A Stroll Down Manning Lane: NFL Opts Out Of CBA - May 20, 2008

With the NFL and its players still trying to hammer out a new CBA, I decided to take a glimpse back in time to May 20, 2008, when the NFL announced it would opt out of the 2 year old CBA (set to expire at the end of the 2012 season).

Sometimes it can be fun to reminisce.

Here's an excerpt from the NFL's press release entitled, "NFL owners opt out of CBA":

The current labor agreement does not adequately recognize the costs of generating the revenues of which the players receive the largest share; nor does the agreement recognize that those costs have increased substantially -- and at an ever increasing rate -- in recent years during a difficult economic climate in our country. As a result, under the terms of the current agreement, the clubs’ incentive to invest in the game is threatened.

The press release goes on to state,

There are substantial other elements of the deal that simply are not working. For example, as interpreted by the courts, the current CBA effectively prohibits the clubs from recouping bonuses paid to players who subsequently breach their player contacts or refuse to perform. That is simply irrational and unfair to both fans and players who honor their contracts. Also irrational is that in the current system some rookies are able to secure contracts that pay them more than top proven veterans.

The NFL also declared that it was "resolved to do our best to achieve a fair agreement that will allow labor peace to continue through and beyond the 2011 season".

Here's a link to the press release.

Ok - maybe not that much fun.

Pats Owner on Lockout: "I think we’re getting close to having to put this thing to bed"

“I think we’re getting close to having to put this thing to bed, so we don’t miss any events."

- Robert Kraft, owner of the Patriots as per Boston Herald article

On the NFL lockout, Kraft feels that the NFL and players are "further along than they had been when the lockout started in March". This is according to Karen Guregian’s article in the Herald.

Kraft also addressed the ongoing litigation: “… the good news is we’re talking. I think we went 34 days without having communications, and the lawyers on each side were doing stuff. That, to me, isn’t progress”.

It is important to remember that the players sued the owners, and the owners were forced into litigation. Once the Appeals Court dropped the lockout back in place, and suggested that it may stay there for an indefinite period of time, the players were given a serious incentive to start negotiating in a meaningful way.

So  litigation did serve a purpose in this case - providing that incentive to talk. Of course, there is the argument that the parties should have never been involved in litigation in the first place. Deals are not made in the Courts, but rather at the negotiating table.

Tough to argue with that.

Discredited: Paper Reports NFL Lockout "Over"

The North Andover, Massachusetts newspaper, the Eagle-Tribune, has reported that the NFL "lockout is over". The article states that "according to an NFL source, owners and players have tentatively reached an agreement to end the lockout".

Not so fast.

This report has been widely discredited. Pats owner Bob Kraft has said that the parties have “a lot of hard work” ahead of them.

George Atallah, who works for the NFLPA, today tweeted, "There's a report that the lockout is over. Umm...no".

The article also says that the parties met in Manhattan, when in fact they met in Long Island. The article also provides that some "coaches and players have been contacted about returning to work probably early next week and as soon as this weekend'. If players and coaches were indeed contacted, this story would have broken quicker than my confidence at a speed dating event.

So it looks like a false alarm. The lockout continues.

I still see settlement in principle no later than the end of July, followed by a full NFL season filled with Brett Favre rumours of a comeback and stories of Clinton Portis battling injury (wherever he may sign). 

Given that there are clear areas of compromise, this case has a profile for settlement.

Drudge Report Features Horton Hit

Drudge Report is a massively popular website. It's generally considered right wing (for response to site see Huffington Post) and today received 32 million hits. It's more popular than Yahoo! for news receiving over 800 million hits over the past 30 days.

Today, Drudge (drudgereport.com) featured a story on Rome's hit on Horton that left the Bruins' forward on the ice unconscious. The site also has a link to the video of the incident.

You can imagine that parents that are considering putting their kids into hockey, or more generally, looking to engage in the sport, might seriously think twice after seeing this story.

The headshot list continues to grow (Matt Cooke on Marc Savard, Mike Richards on David Booth, Matt Cooke on Ryan McDonagh, Zdeno Chara on Max Pacioretty, Patric Hornqvist on Tyler Seguin, etc.). The cumulative effect of seeing these hits on television is not great for a league looking to increase its market share. Of course, I'm not saying anything most don't know.

Breaking News: Jason Bailey Dismisses Anti-Semitism Suit Against Ducks; Continues Against Balance of Defendants

In keeping with Plaintiff Jason Bailey's request, the Court has dismissed the Action against the Anaheim Ducks. Bailey, however, is continuing with his lawsuit against the balance of the defendants, coaches Martin Raymond and Mark Pederson, as well as Flying Pucks LLC.

Bailey moved to have the Action dismissed against the Anaheim Ducks on May 3, 2011.

The focus of the action is that Bailey was subjected to harassment and anti-Semitic remarks by the Condors coaches. The lawsuit contends that Bailey was the victim of religious discrimination, harassment based on religion, intentional infliction of emotional distress and retaliation. Bailey claims he lost income and suffered humiliation. Bailey is suing for unspecified monetary damages.

For my initial summary of the case, please click here.

When the lawsuit was filed, Flying Pucks was not a defendant - it was the Bakersfield Condors hockey team. It seems this defendant was updated to reflect the owner of the team. This is not unusual.

On why he dismissed against the Ducks, ultimately, it may have been that Bailey did not feel he could establish a reasonably sufficient link between the Ducks and the complained of events. According to the Complaint (lawsuit filed by Bailey), the Ducks made the coaches apologize. That may have been a consideration in making this decision. So this may turn on the Ducks' insufficient proximity to the alleged events.

Here is the official Court document dismissing the Action against the Ducks:

Weekend Quick Hits: Around the Web in 80 Seconds

Gone In 17 Minutes: The Winnipeg Franchise, formerly known as the Jets, sold out tickets in 17 minutes. The luxury boxes are also gone for the next 10 years and there is a wait list of 7000.

This begs the question: how much did this help Quebec? I'm guessing immensely. Other owners are now seeing serious revenue/interest coming in from a traditional hockey market, and support for other traditional hockey markets will likely gain some serious traction from inside the NHL.

Knowing hockey would get support is one thing. Seeing it crystallize so dramatically is another.

This type of success is very hard to ignore.

NFL Sponsors Groced Out: AdAge has a good article entitled, NFL Lockout Threatens In-store Promos for Pepsi, Mars, P&G and More.

The story addresses how in-store marketing people are being affected by the possibility of no football in September. Major brand owners aren't sure exactly what they should be doing after having poured millions of dollars into promotion. One thing is clear - unlike anywhere else in sports, sponsors are all hanging around because the NFL brand is immensely strong from a co-promotion standpoint.

Here's an excerpt:

After spending millions in advance on multibrand, in-store promotional deals with the National Football League, Procter & Gamble, Mars and PepsiCo, among others, now find themselves faced with the possibility of a truncated season that could do more damage to their plans and brands than those of the networks and TV buyers.

Networks can schedule alternate programming and marketers can apply media analytics to follow their target audiences wherever they go when they're not watching NFL football. But shopper-marketing events have calendars set a year or more in advance. Product has to be produced and displays have to be filled, regardless of whether games get played.

..."There is going to be a season," she said. "The issue is how late it will start and how it will impact our business." Normally, Mars uses TV ads to plug in-store promos, but the media buying will get tricky if the season is delayed.

...P&G, for example, was aware of the potential for a labor dispute when it negotiated its deal, he said. And one factor behind doing it anyway is the belief that the NFL brand is strong enough to survive "well beyond a game or a few games or even part of the season," he said.

Tebow Can Pitch: According to the Sporting News, Broncos QB Tim Tebow has joined Colts Peyton Manning, Steelers Troy Polamalu and Saints Drew Brees "in the NFL's group of most marketable pitchmen". This is just after one season, which included 5TDs and 3 picks. He promotes Nike, FRS Energy Drinks and Jockey.

 

One expert says a reason for his appeal:  he has an "embraceable wholesomeness".

 

I'm not sure what that means but it makes me want to eat a muffin.

 

Kindly Scratch My Head: The NFL is ahead of the pace on season-ticket sales compared with this point last year. This is fascinating given that the season may start late. However, as I've said all along, I see the season starting on time and a deal in principle being reached in late July.

 

NBA in India: The NBA continues to grow in India. In keeping with its growth, the NBA signed a deal with Times Internet Ltd., one of the country’s largest media companies. The agreement "will create a dedicated digital NBA section on The Times of India and the IndiaTimes English language websites, with the content expected to be featured on other Times Internet Ltd. digital outlets." This is according to the Sports Business Journal.

As we head into a possible NBA lockout, remember one thing - the NBA is very popular overseas. See below for one such indication.

 

Let's Be Friends: And here's your social networking update on the coolest kids on the virtual sports block with respect to Facebook and Twitter combined:

 

Sports Top 10

 

NHL Top 5

1) NHL
2) Hawks
3) Bruins
4) Habs
5) Flyers

NBA Top 5

1) NBA
2) Lakers
3) Celtics
4) Heat
5) Bulls

MLB Top 5

1) Yanks
2) Red Sox
3) Cubs
4) Giants
5) Phillies

NFL Top 5

1) NFL
2) Cowboys
3) Steelers
4) patriots
5) Bears

And here are your top 10 Facebook/Twitter accounts across the virtual board:

NFL Update: Players May Need to Recalibrate

When I listened to DeMaurice Smith speak recently, he said "we are prepared for a lockout" and have been all along. If that's the case, today's events may not phase him. At the very least, they are not a surprise.

If you are an NFL player, today, on its face at least, didn't go so well.

The NFL and its players were in Appeals Court today arguing over the legality of the lockout. The players say the lockout isn't legal; the owners disagree.

You might remember that the Appeals Court converted a temporary stay (or suspension) of the ruling to lift the lockout into a longer one pending the resolution of today's bigger question - is the lockout is legal. When they made that ruling, the majority of the Court remarked that the NFL "has made a strong showing that it is likely to succeed on the merits."

So the thinking was today the Appeals Court (or at least the majority of the 3 judges) would suggest that they are likely to maintain that position. And by all accounts, that's what happened. The majority of the Judges questioned the players pretty heavily on their position. That of course doesn't mean they will find against the players. Still, that together with the remark they made last time around that the NFL was likely to succeed, it's not unreasonable to put your money on the owners.

So what if the NFL owners win?

That would mean that the lockout would stay in place for an indefinite period of time (as long as the owners want basically). The players could appeal the decision to the U.S. Supreme Court. It is doubtful it would accept the case, and even if it did, it wouldn't be heard for some time.

So all this means that if the NFL is successful, then the players may need to rethink their strategy. Do they dig their heels in and continue to resist the NFL's latest proposal or do they decide to offer up some further concessions.

If the players want to play, they will need to make concessions. Don't forget, the last time the owners signed a CBA, some owners didn't like it - at all. They don't want to sign another bad deal (in their eyes) that they will have to live with for a long time. So I expect the owners will continue to dig in their designer heels. Unlike the last time, they seem unlikely to bend in any meaningful way. So if they want to play, players may need to recalibrate their expectations.

The reasonable cutoff to have a full NFL season is around August 15. The season starts September 8, and teams need about 3 weeks to get ready. So stay tuned.

My feeling all along has been an agreement in principle will be reached sometime in mid/late July. I say that because there are fairly obvious areas of compromise and we are not dealing with a major overhaul of the NFL's business model like we had with the NHL in 2004-05 or like we are seeing with the NBA. This is just about splitting up the revenue pie. While of course not a trite issue, that may suggest that this case has a profile for settlement in the short term.

Oh yes - and don't forget half of the 1900 NFL players make $500,000 or less. They will want to play as they understand they have limited earning potential and careers. Their voices will be heard the closer we get to July 23rd, the first day of training camp.

NBA Union Head Hunter: CBA Proposal “Regressive”, “Repressive” & “Non-Starter”

Next week, the NBA and NBPA will meet to try and find common ground on a new CBA.

The issues dividing the parties are significant. The NBA is looking for major changes to its business model, very much like the NHL did in 2004-05, when the league shut down for an entire season.

Here are 3 key demands being made by the NBA:

1) Reduce the salary cap from $58 million to $45 million

2) Non-guaranteed player contracts

3) $800 million rollback in salaries

As mentioned in my column on Bill Daly’s year in review, Hunter spoke two weeks ago at a conference. Below is a breakdown of his comments. As we approach next week, his comments are relevant. As well, NBA Commissioner David Stern acknowledged that it will be “a challenge” to reach a deal on a new CBA before the current one expires in a month (source: Yahoo!).

Listening to Hunter in person, I did get the sense that the Union is looking to make a deal and might be amenable to certain concessions.

Here are Hunter’s remarks:

On the State of the NBA

“Things are going extremely well in the NBA”. It has been the “best year in history”. Television “ratings are up” and “attendance is up”. The NBA has exciting new talent in "Blake Griffin and Kevin Durant”. The NBA has also enjoyed strong market penetration in “China and India”.

On the Big Issue Under CBA

The “big struggle between us and the NBA is how we divide up the revenue being generated”.

On the NBA’s First Proposal 2 Years Ago

“As many of you know, we started our labor negotiations two years ago”. The first proposal made by the NBA was “draconian”.

Last summer, the Union responded with a counter proposal, and about a month ago, the NBA made a “new proposal”. The proposal was a “regressive proposal…and we thought first proposal was bad”. The second proposal made “repressive demands” and was “worse than the first proposal”.

On Expectations Moving Forward

“There has not been any movement and I don’t know whether there will be any between now and June 30”. The NBA has not provided any indication as to whether it is “inclined to soften its demands”.

One Word to Describe the Current Proposal

“Nonstarter”.

On the Ongoing NFL Litigation

NFL antitrust litigation is “casting a giant shadow”. We were “high-fiving when Nelson ruled”.

On the Possibility of Not Reaching an Agreement

It would be “asinine for us not to reach an agreement".

On a Possible Lockout

“We are ready for the lockout”. If the options are the current proposal or a lockout, “gimme the lockout”.

On Striking

The Union would not expect to “strike in the face of the expiration of the agreement”, although “all options are on table…and we will continue to engage in hard knuckle bargaining”.

Our Revenue Sharing

“Our contention is that there may be some teams losing money but that can be resolved through revenue sharing”.

The Union is “prepared to back off the 57% guarantee” but that’s not enough for the NBA.

On Players Playing Overseas During Lockout

The NBA should be “very concerned” with players playing abroad during a lockout.

Final Message

“Put the message out – we very much want a deal - a fair deal”.

NHL Owns JETS Trademarks

There have reports over who owns the JETS trademarks. Some have said that the JETS trademarks are owned by the old Jets owner and as a result the new owners can't use the name.

That's not the case. As per my column a few slots down, the NHL owns the JETS trademarks. In fact, the NHL filed new trademark applications for the WINNIPEG JETS marks after the team moved.

All this means is that if the new owners want the JETS marks, they can have it. The NHL would just need to transfer them over.

See below for more details.

Radio Clip on Team 1200: We Talk Jets

Click here to listen to my radio clip with the Team 1200 talking Jets.

Radio Clip: TSN Radio Toronto - NFL & NBA

Click here to listen to my radio clip on TSN Radio Toronto, where I talk NFL and NBA with Scott and Jim.

Can Players Object to Relocation? Column Revisited

In light of Thrashers move to Winnipeg, I've been asked a few times today if players could refuse relocate to Winnipeg on the basis that when they signed they didn't agree to play in Winnipeg.

On April 19, I wrote a column explaining why Coyote players could not simply opt out of their contracts. Since it has obvious application to today's events, here is a link to the article.

To Jets Or Not To Jets

With the announcement set for today that the Thrashers are moving to Winnipeg (broken here last Friday), one of the issues is what will the team be called.

The Jets moved to Phoenix in 1996. Thereafter, the WINNIPEG JETS trademarks were transferred (or assigned - same thing) to the NHL. This was done to ensure that the marks did not go abandoned. As well, there was still tremendous value in the marks, and that needed to be protected - even if the team was no more.

Some have suggested that because the NHL owns the marks, the Winnipeg franchise can't get them back. That's not accurate - they can. Just see the NHL as a custodian of the marks.

The issue at this point is not whether the owners can get permission to use the JETS trademarks. Rather, it's whether they want the name. It's a branding decision now.

Does ownership call the team the JETS, or if do they migrate to a new name?

Favouring keeping the JETS name is being able to leverage the existing goodwill associated with the name. It's recognizable. On the flip side, ownership may want to wipe the slate clean and rebrand. As well, by rebranding, the owners would be able to sell far more merchandise. The alternative is to keep the JETS name, but change the logo so fans would buy merchandise.

Apart from the JETS issue, there is also the WINNIPEG issue. Does ownership drop the city name and replace it with MANITOBA to suggest a broader reach? My guess is that may be the case (perhaps if they want to pull in U.S. fans, they could rebrand as the North Dakota Jets or the Los Angeles Jets of Anaheim).

So the branding strategy is multi-layered and is something ownership has likely already considered quite carefully.

There may not be a wrong decision in the eyes of ownership as much as a better decision.

Bill Daly's Year in Review

Last week I had the great pleasure of attending the Sports Lawyers Association conference in DC. General counsel for the four major sports (NHL, NBA, MLB, NFL) presented. They were followed by the Union heads, who offered sharply contrasting views.

These were the speakers:

Leagues

- William Daly, Deputy Commissioner, NHL

- Richard W. Buchanan, Executive Vice President and General Counsel, NBA

- Gary Gertzog, Senior Vice President–Business Affairs and General Counsel, NFL

- Dan Halem, Senior Vice President and General Counsel, Labor, MLB

Unions

- Billy Hunter, Executive Director, NBPA

- DeMaurice F. Smith, Executive Director, NFLPA

- Michael Weiner, Executive Director and General Counsel, MLBPA

- (Donald Fehr was attending Derek Boogaard’s service)

The Union heads were profoundly compelling. As far as the lawyers for the leagues, Bill Daly stood apart with a candid and comprehensive review of the NHL year.

In this column, I report on Daly’s comments. I will also report on the talks given by Union chiefs Hunter (NBA), Smith (NFL) and Weiner (MLB) in separate columns. Their talks were riveting (but then again I find Doogie Howser riveting).

Bill Daly Breakdown

On the Hockey Business

Daly opened with the line “business is good”. He cited a “record year both in terms of viewers and households”.

He also noted that the most recent TV deal was the “most lucrative U.S. national deal in the league’s history”. He added that the deal was unique because for the “first time ever we will have a national platform for all our playoff games”.

On the Winter Classic

“We haven’t made a decision with respect to the Winter Classic for this coming season…but certainly we expect it to happen …on Monday January 2 as I expect the NFL will play on Sunday January 1”.

On the Upcoming Expiration of the CBA in 2012

Daly stated that “we have been working several months with Donald Fehr to establish a good working relationship”.

He also noted that there will not be any “substantive negotiations” until the new year, although the NHL is “prepared to engage in the process at any time”.

On the NFL litigation

“We are very interested in the ongoing NFL litigation”.

With the NFL and NBA CBAs up first, followed by MLB, Daly said “in some cases it’s not great to bat last in the batting order. However, in this case, we are pleased to be in that position”.

Translated - the NHL is watching very carefully to see if the NFL players are successful in establishing that the lockout is not legal on the basis that it constitutes an antitrust violation. The NHL is also watching what the NBA will do (i.e., will the NBA decertify and try and block a lockout too?). And of course the NBA is watching the NFL situation very carefully. Everyone is watching everyone else. MLB, though, doesn't expect to encounter any serious issues, so they're probably just watching Perfect Strangers starring Bronson Pinchot.

On Increase in Revenue

The NHL is looking at another significant increase in revenue of 7 to 8%, which is over $200 million. The NHL should be close $3 billion in revenue for this year, which is an increase of "35% since the lockout".

On the Salary Cap

The salary cap for this year was $59.4 million with floor at $43.4 million. The cap has gone up $20 million in 6 years from $39 million. The salary cap will be going up again next year to somewhere between $60.5 to $63.5 million. The final cap number will be determined at the “end of June”.

On Phoenix

The NHL spent 2 months trying to restructure the bond deal and continues to look at “multiple alternatives”. Daly added that “we were going to need more time than we had” and Phoenix “came to the NHL asking if it was interested in extending the deal” and committed another $25 million to cover losses.

The “Governors remain committed to the market”.

Looking forward, the future of the Coyotes is “assured next year in Glendale”. The NHL made “a lot of progress this year” in understanding what a transaction should look like and the NHL hopes to be “successful in transitioning the franchise to a private buyer” by the start of next season.

On "Kovalchuk" Contracts

In negotiating the last CBA, the NHL did not negotiate term limits. It was discussed, “but not agreed upon”. Therefore, long term contracts were “not unanticipated” and it was “a function of the system”.

However, the NHL started to see “extreme front loading on contracts” and there was no doubt that certain clubs had the ability to front load more than others, thereby “creating a competitive imbalance”.

The NHL warned "clubs and that they had to be careful” and that the league “might pursue one of these cases as a circumvention”.

On Player Safety

As a result of the speed of the game and size of players, the “environment is more dangerous”. Brendan Shanahan and Mathieu Schneider are looking at reducing the size of equipment. The thought is that players would be less aggressive if the equipment was smaller. No mention if the equipment wouldn't be as hard.

Surely to the satisfaction of Max Pacioretty, the league is also looking at the design of hockey rinks to make them safer.

Thrashers to Winnipeg - Others Confirming Earlier Offside Report

As I first reported Friday evening on this non-monetized blog, Sportsnet and TSN are now reporting that it appears likely the NHL will announce on Tuesday that the Thrashers are moving to Winnipeg.

Having lost the Expos in 2004, I want to express to Thrasher fans that I am sorry you are losing your team. It's not easy.

Source: NHL Will Announce Move of Thrashers to Winnipeg on Tuesday

I've been informed by a reliable source that barring any unforeseen circumstances, the NHL will announce the move of the Atlanra Thrashers to Winnipeg on Tuesday.

Negotiations to Move Thrashers to Winnipeg "80% Complete"

According to the MyFoxAtlanta.com, a deal to move the Thrashers to Winnipeg is "about 80% complete".

Thrashers co-Owner Michael Gearon added that an announcement "may not come until next week" as there are "still mounds of paperwork to take care of".

As for selling the team to a local group, Gearson noted "there was no serious and/or viable offer to consider". Gearson also emphatically denied that he had reached an agreement in principle with the Winnipeg Group months ago. 

This delay in completing the sale is not unexpected. This is a complex transaction that takes time. Think about how long it takes to close a simple transaction like buying a home. So really, this shouldn' be characterized as a delay.

Horton Water Bottle Incident - Assault?

It has been reported that Boston Bruin forward Nathan Horton will not be suspended after he sprayed a Tampa Bay Lightining fan with a water bottle then threw the bottle at him.

After the Lightning disposed of the Bruins 5-4 in Game 6, fans littered the ice with noisemakers, which were given away for free by the team. As Horton left the ice, he leaned down behind the boards and grabbed a water bottle. He then sprayed a fan (who appeared to be heckling another player) then threw the watter bottle at him.

From a legal standpoint, spraying a fan with water then throwing the bottle at him could constitute criminal assault, as well as the tort (suing for money) of assault (reasonable apprehension of harm) and battery (where contact is actually made).

As far as a defence goes, Horton could argue provocation. The noisemakers were thrown on to the ice, and in some cases hit or came close to hitting players. However, if players could use provocation in these circumstances as a defence, we might routinely see players climb into the stands and go after fans (perhaps hit them with their own shoe, a la Mike Milbury).

Self-defence would also be another defence to battery. That would be tough here since you need to show that there was a real fear of physical injury. That doesn't seem to be the case here.

It's important for players to stay out of the stands.

Period.

Leonsis Talks Place of Sports in Community and Future of Game

Today, I had a chance to listen to Caps and Wizards owner Ted Leonsis talk. He is a gifted speaker. He comes across as kind, measured and charismatic. When he was talking, everyone was listening.

Leonsis made some interesting points. He opined that sports is more important than ever to the daily essence of our lives. It is the tie that binds, so to speak (or write). To make his argument, he relied on a few points:

1) Sports is intertwined with everything in a community. From college to work, it’s ubiquitous.

2) Sports offers a public gathering place, which is not otherwise available – at least at that magnitude. Public spaces are vital to a community, and having a public gathering space is good for a city.

3) Sports provides iconic real estate. Think Fenway, Wrigley and MSG, and you think Boston, Chicago and New York. They are identifiers that are so closely tied to a city. They can help define cities (sorry Big Owe/Montreal).

4) The only brands that people want to watch live are news and sports. This was an interesting point. A few years back, there was some concern that sports would diminish in importance from a television perspective. The opposite has in fact happened. Case in point – the networks were going to pay the NFL $4 billion not to play football. Sports brings in serious television numbers in an increasingly fragmented viewership marketplace. This is of course tremendously valuable.

5) Sports is good for the mental health and psyche of a community. When a team wins, everyone is happy and when they lose, a city is collectively down.

Leonsis told the story that after the Caps lost to the Lightning, he stayed home with his family and ordered a pizza. They just didn’t feel like going out. When the pizza guy showed up, Leonsis gave him $40 on a $26 pizza. The pizza guy thanked him for the generous tip, paused, then declared rather pointedly that he hoped the Caps wouldn’t “choke next year”.

Sports touches every part of a community, and helps solidify ties within the community.

On supporting charities, Leonsis said that his teams gave away $12 million to 387 charities last year. He also said they are taking a more analytical approach to analysing that data.

Leonsis also said that when they draft a player they sit him down and talk legacy. The most important thing, he tells a player, is being a great teammate and a great citizen. That’s the stuff legacies are made of.

Leonsis also spoke of the impact of sport on his memories. Leonsis said he grew up poor. His dad, a waiter, would sometimes get tickets to games as a tip, but otherwise could not afford tickets. Then one year, he got his son season tickets to the Jets, and father and son went to games together. They even saw the Jets win the Super Bowl in 69.

Fast forward 40 years.

While working out on his treadmill, Leonsis recounted that the NFL Network was replaying the 69 Super Bowl. Leonsis was overwhelmed and began to “weep like a baby”. His wife walked by, with laundry in hand, and concerned, asked him what was wrong. He proclaimed, “Joe Namath!!”.

He then said he knew what his job was: “My job is to make grown men cry 20 years after the fact”.

On his biggest concern, he spoke about the in-arena experience. It’s more convenient for fans to stay home drinking a modestly priced beer and watching the game on a big screen TV. They don’t have to fight traffic or worry about drunk fans. If you ask around, this is major concern for sports leagues generally – how do we get people into seats when they can stay home and watch the game under better conditions.

Leonsis said this makes him “nervous”.

Finally, while he’s been very successful in business, the hardest thing is winning in sports. By way of example, he said that teams have to deal with injuries, which never happened at AOL (he never lost a programmer to tennis elbow).

Overall, the talk was very interesting and Leonsis was quite compelling.

LeBron Takes His Talents To 7-Eleven

NHL fans are used to hearing that in the playoffs their favourite players have played with separated shoulders, broken hands, missing vertebrae and no feet.

ESPN has reported that LeBron James has declared he is fighting a "head cold".

"I'm taking everything you can get from 7-Eleven," James said to ESPN. "I've been sick since we got here."

According to the report, the head cold, while it has drained LeBron, won't prevent him from playing.

Somewhere Bob Gainey is shaking his head (and bad shoulders).

Bonds Sentencing Hearing Delayed to June 17

The hearing to determine Barry Bonds' sentence has been postponed from this Friday to June 17. This is according to the USA Today.

Bonds was convicted on the obstruction of justice charge, but none of the perjury charges. As per the sentencing guidelines, Bonds could get 15 to 21 months. However, the Court has the discretion to go in any direction it wishes. If past cases are any indicator, Bonds could walk with just probation and house arrest. However, jail time is not out of the question.

The prosecution could also look to retry Bonds on any of the perjury charges. There is a reasonable possibility they won't, however they may be tempted to take another kick at the can on the perjury charge that accused Bonds of having knowingly lied about being injected (with what - doesn't matter). On that one, the jury split 11 to 1. So if that one juror had sided with the other 11, Bonds would have also been convicted of that one perjury charge.

Radio Clip: Team 1200 - NFL, NBA and Basha

Listen to my radio clip with the guys from the Team 1200. We talk the latest development in the NFL case, a bit of NBA and address the trademark case involving Basha.

Basha & The Habs: Why Banners Are An Issue

I love Basha Restaurant. I grew up in Montreal and love their food. However, the unauthorized use of the Montreal Canadiens intellectual property is a problem. 

Yahoo's Puck Daddy recently reported that the Habs organization is requiring that Basha pay up for using its marks.

Basha first displayed the banner on the left on the side of a building. After receiving a complaint from the Habs, he concealed the Habs logo and "Go Habs Go", but kept the banner up:

Both are a problem from an intellectual standpoint. Let me explain why.

Unless Basha had the consent of the Canadiens, it was not permitted to use the trade-marks in the promotion of its business. By using the Habs' trade-marks, the suggestion is that Basha is affiliated with, or otherwise sponsored by, the Canadiens. Associating itself with the Habs is obviously good for business. However, unless it had permission to use the various marks by way of a license agreement, Basha can't do what it's doing.

Remember businesses pay handsomely for rights to use trade-marks of sports teams. The idea is that they are seen as an official sponsor of a team, which in turn can be good for business as it elevates the image and goodwill of the business.

So the overall commercial impression created by the banner on the left, complete with the Canadiens' trade-marks, is that Basha is affiliated with the Habs.

What about the banner on the right? Arguably a problem. While the Habs logo and the "Go Habs Go" mark have been concealed, the aggregate effect of the colours leaves the impression that the person in the banner is wearing a Habs jersey. That may also create a false impression that Basha and the Habs are connected. What doesn't help is that Basha is in Montreal and has a location a few blocks away from the Bell Center. That may also contribute to the possibly mistaken impression that a commercial relationship exists between the Habs and Basha. The second scenario, though, isn't clear cut.

Also, while the Habs logo has been concealed, it's been concealed in a way that has kept the imprint of the logo visible. So, as a matter of first impression, it may still come across as a Habs jersey. Would have been better if a square block were put over the jersey.

There's another key problem for Basha apart from trade-mark infringement and passing off (which relates to the unauthorized use of a third party mark in business): copyright infringement.

You can't reproduce a copyrighted work without the permission of the copyright owner. As well, you can't reproduce a substantial part of the copyrighted work such that it is readily identifiable as that work. In copyright law, a "work" just refers to what is protected, like an image or a song.

So for the banner on the left, Basha has reproduced the Habs logo. Can't do that. As far as the banner on the right, the Habs could try and claim copyright in the design.

NBA's Initial CBA Proposal Calls For Drastic Changes

The Sports Business Journal has confirmed that the NBA is looking for a major overhaul of its business model.

The NBA's initial CBA proposal "called for a $45 million per team hard salary cap along with non-guaranteed player contracts and significant cuts in annual salary increases".

An April 26 memo issued by NBPA head Billy Hunter indicates that the NBA is pushing to "for a major overhaul of the NBA’s economic model and emphasizes to players an aggressive bid to significantly slash costs and shorten contracts."

The current cap is a soft cap of $58 million. Dropping the cap to $45 million would represent a 25% reduction.

Right now, the NBA has a soft cap, which means that there are several exceptions that allow teams to exceed the salary cap (for an example click here and read the Larry Bird Rule). In contrast, the NFL and NHL have hard caps, which means they offer relatively few, if any, circumstances under which teams can exceed the salary cap.

Migrating to non-guaranteed contracts would also represent a dramatic change.

The NBA is looking at fundamental changes to its business model, and the last time we saw a league do that was the NHL in 2004-05, where the league lost an entire season.

NFL Players Stay Locked Out

The Appeals Court has converted the temporary stay into a longer stay, thereby keeping the lockout in place. Next up is for the sides to attend a hearing on June 3 arguing whether the lockout to begin with was legal.

This is a significant win for the NFL owners and consequently a big loss for the players. Momentum has now firmly swung back to the owners.

The lockout will remain in place until at least late June/early July.

I will report back when I've read the decision.

AJ & I Celebtrate His New Twitter Account

After much encouragement from me, AJ finally joined Twitter. It made sense since AJ is a media mogul.

This of course deserved a celebration. So rather than call in for my segment, I surprised AJ in studio with (delicious) cake and hats that share the colour of Twitter.

This clip is slightly to completely ridiculous.

Click here to listen.

Is Solidarity Among NFL Players Realistic?

If the NFL lockout continues to drag on, is it realistic to expect that NFL players will remain unified?

Not all NFL players have the same needs and for that reason it remains possible that mid and lower-tier players may request a seat at the negotiation table.

The NFLPA, either as a union or trade association following decertification, has constituents like Tom Brady and Drew Brees that make in excess of $15 million. However, of the 1900 or so NFL players, half that population makes about $500,000 or less a season. That together with the average career lasting 3.5 years, this latter cluster of players is more likely to have different concerns.

Higher paid players may focus on issues like free agency restrictions, maximizing the salary cap and the franchise tag. On the other hand, the other group of NFL players would be concerned about issues closer to home, like health benefits, post-career medical coverage, earlier vesting of pensions and higher minimum salaries.

We’ve already seen one law firm try and assemble some of these players. That firm, though, had to back out after it was revealed there was a legal conflict. Still, the issue is not dead with other law firms giving it a shot.

How would the NFL react to these players asking for a seat at the table? It would pull out chair, make sure they’re comfortable and get them a skim latte (with no foam). That’s right – the NFL would be happy. Those players understand very well that they have limited earning potential and potentially short careers. As a result, they may be more willing to compromise on the key issue of revenue sharing. That by extension would apply pressure on the players as a whole to settle.

Divide and conquer. That's what the NFL is counting on in part.

If the Appeals Court rules that the NFL lockout is legal, and the lockout stays in place, we may hear more rumblings from this group of players. The next 30 days will be critical in determining how this saga will be decided.

Radio Clip: Team 1260 Edmonton - Talk Next Steps in NFL

Click here to listen to my radio clip with the guys from the morning show on the Team 1260.

We talk a bit and Seagal/Van Damme and then hit the NFL lockout.

NFL & Players Go Back To Court on TV Deal

The NFL is back in Court - this time Minnesota.

You may remember that Judge David Doty that the NFL violated the CBA by entering into deals with television networks that would pay them $4 billion if there was no football.

Why was this a big deal? In the event that football was not played in 2011, the NFL wouldn't be sharing television revenue with the players, and in securing a payout for not having a season in 2011, the Union argued that the NFL did not seek to maximize revenue in other seasons when the league would need to share that money with players.

So for the Union, the deal violated an agreement between the parties that the NFL must negotiate in good faith with a view to maximizing revenue for players. The NFL took less in years it had to share revenue to guarantee that it gets paid if there is no football.

Basically, the NFL left money on the table in other sharing years to get paid if there was no football.

For some background, click here.

So now the parties are in Court arguing over how much the NFL should pay the players for violating the CBA. The NFL doesn't want to pay beyond the $6.9 million it was ordered to pay by a master, and the players could ask for $600 million to $1 billion dollars.

If Doty does assess damages, the case could be appealed to the same Appeals Court hearing the lockout issue.

Here's A Question I've Been Asked A Lot Regarding the NFL

Q. Shouldn't the NFL open its books to the players - after all the players and the NFL are partners.

A. While the players and NFL partner in revenue, they are not partners in the legal sense, or co-owners. Players, rather, are employees, who are employed by their respective teams, and can be cut by their respective teams. 

Forbes: 10 Most Influential Athletes

Forbes.com has released a list of the 10 most influential athletes.

E-Poll and Nielsen Media Research surveyed over 1,000 adults as to the athletes they considered influential, while also assessing their likeability and awareness levels. Only those known to at least 20% of the respondents were considered. No one from Dancing With The Stars made the list.

The top 10 are as follows:

1) Jimmie Johnson

2) Tom Brady

3) Dale Earnhardt Jr.

4) Shaq

5) Michael Phelps

6) Troy Polamalu

7) Peyton Manning

8) Jeff Gordon

9) LeBron James

10) Tim Tebow

Fascinating list. Some names are a surprise, including King James and Tebow. Lots of race car drivers too.

Glendale Council Voting on Keeping Coyotes in Phoenix for One More Year

Tonight at 7pm (pacific), Glendale City Council will consider extending the current NHL and Arena Management Agreement for another year. That means the Council is voting on whether Glendale will cover the NHL's losses up to $25 million for another year. If they do, the Coyotes stay for another season - at least.

The Council issued a press released in the form of a Q & A. It starts with the following:

On Tuesday, May 10, the Glendale City Council will consider for approval authorization to extend the current National Hockey League (NHL) and Arena Management Agreement for another year. The agreement allows for the team to remain in place for the NHL 2011-12 season; allowing the NHL and staff additional time to complete the required agreement with an ownership group that will be committed to retaining the team in Glendale.

On why the city of Glendale needs to pay the NHL $25 million: "It is an arena management fee that requires the NHL to manage the Arena while assuring the team stays in Glendale as the primary tenant."

Glendale also notes that the $25 million will assure that the Coyotes stay put:

The NHL has said it is committed to keeping the Coyotes in Glendale. Extending its Arena Management Agreement with the city for another year continues that commitment and allows the NHL to establish the team’s schedule for the 2011-2012 season.

So bottom line is that the Coyotes are in Phoenix for at least another year once the Council votes to cover the NHL's losses up to $25 million.

Here's the entire press release (you can click here to read it or click on the image):

NHL Chimes in on NFL Appeals Case

Yesterday, the NHL filed a friend of the court brief on behalf of the NFL at the 8th Circuit Court of Appeals, arguing that Judge Nelson's lower Court decision to lift the lockout would impair collective bargaining by allowing unions to decertify at the drop of a hat and sue for antitrust violations.

What is this brief? It's referred to as an amicus brief and is filed by a person with strong interest on the subject matter of an action, but not a party to the action. The brief is designed to raise awareness on certain issues before the Court. The briefs are commonly filed in appeals concerning matters of a broad public interest, such as civil rights cases. The Court doesn't have to consider it.

To read the brief, click here.

Here's an excerpt, which basically says that by allowing decertification as a negotiation tactic the traditional weapons of strikes and lockouts are removed. All along the NFL has argued that decertification (read primer on decertification here) is a "sham":

The NHL has a direct interest in ensuring that the determination of terms and conditions of employment for NHL players is the product of a bona fide labor process rather than the "lever" of potential antitrust liability. This is especially true in the context of the stable and mature collective bargaining relationship that the NHL and the National Hockey League Players' Association ("NHLPA") have had for nearly 45 years. Yet, under the district court's decision and rationale, a group of employees can, at any time and for any reason, insinuate the antitrust laws into the dynamics pursuant to which new terms and conditions of employment are negotiated and determined. All a union has to do is have its members "disclaim" union representation, simultaneously reconstitute itself as an employee "association," and then ask the court to immediately enjoin any joint labor activity of the employers (e.g., including the implementation of a lawful lockout) by filing a treble damages antitrust complaint and a motion for preliminary injunction. The NHL respectfully submits that this cannot be the state of the law.

Left to stand, the district court's ruling creates a perverse incentive for unions – during the collective bargaining process and in the midst of negotiations – to divert their efforts to antitrust litigation tactics rather than complying with their obligations under federal labor law to bargain in good faith. The net effect is that traditional economic weapons contemplated and made available in the labor process – employee strikes and employer lockouts – are removed as options. In turn, the labor process is necessarily subjugated to antitrust law and related litigation tactics. Indeed, under the district court's ruling, union disclaimer and simultaneous antitrust suits are likely to be the chosen path any time employeeplayers (or other unions or associations of employees for that matter) believe that these tactics are the most viable method of obtaining the terms and conditions of employment they desire, but might not achieve through the traditional collective bargaining process.

NFL Case: Appeals Court Cites Public Interest in Posting Docs Online

Citing that it's in the public interest, all NFL pleadings and documents have been made publicly available on the Appeals Court website.

Click here to access the Court's page.

Today, the NFL filed its brief (or arguments). Nothing surprising in it. The NFL argues that this is not an antitrust case but rather a labor law case. I will take a closer read soon and report back with anything of interest.

Here's a snapshot of the Appeals Court NFL page. The players' arguments are due May 20 and the hearing is scheduled for June 3. The longer this goes on the less likely it seems that the lockout will be lifted. So expect the lockout to stay in place until June 3rd:

NFL Update

The Appeals Court did not rule this week whether it would convert the temporary stay (which resulted in the lockout being restored) into a longer stay pending the Appeals Court review of the bigger issue - is the lockout legal.

This was a bit of a surprise and we may have a decision this week. Bear in mind that the hearing on the legality of the lockout is slated for June 3. So ultimately the lockout may stay in place until the case is decided. However, this is merely speculation.

If so, the NFL will have regained leverage and momentum.

Things continue to be interesting.

By the way, there is talk that a law firm is trying to recruit mid-level players to intervene in the lockout (i.e., get a seat at the table). This almost happened a couple of weeks ago, but the law firm that recruited the players had to back out because of a conflict.

Don't forget that half of the 1900 NFL players make $500,000 or less, and on average only play for 3.5 years. So for them, time is of the essence.

Twitter Feed

This is just a reminder that you can follow me on Twitter - @EricOnSportslaw

You will get my up to date reaction on developments.

Radio Clip: Team 1260 - NFL Stay and Eyebrows Gone Wild

Click here to listen to my radio Clip with Nielson & Chase's of the morning show on the Team 1260.

I breakdown the NFL Stay issue.

We also talk about my eyebrows, which no longer want to cooperate.

Breakdown: NFL Stay, What's Next & Copy of Decision

For those looking for musical accompaniment for this column, please feel free to click here and listen to Lisa Loeb's song, Stay (I Missed You). I miss Lisa. I enjoyed her show, Number 1 Single. From what I understand, I was the only one. Well, me and Ethan.

Here's a breakdown of recent events, and what's next on the NFL front - Q&A style. Feel free to leave further questions in the comments section or send me questions via Twitter (@EricOnSportsLaw.

Remind me Eric - what happened last week

So by now you've heard that the 8th Circuit Court of Appeals granted the NFL a temporary stay of the decision to end the lockout. So the result is that the lockout is restored on a temporary basis until the Appeals Court decides whether to put a longer stay in place.

What's Stay?

In a case like this, it's just another term for the suspension or temporary postponement of a Court's decision ordering someone to do something. For example, if the Court ordered one party to pay another party $50,000.00, the party that has to pay it can seek a stay of that Order pending appeal (or reconsideration) of the Order.

Fine - that makes sense. How does the stay apply to this case?

In the case of the NFL, Judge Nelson in the lower court made a decision that the lockout should be lifted. The NFL wasn't pleased so they asked Judge Nelson to stay (or suspend) her own decision pending an appeal of her ruling addressing the legality of the lockout.

Judge Nelson turned down the NFL's request for a temporary suspension of the Order. So the NFL went to the Court of Appeal and asked for the same temporary stay - and they got it. That means that the NFL lockout has been restored on a temporary basis. That's where we are now.

What's next - are we in for more stay talk?

Lisa Loeb will be happy because yes we are in for more stay talk. The NFL has requested an even longer stay until the Appeals Court rules on the bigger issue - is the lockout legal at this early stage? If the NFL gets that longer stay, it could be in place until at least early June, and probably longer.

When will the Appeals Court rule on the longer stay?

I expect a decision this week, and probably today or tomorrow.

Why do you say the stay could be in place "until at least early June"?

The hearing to determine the legality of the lockout is set for June 3. That could change but that's the earliest date. So if a longer stay is granted this week, and the lockout remains in place, nothing will change until June. And remember, the oral hearing is set for June 3. After that, though, the Appeals Court will have to consider the issues and render its decision. So that will cause a further delay. So the lockout could remain in place for some time. On top of that, if the Appeals Court rules in favor of the NFL, the lockout will remain firmly in place.

Do you think a longer stay will be granted?

Good question. Before the temporary stay was granted, everything was going as scripted and momentum was firmly with the players'. They won the big $4 billion TV revenue lawsuit, they decertified and were successful in getting the lockout lifted.

However, everything changed when the Appeals Court restored the lockout. Generally, a stay in these circumstances is reserved for emergencies, like a stay of execution. So this result was a bit of a surprise.

This doesn't mean a longer stay will be granted. However, I would not be surprised if the NFL got the longer stay.  If they do, momentum is back with the NFL. This could be big.

How many Judges on the Appeals Court granted the short stay?

The Appeals Court has a Panel of 3 Judges. majority rules (2 of 3). In this case, two Judges sided with the NFL and one Judge didn't agree and sided with the players. The one judge who didn't agree "dissented", which means he didn't agree with the majority.

Why did the majority of the Judges say in the Decision?

The majority wrote as follows: "The purpose of this administrative stay is to give the court sufficient opportunity to consider the merits of the motion for a stay pending appeal."

So they didn't rule on whether they would ultimately find for the NFL and grant a longer stay. They just basically said they need time to review the matter more carefully, and pending that review, they decided to restore the lockout.

Why did the "dissenting" Judge disagree?

That Judge thought stays should be reserved for "emergency situations", and this was not one. The Judge wrote as follows:

In my tenure as an appellate judge, the only circumstances I can recall in which the power to grant a temporary stay has been invoked by a party, and exercised by our court, have been circumstances which truly qualify as emergencies. 

The Judge cited examples of emergencies, like the pending execution of a prisoner or deportation of an individual.

Here's what the Judge wrote specifically:

...I have granted such a request on behalf of an immigrant who has filed a petition with our court to review a removal order entered by the Bureau of Immigration Appeals (BIA), when the immigrant's removal date was imminent and the government had not yet responded to the immigrant's request for a stay of removal pending our review of the petition. Another situation in which a temporary stay, pending review of a motion for a stay itself, may be appropriate is in a death penalty case where an execution date has been set and is imminent.

Such circumstances qualify as true emergencies because of the impossible or nearly impossible task of reversing the consequences of allowing a district court's order to take effect.

The Judge went on to write that the NFL did not convince him hat this is a similar emergency, and that if the lockout stayed in place, the outcome was not "irreversible".

I'm in a keeper pool and I picked up Peyton Hillis for $1. I want to build around him and I'm really excited about my fantasy team. Do you think there will be football in 2011?

If the temporary stay becomes permanent, and the lockout stays in place, then the NFL will regain its leverage. A permanent stay would be very significant. This once again becomes an issue of who has staying power. The answer to that may be the owners since the players have limited careers and limited income.

Don't forget that of the 1900 or so NFL players, half that population makes $500,000 or less. They won't like uncertainty and may start to voice their concerns.

So if the NFL gets the permanent stay, it is possible that football could be delayed. Goodell said yesterday that he was concerned that the season may not start on time: "We do not have a drop-dead date right now. My concern is so much has to happen to get ready for the regular season".

However, a longer stay may encourage the sides to sit down and hammer out a deal. I remain optimistic that we will have football in 2011 as we are not looking at a fundamental overhaul of the NFL business model like we had with the NHL in 2004-05, which resulted in a lost season. The issue here is how to divide the rather enormous revenue pie.

So a lot will hinge on whether the NFL gets a longer stay this week. Stay tuned.

Eric I'm bored - can I see the short 4 page decision of the Appeals Court where they granted the temporary stay?

Sure - click here to read it. Here's a snapshot of the first page:

Glendale Pays NHL $25 Million

According to reports, the city of Glendale has paid the NHL $25 million. The city had pledged to pay this amount to cover the Coyotes' losses for this year.

When the NHL took over operations of the Coyotes, it reportedly lost $25 million. To avoid a further loss, the NHL told the city of Glendale if you want to keep the Coyotes, guarantee us this amount if the team is not sold.

One of the changes in the renegotiated purchase agreement appears to be that Hulsizer will no longer refund the $25 million to Glendale. Originally, he was to pay it out of the $100-million he was to receive from the bond sale in exchange for parking rights and other considerations.