Tuesday, May 10, 2011

NFL Lockout, Day 59: What's New?

Today we're in the middle of Day 59 of the NFL Lockout, which started on March 12. So where do things stand today? The short answer: the status quo continues, as the Eighth Circuit has not yet ruled. (There is a minor, non-stay-related, update below)

As I explained last week, both the owners and players share the responsibility for the current state of affairs. And because things are in limbo right now, I don't expect a resolution in the next couple of days -- I think next week is the best hope for us fans -- as the legal process continues to wind on.

I'm going to start by discussing the football implications of where we stand. Further on, I'll go into a little more depth on the legal posture of the case. Law nerds can jump ahead.

One minor update from when this was first posted: Late this afternoon, the "NFL Players' Reserve", an entity purporting to represent entering rookies, filed a motion to intervene in the appeal as a defendant, i.e., on the owners' side. Although this may seem significant at first blush, I wouldn't read too much into it. First of all, I can't find any reference to the NFLPR on the Internet. Secondly, the brief is, well, brief -- only 7 pages -- it never explains exactly what players the "pro se attorney" claims to represent. Finally, the complaint in Brady v. NFL includes Von Miller, an entering rookie, as a plaintiff, specifically so the suit could be on behalf of incoming rookies. The complaint explicitly mentions a "Rookie Subclass". (See, e.g., para. 25.) So, while the "NFLPR"'s motion to intervene sounds like a big deal, it probably won't change the landscape in any meaningful way.

Football Implications
  1. Football is still going on. The owners' lockout means that the NFL's "league year" has not started. As a result, free agency has not begun; teams are not making trades, and so on. But that doesn't mean there is nothing going on. Several players are taking it upon themselves to organize workouts so that they can stay in football shape (although there is a question of exactly how useful these workouts are).

  2. That doesn't mean it's business as usual. Perhaps those hardest hit are newly-drafted rookies, who have not been able to meet with team personnel, get into film study, access teams' medical and exercise facilities, etc. Particularly if the lockout stretches into the summer, I will be interested to see how this year's rookie class does. Each year, there are several rookies that are selected to the Pro Bowl. It wouldn't be surprising to me if there were few or no rookies selected this year.

  3. There is a lot of litigation still in store. Who knows if it will all actually happen -- a settlement could wipe them all out -- but they are at least on the radar for now. On May 12, Judge Doty will hear arguments in a dispute involving TV revenues. Judge Doty has said that the owners are liable for damages; the question on Thursday will be exactly how much. A decision in that case could take a few weeks. Then, on Monday, the two sides will sit down for a mediation session in Minnesota -- the first time they will negotiate face to face since talks broke down on April 20. The players' brief in the Eighth Circuit appeal is due on May 20. The NHL filed a friend of the court brief on Monday in support of the owners. It will be interesting to see if the players have people in their corner as well.
Legal Posture
  1. First, some procedural wrangling. On Monday, the owners filed their opening brief in the Eighth Circuit as to the merits of the underlying appeal. Remember, Judge Nelson issued a preliminary injunction, lifting the lockout, two weeks ago. The Eighth Circuit granted a "temporary stay" of that order on April 29, and that "temporary stay" is still in place. At the time, I wrote that the order would reinstate the lockout "only for a few days", while the Court decided whether to issue an actual "stay pending appeal" (which would last through the pendency of the appeal, and could potentially last for months). Clearly, I was wrong (though not alone in thinking as I did); no decision on the stay pending appeal has been issued and it is now almost two weeks after the temporary stay went into place.

  2. The owners' brief says what you would expect. The owners make four main points in their appeal, and three of them would dismiss the case without reaching the merits. I find this to be an interesting tactic. Obviously, good lawyers raise all meritorious arguments. But of the 61-page brief, only the last nine or so pages address the preliminary injunction standard. The bulk of the owners' brief argues that the injunction should be vacated because (1) the Norris-LaGuardia Act, which prohibits injunctions against lockouts, applies here; (2) the Court should have deferred to the NLRB under the doctrine of "primary jurisdiction", because the owners have a pending complaint against the (now-disbanded) union before that agency; and (3) the nonstatutory labor exemption, which is a judicially-created doctrine that essentially prohibits antitrust actions by a union against an employer, applies. Note that all three of these arguments hinge on the union's decertification in March: if the decertification was valid, (1) and (3) are resolved in the players' favor. Point (2) turns on who has jurisdiction, but the owners' complaint before the agency is that the union's decertification is a sham, so that point hinges on the decertification issue as well. The owners -- who have suffered a string of legal defeats -- have pinned most of their hopes on this one aspect of the dispute. But it is not irrational; if the decertification was, in fact, a sham, the players' strategy falls apart.

  3. Both sides were gearing up for litigation. The owners filed a complaint before the NLRB in March, arguing that the union was not negotiating in good faith, because it was making to disband and bring an antitrust action (which it did). But the owners had more at stake than just an ideal of good faith negotiation. The owners' complaint is what sets up Point (2) in their argument now -- that the federal courts should defer to the NLRB. Thus, just as the union was preparing to decertify so it could sue, the owners, I'm sure, filed this NLRB complaint to set up a future argument that the federal courts should stay out of the issue altogether.

  4. The NHL has jumped in. The NHL's amicus brief is an interesting read (or skim). The NHL says, in effect, "If you let the District Court decision stand, all players' unions will decertify, or threaten to decertify, to extract concessions from owners". Now, enlisting allies to file amicus briefs is nothing new. But I was struck by the unusual positions people are taking in this case. Usually, we have employees alleging that employers are not negotiating in good faith. Usually, we have employers seeking to disband a union while employees fight to keep it in place. Usually, people representing employees think unions are a good thing. Here, the usual positions are exactly flipped.
Well that's where we stand today. A decision on the stay pending appeal could come at any time, so stay tuned.


  1. In your opinion (legally speaking) what do you think the ultimate result will be? Can we expect a season or not?

  2. @ 9:04 PM--

    In light of his commentary regarding the Pro Bowl, it sounds to me like Goutam will answer in the affirmative; I'll let him do so but this brings me to my own question...


    Why the optimism regarding the lockout's ultimate end? Simply a matter of the stakes involved? Also, would you agree with me that the Eighth Circuit's temporary lockout ruling is more significant now (in terms of whether the same panel will rule in favor of the victor on the merits of the appeal) given that the Court has now had nearly two weeks to consider it?

  3. @9:04, I don't know what the end LEGAL result will be -- i.e., who will "win" -- but I do think we'll have a season. I think the ruling on the stay pending appeal will be a big one and shift leverage to one side or the other, especially if it comes before the 5/16 mediation. Maybe I'm unreasonably optimistic, but I do think we'll see a season. Then again, the Reggie White case went all the way to trial...

    I do think the temporary lockout ruling is more significant now, but only in retrospect. In other words, when it was issued, no one knew it would last for two weeks; if they did, they may have planned differently. So, although the "temporary" stay might extend for a long time, it theoretically COULD be lifted at any time. In my view, this makes it hard to decide what next steps to take; you don't want to plan for an extended lockout only to have the Court lift it tomorrow.

    As why I'm optimistic... I don't know. I just can't imagine that the parties, with this much money at stake, would kill the goose that lays the golden eggs. I know people who took years to get back into baseball after the 1994 strike. We're talking about the most profitable sports enterprise in history. Would the two sides really walk away from that?

    Conventional wisdom is that the players would buckle in late summer, once they start to feel a financial pinch. But if they win big in front of Judge Doty, to the tune of tens or even potentially hundreds of millions of dollars, they may be able to wait this one out. (I suspect the players won't actually see any of the money they win from Judge Doty; instead they'll "give it up" in exchange for some concession with regard to the labor issue.)

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