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Players sue NBA for antitrust violations

Posted on: November 15, 2011 8:24 pm
Edited on: November 15, 2011 11:45 pm
NEW YORK -- NBA players sued the league alleging antitrust violations Tuesday, in part using commissioner David Stern's own words against him in making their case that the lockout is illegal.

With two antitrust actions -- one in California naming superstars Carmelo Anthony and Kevin Durant among five plaintiffs, and another in Minnesota naming four plaintiffs -- the players are seeking summary judgment and treble damages totaling three times the players' lost wages due to what lead attorney David Boies referred to as an illegal group boycott.

"There's one reason and one reason only that the season is in jeopardy," Boies told reporters at the Harlem headquarters of the former players' union, which was dissolved Monday and reformed as a trade association to pave the way for the lawsuits. "And that is because the owners have locked out the players and have maintained that lockout for several months. ... The players are willing to start playing tomorrow if (the owners) end the boycott."

The California case, filed Tuesday night in the Northern District, named plaintiffs who represent a wide array of players: Anthony, Durant and Chauncey Billups (high-paid stars); Leon Powe (a mid-level veteran); and Kawhi Leonard (a rookie). The plaintiffs in a similar case filed in Minnesota are Caron Butler, Ben Gordon, Anthony Tolliver and Derrick Williams.

Boies said there could be other lawsuits, and at some point, they could be combined.

It is possible, Boies said, that the players could get a summary judgment before the NBA cancels the entire season -- essentially a two-month timeframe. By that point, with the clock starting on potential damages Tuesday -- which was supposed to have been the first pay day of the season for the majority of players -- treble damages could amount to $2.4 billion.

"We would hope that it's not necessary to go to trial and get huge damages to bring them to a point where they are prepared to abide by the law," Boies said.

A statement released by the league office Tuesday night, spokesman Tim Frank said: "We haven't seen Mr. Boies' complaint yet, but it's a shame that the players have chosen to litigate instead of negotiate. They warned us from the early days of these negotiations that they would sue us if we didn't satisfy them at the bargaining table, and they appear to have followed through on their threats."

Earlier, Boies seemed to have anticipated this response, noting that the NBA's lawsuit in the Southern District of New York -- in which the league sought a declaratory judgment pre-emptively shooting down an eventual dissolution of the union -- came first.

"The litigation was started by the owners," Boies said. "... This case was started months ago when the NBA brought it there."

The crux of the players' argument is that, absent a union relationship to shield them from antitrust law, the 30 NBA owners are engaging in a group boycott that eliminates a market and competition for players' services and are in breach of contract and violation of antitrust law. The players are seeking to be compensated for three times their lost wages as permitted by law, plus legal fees and any other relieft the court deems necessary and appropriate.

One of the many issues to be resolved is where the lawsuits ultimately will be heard. The NBA almost certainly will file a motion seeking that the players' complaints be moved to the Southern District, which is in the more employer-friendly 2nd U.S. Circuit Court of Appeals. The Northern District in California is in the more employee-friendly 9th Circuit, while the Minnesota case was filed in the district residing in the 8th Circuit, where the NFL players ultimately fell short in their quest for a permanent injunction lifting the lockout.

The NBA players are not seeking a permanent injunction; rather, Boies said they are pursuing the more expeditious and fact-based summary judgment, which could save months of legal wrangling.

UPDATE: Boies asserted that the plaintiffs have the right to choose which appropriate court has jurisdiction over their lawsuit, and that the NBA's lawsuit in New York was premature -- since the NBA players had never before in their history of union representation since the 1950s disclaimed interest or decertified until Monday. In contrast to the NBA's argument that dissolution of the union and an antitrust action were the players' goals all along, the lawsuit laid out that the players participated in bargaining with the league for more than four years after they were first allegedly threatened with massive rollbacks of salaries and competition for their services. Boies said the players had continued to bargain for months while locked out, offering a series of economic concessions totaling hundreds of millions of dollars until they finally reached the owners' desired 50-50 split in the final days of negotiations.

Unlike the NFL Players' Association's failed disclaimer of interest and antitrust action, in which the players' case was harmed by the lack of certainty over whether the collective bargaining process had ended, Boies said there was no disputing that bargaining talks had concluded in the NBA -- and that Stern himself had ended them by presenting a series of ultimatums and "take-it-or-leave-it" offers that the players could not accept.

"They had an opportunity to start playing with enormous concessions from the players," Boies said. "That wasn’t enough for them. If the fans want basketball, there’s only one group of people that they can get it from, OK? And that’s the owners, because the players are prepared to play right now."

The NBA undoubtedly will argue that it was the players who ended bargaining when their union disclaimed, and that the disclaimer is a sham, or a negotiating tactic as opposed to a legitimate dissolution.

The lawsuits came one day after the players rejected the league's latest ultimatum to accept their bargaining proposal or be forced to negotiate from a far worse one. The National Basketball Players Association at that point disclaimed interest in representing the players any longer in collective bargaining with the league after failing to reach an agreement during the 4 1-2 month lockout that was imposed by owners July 1.

In the California case, Boies, his partner, Jonathan Schiller, and players' attorney Jeffrey Kessler laid out a meticulous case that the collective bargaining process had been ended by the owners and that the players had no choice but to dissolve the union and pursue their case via antitrust law. They laid out a series of concessions the players made in an effort to reach a deal, including a "massive reduction in compensation" and "severe system changes that would destroy competition for players."

The lawsuit quoted Stern's own demands when he issued two ultimatums to the union during the final week of talks, threatening the players both times to accept the offer (with a 50-50 revenue split and various restrictions on trades and player salaries) or be furnished a worse offer in which the players' salaries would have been derived from 47 percent of revenues in a system that included a hard team salary cap and rollbacks of existing contracts -- all deal points the two sides had long since negotiated past and abandoned.

Asked if Stern made a mistake issuing the ultimatums that ended the talks, Boies said, "If you're in a poker game and you bluff, and the bluff works, you're a hero. Somebody calls your bluff, you lose. I think the owners overplayed their hand."

In the California lawsuit, the players' attorneys alleged that the owners' bargaining strategy was hatched during a meeting between league and union negotiators in June 2007. In that meeting, the lawsuit alleged, "Stern demanded that the players agree to a reduction in the players' BRI percentage from 57 percent to 50 percent," plus a more restrictive cap system. Stern and deputy commissioner Adam Silver told Hunter, according to the lawsuit, that if the players did not accept their terms, the NBA was "prepared to lock out the players for two years to get everything." Stern and Silver assured Hunter in the meeting that "the deal would get worse after the lockout," the lawsuit alleged.

The threats of getting a worse deal after the lockout if the players didn't accept the owners' terms were repeated in a letter to the union dated April 25, 2011, according to the lawsuit -- which then laid out the contentious, sometimes bizarre, and almost indisputably one-sided negotiation that transpired over the next few months.

"I will give the devil their due," Boies said. "They did a terrific job of taking a very hard line and pushing the players to make concession after concession after concession. Greed is not only a terrible thing, it's a dangerous thing. By overplaying their hand, by pushing the players beyond any line of reason, I think they caused this."

Boies said it was in neither side's best interests for the action to proceed to trial, which could take years and multiply the threat of damages against NBA owners. Even in their current capacity as members of a trade association, the players could have a settlement negotiated on their behalf among the attorneys for both sides. The settlement could then take the form of a collective bargaining agreement, but only after the majority of players agreed to reform the union and the owners agreed to recognize it.

Another option would be for a federal judge to require both sides to participate in mediation under the auspices of a federal magistrate; attendance would be required, though the results wouldn't be binding.

"There's lots of ways to get started, but it takes two to tango," said Boies, who once sued Microsoft in an antitrust case and represented Al Gore in his failed 2000 presidential bid based on a disputed vote count in Florida.

"If you've got somebody on the other side who is saying, 'It's my way or the highway, it's take it or leave it, this is our last and final offer and you will not see negotiation,' you can't resolve this," Boies said. "That, I will predict, that will stop, OK? There will come a time when the league faces the reality of the exposure that they face under the antitrust laws, the exposure that they face because of fan dissatisfaction with their unilateral lockout, the exposure they face by having other people in the business of professional basketball. And they will believe it is in their best interests to resolve this case.

"I can't tell you when that will happen," Boies said. "But I will tell you that it will happen, because those forces are too strong for anybody to resist indefinitely."


Since: Aug 3, 2008
Posted on: November 17, 2011 10:28 am

Players sue NBA for antitrust violations

The lawyers will get paid, win or lose.  Lawyers on both sides are saying 'We can win this', encouraging litigation of course.

The owners are likely overstating their losses but there is no doubt that some teams are losing money.  Are any players losing money by playing?  There is something really wrong when Gilbert Arenas was set to make $20 million.  No, no one forced the owners to pay that, but it is evidence that the system is broken.  If it takes a lost season or 2 to fix it, so be it.  Both sides will lose millions, in part at the wise counsel of their legal staffs.

Since: May 11, 2007
Posted on: November 17, 2011 9:41 am

Players sue NBA for antitrust violations

Two problems with the lawsuit 1) No judge will force a company to continue losing money and 2) enough players have found alternative employment in the field by going overseas to still make more than the average Joe.  The request for a summary judgement is comical.  There is no way it gets handed down based simply on the magnitude of the potential settlement.  What judge in his right mind would make a snap Billion dollar decision without letting it go through due process.  The request is in the normal course but will never happen in this situation.  Way to many things working against the players.  The NBA is the only major sport that can reset the talent.  Open a draft up to current players as well as college kids and foreigners and reload the rosters under terms that will be profitable to the owners.  The NFL - too many players per team with most positions not interchangable; MLB - no way to possibly fill pitching rotations and bull pens with enough talent; NHL - 60 goalies - no way.  The NBA has new superstars every year on a team with five guys on the court.  They could do it.

Since: Oct 10, 2011
Posted on: November 17, 2011 9:29 am
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Since: Oct 15, 2007
Posted on: November 17, 2011 9:19 am

Players sue NBA for antitrust violations

You hit the nail on the head there, hittnlong. The players are now entering an area they are grossly underprepared for: taking on the owners without the resources or representation of a players union. Frankly though, they weren't practical enough to see the forest through the trees and take the best offer they could have gotten, so I don't think they will get very far with this litigation they are pushing.

Since: Jul 2, 2009
Posted on: November 17, 2011 8:12 am

Players sue NBA for antitrust violations

Did anyone else find it surprising on the cbs poll a few days ago

Is the NBA season worth saving

11% yes

89% no

with 2500 votes?

Im glad to see that Im not the only one who couldnt give a rats arse about the NBA anymore. 

Since: Jan 21, 2010
Posted on: November 17, 2011 8:11 am

Players sue NBA for antitrust violations

A business loses money they close the business.  A players union is disolved and what do you have?  A bunch of uneducated jocks that have millions of dollars and they have this totally rediculous idea that they can take on their bosses  who happen to have 1. education, 2. experience in running a business and 3. BILLIONS OF DOLLARS.  You can't even say "nice try guys".

Since: Jun 3, 2008
Posted on: November 17, 2011 6:54 am

Players sue NBA for antitrust violations

I didnt even know the nba still exisisted.  Im from the detroit area and I couldnt name one piston starter, yet I can tell you the starting rotatation of the tigers, 90% of the roster of the wings and most of the lions starters.  I just cant figure out why anyone would give a crap about this league

Since: Feb 7, 2007
Posted on: November 17, 2011 2:41 am
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Since: Oct 13, 2007
Posted on: November 17, 2011 1:48 am

Players sue NBA for antitrust violations

As I sit back and read about the "woes" of the NBA player, I cant help but ask? Do any of them have any skills outside of basketball? A large majority of these players will have manged to squander away Millions of dollars, and end up broke 20 years after they retire? Why, they lack the intelligence to do so. Basketball is not a sport where you have to have true talent. Watch a neighborhood game of basketball, and see what it means to play the game. I, as an African American male, knows the value of being perceived for my actions, not my inactions. The NBA can go the way of the dinosaur, I surely for one will not miss it.

Since: Sep 16, 2006
Posted on: November 17, 2011 12:42 am

Players sue NBA for antitrust violations

Thank the players for taking away jobs that people need. I feel more for the people who give out the beer and snacks. and many other that are needed at the games who will not be geting paid. Instead NBA players are broke because millions of dollars are gone.I think the owners ALL 30 of them deserve the money. much more players than owners, plus they are the ones who bought the business, not work as the employee.

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