Sports Law Blog
All things legal relating
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Sunday, December 28, 2008
 
The significance of defining sport

I have written on several occasions about how to define sport and what qualifies as sport, a common game among “sports-and-____” academics. A frequent response to these posts has been “so what, what difference does it make?” And, in truth, it is largely an academic exercise and a fun way to make fun of gymnastics, figure skating, and golf. But, courtesy of Matthew Mitten at the Marquette Faculty Blog, it may have practical import after all.

The Wisconsin courts msust figure out whether cheerleading is a sport, and a contact sport at that. A high-school cheerleader who fell and suffered severe head injuries while performing a maneuver sued her fellow cheerleader for negligence in failing to spot her properly. The defendant argued that he is immune under a state statute that eliminates liability for negligence (but not reckless or conduct taken with intent to cause injury) for injuries caused "in a recreational activity that includes physical contact between persons in a sport involving amateur teams." The appellate court assumed that cheerleading was a sport and acknowledged the athleticism involved in cheerleading. And, although the court did not mention, there are high-school cheerleading competitions (often seen at midnight on ESPN 8). But the court held that cheerleading was not a contact sport within the meaning of the statute because physical contact between opponents is not an element of the activity, thus the immunity did not apply. The case now is before the Wisconsin Supreme Court, which heard oral argument last fall.

I am troubled by the appellate court's approach (although not the result) because I think it might have unintentionally eliminated from the scope of the immunity activities that plainly are sports that should be covered by the statute but that do not typically involve physical contact between opponents. The first example is baseball--not much direct physical contact with opponents, only with objects thrown or hit by opponents. So could I sue the opposing pitcher for a negligently thrown beanball? Could I sue a teammate who did not get out of the way when I called for a flyball? Perhaps plays at the plate or on the base paths, involving potential collisions with opposing players, are common enough. that baseball would fall within the statute as interpreted. OK, what about tennis--it is virtually certain that physical contact with my opponent on the other side of the net is in no way part of the game. But would this mean that I could sue my doubles partner if I am injured when I crash into my him (which, frankly, is more likely than crashing into my opponent) because of his negligence? Would this also would mean that I could sue my opponent if I was injured when he negligently hit me with a ball (e.g., serving when I was not ready)? Or track and field--if I am a long-jumper, I expect no physical contact with my opponent. Could I sue him if he jumped before I had a chance to leave the pit and landed on top of me?

The statute was enacted in response to a 1993 Wisconsin Supreme Court decision arising from an injury suffered during a soccer game, so the legislature had true "contact sports" in mind. And the appellate court emphasized that cheerleading is not a contact sport in that way. But baseball, tennis, golf, track, etc., also cannot be classified as contact sports in the same way as soccer. Now maybe this was intentional and the legislature did want to treat contact sports differently from other sports. But if the legislative concern was about not wanting to chill participation in amateur (especially high school) sports (which might come with a standard of care lower than recklessness), liability in any of the situations described above would defeat that purpose. Assuming the legislature did not intend to treat contact and non-contact sports differently, a court might get around this, at least in my baseball and tennis hypos, by reading the statutory term "physical contact" to mean contact with objects propelled by an opponent. And maybe track would fall in because physical contact is at least a possible element of running side-by-side with an opponent. But this is getting somewhat difficult to maintain.

Alternatively, a court might focus on the statutory term "sport" and find a workable definition of that word--exactly what I and others have been doing as a parlor game. My current favorite standard defines sport by four elements:

1) Large motor skills.
2) Simple machines only.
3) Objective scoring or at least the possibility of determining a winner by something other than subjective judging.
4) Competition among contestants.

Cheerleading satisfies ## 1 and 2, but fails # 3 and possibly # 4 (we would need to know more about whether this team participated in competitions). But track, baseball, and tennis--the examples above--satisfy all four criteria. This gets at the result--the cheerleader's claim can go forward--without cutting large swaths of sports out of the statute.

 
Study of NBA Player Charities

Paul Caron at Tax Prof Blog reports on a study by the Salt Lake Tribune on the financial documentation filed by 89 NBA player charities. The study found that the average player foundation actually put just 51 cents of every dollar earned towards charitable programs, the rest eaten by administrative costs and inefficiencies. The post and the study are worth a read.

Wednesday, December 24, 2008
 
How Would "Safe" Steroids Impact Sports?

University of Pennsylvania bioethics professor Arthur Caplan has a provocative piece in the British Journal of Sports Medicine entitled "Does the the biomedical revolution spell the end of sport?". Here's an excerpt:

* * *

But, what if biomedical science could put the safety issue [of steroids] aside? Someday, probably soon, there will be drugs that do what steroids do without any real risk of harm to the user. Forms of gene therapy are also being developed that will let us safely tweak ourselves and our offspring to perform athletic feats that are ’’swifter, higher and stronger’’ than ever before seen. Would the world still want the interventions banned? Would doctors who offered such techniques be acting immorally?

* * *

Strangely, the greatest threat in to the future of sport is not necessarily new drugs, gene therapy or better chemistry. It may simply be that the more knowledge we gain about the hereditary and developmental factors involved, the greater the threat to our ability to value performance as a result of much other than random luck in the distribution of the hereditary materials that govern so much of who we are and what we can achieve.

Science does not destroy the possibility of effort but it may diminish our understanding of its role to the point where sport simply devolves into exhibition.

* * *

To access the rest of the article, click here (there is a fee). For a related Sports Law Blog piece, check out Greg's posting "Performance Enhancing Drug or Air Conditioning?"

Tuesday, December 23, 2008
 
whither chizik and kiffin?

For years, the National Collegiate Athletic Association and Division I athletic directors and university administrators have come under intense scrutiny and fire for their repeated failure to hire African American and other minority head coaches for their collegiate football programs. The Sports Law Blog has addressed the issue of minority head coach hiring on many occasions, including recently. Despite the rhetoric, scrutiny, criticism and venom, the NCAA, athletic directors and university administrators continue to ignore the call for equal opportunity. Athletic directors and university presidents continue to thumb their collective noses at critics in particular, but also, at the very athletes that power college football.

At this time, African American athletes comprise more than half of the scholarship players at the Division I college football level. In the professional football ranks, more than 70% of the athletes are African American. As things stand today at the collegiate level then, the 50% black athletes who play college football can expect a 5% chance that their head coach will be African American (six head coaches of the 119 head coach positions). In the National Football League, the 70% black athletes on NFL rosters can expect a 22% chance that their head coach will be African American (seven head coaches of the 32 head coach positions, including interim Mike Singletary).

This particular month (December 2008), the glaring issue of the failure of collegiate programs to hire African American head coaches has come under particular scrutiny. Auburn University drew a cacophony of protest when it hired Gene Chizik to replace Tommy Tuberville, despite Chizik’s extremely poor win/loss record at Iowa State and the “passing over” of Turner Gill who has resurrected a football program at the University of Buffalo (and is African American). Still, Auburn is not alone. High profile head football coach positions at Tennessee, Kansas State, Washington, Iowa State, Syracuse and Mississippi State have been filled by white head coaches, many of them unproven neophytes (Washington, Kansas State and Mississippi State replaced terminated African American head coaches). One writer termed these hiring decisions as a "laugh riot."

Floyd Keith, President of the Black Coaches Association, in exasperation, has begun exploring avenues to sue university administrations under Title VII for intentional race discrimination in hiring. Despite his work in developing the hiring “report card” and in motivating the NCAA to adopt a non-binding “Best Practices” memorandum that, similar to the NFL’s Rooney Rule, asks university administrations to interview at least one minority candidate for each collegiate head football coach opening, Keith remains discouraged at the refusal of NCAA member institutions to diversify the head football coaching profession.

To this reverberating call for change, inclusion, social justice and equal hiring, I would add the following points that have perhaps gone unrecognized during the course of this debate.

First, per William Rhoden’s piece in the New York Times, when asked to name the top five coaches that NFL athletes would most like to play for, four of the top five identified by the players are African American head coaches (i.e., Tony Dungy (1st place); Lovie Smith (2nd place); Herm Edwards (4th place); and Mike Tomlin (5th place)). This suggests several things: (a) when given the opportunity, black head coaches generally excel; (b) 70% of the athletes in the NFL are African American and those athletes clearly prefer playing for an African American head coach (see Rhoden); (c) African American head coaches relate in genuine ways to the modern athlete and take the mentoring role very seriously (see Tony Dungy, Lovie Smith, Turner Gill); (d) of the 32 NFL head coaches, only six at the time of the survey were African American and FOUR were listed in the top five as far as coaches athletes would prefer to play for; and (e) the "black football-playing majority must answer to a predominantly white power structure, which includes team executives and owners." (see Rhoden)


One dispiriting logical conclusion then, for those NCAA university administrators and athletic directors that refuse to hire minority head coaches, is that they are essentially telling their African American student athletes, that the athletes preference to be coached or mentored by an African American head coach is completely unimportant to the goal or mission of the institution. Athletic directors and university administrations, as per the usual, seem so beholden to the booster or the alum (the good old boy network), that what may be in the best interest of the athlete (and the program in the long term), is insignificant or even trivial. Again, Rhoden’s story indicates that African American athletes want to play for an African American head coach. Presumably, a coach that “gets” them, understands their challenges and wants to help them learn to develop both as an athlete and as a man. (see Tony Dungy). Only 5% of NCAA D.1 football programs have hired an African American head coach to mentor their more than 50% African American athletes.

Second, African American head coaches, when they are finally given the opportunity to be a head coach, are usually tasked with resurrecting or turning around failed or moribund organizations (see Tony Dungy—Tampa Bay Buccaneers; Lovie Smith—Chicago Bears; Romeo Crennel—Cleveland Browns; Marvin Lewis—Cincinnati Bengals; Turner Gill—University of Buffalo; Mike Locksley—University of New Mexico, etc.). This is typically not true for many white coaching hires (see Norv Turner—San Diego Chargers; Wade Phillips—Dallas Cowboys; Lane Kiffin—University of Tennessee; Gene Chizik—Auburn University; Urban Meyer—University of Florida etc.). For the white neophyte head coach, a solid underlying program or foundation is often in place allowing quick successes. For the African American head coach, a miraculous turnaround is often the order of the day (only Mike Tomlin’s hire by the Pittsburgh Steelers and Tony Dungy’s hire by the Indianapolis Colts can fairly be characterized as a hire into a solid situation).

Third, the latest trend in hiring head football coaches, the "coach-in-waiting" model, starkly and baldly circumvents both the Rooney Rule in the NFL and the Best Practices Memorandum in the NCAA. Essentially, stable programs like Florida State University, the University of Texas and the Seattle Seahawks, designate an assistant coach on staff, typically white (but not always, see Joker Phillips at Kentucky), that will become the next head coach when the current coach retires. Bobby Bowden will be replaced by Jimbo Fisher at Florida State. Mack Brown will be replaced by Will Muschamp at Texas. Mike Holmgren will watch Jim Mora, Jr., take over when he steps down this offseason. When affirmatively trying to level a playing field, selecting a "coach-in-waiting" simply rejects an equal opportunity hiring process and mocks the spirit of the Rooney Rule and the Best Practices Memorandum.

Fourth, the African American head coach must typically prove his mettle for decades as an assistant and interview for dozens of jobs before being given an opportunity to become a head coach. Tony Dungy was passed over for years before landing the Tampa Bay Buccaneer job. Marvin Lewis interviewed repeatedly for head coach opportunities. Apparently Turner Gill, who interviewed at Syracuse and Auburn this hiring cycle must continue to pay his dues before he will land the coveted BCS program head coach position. For Lane Kiffin, Steve Sarkisian and Gene Chizik, the dues that must be paid appear to be much different and their dues do not cost nearly as much. No matter how an athletic director or university administration justifies that differing cost, it is purely and simply unequal.

A call has been made for a Civil Rights Movement in hiring head football coaches. Apparently, without one, the NCAA and its member institutions will not do the right thing, which is to diversify its coaching ranks.*


* Thanks to Rob Dixon, 3L, West Virginia University College of Law for providing research and insight. Thanks also to Sheila Hassani, 3L, West Virginia University College of Law for research and source material.


 
Sports Law Blog selected as one of the ABA Journal's Blawg 100

This year we have been selected by the editors of the ABA Journal as one of the top 100 best websites by lawyers, for lawyers. Now lawyers are being asked to vote on their favorites in each of the Blawg 100’s 10 categories. Sports Law Blog is in the "Niche" category. You can vote for our blog here by simply clicking on the "Vote!" box next to our listing. Voting ends January 2.

"New legal blogs are springing up on a daily basis – we now have more than 2,000 in our online directory. Competition for the time and attention of lawyers is getting fiercer," says Edward A. Adams, the Journal’s editor and publisher. "Half the blogs on last year’s inaugural Blawg 100 list didn’t make the cut this year. That’s a testament to the quality of this year’s honorees, and evidence of the increasing amount of valuable information all legal blogs are publishing."

Monday, December 22, 2008
 
School Colors Reaffirmed as a Valid Trademark



Although many think of logos and designs are central to trademarks, the use of color schemes also are protectable under trademark law -- even if the color schemes are not registered with the Patent and Trademark Office. This was the ruling of the 7th Circuit in LSU v. Smack Apparel, 07-30580, which affirmed a summary judgment ruling of the trial court with respect to infringement.

The Universities -- Louisiana State, University of Oklahoma, Ohio State and the University of Southern California -- alleged that the defendants violated the Lanham Act and infringed their trademarks by selling t-shirts with the schools’ color schemes and other identifying indicia referencing the games of the schools’ football teams. After the district court granted summary judgment to the Universities, a jury trial as to damages was conducted, with the jury returning
a verdict favoring the plaintiffs for actual damages of over $10,500 and lost profits of $35,686. The district court also enjoined Smack from manufacturing, distributing, selling, or offering for sale any of the six t-shirt designs found to be infringing or any other similar designs.

The appeals court, not surprisingly, concluded that the colors, content, and context of
the offending t-shirts are likely to cause confusion because of their similarity to the use of the colors of the school -- which were used, in some cases for decades, dating back to the late 19th century. Because of this use and familiarity by fans, the marks acquired "secondary meaning" entitling them to protection under the Lanham Act. As the court noted: "[The] use of the color scheme marks and their prominent display on merchandise, in addition to the well-known nature of the colors as shorthand for the schools themselves and Smack’s intentional use of the colors and other references," prove that secondary meaning occurred. The opinion added "we think this conclusion is consistent with the importance generally placed on sports team logos and colors by the public." With that in mind, the court had an easy time showing the likelihood of confusion element for trademark infringement because of the similarity to the schools' color and the marketing of the merchandise to the same retailers which sold trademark goods of the respective schools.
An interesting argument made by Smack was that the color scheme was "functional" and therefore not protectable. It claimed that the Universities’ colors on the t-shirts are functional because "the shirts allow groups of people to bond and show support for a philosophy or goal; facilitate the expression of loyalty to the school and a determination of the loyalties of others; and identify the wearer as a fan and indicate the team the fan is supporting." The panel rejected this kind of aesthetic use as a form of functionality.

This basis for this ruling could be applied to professional sports teams if a color scheme can be shown to be identified with a team (e.g. green, white and yellow for the Packers). What surprised me, however, was that the schools did not register their colors. They are fortunate that under U.S. trademark law (as opposed to most of the rest of the world) registration is not a pre-requisite for protection. Common law use merits protection. I still wonder why the schools did not make register the colors. They be consider doing so in the near future.

Thursday, December 18, 2008
 
Minority Football Coaches and Civil Rights (Updated and Moved to Top)

Update, Thursday, 1:00 p.m.:

Alert reader Michael Nichols has written in detail on this subject in a forthcoming piece in the Virginia Sports & Entertainment Law Journal.


The new-old controversy in college football is the lack of Black head coaches in Division I-A college football. With recent firings and resignations, there are four Black coaches (out of 119 schools) in a sport in which approximately 46 % of players are Black. Exacerbating this problem is the recent trend of current head coaches at major programs designating a current (usually white) top assistant as the new future head coach whenever the current coach retires, a process that pretermits any future coaching search in which outside, Black candidates might be considered for the job. Essentially, the practice locks-in the current state of coaching at many major schools.

Richard Lapchick, one of the leading scholars on collegiate sport, race, and society, criticizes this state of affairs. He argues that the NCAA should adopt a version of the NFL's "Rooney Rule," which requires that teams interview at least one minority candidate for a head coaching job. Lapchick calls his proposal the "Robinson Rule," after the late Eddie Robinson, the all-time-winningest D-I coach at historically back Grambling State (a D-I-AA school) who never even got an interview for a D-I-A head job.

So here are my questions for con law and employment-law types out there: Would such a rule be constitutional under the Fourteenth Amendment? The NCAA is not a state actor, but individual state schools would be in following and carrying out such a rule. So, given the current state of Equal Protection law, would it be unconstitutional for a governmental actor to automatically interview and give serious consideration to a minority for every position? Or, as to private schools, does it violate Title VII? Finally and conversely, would the NCAA's failure to adopt such a rule (or a similar rule designed to ameliorate the dearth of opportunities for minority coaches) violate Title VII (Lapchick reports that the Black Coaches Association is considering using Title VII to challenge current hiring practices)?

 
NFLPA Concerned about Bonuses and U.S. Tax Code Section 409A

Aaron Zelinksy of Yale Law School and The Huffington Post passes along a link to a story on Janell Grenier's Benefits Blog, which excerpts a story from Andrew Brandt on The National Football Post:

* * *

Even though 409A has been around now for three years, employers continue to be surprised at the implications, as evidenced by this story:

NFL agents were sent an urgent memo this week from the NFLPA, requiring immediate attention to Federal Tax Code 409A. This provision, originally aimed at bloated executive compensation packages, potentially calls for a full tax burden on signing bonuses and future guaranteed money in the year the package is negotiated, even if the money is deferred over several years. This would have dramatic ramifications.

Virtually every signing bonus of any significance in an NFL contract is paid out over a period of at least a couple of years. For instance, if an NFL player signed a contract in March 2008 with an $8M bonus, payment terms of that bonus might have looked something like this:

$2M upon execution of the contract;
$2M in October 2008;
$1M in both March and October 2009;
$1M in both March and October 2010.

Some teams have more deferrals than others, but the amount of deferral is usually not a sticking point in negotiations with agents, as the money is guaranteed. . .

The NFLPA was clear about the importance of this provision in its memo to all agents: “This memorandum identifies an extremely important tax issue that may affect your player-clients and requires your immediate attention. The NFL has just informed the NFLPA that NFL clubs did not draft or amend many NFL player contracts in order to bring them into compliance with Section 409A of the Internal Revenue Code. As a result, many player contracts that include certain deferred compensation arrangements may not comply with the new tax provisions, thereby resulting in accelerated taxable income and/or an additional 20% tax, imposed on the player-client, unless the contracts are amended on or before December 31, 2008.”

* * *

For other Sports Law Blog posts on tax law, click here. For a post on the potential sports-related implications of President-elect Obama's tax plan (which calls for an increase in the top marginal tax rate from 35 percent to 39.6 percent), click here.

Tuesday, December 16, 2008
 
Tort Liability for Fans Hit by Soccer Balls

Interesting piece by Attorney Mack Sperling on North Carolina Business Business Litigation Report on a new decision by the North Carolina Court of Appeals:
All lawyers know, from first year torts class, that if you are hit by a baseball at a baseball game, you are unlikely to have any claim against the operator of the baseball stadium. There's a well developed body of law to that effect.

Today in Allred v. Capital Area Soccer League, Inc., the North Carolina Court of Appeals held that the rules of the game may be different when it's a soccer game being played. The Allred case is apparently one of only three cases in the country that deals with injuries suffered by spectators from soccer balls kicked into the stands.

The Plaintiff in Allred was attending a women's professional soccer game at State Capital Soccer Park in Cary, North Carolina. She was sitting in the stands behind one of the goals, and was hit in the head by a ball during warmups, when "many balls were directed towards the nets in a relatively short period of time." Op. at 4.. She suffered "substantial head injuries." Op. at 2.

For the rest of the piece, click here.


 
Non-Tendered Players Become Free Agents

On Friday December 12, all teams had a deadline to decide whether or not to tender a contract offer to a select number of their players. If the player was non-tendered by the deadline, that player was granted free agency. The vast majority of the players impacted by the deadline are eligible for salary arbitration. Teams can still negotiate with a player that was non-tendered an offer, but the player obviously has the right to negotiate with other teams as well. Typically, the issue is one involving the likely amount that the arbitration panel might award if the two sides cannot reach an agreement.

According to my research the following American League players were non-tendered by the deadline and became free agents:

John Bale (Kansas City Royals), Chris Britton (New York Yankees), Jaime Burke (Seattle Mariners), Daniel Cabrera (Baltimore Orioles), Kevin Cash (Boston Red Sox), Justin Christian (New York Yankees), Lance Cormier (Baltimore Orioles), Jairo Cuevas (Kansas City Royals), Joey Gathright (Kansas City Royals), Jonny Gomes (Tampa Bay Rays), Aquilino Lopez (Detroit Tigers), Doug Mathis (Texas Rangers), Jason Smith (Kansas City Royals).

According to my research the following National League players were non-tendered by the deadline and became free agents:

Reggie Abercrombie (Houston Astros), Mario Alvarez (Los Angeles Dodgers), Denny Bautista (Pittsburgh Pirates), Matt Belisle (Cincinnati Reds), Angel Berroa (Los Angeles Dodgers), Yhency Brazoban (Los Angeles Dodgers), Chris Burke (Arizona Diamondbacks), Chris Capuano (Milwaukee Brewers - who was signed to a minor league deal by the Brewers), Randy Flores (St. Louis Cardinals), Charlie Haeger (San Diego Padres), Robby Hammock (Arizona Diamondbacks), Clay Hensley (San Diego Padres), Norris Hopper (Cincinnati Reds - who was quickly signed by the Reds to a one-year deal), Chuck James (Atlanta Braves), Tyler Johnson (St. Louis Cardinals), Wil Ledezma (Arizona Diamondbacks), Gary Majewski (Cincinnati Reds), Scott Mathieson (Philadelphia Phillies - who was signed to a minor league deal by the Phillies), Aaron Miles (St. Louis Cardinals), Joe Nelson (Florida Marlins), Scott Proctor (Los Angeles Dodgers), Tim Redding (Washington Nationals), Takashi Saito (Los Angeles Dodgers), Jeff Salazar (Arizona Diamondbacks), Willy Taveras (Colorado Rockies), Ty Wigginton (Houston Astros).

 
Interesting tidbit

Hall-of-Fame running back Franco Harris was an elector from Pennsylvania for Barack Obama.

Sunday, December 14, 2008
 
Minority Football Coaches and Civil Rights

The new-old controversy in college football is the lack of Black head coaches in Division I-A college football. With recent firings and resignations, there are four Black coaches (out of 119 schools) in a sport in which approximately 46 % of players are Black. Exacerbating this problem is the recent trend of current head coaches at major programs designating a current (usually white) top assistant as the new future head coach whenever the current coach retires, a process that pretermits any future coaching search in which outside, Black candidates might be considered for the job. Essentially, the practice locks-in the current state of coaching at many major schools.

Richard Lapchick, one of the leading scholars on collegiate sport, race, and society, criticizes this state of affairs. He argues that the NCAA should adopt a version of the NFL's "Rooney Rule," which requires that teams interview at least one minority candidate for a head coaching job. Lapchick calls his proposal the "Robinson Rule," after the late Eddie Robinson, the all-time-winningest D-I coach at historically back Grambling State (a D-I-AA school) who never even got an interview for a D-I-A head job.

So here are my questions for con law and employment-law types out there: Would such a rule be constitutional under the Fourteenth Amendment? The NCAA is not a state actor, but individual state schools would be in following and carrying out such a rule. So, given the current state of Equal Protection law, would it be unconstitutional for a governmental actor to automatically interview and give serious consideration to a minority for every position? Or, as to private schools, does it violate Title VII? Finally and conversely, would the NCAA's failure to adopt such a rule (or a similar rule designed to ameliorate the dearth of opportunities for minority coaches) violate Title VII (Lapchick reports that the Black Coaches Association is considering using Title VII to challenge current hiring practices)?

Friday, December 12, 2008
 
Farewell to the Father of Law-and-Baseball

The New York Times reported today on the death of William S. Stevens, who arguably started the law-and-baseball movement with his 1975 unsigned student comment Aside: The Common Law Origins of the Infield Fly Rule. (H/T: Paul Horwitz at PrawfsBlawg). This was one of the first articles to draw links, humorously or seriously, between baseball and its rule-bound traditions and the law and has sparked all manner of scholarship building on those links.

Wednesday, December 10, 2008
 
The Economy Strikes Again (Sabathia not Worried)

According to the Denver Post, the Arena Football League “faces possible dissolution unless it secures an infusion of money by December 19.” Perhaps they can call CC Sabathia, who is reportedly set to sign a 7 year, $161 million contract with the Yankees.


Given the state of the economy, reports of the AFL’s possible demise are not shocking, but they do raise a few interesting issues. First, this sheds some light on the then-surprising decision of team owner Tom Benson to fold the popular New Orleans VooDoo this past October (as well as Commissioner Baker’s sudden resignation). At the time, VooDoo executives claimed that the franchise folded because of “circumstances surrounding the team and the league,” but some speculated that the end of the VooDoo was an ominous sign for the future of professional sports in New Orleans. Perhaps now—particularly with the Hornets and Saints thriving—we can see Benson’s actions as more of a reflection of the AFL than the city of New Orleans.


Second, the fall of the AFL may be very good news for the rise of the United Football League, which plans to launch in 2009. The UFL will not only have access to a large number of professional football players and coaches looking for jobs, but will also have the ability to slide in to play the role of the NFL’s “feeder league.”


Third, it is interesting to read statements from various executives involved with the AFL. On the AFL website, the league’s official statement is: “Despite rumors and reports to the contrary, all AFL teams are continuing to work towards ArenaBowl XXIII. As it has previously stated, the AFL continues to work on long-term structural improvement options.” Brett Bouchy, the new owner of the Orlando Predators said that he "expects the league's 2009 schedule to be released in the next 2-4 weeks….I will tell you that the overall economy has presented challenges for arena football, just like any other business that's out there, and we are addressing that. We are going to come out of this with the best economic model the arena league has ever had in the next 30 days.” And, Michael Young, the executive vice president of the Colorado Crush stated that “[t]he business model for the league is broken.”


These statements all focus on the economic model of the league and suggest that league owners are working on a new model for the league going forward (and that would allow them to go forward). What model could they employ that might permit them to lower costs, particularly in the form of player salaries? Well, perhaps our old friend the single entity. Stay tuned…

Update (3:20 pm, Eastern). Well, that didn't take long. According to the Kansas City Star, the AFL will cancel its 2009 season. The article quotes Pete Likens, the director of communications for the Kansas City Brigade, as offering up this interesting tidbit: “It’s pretty much a done deal to suspend the 2009 season and work toward a single entity-league,” Likens said. “We plan to start up again in 2010, if the owners vote this way. We’re prepared to play this year, and/or next.”

It will be interesting to see what type of single entity structure the AFL comes up with to immunize itself from a Section 1 attack and how the players respond to the new league structure. Given the Seventh Circuit's "one facet at a time" approach in American Needle, the AFL may have to go to extremes to avoid the risk that a court would conclude that the AFL is a single entity for purposes of the player market.

Update (12-11-08) The Sports Business Daily is reporting that the AFL Board of Directors voted not to suspend operations for the 2009 season. Yet.


 
News on Two Members of the 2008 Salary Arbitration Hearing Group - Francisco Rodriguez and Mark Loretta

As noted in Gabe Feldman's earlier post today, Francisco Rodriguez has reached a three-year, $37 million agreement with the New York Mets to bring the closer from Anaheim to New York. Rodriguez, who set a Major League record last year with 62 saves, went to a hearing last year and lost when his panel (Stephen Goldberg, Elizabeth Neumeier, Steven Wolf) chose the Angels’ figure of $10 million instead of his request for $12.5 million. According to Anthony DiComo for MLB.com, Agent Paul Kinzer was hoping for a five-year, $75 million contract for Rodriguez. The general economic condition and the number of free agent closers on the market worked against Kinzer and Rodriguez.

Another hearing player from last year who is close to signing this week is Mark Loretta. According to an AP story in USA Today, Loretta will sign a one-year deal with the Dodgers. Last year Loretta sought $4.9 million from the Astros, but his panel chose the team’s figure of $2.75 million. Loretta played in 101 games in 2008, his lowest total since his 2000 campaign with the Brewers, and he posted a batting average of .280. Loretta will be entering his 15th season next year with a career batting average of .297. He played all four infield positions last year for Houston. He will be returning to his native state of California. Loretta was born in Santa Monica in 1971.

Tuesday, December 09, 2008
 
The Economy Strikes Again (K-Rod not Worried)

While Francisco Rodriguez (and his new 3-year, $37 million deal) probably won’t be doing much complaining about a recession, the impact of the tough economic times continues to be felt by major sports entities in the U.S. Today, the NFL announced that it plans to cut more than 10 percent of its staff and that it has indefinitely suspended plans to play a preseason game in China. As espn.com reports, “[t]he NFL has been symbolic of the wealth surrounding professional sports, but it now joins the NBA, Major League Baseball and NASCAR in announcing layoffs.” The NHL doesn’t pain a much rosier picture, as Bill Daly, the NHL deputy commissioner, recently said: “In the short term, it’s pretty dark…It’s a credit crunch, not a lot of stable financing available, a lot of bad paper out there. So, it’s going to be tough sledding,” said Daly. Even the mighty Tiger Woods was not immune, as General Motors chose to end its lucrative endorsement deal with him.

Not surprisingly, the impact is also being felt across the pond. As the Guardian reported last week (h/t to J Hutcherson at usscoccerplayers.com), clubs in the Football League Championship (the “Championship”) have discussed the possibility of instituting a salary cap. For those of you who do not follow English soccer (and even for those of you who do), the Championship is the second highest division in the English football league system after the English Premier League. The bottom three teams from the Premier League get relegated down to the Championship each year, while the top 3 teams from the Championship (the top 2 based on standings, and then the winner of a playoff involving teams finishing 3-6) get promoted up to the Premier League. Likewise, the bottom three teams in the Championship get relegated to the next division, Football League One. Clubs in the Championship thus face a very different reality from clubs in US sports leagues. Championship Clubs are fighting to both gain promotion to the Premier League and to avoid relegation. Clubs relegated down one league typically suffer a huge drop in revenue (particularly from the Premier League to the Championship), as they lose revenue from tv deals, sponsors, attendance, etc. The pressure to win—and to sign high-priced players who can help them win—is thus tremendous.

And, as the Guardian notes,
[m]ost clubs in the [Championship] are losing significant money because they pay what one chairman described as ‘unsustainable’ wages on players they hope will win them promotion to the Premier League. Without the cushion of the multimillion-pound television deal enjoyed by the 20 Premier League clubs, Championship clubs are reporting tougher economic conditions, with away gate beginning to suffer and sponsorships and corporate hospitality harder to secure….

Many clubs are preparing to seek sponsorship for next season, a task one senior club source said is proving "difficult" because it is "grim out there". Second-tier sponsors especially, who do not have their name on team shirts but pay to advertise or sponsor matches or stands, tend to be more local businesses than the big companies attracted by the Premier League, and many of those are struggling so have less money to spend on football….

Adam Pearson, the chairman of football at Derby County, warned that football is inadequately prepared for the economic downturn. "The game is close to meltdown at all levels," he said. "Club boards are under pressure to gain success and that leads to them paying ridiculous wages. It cannot carry on or it will end in disaster. There is a growing feeling now that some sort of wage cap has to come in."

Club owners are thus considering a cap that would limit player salaries to a percentage of Championship revenues. Given the intense pressure to achieve promotion and avoid relegation, it is understandable why some owners would be resistant to the cap (and more so than in US leagues), even if it might achieve financial stability for some clubs and increased competitive balance in the Championship, as some Championship club owners at least want the ability financially to “outcompete” their rival teams to advance up to the Premier League where the economic situation is not quite as grim. More on this as the situation develops…

 
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Monday, December 08, 2008
 
Oliver and Weathers Accept Salary Arbitration

Of the 24 free agents offered salary arbitration by their teams last week, only pitchers Darren Oliver of the Los Angeles Angels of Anaheim and David Weathers of the Cincinnati Reds accepted the offer. Thus, both Oliver and Weathers will stay with their current team for the 2009 season. The only point left to determine is the salary. In the other 22 cases, the team will get either one or two draft choices depended upon whether or not their player is a Type A or a Type B free agent according to the Elias Sports Bureau ranking system.

Oliver pitched for the Angels last year for $2 million. As a lefty middle-reliever for a bullpen with current free agent closer Francisco Rodriguez, Oliver pitched in 54 games with a 7-1 record and a 2.88 ERA. His ERA was nearly 2 runs below his career ERA in 15 years of major league work. Oliver was originally a third round draft choice of the Texas Rangers, and his greatest payday came with a three-year, $19 million deal in 2000. In 2002 Oliver moved to the Red Sox only to be released on July 2. The Cardinals picked up Oliver on July 19 and released him on August 13 after Oliver pitched in 5 games for Memphis in the Pacific Coast League (14 earned runs in 16 innings as a starter).

Weathers will be entering his 19 major league season in 2009. In 69 1/3 innings last year, Weathers posted a 3.25 ERA with a 4-6 record. He finished 17 games with no saves after yielding the closer’s role in Cincinnati to Francisco Cordero who recorded all 34 saves for the staff. Weathers completed the final year of a two-year, $5 million deal last year. MLB.com’s Mark Sheldon predicts that Weathers “stands to get a considerable increase through the arbitration process.”

Friday, December 05, 2008
 
Let Them Play! (at least on this Sunday)

U.S. District Court judge Paul Magnuson granted a temporary restraining order earlier today which will permit Will Smith and Deuce McCallister of the New Orleans Saints to play in their game this Sunday in New Orleans (the TRO also applies to Charles Grant, but he is on the injured reserve list and thus unable to play). Judge Magnuson also upheld the temporary restraining order granted Wednesday in Hennepin County District Court to Pat Williams and Kevin Williams of the Minnesota Vikings, which will allow them to beat, er, play against, the Detroit Lions this Sunday.

The players had been suspended for four games pursuant to the NFL Policy on Anabolic Steroids and Related Substances (the “Policy”) after testing positive in training camp this summer for the banned diuretic bumetanide. Bumetanide and other diuretics are on the banned substance list because they can be used as masking agents to prevent the detection of steroid use. The bumetanide consumed by the players was apparently contained in the dietary supplement StarCaps, but was not listed as an ingredient on the bottle.

Pursuant to the procedures set forth in the Policy, the players filed an internal appeal, which was heard by Jeffrey Pash, the chief legal officer of the NFL. Pash upheld the suspensions. Despite the fact that the Policy states that the result of the internal appeal “will constitute a full, final, and complete disposition [and]…will be binding on all parties,” the players then filed an action seeking to vacate the suspensions. How can the players challenge the decision in court if the Policy states that the result of the appeal is final and binding? Well, the NFL argues that the players can’t, but the players have contended that the NFL’s internal arbitration proceedings were “fundamentally unfair and the result of evident partiality” because the arbitrator, Jeffrey Pash, “was reviewing and immunizing misconduct by his own office, in which his own subordinate was involved.”

This is obviously not the first time an athlete has challenged a positive drug test result in court. But, in many of the recent cases, the athlete has challenged the result on the basis of a faulty test or a breakdown in the integrity of the drug testing procedures. In this case, however, the players are making a very different argument. The players are not challenging the test itself. In fact, the players appear to have conceded that the drug test was accurate.

Instead, the players are arguing—with an interesting twist—that it is not their fault that bumetanide was in their system. In typical cases, this argument would be a non-starter because the Policy employs a strict liability standard. According to Section 3.E.: “Players are responsible for what is in their bodies, and a positive result will not be excused because a player was unaware that he was taking a [banned] substance.” This strict liability standard, like the standard contained in the World Anti-Doping Agency Code, removes intent as a requirement for a finding of a violation and makes players responsible for any substance that is present in their body, regardless of how it got there (with some extremely limited exceptions).

Strict liability standards are often criticized for being unfair because they can result in the punishment of “innocent” individuals (ie, one who did not have the intent to commit the violation), but, in the typical tainted supplement case, I don’t think there’s much of a case to be made that imposition of a strict liability standard is unfair. Given the apparent frequency of unlabeled banned substances appearing in supplements (and particularly given the language in Appendix F discussed below), NFL athletes are on notice that taking a supplement is a risky behavior which may lead to punishment. This notice, in essence, serves as a substitute for intent.

This case, however, is not the typical tainted supplements case. In this case, the players are not just arguing that they did not intend to take the banned substance. Instead, they are arguing that the NFL’s Independent Administrator on Anabolic Steroids and Related Substances (Dr. John Lombardo) and NFL lawyers knew that StarCaps contained bumetanide, but failed to disclose this fact to the NFL players or the NFL Players Association. The players claim that this constituted a breach of fiduciary duty, endangered the health of the players, and “fatally tainted the suspensions so that enforcing the [suspensions] would unfairly punish the players and condone the improper behavior and breaches of duty by the NFL, in violation of public policy and the essence of the CBA.”

As I mentioned in a NY Times article today, I believe that these additional facts alleged by the players make for a compelling and sympathetic case, but the players have a very difficult fight ahead of them. Even assuming, as the players appear to have argued, that the Independent Administrator had an affirmative duty to warn the players of tainted supplements, the NFL has a strong argument that they satisfied the duty in Appendix F to the Policy, which states:


Over the past several years, we have made a special effort to educate and warn players about the risks involved in the use of “nutritional supplements.” Despite these efforts, several players have been suspended even though their positive test results may have been due to use of a supplement. Subject to your right of appeal, if you test positive or otherwise violate the Policy, you will be suspended. You and you alone are responsible for what goes into your body. Claiming that you used only legally available nutritional supplements will not help you in an appeal.

As the Policy clearly warns, supplements are not regulated or monitored by the government. This means that, even if they are bought over-the-counter from a known establishment, there is currently no way to be sure that they: (a) contain the ingredient listed on the packaging; (b) have not been tainted with prohibited substances; or (c) have the properties or effects claimed by the manufacturer or salesperson.

Therefore, if you take these products, you do so AT YOUR OWN RISK!

(each version of emphasis in original)

In addition, Section 3.E. of the Policy states: “If you have questions or concerns about a particular dietary supplement or other product, you should contact Dr. John Lombardo…Having your Club’s medical or training staff approve a supplement will not excuse a positive test result.” (emphasis in original).

Granted, this falls short of warning the players that the NFL has specific knowledge that a particular supplement is tainted, but the NFL can argue that they put the players on notice that every supplement is tainted. That is, the players should assume that every supplement contains a banned substance, unless told otherwise by the Independent Administrator. Of course, as a broader argument, the NFL can argue that it does not matter that the Independent Administrator did or did not know of the presence of a banned substance in StarCaps, because the Policy calls for a suspension “if you test positive…. You and you alone are responsible for what goes into your body.”

This case presents a number of different issues and provides an interesting test for the scope of strict liability standard. I hope to write more these issues as the case unfolds. For now, I will enjoy one more Sunday (at least) of watching Deuuuuuuuuuuuce in the Superdome...

 
Free Agents and Salary Arbitration

Some of you have not seen a post from me on the Sports Law Blog for awhile. However, salary arbitration season is now in full swing. Earlier this week (Monday midnight ET deadline), 24 free agents were offered salary arbitration by their teams. The split between leagues was identical with 12 in each league.

One of the primary reasons that teams offer arbitration is to make sure that if their free agent moves to another team the team that loses that player receives draft picks as compensation. The Elias Sports Bureau ranks free agents in three categories - A, B, or unranked. If a team loses a Type-A free agent, the team losing a player receives two compensatory draft picks: If the signing teams first-round pick is below the top fifteen picks in the draft, the signing team loses that pick to the free agent’s former team plus a supplemental or sandwich pick between the first and second rounds. If the signing team has a choice in the first fifteen, the free agent’s former team receives the signing team’s second-round choice plus the sandwich pick. The compensation for losing a Type-B free agent is a supplemental selection. However, if a team offers arbitration, and the player accepts by the deadline this Sunday, both team and player are locked into the upcoming season with the only issue remaining the compensation for the year. Most teams prefer not to do this because the compensation almost always increases over the prior year with arbitration.

The list of players offered arbitration is as follows:

American League

Milton Bradley (Texas Rangers), A.J. Burnett (Toronto Blue Jays), Paul Byrd (Boston Red Sox), Orlando Cabrera (Chicago White Sox), Jon Garland (Los Angeles Angels of Anaheim), Mark Grudzielanek (Kansas City Royals), Raul Ibanez (Seattle Mariners), Darren Oliver (Los Angeles Angels of Anaheim), Dennys Reyes (Minnesota Twins), Francisco Rodriguez (Los Angeles Angels of Anaheim), Mark Teixeira (Los Angeles Angels of Anaheim), Jason Varitek (Boston Red Sox)

National League

Casey Blake (Los Angeles Dodgers), Juan Cruz (Arizona Diamondbacks), Brian Fuentes (Colorado Rockies), Orlando Hudson (Arizona Diamondbacks), Derek Lowe (Los Angeles Dodgers), Brandon Lyon (Arizona Diamondbacks), Oliver Perez (New York Mets), Manny Ramirez (Los Angeles Dodgers), CC Sabathia (Milwaukee Brewers), Ben Sheets (Milwaukee Brewers), Brian Shouse (Milwaukee Brewers), David Weathers (Cincinnati Reds).

There were fifteeen Type-A free agents offered arbitration and nine Type-B players offered arbitration. The lists are as follows:

Type-A - 15 (Burnett, Cabrera, Cruz, Fuentes, Hudson, Ibanez, Lowe, Oliver, Perez, Ramirez, Rodriguez, Sabathia, Sheets, Teixeira, Varitek)

Type-B - 9 (Blake, Bradley, Byrd, Garland, Grudzielanek, Lyon, Reyes, Shouse, Weathers

By my count, 56 American League free agents and 67 National League free agents were not offered arbitration.

I will offer a review next week of this first round of arbitration. Usually this is not the focal point of arbitration. That focus usually involves players that are not yet eligible to become free agents because they lack six years of qualified service. The dates of importance for those players and their teams are January 5-15, 2009 (salary arbitration filing period), January 19, 2009 (exchange of salary arbitration figures), February 1-21, 2009 (salary arbitration hearings).

 
And you Thought only the Mets were Playing in Taxpayer Field

Since the federal government's $700 billion bailout of the banking industry, many taxpayers have demanded that the New York Mets new stadium, Citi Field, be renamed Taxpayer Field. However, low and behold, it's not just the Mets that are enjoying free taxpayer money. Many teams, including the Florida Marlins, are actually getting huge stadium subsidies directly from local governments.

For those interested in the public funding of private baseball stadiums, check out my newest article in the Rutgers Journal of Law and Public Policy, entitled Sports and the City: How to Curb Professional Sports Teams' Demands for Free Public Stadiums (PDF).

Thursday, December 04, 2008
 
Sentencing of O.J. Simpson

I have a new SI.com column on O.J. Simpson, who will be sentenced tomorrow in a Las Vegas court. Hope you have a moment to check it out.

Tuesday, December 02, 2008
 
The Legal Woes of Plaxico Burress

I have a new SI.com column on Plaxico Burress. I hope you have a chance to check it out.

Update 12/2: I have a new SI.com column up on Burress and I'll be interviewed on CNN tomorrow morning in a segment that will air several times between 6 a.m. and 9 a.m., hope you have a chance to watch.