioner disciplinary action). The effect of subjecting the commissioner's disciplinary action to outside review by an impartial arbitrator should not be underestimated because it impacts the commissioner's initial decision to take disciplinary action as well as the level of suspension he imposes. An arbitrator reviews the commissioner's action under a just cause standard, ensuring that the imposed discipline is not arbitrary, unduly harsh or contrary to established precedent.
The NBPA is obviously concerned about due process as well as the financial impact that league suspensions without pay will have on its players. The NFLPA, however, seems to take the view that stricter league disciplinary action is warranted in order to "clean up the league". The NBPA views the league in an adversarial position and feels that the commissioner's disciplinary action should be scrutinized, even when it involves suspension of a player for a small fraction of the season. Conversely, the NFLPA views the commissioner more as a partner in a "get tough on crime" policy and puts a great deal of trust in the hands of the commissioner to do whatever he thinks is necessary, even if it means suspending a player for half a season or a full season. So here's my legal question for the week: What is the proper role of a labor union certified under the National Labor Relations Act in representing the best interests of its members accused of off-field misconduct and disciplined by the commissioner?