Posted on: October 13, 2011 5:49 pm
Edited on: October 13, 2011 11:18 pm
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 12, 2011 6:24 pm
Edited on: October 12, 2011 8:54 pm
The NBA labor talks are headed for government intervention after the canceling of games drew the attention of the nation's top federal mediator.
George Cohen, director of the federal mediation and conciliation service, will oversee further negotiations between the NBA and its players' association on a new collective bargaining agreement, the agency said in a news release Wednesday. The sessions will begin Tuesday in New York.
"For a number of months, I have participated in separate, informal, off-the-record discussions with the principals representing the NBA and the NBPA concerning the status of their collective bargaining negotiations," Cohen said in the statement. "It is evident that the ongoing dispute will result in a serious impact, not only upon the parties directly involved, but also, of major concern, on interstate commerce—i.e., the employers and working men and women who provide services related to the basketball games, and, more generally, on the economy of every city in which those games are scheduled to be played.
"In these circumstances, the agency has invited, and the parties have agreed, to convene further negotiations under my auspices," Cohen said.
Billy Hunter, the NBPA's executive director, divulged in a radio interview with WFAN in New York earlier Wednesday that the two sides had agreed to have their failed negotiations federally mediated.
Cohen, appointed by President Obama, was called upon to mediate the NFL's labor negotiation with the NFL Players Association before that sport's recent lockout was imposed. He has no binding authority and can only make suggestions. If nothing else, a fresh set of eyes and opinions -- not to mention meetings with a different venue and format -- couldn't hurt.
Cohen has argued five landmark labor cases before the U.S. Supreme Court and last year helped avert a crisis in Major League Soccer's labor talks. He is a former appellate court attorney with the National Labor Relations Board, and in fact argued before then-U.S. District Judge Sonia Sotomayor on the day she issued an injunction that effectively ended the Major League Baseball strike in 1995. Cohen was the MLBPA's lead attorney in the case, and also has worked with the NBPA.
In a Los Angeles Times article from March, football agent Leigh Steinberg said a good mediator is "an expert in the psychology of human gridlock." To that extent, Cohen has joined the right fight, as the NBA and NBPA are hopelessly, needlessly gridlocked over issues that should have been easily solved once they approached a compromise on how to divide the sport's $4 billion of revenues. The league's bargaining talks broke off Monday night after 13 hours over two days and multiple sessions over a two-week period. The league on Monday canceled the first two weeks of the regular season.
Drawn by the fact that lost games will have an economic impact beyond the parties involved, Cohen's office called both parties this week to request that they voluntarily participate in mediation, two sources said. Both agreed.
For those wondering why the step wasn't taken sooner, federal mediators generally don't get involved in labor disputes unless asked, or unless they reach an impasse after the sides had ample time to bargain. The NFL requested Cohen's involvement before the lockout was imposed, and while it's unclear what impact he had on the ultimate resolution, his powers at the time were muted by the lack of urgency in the talks.
Posted on: October 10, 2011 11:08 pm
Edited on: October 11, 2011 1:15 am
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 11:49 am
NEW YORK – We have reached the point of few words and fewer clues as to how and when the NBA lockout will end. One of three things will happen Monday, in no particular order of likelihood:
1) The two sides emerge, say nothing again, and announce that they’re going to continue meeting. A short time later, the first two weeks of the regular season are postponed, rather than canceled, with the possibility that the games could be squeezed in or the season compressed if a deal is reached by Friday.
2) David Stern appears on the sidewalk – in the daylight hours this time – and announces that, unfortunately, the league was unable to reach an agreement with the players and he has no choice but to cancel the first two weeks of the regular season.
3) Stern and union director Billy Hunter emerge together and announce a deal in principle on a new collective bargaining agreement, starting a race against time to get the details ironed out and deal ratified so the season can start on time.
The list of agenda items that stand between here and any of those outcomes is longer than Kevin Durant’s wingspan.
For the second time in recent weeks, the two sides dropped all discussion of the elephant in the room – the BRI split – and focused on system issues only Sunday in a hastily called bargaining session. The last time this happened, the league and union negotiators made little tangible progress on the system issues, and when they returned to the BRI split this past Tuesday, they could not close the gap from the 53 percent the players were offering to the 50 percent where owners had dug in.
Now, while sources say agreement is within reach on adjustments to spending exceptions like the mid-level and bi-annual exceptions, a major sticking point is a punitive, laddered luxury tax that players fear will effectively serve as a hard salary cap. When the two sides reconvene at 2 p.m. ET in Manhattan, the job at hand will be monumental: somehow marrying the system issues that remain hotly contested with the BRI split, which is contested at something akin to inferno levels.
What’s most puzzling about how the negotiators got to this point – with no deal and regular season games scheduled to be scrapped by the end of the day – is that in mid-September, Stern acknowledged that the two sides were “on the road” to an agreement on the economics. At that point, the players were believed to have been offering to receive a 54 percent share of BRI – already a $1 billion concession over six years in an effort to address the owners’ stated annual losses of $300 million – while signaling a willingness to make another economic move conditioned on key system aspects remaining intact.
Days later, the owners on Sept. 22 increased their proposed players’ share of BRI from 44 percent to 46 percent on average over the life of a 10-year proposal. The owners inched upward from there in subsequent negotiations – to 48 percent and finally to 50 percent this past Tuesday – while the players made another move to 53 percent, marking roughly equivalent $1.3 billion concessions for each side.
As we learned after Tuesday’s crucial bargaining session, the two sides weren’t exactly stuck at 53 and 50, respectively, for the players. In a small side conference as the talks entered crunch time Tuesday, the owners offered a 49-51 percent range for the players’ share, while the players countered with 51-53. That’s where it ended, and no further negotiations on the BRI split occurred Sunday night.
The impasse leaves open the maddening question: If the two sides were “on the road” to an agreement on the economics in mid-September when the spread was 46-54, how could they be so far apart after the gap was shaved by $1.6 billion this past Tuesday – with the difference between the midpoint of each side’s BRI band being reduced to a mere 2 percentage points (52-50)?
The answer can likely be found in a couple of crucial areas. For one, small-market owners may have dug in hard on the BRI split, insisting they cannot accept a deal in which the teams receive less than 50 percent of revenues without substantially addressing system issues they believe put them at a competitive disadvantage compared to high-revenue, big-spending teams. Second, to the extent that the division of revenues is inexorably linked to the system that determines how the players’ share is delivered, the players could find themselves in a quid-pro-quo position: If they want the system mostly intact, then 50 percent is the best offer they’re going to see. For room to exist for further negotiation on the split, the owners need system adjustments they believe will enhance competitive balance and give teams the flexibility they need to get out from under bad contracts and keep star players from bolting for bigger markets.
All of these moving parts must somehow be tied together Monday – or realistically, by Friday, as long as enough progress and momentum exist. If not, the NBA faces the slippery, dangerous slope of canceled games – which would lead to economic losses each side would then try to recoup in further negotiations, which would lead to more canceled games and, essentially, the Armageddon both sides recognized would be a possibility when the lockout was imposed July.
As Stern said that day, these things tend to take on a life of their own.
Stern was a man of exasperated expressions and few words Sunday night. Though the real 11th hour could be weeks or even months away – the deadline to cancel the entire 1998-99 season wasn’t until Jan. 7, and a deal was reached with hours to spare – Stern may sense that the public tolerance for this lockout is waning and waning fast.
There was no Twitter, no 60-second news cycle, no All-Star charity games streaming online in ’99. Collective bargaining negotiations in sports are excruciating -- not nearly as conducive to the way fans connect and follow the sport as the sport itself is. People want answers, a resolution, and their tolerance in the 60-second news cycle for the glacial, painful manner in which billions are divided is running out – and will be on empty soon.
People were ready to move on from the NBA in ’99, and the damage from the lockout was incalculable. To the contrary, people now want to embrace the NBA and the product and storylines it offers in the ever-more crowded landscape and crackling news cycle of sports.
But this stuff? This bickering over billions? People are ready to move on from it, go find the next story, the new trending topic, something – anything – more interesting and satisfying. And Stern knows they will find it, thus transforming his sidewalk statements into trees falling in the forest with no one around to hear.
Stern and his players have reached the point of few words, all right. If they don’t find the point of many solutions soon, those words and the whole sport will fall on deaf ears.
Posted on: October 9, 2011 1:56 pm
Edited on: October 9, 2011 10:29 pm
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 7, 2011 6:07 pm
Edited on: October 7, 2011 6:43 pm
The National Basketball Players Association requested a meeting with league negotiators for Monday before the first two weeks of the regular season are canceled and could not agree with NBA officials on the parameters, a union source told CBSSports.com.
NBA officials did not immediately respond to a request for comment on the information released by the union, which is now planning regional meetings Saturday in Miami -- in conjunction with the All-Star exhibition game involving LeBron James, Dwyane Wade and other stars -- and Monday in Los Angeles. NBPA executive director Billy Hunter is expected to fly to the West Coast Sunday.
According to the union source, the league would agree to a meeting Monday -- the deadline set by commissioner David Stern for canceling the first two weeks of regular season games -- only if the players agreed beforehand to accept the NBA's offer of a 50-50 revenue split. The union declined, the source said, believing it could not negotiate a fair deal for the players if it gave up the right to negotiate before the meeting even began.
This latest round of posturing comes as negotiations reach the potential home stretch after the sides trimmed $1.6 billion off the gap between them Tuesday but couldn't agree on the final number on the split of the league's $4 billion in revenues. When the two sides walked away Tuesday, the league had put an offer of 49-51 percent for the players, and the players had responded with a 51-53 percent band.
As the two sides saber-rattle their way into the next meeting -- whenever that might be -- I leave you with this quote from Friday's column in which a team executive tries to predict what happens next.
"You don't walk away from a deal that close to being done," the executive said. "You posture, you draq your heels, you pontificate, you demean the other side, you invoke all the evils in the world. But you don't walk away. Something's got to pop soon."
That's where we are. Get ready for some first-class hand-wringing, foot-stopping, finger-pointing and fireworks. That's how you know this is almost over.
Eye on Basketball will take it from here for the rest of the night and tomorrow, so be sure to follow all the developments here.
Posted on: October 4, 2011 8:42 pm
Edited on: October 4, 2011 11:19 pm
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
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.