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Monday, April 25, 2011
New Sports Illustrated Column: NFL Players Secure Big Victory before Judge Nelson

Judge Nelson granted the players the injunctive relief they were seeking -- but an appeal may make it a short-term success.  I have an SI column on the ruling and what it means.  Here's an excerpt:
8. What effect, if any, does Judge Nelson's ruling have on the NBA?

The collective bargaining agreement between the NBA and the National Basketball Players' Association (NBPA) will expire on June 30. Just like we saw last month with the NFLPA and the NFL, the NBPA is poised to decertify and the NBA is poised to institute a lockout.

On one hand, Judge Nelson's ruling sends a warning to the NBA and its owners that, at least in her view, antitrust law holds a dim view of lockouts and that judges should not wait for the NLRB to decide on unfair labor complaints.

On the other hand, the NBA is in a very different situation.

For one, the NFL's legal argument has been hampered by the fact that not one NFL team can show that it is losing money. The inability of a team to do so suggests that enjoining the NFL lockout would not force an NFL team to lose money. The NBA, in contrast, asserts that 22 of its 30 teams will lose money in the 2010-11 season, and the league is willing to open the books to prove it. A court decision to lift a lockout instituted by the NBA would therefore subject NBA teams to losing money in the 2011-12 season. Such a consequence could motivate a judge reviewing an NBA lockout to be less willing than Judge Nelson to lift the lockout.

Second, irreparable harm may be more difficult for NBA players to show, since unlike NFL players who can play nowhere else and earn an NFL-quality income, some NBA players would be able to secure lucrative contracts in Europe and elsewhere during a lockout. If NBA players can't show irreparable harm, they would not be able to convince a judge to enjoin an NBA lockout.

Third, Judge Nelson's decision would not bind a court that reviews the NBA lockout. In fact, it is likely that such a court would be in New York, where both the NBA and NBPA are located. The NFL and NFLPA are litigating the lockout in Minnesota because the parties choose to do so in their collective bargaining agreement.

Bottom line: while Judge Nelson's ruling likely caused some concern for NBA teams, the NBA is in a very different situation and a lockout may be viewed more favorably by a court.


It's interesting how Judge Nelson devoted so much of her opinion to a General Counsel Advice Memo. GC Memos are not binding on the NLRB and merely represent the GC's policy and opinion regarding the specific matter before him or her. I can't recall another federal court opinion which appears to rely so heavily on a GC advice memo.

Blogger Tribe -- 4/25/2011 11:30 PM  

And, I feel compelled to add, I'm a union guy....just trying to look at this things as objectively as I can.

Blogger Tribe -- 4/26/2011 11:55 AM  

As usual, you have presented a solid analysis (I read the longer SI piece). I do think that the NBA is in a better position arguing in the Second Circuit instead of the Eighth Circuit. Judge Winter's strong preference for labor law over antitrust law is generally shared by his colleagues, and Judge Winter's prior decisions and law review scholarship are strong arguments. In fact, the Second Circuit is on record as not accepting the three-part Mackey test that Judge Nelson cites near the beginning of her opinion.

Blogger Ed Edmonds -- 4/26/2011 12:30 PM  

An additional point on irreparable harm - notice that the antitrust plaintiffs (Brady, Brees, Jackson, Manning, Vrabel, etc.) are generally players who have already exceeded the 3-plus year career average length in the NFL. If some of the players currently in the NFL miss the 2011 season, they may never play another down in the league. My feeling on the point that you make at the end of number 4 is that the players have a pretty strong argument on harm not being amenable to a determination of monetary damages. So, I think the NFL loses on that point on appeal.

Blogger Ed Edmonds -- 4/26/2011 12:40 PM  

@ Tribe, I am assuming she relied on it because it is the only thing directly on point. The GC memo and Judge Doty's opinion in McNeil are the only two cases that address the "sham decertification" argument, and both took different approaches. The GC memo said the NFLPA complied with the "good faith" standard that the league has said the union has failed to comply with, while Doty's opinion said (see fn.6) that the "good faith" standard didn't apply. Thus, I would quibble somewhat with her ultimate statement ("Here, as in 1990, the good faith test is met") because Doty's opinion said the "good faith" test didn't apply once the players indicated that they did not wish to be represented by any union (this seems right since all the cases cited were about disclaimers in a multiemployer bargaining unit where the union still existed after the disclaimer). In the end, rejecting the "sham" decertification argument seems correct no matter which way you analyze the "good faith" issue.

Anonymous Dave -- 4/26/2011 1:29 PM  

@Dave, I don't disagree with you that Judge Nelson ruled correctly on the sham certification issue. But, I still think it's somewhat extraordinary for a federal court to lay so much reliance on a GC Advice memo. Admittedly, the fact pattern in the case which was the subject matter of the memo is certainly similar to the instant dispute, but in any event, the memo didn't create any new Board law in regard to the test used by the Board in measuring whether a disclaimer of interest is made in good faith or not. The Board has addressed that issue through case law many times.

I also agree that the Judge correctly refused to defer to the Board on that issue. It's hardly new law that federal courts can determine collateral labor law issues when a case is properly before it. I'm not sure how the 8th Circuit, regardless of how pro-management it might be, will be able to get around that one.

My best guess is the 8th Cir. may focus instead on the impact of the Norris-LaGuardia Act. We're in uncharted waters in regard to the relatively unique fact pattern in this case, namely, parties are in bargaining, union disclaims interest, employer locks out. In light of the rapid succession of events, perhaps the 8th Cir could be persuaded that the clubs have some limited right to lock out the players since the genesis of the dispute is in fact a labor one.

Blogger Tribe -- 4/26/2011 8:25 PM  

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