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.