Blog Entry

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."





Comments

Since: Nov 16, 2011
Posted on: November 16, 2011 5:24 pm
 

Players sue NBA for antitrust violations

i agree, let them go out and get a real job making $9.00/hr. they PLAY a game, boo hoo.



Since: Oct 13, 2008
Posted on: November 16, 2011 5:19 pm
 

Players sue NBA for antitrust violations

This is what happens when you turn NBA players into rock stars. This is what happens when you parade around players on a stage before the season and shoot off fireworks and promise championships. This is what happens when you reward athletes for what they have done off the court rather than on.

ARROGANCE ON BOTH SIDES. I could care less about these greedy players and owners. My heart does go out to the little people that have been depending on the NBA for their jobs. NBA players panicking over lost wages? Cry me a river. Concession workers panicking over lost wages? Victims of greed and ignorance.



Since: Nov 16, 2011
Posted on: November 16, 2011 5:19 pm
 

Players sue NBA for antitrust violations

when are these guys going to realize they are on a gravytrain? as far as insurance goes, they make enough money to pay for it on thier own!!!!



Since: Sep 5, 2006
Posted on: November 16, 2011 5:16 pm
 

Players sue NBA for antitrust violations

, I think you were talking to me.  Don't tell my company, but with the economy the way it is, I would work for less if it came to that.  I realize how lucky I am. 

Having said that, I can leave and go to another company if I want to, and those other companies cannot tell my company how much or how little to pay me, for how long, what my starting salary is. 

My point was a response to a question "I wonder if the players who came out early wished they stayed to get their degree".  I think everyone who is on this board who will take 10-25 years to earn $1 million even with a degree would answer "no, a degree is not a viable subsitute to a good NBA contract". 

Yes, 75% of them will be broke within two years of retirement, but that is regardless of whether or not they get a "fair" deal or not.  For that other 25%, losing 1 or 2 million this year (in an abbreviated season) can be more than recovered over the course of their career if they get the right deal. 

SDBlue, you seem to be a reasonable person - walk through the numbers with me.  This isn't well researched, just round-about numbers that I use to make sense of it.  If its wrong, help me out.

The players currently get 57% of BRI.  The owners want them to reduce that to 47%, the players want 53%, and conventional wisdom says they should meet in the middle at 50%.  Since the salary cap was between $55 and $60 million last year, we can say that each point is about $1 million for each team (give or take).  So the owners for each team want the players to take about $7 million per in contracts back - per season.  Since they are raising the league minimum (usually guys with short contracts), that means those savings were coming from the guys with actual careers - lets say the 7-10 guys near the top.  That means on average each player will lose 700K - 1 million per season.  So the 1 million or 2 they lose this year will offset the loses they are trying to avoid long term ($3.5 - $5 milllion in a 5 year career, and growing as they go on).

The point is, if you have no plans for after your ball career (and like you point out, 75% of them don't), you BETTER fight for it now, so that maybe - JUST MAYBE it will be 5 years after  your career that you end up broke, rather than 2 years.

I still think the deal at 50/50 on the table was a good one and the players should have taken it, but I do understand why they are resisting (in addition to the ego thing). 

Look, its now time to watch this as a drama rather than as a sporting event.   I like a good business drama movie (Wall Street, Too Big to Fail, whatever).  I would rather watch hoops, but this is the best that we got right now. 



Since: Nov 4, 2006
Posted on: November 16, 2011 4:29 pm
 

Players sue NBA for antitrust violations

Who was the Pee Wee Herman wannabee in the article photo?



Since: Jan 10, 2010
Posted on: November 16, 2011 4:15 pm
 

Players sue NBA for antitrust violations

u wanna end this lock-out? then get rid of that union leader billy hunter! completly unreasonable and realizes that when this lock-out ends, then so will his face time on tv. i think the owners have been more than fair w/ the players and these idiot players follow this bafoon hunter like blind sheep. at some point these players need to stand up to hunter and not the owners. gonna big big time fallout from this whole lock-out. your greed has lead u to bickering how to split zero instead of how to split millions. absolutely moronic!




Since: Sep 19, 2006
Posted on: November 16, 2011 4:11 pm
 

Players sue NBA for antitrust violations

It's like spoiled teenagers when their parents cut them off from receiving their weekly allowances.  They've been used to getting free money, but after a certain point, you got to make them work for it.



Since: Mar 17, 2010
Posted on: November 16, 2011 3:35 pm
 

Players sue NBA for antitrust violations

Is your company hiring? I use to make that good income like you but I would work for less than your 100k. People need jobs and these terds think they are beneath it. One stat really stands out,75% of them are broke within 2 years after they retire.



Since: Sep 11, 2006
Posted on: November 16, 2011 3:35 pm
 

Players sue NBA for antitrust violations

 When TV comes in and starts taking money from both sides this will end in a heartbeat. The 53% the players want will be the 47% the owners are offering now. The players can not win this arguement! The owners took it up the bazoo with the last contract and the players will this time because the owners have the RIGHT to make a profit. Where else in America does the employee tell the employer how it is? I know that every union out there fights for every dollar they can get their people but for the most part they know when the have gotten all they can and settle. NBAPA, it is time to settle. You will continue to make millions for playing a GAME, so get this over with before many of you will have to get jobs, real jobs outside of television. To those of you who have your degrees I give you your props and to those of you who don't: I give you Burger King! You folks have seen many many players working as cashiers, dish washer's, garbage men and other positions after their sport's career do you really want to join them? Just my opinion. 



Since: Mar 17, 2010
Posted on: November 16, 2011 3:28 pm
 

Players sue NBA for antitrust violations

This isn't USA vs Microsoft. This is bunch of cry baby rich kids that want more ice cream in their beer. Judges will need to take notice. Mr Boies and his partner better be ready for another Al Gore type of loss. If I were an owner I wouldn't be scared of the theater type horse play Boies is talking about. Better be ready for a long drawn out fight. One of Boies' main arguments that the fans want NBA back is not happening.  People are tired of the 1%. They hate both sides. The players will wind up broke as usual.  NFL players did it right. NBA players got too much in the last CBA and no one can afford it. The owners can take the loss and bk the whole thing. Then what Mr. Boies? USA vs Mark Cuban??? That will fly. What a joke. I can imagine Mr. Boies final argument. We will change the name to the USABA and the US govt and the tax payers will pay the players their demand salaries and I nominate myself to be the next commissioner.  Mr. Obama would fight you for the commissioner job because he won't be President after next year.


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