Tag:Billy Hunter
Posted on: October 18, 2011 9:31 am
Edited on: October 18, 2011 9:58 am
 

On big day for NBA, why is the max so sacred?

NEW YORK – A few thoughts on a very important day for the NBA:

• What does it mean that commissioner David Stern is giving mediator George Cohen one day to solve all the league’s problems before breaking away for two days of Board of Governors meetings? On one hand, it’s unrealistic that Cohen and his colleague, Scot Beckenbaugh, could do in one day what Stern and Billy Hunter haven’t been able to do in two years. On the other, it creates a sense of urgency – without which nothing ever gets done in negotiations. “That’s David’s style,” one league executive said. “He likes deadlines.”

• There are rumblings in the agent community and among team executives that the hawkish position of the players’ association – its line in the sand at 53 percent and inflexibility over competitive aspects of the system – is a recipe for doom. “Sad to say, but I think (the owners) just want to sit the season out,” one prominent personnel man said. The involvement of superstars Kobe Bryant, Kevin Garnett and Paul Pierce in the negotiations two weeks ago shook some team executives who believed the two sides were on their way to a deal. “It baffles me that a union of 400 guys is fighting for one or two guys, whereas hundreds of guys are the ones taking the loss,” another team executive told CBSSports.com.

• Several executives fear that Hunter and union president Derek Fisher have been swayed by star players and their agents into taking a hard-line position that could be devastating to hundreds of rank-and-file players if the season were lost. “The thing that they’re fighting for right now is not the middle-of-the-road guy, and that's who you would think the union would be fighting for,” one of the executives said. “They’re fighting for the max guys right now or the max-to-be guys.”

• Longtime agent Steve Kauffman, a player agent during the 1998-99 lockout who now represents coaches and management executives, agrees that not enough time has been spent examining how much money and system flexibility could be freed up by reducing max contracts. “The deal is there to be made,” Kauffman said. “It's ridiculous. The main thing is, tell me what the max salaries are going to be. Because if you want to really help your union, who does the union represent? Whose interests are they protecting? If it's supposed to be everybody, then you've got to strike a balance.”

• Among the negotiating points that the league has said it’s conceded is the initial goal of curtailing the size and length of max contracts. Kauffman believes that’s gotten in the way of getting a deal. “You can make the argument that the stars deserve to be paid 75 or 80 percent of the payroll,” Kauffman said. “But if the max got a 15 percent cut, there would be more room to do those contracts that (the agents) are complaining they can't do. … The superstars are always going to get theirs through endorsements and other avenues.”

• Does this point about max salaries bear out in the math? A 15 percent reduction in future max salaries would represent only 1 percent of BRI annually – about $54 million based on the 21 players who currently make $15 million or more. But over a six-year deal, that’s roughly $325 million – the difference between a players’ share of 52 percent, which sources indicate the union would accept, and 51 percent, a figure that owners likely also would agree to. If the league’s biggest stars took a pay cut, or at least agreed that future max contracts would be reduced by 15 percent, the difference could easily be made up by giving those players a bigger share of licensing money, which currently is divided equally among the players regardless of whether you’re Kobe with millions in jersey sales or Sasha Vujacic, whose only jersey sale likely was transacted by his finance, Maria Sharapova.

UPDATE:

• Some small-market executives are fearful that the amnesty provision being negotiated will turn out to be only another advantage for big-market teams. The provision would allow teams to release an underperforming player and spread the money left on his contract over twice the years remaining, plus one, for cap purposes. One small-market GM envisions this provision being used by big-market teams to collect players cast off by small-market teams. "It's a great idea until Baron Davis goes to Miami," the GM said.

• Do not underestimate the owners' obsession with creating a competitive system that mimics the NFL, through whatever vehicle gets them there. 
"In the NFL, every team has a chance," one team executive said. "That's what makes it great, and we don't have that. We're like Euro League. Until we have revenue sharing and a hard cap, we not going to be a fair league." 

• One final note on the two weeks of games that have been canceled so far. Given reports that league scheduling guru Matt Winick is working on a host of contingency plans, including an 82-game schedule that would begin Dec. 1, it isn’t a foregone conclusion that those games are lost forever. Of importance Tuesday in the mediation session with Cohen is that those games could enter the equation as a valuable bargaining chip. If the two sides reach another impasse on the BRI split, they could be enticed to move closer by getting back the $200 million each side “lost” when those games were canceled.

Posted on: October 17, 2011 9:09 pm
Edited on: October 17, 2011 9:50 pm
 

NBA, union meet with federal mediator

NEW YORK -- Federal mediator George Cohen met separately with executives and legal staff from both the NBA and its players' association Monday, a prelude to a crucial bargaining session he will oversee with time running out to avoid losing a subtantial portion of the season to the lockout.

Cohen, director of the federal mediation and conciliation service, and deputy director Scot Beckenbaugh met with NBPA executive director Billy Hunter and legal staff for about 2 1-2 hours at the union's headquarters in Harlem. Sources also confirmed that league executives and lawyers met with the mediators at NBA headquarters.

The separate meetings set the stage for a bargaining session Tuesday in Manhattan under the supervision of Cohen, a respected presidental appointee and the top federal mediator in the country. During appearances on various media outlets late last week, commissioner David Stern said if the two sides weren't close to a deal by the time his owners convened in New York for meetings Wednesday and Thursday, his "gut" feeling was that games eventually would be canceled through Christmas.

 "I really think David wants to go present his owners with something on Wednesday," a person familiar with the process told CBSSports.com.

On Wednesday, the league's planning committee -- headed by Celtics co-owner Wyc Grousbeck -- is expected to present a revenue sharing plan to the full Board of Governors. The labor relations committee, headed by Spurs owner Peter Holt, will report on the progress -- or lack thereof -- on negotiations with the players. The issues of revenue sharing and collective bargaining have always gone hand-in-hand, and they will be inexorably linked this week in New York.

If there is no collective bargaining agreement soon, there will be no revenue to share.
Posted on: October 13, 2011 5:49 pm
Edited on: October 13, 2011 11:18 pm
 

Stern: Deal or despair by Tuesday


NEW YORK -- Setting another arbitrary deadline for more lost games, NBA commissioner David Stern said that without an agreement on a new collective bargaining agreement by Tuesday, he fears there will be no games on Christmas Day.

"It's time to make the deal," Stern said, speaking deliberately and threateningly Wednesday in an interview on New York's WFAN radio. "If we don't make it on Tuesday, my gut -- this is not in my official capacity of canceling games -- but my gut is that we won't be playing on Christmas Day."

Tuesday is the day the league and players' association will meet with federal mediator George Cohen in an attempt to resolve their differences before more games are canceled.

"Deal Tuesday, or we potentially spiral into situations where the worsening offers on both sides make it even harder for the parties to make a deal," Stern said.

Stern confirmed that negotiating committees for the league and National Basketball Players Association will meet separately with Cohen on Monday and then will convene for a bargaining session under Cohen's supervision Tuesday. Why the deadline? Stern's Board of Governors is scheduled to meet in New York Wednesday and Thursday -- first for the planning committee to present its revenue sharing plan and then for a full board meeting.

Asked when more games could be imperiled after he canceled the first two weeks on Monday, Stern said, "I don't have a date here sitting at my desk. But if we don't have a deal by the time the owners are in, then what's the purpose of us sitting around staring at each other on the same issues?"

Sources familiar with the mediation process told CBSSports.com that Cohen at first wanted to hold bargaining sessions at his Washington, D.C., office beginning Tuesday and continuing for the rest of the week. With owners headed to New York for the board meetings Wednesday and Thursday, that wasn't possible.

"We have owners meetings Wednesday and Thursday," Stern said later in another interview on NBA TV. "Each side’s going to meet with the mediator on Monday, and if there’s a breakthrough, it’s going to come on Tuesday. If not, I think that the season, you know, is really going to potentially escape from us because we aren’t making any progress."

Pressed by interviewer David Aldridge, Stern said, "How many times does it pay to keep meeting, and have the same things thrown back at you? We’re ready to sit down and make a deal, and I don’t think the union is. But hopefully on Tuesday, aided by the mediator, they’ll be ready to make a deal. And certainly, I’ll bring my owners ready to make a deal. Unlike Billy Hunter, you’ve never heard me say something is a 'blood issue.'"

Hunter, who appeared Wednesday on WFAN -- the nation's largest sports talk station -- was traveling Thursday to Los Angeles, where he will meet with players Friday to update them on the bargaining status.

In a work stoppage known more for catch phrases and YouTube moments than compromise, this will go down as Stern's "Grinch" moment. Placing that much importance on the first sit-down bargaining session with a mediator who has no binding authority felt like a negotiating tactic more than a realistic deadline or threat.

But in responding to assertions made a day earlier on WFAN by union chief Billy Hunter, Stern did by far his most effective, convincing job yet of laying out the owners' vision for a new system that would shrink payroll disparity and enhance competitive balance in a new CBA.

In meticulous, lawyerly fashion, Stern skewered the union's bargaining stance on the key system issues standing in the way of a deal -- the type of cap system and contract length. He also took Hunter to task for his characterization of a 50-50 split of revenues that had been discussed in informal side meetings during a key bargaining session on Oct. 4 -- calling it an idea first broached by the players and saying Hunter's characterization of it "caused my head almost to explode."

"The first time 50 percent was uttered was several weeks earlier, by the players' negotiator (Jeffrey Kessler), who said it's not an offer, it's a concept," Stern said. "He said it's a concept if everything else stays the same. And we said, 'No, no, no, no.'"

Stern said when each side was in its respective room during the Oct. 4 session, there was a knock on the door. 

"It was Derek Fisher, the president of the union, and Jeff Kessler, the lead negotiator, who probably does 70 percent of the talking for the union," Stern said. "And they asked us to come out into the hall, where I went with Peter Holt, the head of the labor relations committee, and Adam Silver, who's really our lead negotiator.

"Without trying to pin it on anybody in particular, all the parties to that conversation agreed that we would go back to our respective rooms and each promised to try to sell a 50-50 split," Stern said. "We were in the process of selling it, and there was a knock on our door. Kessler and Derek Fisher asked us to come into a room where they were with three other players -- not Billy -- and they said, 'We can't do it. We can't sell it.' And we said, OK, we get it.' Now it strikes me as strange that the union and the chief negotiator are being left out there because Billy wasn't in the room? I'm sorry."

Union sources have given a different account of the side discussions, saying the league at one point offered to try to sell a band of 49-51 percent for the players, while the players countered with a band of 51-53 percent.

"It was actually a union-initiated proposal, and it didn't fly, OK?" Stern said. "But Billy's ... you may have to have both of us in tomorrow with lie detectors."

In any event, Stern now considers the two sides to be six percentage points apart on the split of BRI, with the players asking for 53 percent -- a $1 billion concession over six years from their previous guarantee of 57 percent -- and the owners offering 47 percent. Stern made it clear that he believes the economic deal to be made is 50-50.

"When one side is at 53 and the other side is at 47, you have an idea of where this is going, OK?" Stern said.

While Stern's motivation to put another threat of canceled games out there was clear -- negotiating leverage -- it's unclear why he waited this long to give a thorough, persuasive summary of the system changes owners are seeking. 

"If you live in a market where you have a perception as a fan that it's only open to the rich teams to have the best players, then you're starting out in a bad place," Stern said.

On negotiations over the type of cap system, Stern said, "We proposed to the players that every team have the same amount available (to spend). That's what the NFL has. And the union said, 'No way. That's a blood issue.' So we said, 'All right, all right, you know, good ol' softees that the owners are, how about the flex cap like NHL has, where you agree upon a band between $52 million and $68 million -- because you can compress the difference? And they said, 'Blood issue. That's still a hard cap at the high end. Why don't you propose a punitive tax?' We said, 'OK, we'll propose a punitive tax.' And we did."

Stern described in detail how the owners' latest luxury tax proposal would work: It would tax teams $1.75 for every dollar of the first $5 million over the tax threshold, with 50 cents added for each additional $5 million. So a team spending $20 million over the tax would be charged $65 million, compared to the $20 million it cost under the dollar-for-dollar tax system in the previous CBA. The players on Monday rejected the owners' luxury tax plan because it was so punitive, it would effectively serve as a hard salary cap.

The league also wanted to impose even stiffer penalties for teams that failed to come out of the luxury tax after a period of time -- repeat offenders, so to speak. 

"We really have been reaching for the union here," Stern said. "... If anyone thinks we wanted to miss a single game, they are wrong."

UPDATE: In the NBA TV interview, Stern asserted that near the end of Monday's bargaining session, the union's tax proposal worsened from a $12.5 million tax on $10 million to $11 million.

"It was clear that they weren't ready to make a deal," Stern said. "And we didn’t know what else to do."

Stern didn't mention the aspect of the league's proposal that would forbid tax-paying teams from using the Bird exception to retain their own free agents, but did reveal that the league proposed a so-called "Super Bird" exception whereby teams could re-sign one designated free agent for a maximum of five years. Other contract lengths would be capped at four and three years under the league's proposal. Previously contracts could be no longer than six years for free agents who stayed with their teams and five years for those who left. The union has offered to cap contract lengths at five and four years, respectively.

"I was a participant in developing the Bird exception in 1983, so it doesn't break my heart to see it continued," Stern said. "But frankly, our owners went into this thinking that it was better to eliminate it so that teams could only keep certain players and the rest would be available to other teams."
 
Stern's spin on the league dropping its insistence on eliminating guaranteed contracts and rolling back existing ones was that, "We were anxious to save the season and make a deal." While the provision forbidding tax-payers from retaining Bird free agents would result in many of those players leaving their teams -- which is exactly what the exception was created to prevent -- he said the Super Bird provision would be "better for the players."

"The very good players will keep getting raises and new contracts, and the others, the money that becomes available by the expiration of the four- and three-year contracts will be available to the performers," Stern said. "That's what we call pay-for-performance. The union is not in accord with our view. They want longer contracts."

The luxury tax penalties and contract lengths will be the two most divisive issues when the parties meet with the federal mediator next week, Stern said.

"We really want the union and us to explain ourselves to a federal mediator," Stern said. "It may be that in the act of explaining, we will get a better reality check -- maybe of our proposals and our willingness, I accept that -- and maybe of the union's. We'll just see how that works out. So that's why, in some measure, both sides embrace the arbitrator."



Posted on: October 10, 2011 11:08 pm
Edited on: October 11, 2011 1:15 am
 

Stern cancels two weeks over labor impasse

NEW YORK -- Citing an impasse with the players' association over matters that seemed trivial entering the home stretch of negotiations, David Stern announced Monday night the cancellation of regular season games for the second time in his more than a quarter century as commissioner.

Stern canceled the first two weeks of the regular season after more than 13 hours of bargaining over two days with the National Basketball Players Association left the two sides "very, very far apart on virtually all issues."

"I'm sorry to report, particularly for the thousands of people that depend on our industry for their livlihood, that the first two weeks of the season have been canceled," Stern said.

Asked if there was no chance of having an 82-game season, Stern said, "Yes, I think that's right. And every day that goes by, we need to look at further reductions in what's left in the season."

The biggest issue that separated the parties in negotiations that began in earnest with the owners' initial proposal in January 2010 -- the split of revenues -- was not the tipping point that led to the cancellation. It was system issues -- luxury tax, contract length, length of the CBA, annual raises, and the like -- meaning that both sides will miss games over details neither imagined they would.

"I'm convinced this was all just part of the plan," said Billy Hunter, executive director of the National Basketball Players Association.

Indeed, a person involved in the negotiations told CBSSports.com that the cancellation seemed "pre-ordained."

"This could have been solved so easily, with any amount of effort," the person said.

Indeed, the two sides engaged in a flurry of lengthy talks over the past two weeks, culminating with six hours Sunday night and seven hours on Monday -- all dealing with system issues with no sunstantive discussion of the split of basketball-related income. Speaking on the sidewalk outside the Upper East Side hotel where negotiations took place, Stern delivered a laundry list of items that league negotiators found most objectionable about the players' proposals: contract length, length of the CBA, use of exceptions by tax-paying teams, the tax levels and what deputy commissioner Adam Silver described as the "frequency of the tax."

The latter point, according to a union source, apparently was in reference to the owners desire to punish teams that repeatedly spend over new luxury-tax thresholds in order to prevent "runaway teams" in big markets from maintaining an unfair competitive advantage over small-market teams.

Such negotiating points seemed minor heading into the final push to save regular season games, given that last Tuesday, the two sides had shaved about $1.6 billion off the economic gap that separated them. Few observers or participants in the talks expected games to be lost over technical deal points -- the likes of which could've been agreed upon and written up by low-level attorneys working at home on the weekend while players reported for training camps.

But Stern characterized the distance between the sides as "a gulf," and added, "We just can't get over the system hurdles."

"It makes no sense for us to operate under the current model, where taxpayers ... have a huge advantage over other teams," Silver said.

Unsurprisingly, each side had a different view of the others' vision of the system they were negotiating to achieve. According to a union source, the players agreed to concessions on contract length -- reducing them from five- and six-year deals in the previous CBA to five- and four-year deals -- and offered to lower the mid-level exception from its previous level of about $5.8 million to $5 million. The source said league negotiators were insisting on a reduction in the mid-level to $3 million a year.

Not mundane enough for you? Other aspects of the impasse included annual raises. The players offered to reduce them from 10.5 percent and 8 percent for "Larry Bird" free agents under the previous deal to 10.5 percent and 9 percent for Bird free agents and 8 percent and 7 percent for other players. Hunter said owners wanted to forbid tax-paying teams from using the Bird exception, meaning they would need to have cap space to retain one of their Bird free agents.

The totality of the owners' system offers -- including a more punitive luxury-tax model that would increase to as much as 4-1 and beyond for repeat offenders -- would have the same effects as a hard salary cap, Hunter said.

"My attitude is, if it quacks like a duck and walks like a duck and it looks like a duck, it's a duck," Hunter said. "... We came up with proposals to stiffen the tax, but we do not want a hard cap. You can't say, 'OK, we agree we're going to move away from a hard cap,' but then do everything else that brings about the same result."

Stern maintained that the owners' latest proposals did not include a hard team salary cap, and also would allow players to retain guaranteed contracts and would not roll back existing contracts.

"We tried awfully hard," Stern said. "We made, in our view, concession after concession."

Stern predicted that the economic loss from canceling games would cause the league's negotiating position to harden because "we have to account for the losses that we are incurring." He stopped short of saying the entire season is in jeopardy, but added that further cancellations would be dealt with in two-week increments.

"I don't know that the season is in jeopardy," Hunter said. "I think it would be foolish for them to kill the season. We're coming off the best season in the history of the NBA, and I'm not so sure in this kind of economy if there is a protracted lockout whether the league will recover."



Posted on: October 10, 2011 12:25 am
Edited on: October 10, 2011 3:10 am
 

NBA labor talks extend to Monday

NEW YORK -- Facing a deadline for the cancellation of regular season games, negotiators for the NBA and its players' association met for nearly 5 1-2 hours Sunday night and will reconvene Monday afternoon for more bargaining.

Commissioner David Stern and deputy commissioner Adam Silver emerged from the Upper East Side hotel where negotiations took place at 11:50 p.m. ET, and Stern issued a brief statement before walking away.

"We don't have any comment at all, other than we are breaking for the night and reconvening tomorrow afternoon," Stern said.

Stern has said he will cancel the first two weeks of the regular season if a new collective bargaining agreement isn't agreed to by Monday. He did not address the cancellation deadline in his statement, and a person with knowledge of the talks said both sides agreed it would not be addressed with reporters.

"We're not necessarily any closer than we were going into tonight," union president Derek Fisher said. "But we'll back at it tomorrow and we'll keep putting time in."

According to a person briefed on the talks, the primary focus Sunday night was system issues -- salary cap, luxury tax, etc. -- leaving Monday to reconcile those complicated items with the most important point of all: the split of revenues between owners and players. Fisher characterized the meeting as "intense."

"We're going to come back at it tomorrow afternoon and continue to try and put the time in and see if we can get closer to getting a deal done," Fisher said.

The last-minute meeting was called after league and union officials originally couldn't agree on the parameters of one final bargaining session to save regular season games. On Friday, officials from the National Basketball Players Association requested a meeting, but were met with a precondition from the league that they agree to a 50-50 split of revenues that was offered in Tuesday's bargaining session. The union declined, and scheduled regional meetings for Miami on Saturday and Los Angeles on Monday.

NBPA executive director Billy Hunter did not travel to Miami, and an impromptu players' meeting was held after the All-Star charity game at Florida International University featuring LeBron James, Dwyane Wade, Carmelo Anthony, Amar'e Stoudemire, Chris Paul and other stars. Fisher said the regional meeting for L.A. on Monday was postponed so union officials could concentrate on bargaining.

"Our guys would want our time to be used in meeting and trying to get closer to getting a deal done," Fisher said. "So instead of going forward with that (Los Angeles) meeting, we're going to put it off and then we'll reschedule it accordingly, depending on what happens tomorrow and into the week if we continue to meet."

Silver arrived at 5:10 p.m. ET, climbed out of a black sedan and greeted league security personnel with a smile and handshake. Union chief Hunter and general counsel Ron Klempner arrived at 5:30, followed closely by union VP Maurice Evans, who stepped out of a yellow taxi moments later. The three greeted Fisher, the union president, when he arrived in a black SUV at about 5:50, and the players' contingent stayed on the sidewalk and talked for about 25 minutes. NBPA outside counsel Jeffrey Kessler arrived, followed by Timberwolves owner Glen Taylor, the chairman of the Board of Governors, and Spurs owner Peter Holt, chairman of the labor relations committee. The meeting started around 6:30 p.m.

Heading into the weekend, the players' were entrenched in their desire for 53 percent of basketball-related income (BRI), while the owners were stuck on offering the players 50 percent. The split under the six-year agreement that expired July 1 was 57 percent for the players and 43 percent for the owners.

From the standpoint of negotiating leverage, psychology and feeling the need to follow through on their threats, both sides seem willing to sacrifice the first two weeks of the regular season -- possibly more -- to get a deal. But from the standpoint of math and what's at stake economically by failing to reach an agreement by Monday, it is clear that a deal would be more advantageous to both sides than digging in.

The last movement of Tuesday's negotiations indicated that there was room on both sides to move beyond their respective positions on BRI. The league offered a 49-51 range for the players, who countered with a 51-53 range. Both offers occurred during informal side conferences involving Stern, Silver, Holt, Fisher, Kessler, and superstars Kobe Bryant and Kevin Garnett.

If you look at it from the midpoint of each side's range in their most recent offers -- 50 percent and 52 percent, respectively -- they are only $80 million apart in the first year of a new CBA. Each side would lose about $200 million by canceling the first two weeks of games. A rational split of 51.5 percent for the players and 48.5 percent for the owners -- with most of the system issues remaining the same, as the players want --would address most of the owners' stated annual losses of $300 million and preserve the flexibility the players wanted to maintain from the existing system.

By holding out for 1.5 percent of BRI -- the owners at 50 percent and the players at 53 -- each side would be drawing a line in the sand over less than $400 million -- $393 million, to be exact -- over six years. And each side would lose half that amount by canceling the first two weeks of games. In the simpler, shorter-term horizon of the first year of a new CBA, each side failing to move 1.5 percent to the 51.5-48.5 split would cost it $200 million compared to the $60 million that would be negotiated away by making the concession.
Posted on: October 9, 2011 1:56 pm
Edited on: October 9, 2011 10:29 pm
 

Source: League, players trying to arrange meeting

NEW YORK -- Top negotiators for the NBA and its players' association are trying to arrange a last-ditch bargaining session Sunday night before a deadline hits Monday to cancel the first two weeks of the regular season, a person briefed on the developments confirmed to CBSSports.com.

The New York Times first reported efforts to hold the meeting were under way.

Update: The two sides approached the four-hour mark Sunday night on Manhattan's Upper East Side with no word of when the session might end. Representing the league were commissioner David Stern, deputy commissioner Adam Silver, Spurs owner Peter Holt, Timberwolves owner Glen Taylor and deputy general counsel Dan Rube. For the union, it was executive director Billy Hunter, president Derek Fisher, vice president Maurice Evans, general counsel Ron Klempner and outside counsel Jeffrey Kessler.

Hunter did not travel to Miami Saturday night for the All-Star exhibition at Florida International University. His plans for a regional players' meeting in Los Angeles remain in place for Monday, two people with knowledge of his plans said -- but Hunter is not scheduled to fly to L.A. until Monday morning.

On Friday, the players proposed a meeting for Monday before games were canceled. The league agreed to meet, but advised the union that it was not moving off the 50-50 split of revenues it offered in Tuesday's bargaining session. Viewing this as a precondition it could not agree to, the union declined the meeting.

UPDATE: The 50-50 prerequisite was dropped in the scheduling of the Sunday evening meeting, one of the people familiar with the discussions told CBSSports.com.

From the standpoint of negotiating leverage, psychology and feeling the need to follow through on their threats, both sides seem willing to sacrifice the first two weeks of the regular season -- possibly more -- to get a deal. But from the standpoint of math and what's at stake economically by failing to reach an agreement by Monday, it is clear that a deal would be more advantageous to both sides than digging in.

As far as bargaining rhetoric is concerned, the players are holding firm at 53 percent of basketball-related income (BRI), while the owners are holding the line at 50 percent. But in the last movement of Tuesday's negotiation, the league offered a 49-51 range for the players, who countered with a 51-53 range. Both offers occurred during informal side conferences involving Stern, Silver, Spurs owner Peter Holt, Fisher, union lawyer Jeffrey Kessler, and superstars Kobe Bryant and Kevin Garnett.

The split under the previous collective bargaining agreement that expired July 1 was 57-43 percent in favor of the players.

If you look at it from the midpoint of each side's range in their most recent offers -- 50 percent and 52 percent, respectively -- they are only $80 million apart in the first year of a new CBA. Each side would lose about $200 million by canceling the first two weeks of games.

A rational split of 51.5 percent for the players and 48.5 percent for the owners -- with most of the system issues remaining the same, as the players want -- would address most of the owners' stated annual losses of $300 million and preserve the flexibility the players wanted to maintain from the existing system. By holding out for 1.5 percent of BRI -- the owners at 50 percent and the players at 53 -- each side would be drawing a line in the sand over less than $400 million -- $393 million, to be exact -- over six years. And each side would lose half that amount by canceling the first two weeks of games.

In the simpler, shorter-term horizon of the first year of a new CBA, each side failing to move 1.5 percent to the 51.5-48.5 split would cost it $200 million compared to the $60 million that would be negotiated away by making the concession.



Posted on: October 4, 2011 8:42 pm
Edited on: October 4, 2011 11:19 pm
 

League, players about $80 million apart

NEW YORK -- There were no fireworks, no tantrums and no tirades. There was all the resignation and disappointment of doomsday, but none of the reality. 

The reality is that the NBA owners and players, after showing most of their cards Tuesday in a bargaining session that failed to save an on-time start to the regular season, are approximately $80 million-a-year apart on the economics of a new collective bargaining agreement, multiple sources with knowledge of the negotiations told CBSSports.com.

Though no additional negotiations are scheduled and the process now enters the dangerous and unpredictable phase where any slipups could jeopardize a large chunk of the regular season, the two sides are closer than they publicliy divulged in a pair of dueling news conferences in adjacent meetings rooms of a Times Square hotel.

Here is where they are, according to multiple people involved in the negotiations: After the owners offered the players a 50-50 split of revenues that effectively was a 47 percent share with about $350 million in expenses deducted first, the two sides met in small groups in the hallway while each side's larger group caucused in separate rooms. As the hour grew late, the tension was rising and becoming palpable. Both sides recognized it was time to try everything possible to make a deal. 

In the group for the league side were commissioner David Stern, deputy commissioner Adam Silver and Spurs owner Peter Holt, the chairman of the labor relations committee. For the players, it was union president Derek Fisher, outside counsel Jeffrey Kessler and two of the brightest stars who attended Tuesday's crucial bargaining session -- Kobe Bryant and Kevin Garnett, according to one of the people with knowledge of the side meeting.

In that group, the league -- sensing that the opportunity for a deal was there -- proposed essentially a 50-50 split with no additional expense reductions over a seven-year proposal, with each side having the chance to opt out after the sixth year, one of the people said. This was the offer Stern described in his news conference Tuesday evening, one that he and Silver thought would be enough to finally close the enormous gap between the two sides.

The league's offer, according to three people familiar with it, came in a range of 49-51 -- with 49 percent guaranteed and a cap of 51 percent, the sources said.

Stern told the players and Kessler that he was bringing this proposal to his owners in an attempt to sell it, making no bones about the fact that he would. In fact, Stern said in the news conference, he did sell it. The owners were prepared to sign off on this 49-51 percent band, and with many of the most polarizing system issues resolved, the framework of a deal was in sight.

While the owners were caucusing, a member of the players' group returned with a counterproposal -- approximately 52 percent of BRI for the players with no additional expenses deducted. The players' counterproposal followed the format presented by the owners -- a 51-53 percent band with 51 percent guaranteed and a cap of 53. League officials rejected the offer, the sources said.

So while Hunter and Stern remained publicly entrenched in the ecoomic positions of their most recent formal proposals -- with the players asking for 53 percent and the league offering effectively 47, the reality is this: the gap has closed to 2 percentage points of BRI, the difference between the midpoint of the two offers.

With each percentage point of BRI worth about $40 million, the two sides -- who were at one time $8 billion apart over 10 years -- are now a mere $80 million apart on an annual basis. So you can see what the two sides saw Tuesday -- the road to a deal that both sides eventually can find a way to live with that is better than the alternative of missing a substantial portion of the regular season.

UPDATE: Though there were no immediate plans for the two sides to meet Wednesday, two people close to the discussions said a Thursday meeting was possible. Several key parties to the process will be unavailable from sundown Friday to sundown Saturday for Yom Kippur, the most solemn day of the Jewish calendar.

Complications remain, of course, not the least of which is the fact that this sidebar, informal discussion of the two BRI bands would have to be worked through the formal process of getting each side's committee to sign off -- and then, it would have to be negotiated further. Also, by walking out without a deal Tuesday, the players' association is subject to the influence of agents who have made it clear they are unhappy with the course of negotiations and have openly threatened encouraging their clients to decertify the union.

Two people with direct knowledge of the strategy being invoked by a group of seven super agents who wrote a letter to their clients over the weekend said the group -- including Arn Tellem, Bill Duffy, Mark Bartelstein, Dan Fegan, Jeff Schwartz, Leon Rose and Henry Thomas -- is willing to accept no less than 52 percent. There is disageement within the ranks on that figure, with a hard-line faction pushing for the players not to retreat at all from the 57 percent of BRI they received under the previous CBA.

The more time that goes by without closing the now comparatively narrow gap between the two sides, the more opportunity there will be for players and their agents to apply pressure to the union -- and perhaps even encourage clients who are unhappy with the course of negotiations to hold a decertification vote, which would stall the talks.

One of the people with direct knowledge of the super agents' strategy said at least two strong voices in that camp have quelled their pursuit of decertification, which would remove the process from the negotiating room and throw it into federal court under anti-trust law. Such a move at this stage, the person with knowledge of the agents' approach said, would inject too much chaos with a deal within reach.

With most system issues preserved from the previous deal, one of the high-powered agents has told associates that he would accept 52 percent and "call it a wrap," a source said Tuesday.

Recognizing the uncertainty and risk that lies ahead -- the rest of the preseason was canceled after the bargaining session Tuesday and regular season games are potentially days away from being lost -- Fisher took direct aim Tuesday at the agents who have most vocally objected to the union's legal and bargaining strategies.

"The only people that really decide whether we accept and ratify a deal are the guys that are standing right here and the other 400-plus guys that aren't here right now," Fisher said, flanked by several committee members and superstars Bryant, Paul Pierce and Kevin Garnett. "And not out of disrespect, I'm just not inclined to engage in a discussion about what a group that doesn’t control any part of this process has to say."
Posted on: October 4, 2011 8:29 am
 

Clock ticking for Hunter, Stern

NEW YORK -- Contrary to popular belief, the most important fight being waged Tuesday in Manhattan is not David Stern vs. Billy Hunter, nor is it the NBA vs. the players.

Fight No. 1 will occur at 10:30 a.m. in another happenin' hotel in the city, when Stern and his cabinet meet with the owners privately to set their strategy for what could be the last bargaining session with the players for a very long time. Fight No. 1(a) is Hunter's fight, and that one begins in earnest after the owners-player talks blow up spectactularly at noon.

One is contingent on the other. If Stern is unable to rein in his owners and insist on offering the players a fair deal that they will accept -- if he is unable to win fight No. 1 -- then Hunter's fight is inevitable. There is real frustration, venom and fury ready to be unleashed by a cadre of powerful agents who represent enough players to turn this process into a cataclysm that will bring basketball to its knees.

Billy "Giveback" Hunter, one agent referred to him as on the phone early Tuesday -- and it got worse from there, much more mean-spirited and unfair and too angry, honestly, to publish any more. There is real anger here among the agents, some of whom are advising their clients not to vote for a deal that gives back one dollar of the players' 57 percent of revenues -- even as the National Basketball Players Association is believed to have offered 53 percent and maybe lower. What the agents are fighting for now has already left the barn, hasn't it?

"Nothing has left the barn," one of the agents said. "The vote will determine what's left the barn."

The agents want their players to be able to vote in a private setting on any deal Hunter and the union agree too, and they want their clients to have more than 24 hours to digest the particulars. They don't want another show-of-hands vote like the one that ended the 1998-99 lockout, in which every player had the "opportunity to vote," as it states in the union bylaws, but less than half the membership actually voted.

"A Libyan vote," one agent characterized it as. "It was a pep rally."

The agents are furious with Hunter and want a piece of Stern and the owners, too. It is clear that even if Hunter reached a deal Tuesday on a percentage of BRI the union already has offered, there's no guarantee he'll get it past a vote -- only a guarantee that Hunter would be out of a job.

Hunter has always been in an impossible position in these negotiations, and I personally don't blame him for the bargaining and legal strategies he's pursued and for those he's left unexplored. The agents -- seven of whom wrote to their clients over the weekend urging them to dig in -- have only seen one viable option since 12:01 a.m. on July 1: decertification and an antitrust lawsuit. Never mind that decertification didn't work for the NFL players in their lockout, and that it resulted in a sweeping victory for the owners in that sport, too. Never mind that agents work in a profession that, by definition, requires duplicity to be successful. Never mind that the agents can't even seem to agree on what their letter says; one insisted Monday that it urges players to accept "no further reduction" in BRI from what the union has offered, while another said the line in the sand was 57 percent.

Union president Derek Fisher, thrust into a tempest of politics and age-old grudges that make Shaq vs. Kobe look like a game of pattycake, responded with a letter of his own Monday night rebuking the agents. This game of pen pal is nice and quaint, and now the powder keg gets wheeled into the room at noon ET Tuesday for the real fireworks.

It's a mess, a basketball Armageddon that only Stern and his owners, and then Stern and Hunter -- doing their last bargaining dance with jobs and legacies on the line -- can forestall.
 
Happy Tuesday. 
 
 
 
 
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