Blog Entry

NBA says it could void all existing contracts

Posted on: November 13, 2011 10:57 pm
By Matt Moore 

There's been a quiet response to all the decertification talk this weekend, and in a fairly embarrassing Twitterview, the NBA presented it front and center Sunday night. The league has given the players a choice between a proposal they obviously find unacceptable, and even worse deal which will be the owners' new starting point for negotiations should the players reject the current offer. In response, the players have pushed even closer to decertification or potentially a disclaim of interest to dissolve the union and pursue antitrust lawsuits against the league.  The league has answered every move the players have tried to make. So their response to the threat of decertification?

They will pursue voiding all existing contracts.

It's not as simple as just saying "your contracts are void," there's a legal process. It involves the suit currently filed by the league against the players which they filed months ago, and even if that didn't go through, they'd file again post-decertification in pursuit of the same goal. It's a complex, and messy situation that could take years to resolve if it came to that. But much like decertification, it works better as a threat than as a legitimate weapon. 

If you're a max player, say, Carlos Boozer, and you just landed that last big contract to set you up guaranteed for the next four seasons, and the league says it can nullify that contract and set you back, how do you consider the proposal tomorrow as player reps meet in New York? If you're Joe Johnson, and you know there's no freaking way you get the deal you got in 2010 in a wide-open free agency, how do you respond? Every player earning more than he probably would in an open market would pause. Yes, you have your Derrick Rose's, your Blake Griffins, but there are far more players playing on longer-term contracts with considerable value than there are young players bucking for an open market.

And the threat works both ways for the owners. If you're Donald Sterling, how do you feel about the idea that Blake Griffin could be a free agent? Or Clay Bennett with Kevin Durant? How about Ted Leonsis and John Wall? But still, much like the CBA debate itself, it's not about the stars, it's about the rank and file guys, and those guys would be devasteated financially to lose their current contracts, especially if they also lose the ability to negotiate a guaranteed contract in the next agreement. 

It's a hefty threat, the kind of nuclear weapon for the owners that decertification is for the players. Both sides continue to get closer to the button and there appears to be no cooler head to walk things back.  

Since: Dec 10, 2006
Posted on: November 14, 2011 7:04 pm

NBA says it could void all existing contracts

This is the best news yet! There is hope that after a lengthy fight, the NBA will be on solid ground. If all contracts are voided, this will eliminate all the "Arenas" contracts where a has been gets 20 million per year. It will eliminate the "Hedo" contracts where a guy who maybe had one good year got 50 million and does nothing to earn it. It will eliminate the "Bargnani" contracts of players with potential who get 50 million even though they never reach their potential.

When the smoke clears the owners could agree among themselves that for the first 60 days, teams will only negotiate with players who were on their roster at the lockout. After 60 days, everyone becomes a free agent. By then the league's cap would be in place and there would only be room for one or two superstars per team, like the NHL. A Superstar signs with Cleveland or the Clippers or they go to a contender for 7 million less per year. NOW let's see if they will stack teams if it means they REALLY get paid half as much.

So today the players moved to decertify, now the NBA moves to void all contracts. Then we get a true "reset" and the NBA has a chance to regain its former glory.

Since: Dec 5, 2006
Posted on: November 14, 2011 6:54 pm

NBA says it could void all existing contracts

The antitrust laws would seem to prevent the league from continuing without a union contract (which protects them from such action.) The contracts may be voided and reinstated in the final settlement which restores a union but the ability to maintain player rights would depend on the union contract. The settlement will likely require those contracts be restored but the players will soon discover that they have absolutely no gain on this path. Who gains? The lawyers (think the notorious racist Jeffrey Kessler) are the ones to gain. Typically attorneys in an antitrust action collect 35-40% of the settlement. That encompasses billions. See why the advice is to disclaim?

The rank and file guys are, indeed, the ones most hurt by this decision. That they were not consulted is sad, really sad. They lose on average 25% of their career and 25% of them just ended their careers. Sorry guys, take one for the agents. Will it help future players? Not according to the precedent set by the NHL. The next contract offer is going to be worse because the last one caused owners to lose ~$34 million per year. The reset corrects that problem at 47% but still provides a miniscule return on investment. And court cases such as this usually take 2-3 years. We better hope that the players wake up before that. There could still be basketball in 2012-2013. But only if the reality sets in.

Since: May 20, 2011
Posted on: November 14, 2011 6:49 pm

NBA says it could void all existing contracts

The NBPA will have a tough time arguing hardship because the new contract provides for an average salary of $4.7 million rather than $5.3 million per year on average particularly if the league can truly show that many of its teams lost money (I am talking about real greenbacks and not depreciated losses). If many of the former union members have successfully found employment on foreign teams, the argument becomes still harder to make. Jeff Kessler will have the chance to prove that he is actually a good lawyer and not just a loud mouthed jackass with a law degree. If I was a player, I would not like my chances. 

Since: Mar 27, 2011
Posted on: November 14, 2011 6:14 pm

NBA says it could void all existing contracts

so , what about actors and music entertainers? should they do what they do for 200 or 800 thousand a year? why do you think Robert Deniro gets 20 million per movie? b/c he is the product.just like the players are the product in sports entertainment.

Since: Apr 29, 2011
Posted on: November 14, 2011 5:40 pm

NBA says it could void all existing contracts

Sounds like you don't play sports and never have. I play basketball 3 times a week at a gym by work because I love competing and for the love of the game, not because I want to get picked up by the NBA.

Since: Jan 8, 2007
Posted on: November 14, 2011 5:34 pm

NBA says it could void all existing contracts

The NBA would never void the contracts.  First of all, most teams will not risk losing their contracted stars to free agency.

Not entirely true.  Could void contracts but not team rights to players.  Your second point is more relevant.

Since: Feb 1, 2008
Posted on: November 14, 2011 5:00 pm

NBA says it could void all existing contracts

The NBA would never void the contracts.  First of all, most teams will not risk losing their contracted stars to free agency.  Second, whatever deal the players and owners eventually agree to will require that owners honor existing contracts.  It's time for the players to file their antitrust suit and then flock to Europe.  Unlike the NFL, there's plenty of money to be made overseas.

Since: May 2, 2010
Posted on: November 14, 2011 4:59 pm

NBA says it could void all existing contracts

They will pursue voiding all existing contracts.
This is what I've been saying ALL along.
The NBA needs to correct the entire system by scrapping it and resetting.
Get the players back into the 6 figure range where the individual franchises are actually earning profits.
Team salaries should be in the $10-$15 million range --- NOT $60-$100 million range.
I don't care how talented you are--- you play a frikkin game and you do it for 6 months a year!!
If you can't accept AND survive on a salary in the $200-$800 thousand dollar range there is something wrong with you.
The best doctors, lawyers, software developers---- people that actually contribute to the society of America, can accept and survive on that type of income, why can't athletes?
This is 2011 where the country is in a deep recession and millions of Americans remain out of work. The world of sports needs to get a grip. There needs to be a major market correction.

Since: Dec 28, 2007
Posted on: November 14, 2011 4:22 pm

NBA says it could void all existing contracts

sorry jockstrap

you are wrong

this is sports just no scores

Since: Nov 13, 2006
Posted on: November 14, 2011 4:16 pm

NBA says it could void all existing contracts

If this happens, how much more do you think Lebron and company down in South Beach will try to stack the deck?  You know he and his two flunkies will stick together.  WHo else will they try and get?  I am sure there are a few other big name players who have no class out there, ready to jump on board.

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