Monday, May 16, 2011

New Sports Illustrated Column: Burning Questions from Eighth Circuit's Ruling Tonight in Favor of NFL

A three-judge panel on the U.S. Court of Appeals for the Eighth Circuit has extended its stay of Judge Susan Nelson's order to enjoin the NFL lockout.  The stay will continue into June, when the panel will decide the matter on the merits.  I have a new column for SI on the ruling and what it means.  Here's an excerpt:

7. Will the players stay unified during the lockout?
If the players lose before the Eighth Circuit next month, the unified players' front may splinter into factions. Here's why:

The major advantage for players to decertify was that it empowered them to bring a very threatening antitrust case against the league. Decertification meant that the NFLPA no longer represented NFL players in negotiations with the NFL over employment conditions. As a result, the federal labor exemption, which immunizes collectively bargained rules from antitrust scrutiny, was taken off the table, thus exposing core parts of NFL football -- the draft, the salary cap, restricted free agency, etc. -- to antitrust review. The NFL is very vulnerable to losing an antitrust case, and a loss would command that the owners pay treble damages, likely in the billions of dollars.

The decertification strategy seemed successful on April 25, when Judge Nelson issued a preliminary injunction against the NFL lockout. The injunction meant the lockout was lifted, the league had to figure out new employment rules which would prove compatible with federal antitrust law and players were positioned to eventually win their antitrust litigation. The players, in other words, had all the leverage.

Everything changed April 29, when the Eighth Circuit granted the temporary stay of the preliminary injunction. If the Eighth Circuit rules in favor of the league next month, and assuming neither the Eighth Circuit grants an en banc rehearing nor the Supreme Court favorably intervenes on behalf of players, the antitrust litigation path would essentially be punted to 2012 or beyond, when a trial on Brady v. NFL might happen. By that time, some current players will be too old to play; others might fail to stay in top condition and not be able to get it back.

Such a situation could cause the players to rethink the decertification strategy and possibly contemplate recertification.

One leading reason to remain decertified is that recertification would support the NFL's argument that decertification was a sham. The NFL has filed an unfair labor practices charge with the NLRB on such a ground; the NLRB will likely decide on the charge by early next year. If NFL players recertify soon after their antitrust strategy failed, it would imply that decertification was only pursued to bring an antitrust case. That would play right into the owners' wheelhouse for the NLRB charge.

But there are downsides to remaining decertified. Foremost, players have abandoned the collective bargaining framework and are essentially acting on their own or, if they so choose, as factions of players. There is already discussion of players abandoning the NFLPA/Brady litigation and pursuing their own strategies, with their own attorneys and advisors. Expect that discussion to only amplify should the Eighth Circuit rule against the players in June. The NFLPA cannot prevent any players from negotiating with teams or the league; recertification would be required to do so. The NFL could take advantage of that situation by reaching a deal with one group of players and those players then convincing others to recertify, but perhaps with different NFLPA leadership in place.

This situation is unique and could place the NFLPA in a difficult position. Normally when there are splinter groups of employees, the employer takes a major risk by speaking with them, because Section 9(a) of the National Labor Relations Act commands that the employer speak to the duly-elected union representatives. Here, however, the NFLPA maintains that it has disclaimed interest in representing NFL players. In fact, if the NFLPA now tries to deny a splinter group a seat at the table, the NFL could argue this supports its position that the NFLPA's disclaimer was a sham.

Then again, the NFL may be wary of meeting with the splinter group. If the league does so, it could signal that the NFL acknowledges that the NFLPA has disclaimed interest in representing NFL players. Such a signal would undercut the league's argument to the NLRB that the decertification was a sham and that the NFLPA only decertified for purposes of bringing an antitrust case.

In short, if the players lose before the Eighth Circuit next month, the players and the league will have to think long and hard, not only about what to offer in a negotiation, but with whom to negotiate.
To read the rest, click here.