Blog Entry

Talks blow up with ultimatum, Wednesday deadline

Posted on: November 6, 2011 2:55 am
Edited on: November 6, 2011 2:03 pm
 
NEW YORK – With another ultimatum, artificial deadline and accusations of fraud and bad-faith bargaining, the NBA labor talks blew up again early Sunday. This time, they appear to be careening toward a point of no return.

After eight more hours of talks under the direction of a federal mediator, league negotiators delivered a proposal around 1 a.m. ET and informed the players’ association it has until the close of business Wednesday to accept it or receive a far worse deal.

Union attorney Jeffrey Kessler, singled out by David Stern as the one who rejected virtually all the compromises the commissioner said were proposed by mediator George Cohen, described the league’s tactics as “threats” and characterized the NBA’s description of its economic proposal as “fraud.”

“Today is another very sad day for our fans, for our arena workers, our parking-lot attendants, our vendors,” union president Derek Fisher said. “A very frustrating, sad day.”

League negotiators essentially offered the players a 50-50 split of basketball-related income, their obvious target for weeks. The offer was tweaked into the form of a 49-51 percent band for the players’ share – the same band discussed informally Oct. 4 at a key meeting that fell apart over the split of revenues between owners and players.

In the league’s proposal, the players would receive 50 percent of revenues (net about $600 in expense deductions, as in the previous system) if revenues grew as projected – 4 percent a year. Stern and deputy commissioner Adam Silver portrayed the band as capable of delivering a 51 percent share to the players if there was, as Stern described, “significant growth.”

But Kessler -- speaking with Fisher in the union’s press conference in the absence of executive director Billy Hunter, who was “under the weather,” according to an NBPA official – said it would take the “wildest, most unimaginable, favorable projections” for the players to ever receive 51 percent of revenues.

“The proposal that this is a robust deal at 51 is a fraud,” Kessler said. “… You can't get to the top of the band.”

The players, who received 57 percent under the previous six-year deal, proposed a 51-49 split in their favor – with 1 percent going toward a fund for benefits for retired players, such as health care, life insurance and pensions. The league never responded to that proposal, union officials said. By going from their previous proposal in which they would've received 52.5 percent, the players moved about $60 million in the first year of the new deal and nearly $400 million over six years. The owners remained in essentially the same place they’ve been economically since Oct. 4.

“They've been consistent for weeks,” Kessler said.

“We made the moves that we needed to make to get this deal done on the economics,” Fisher said. “It just doesn’t seem to be good enough for this particular group of team owners.”

Stern said the proposal will be on the table until the close of business Wednesday, after which the owners will forward a new proposal to the players offering them 47 percent of BRI and an NHL-style “flex cap,” two items the players previously have rejected.

“Hope springs eternal,” Stern said. “And we would love to see the union accept the proposal that is now on the table.”

But while the economic gap between the sides – once 20 percentage points apart – has now shrunk to 1 percent, the implosion early Sunday was as much related to system issues as money. But looking at those issues makes it cruelly implausible that they’d lose a season and squander billions of dollars over their differences.

"With the system issues that we felt like were left open, that we felt like were significant, that we must have in order to get a deal done, they did not go very far at all in trying to close that gap," Fisher said. "And we just did not get the sense that they really had the intent on coming in here tonight to get this deal done. Because there was every opportunity to do it. We were prepared to stay here until the sun came up to get this deal done."

The two sides could not bridge the gap on key aspects of the luxury tax system, specifically the penalty for teams that stay over the tax for three years out of five. The league reduced its offer from $1.50 additional tax for such teams to $1, while the union is holding firm at 50 cents additional tax on the first $10 million over the tax level and $1 after that. The punitive impact would only be felt by a handful of teams that historically have spent at those levels.

They also differ over the length and amount of mid-level exceptions that can be used by tax-paying teams. The players want tax-payers to be able to sign players to four-year mid-level deals starting at $5 million every other year. The league proposed two-year mid-level deals starting at $2.5 million every other year.

Non-tax-paying teams would be able to sign players to mid-level deals starting at $5 million, with the length alternating between four and three years each season under the owners’ proposal. The players want straight four-year mid-level deals for non-tax-payers.

The luxury-tax “cliff” experienced by tax teams, by which they felt the full brunt of going slightly over the tax level by losing all the tax money they would’ve received had they stayed under, also was addressed in the owners’ proposal. The league offered that such teams would receive half the tax money squandered by going from being a tax receiver to a tax payer.

The league has not relented on its insistence that tax-paying teams be forbidden to execute sign-and-trade transactions, which the union argues -- when coupled with the other system restrictions -- would dry up the market for free agents in a way that imitates a hard team salary cap.

"They want it all," Kessler said. "They want the system where tax payers will never be in the marketplace and that for repeat tax payers, it's going to be like a hard salary cap. And those deals are not acceptable for players today, and it's not acceptable for future generations of players. ... The players will not be intimidated."

Nonetheless, the players now find themselves at a crossroads that could determine whether there is a 2011-12 season by Wednesday. Can Fisher and Hunter, notably absent from the post-meeting news conference as Kessler fanned the flames, determine whether they can sell essentially a 50-50 deal to more than half the union membership? A deal with no hard cap, with guaranteed contracts, with mid-level deals scaled back mostly for tax-paying teams, and with salaries rising to nearly $3 billion in 10 years despite an initial 12 percent reduction?

If not, the union appears almost certain to dissolve – either through a decertification petition or a more expeditious but legally riskier disclaimer of interest – either of which would throw the talks into chaos and imperil the entire season.

“We’re not going to talk about other options,” Kessler said.

Stern said the threat of decertification is “not an issue that we're focusing on at this point.”

“We are trying to make a deal with the National Basketball Players' Association,” he said. “They are the duly authorized representative of the NBA players. That's a good thing, and we hope to make a deal with them.”

Fisher said he would communicate with the players and "assess our situation. … But right now, we’ve been given the ultimatum. And our answer is, that’s not acceptable to us."

In the end, the truest words spoken early Sunday morning came from Kessler, who said the owners' tactics were "not happening on Derek Fisher's watch. It's not happening on Billy Hunter's watch. It's not happening on the watch of this executive committee."

If the players successfully decertified, none of the aforementioned would be in power. 

A decertification petition requiring the signatures of 30 percent of union membersship would put the union on approximately a 60-day clock before an election is held to disband it -- and that's only if the National Labor Relations Board authorizes the election. Typically, the agency does not when a union has an unfair labor practices charge pending.

The mere signing of the petition by 30 percent of the union would not by itself cease negotiations since the union would remain in power until the election, which wouldn't happen before January -- if at all.

That leaves two months for cooler heads to prevail. But really, the stopwatch has been set for four days -- 96 hours to spare chaos. Of all the inflammatory words spoken after this latest fiasco, the words "best and final offer" were never among them.

That's legal mumbo-jumbo for this: There's still time to end the asshattery, if everyone's heads return to a place where oxygen is available.

The clock is ticking. 
Comments

Since: Sep 11, 2006
Posted on: November 6, 2011 9:21 am
 

Talks blow up with ultimatum, Wednesday deadline

Keep the lockout going.  Never back down.  Go for 100%.  I am enjoying the extra coverage for NHL on SportsCenter, MSG, etc.  And real basketball starts soon, so go out and support your local colleges and high schools!



Since: Feb 8, 2008
Posted on: November 6, 2011 9:06 am
 

Talks blow up with ultimatum, Wednesday deadline

NBA isn't even a sport really.  They can't even enforce basic rules like traveling and 3 second violations.  THe brand of basketball is horrible.  The season is way too long.  

We have NCAA basketball, football and then spring training.  The NBA is just a sideshow.   



Since: May 28, 2008
Posted on: November 6, 2011 8:43 am
 

Talks blow up with ultimatum, Wednesday deadline

WHAT LOCKOUT? As long as the Tarheels start on Friday Nov 11, 2011 I could care less what the NBA does right not! That LSU-Alabama game was a classic. As long as sports fans have something to watch they are slowly losing interest in this WWE style NBA that David Stern has created. Sit out! I will enjoy NCAA(football/basketball) and the NFL that much more!



Since: Jul 17, 2008
Posted on: November 6, 2011 8:14 am
 

Talks blow up with ultimatum, Wednesday deadline

Faaackkk the NBA! Honestly people I don't think care. Everyone knows this about greed with the players and the owners. The fans are the ones getting screwed and they don't care to watch these overpaid thugs to run up a court and dunk. Big Freaking deal. The NBA is deThead!


The reality is that the profits are made by the players. Not the owners. The business is run by the players, not the owners. Without the players the NBA is no more.   GOOD!  Let em both fail......... 


JimmyGusto
Since: Oct 10, 2011
Posted on: November 6, 2011 8:08 am
This comment has been removed.

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Since: Aug 29, 2006
Posted on: November 6, 2011 7:54 am
 

Talks blow up with ultimatum, Wednesday deadline

That's the kind of racist comment "Planet Zulu"?  Really?  that gives Stern and owners justification not to have a season.  Don't be naive, prices will not drop.  Why would owners make less money for YOU?  Are you serious?  I've long thought that there wasn't going to be a season and that Stern and the owners would find as many excuses as Mayweather is making for not fighting Manny.  

 


JimmyGusto
Since: Oct 10, 2011
Posted on: November 6, 2011 7:43 am
This comment has been removed.

Post Deleted by Administrator




Since: Apr 10, 2007
Posted on: November 6, 2011 6:12 am
 

Talks blow up with ultimatum, Wednesday deadline

Stern should drop the offer by 1% per day.  You'll have a deal this week.



Since: Dec 24, 2008
Posted on: November 6, 2011 5:49 am
 

Talks blow up with ultimatum, Wednesday deadline

cancel the season, dissolvle the league, bunch of street hoops, with trashtalking, no fundementals, chip on shoulder players, and greedy owners.......screw the NBA ill never watch another game



Since: Nov 23, 2008
Posted on: November 6, 2011 5:13 am
 

Talks blow up with ultimatum, Wednesday deadline

Dear players, 50% of a frakload of money >>> 51% of zero. I know most players may think they shoould dig in their heels, but they are losing their entire paychecks in the end, whereas the owners have other investments.


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