Sports and the Law: Sports Executives Say The Darndest Things
[Ed Note: ATL is happy to welcome back Marc Edelman, sports-law professor/sports-law blogger. Marc will be giving ATL readers his take on the sports-law issues of the day on an ad-hoc basis.]
Sports executives are supposed to be shrewd. They are supposed to be savvy. They are supposed to follow sound legal advice, and they are not expected to write smoking gun emails.
Some big-name sports executives, however, keep fouling this up.
Last Thursday, Portland Trailblazers president Larry Miller sent an email to the other 29 NBA teams, asking them not to sign free agent forward Darius Miles. Miller sent this email because he did not want to incur the salary cap hit that would have been triggered if Miles plays in two more games this season. (For more details, see here).
According to various sources, Miller’s email was filled with legal banter such as claims that if any NBA team signed Miles, it would breach a “fiduciary duty as an NBA joint venturer,” and “tortiously interfer[e] with the Portland Trail Blazers’ contract.”
As a matter of law, however, Miller’s claims are bizarre, if not outright bogus. There is no fiduciary duty amongst NBA teams that forbids them from competing vigorously in the free agent market. In addition, there is no active player contract between a free agent player such as Miles and his former team.
Even more disturbing than these outlandish legal claims, however, is that Miller’s email seems to invite NBA teams to boycott Miles’s services. This reading of Miller’s email places the Blazers at risk of facing an antitrust lawsuit under Section 1 of the Sherman Act or a labor grievance under the anti-collusion provisions in the NBA collective bargaining agreement (Major League Baseball owners got into trouble for similar misconduct in the late 1980s) (pdf).
After the jump, more sports executives behaving badly.
Astoundingly, this is not the first time in recent months that a veteran sports executive has exposed himself to legal risk during a bout with oral diarrhea. Just last month, Atlanta Braves president John Schuerholz told the media that he would never again negotiate a contract with a player represented by agent Paul Kinzer. Although Schuerholz’s language was not nearly as outlandish as Miller’s, a finder of fact may interpret Schuerholz’s words to express an intent to violate the labor-law duty to negotiate in good-faith with an approved union and its representatives (of course, this presumes that the National Labor Relations Act considers a player agent to be a union representative).
Maybe it is too easy to pick on sports executives given how often they act in public. Because these executives operate in a public arena, however, one would expect them to better understand the legal implications of their words.
In the case of Miller, who ironically will be speaking later this month at a conference on “The Law of Sports Leagues,” he may get off easily with his blunder. Despite Miller’s best efforts to deter other NBA clubs from signing Miles, the Memphis Grizzlies on Saturday announced their intent to sign Miles. If the Grizzlies sign and play Miles, the Blazers would likely avoid an ugly antitrust or labor lawsuit.
Nevertheless, Miller’s reputation may ultimately take a big hit from this whole mess. Indeed, the same can also be said about the Blazers’ team salary cap.
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Marc Edelman is a Visiting Assistant Professor at Rutgers School of Law-Camden. He will be joining the faculty of Barry Law School in Fall 2009. His bio is available here, and his publications, here.
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GULCing SHEEP
Edelman = TTT agent wanna be. Go home and jerk off to Jerry McGuire again rather than wasting our time.
what happened to the clipart? that was the best thing about these posts!
Wow, I never would have inferred from the text of Sherman 1 that collusion could be an anti-trust violation. It's no wonder that with such deep, nuanced legal analysis like this that he landed a teaching gig at the prestigious Barry School of Law. Tenure track, Marc?
This post needs a JARVIS PROBE
Couple things. The email did not claim that other teams would "tortiously interfere" with the Portland contract, but rather claimed signing Miles would "tortuously" interfere with Portland. The distinction was clearly lost on Larry Miller, but it is actually even funnier.
Second, you're leaving the toilet that is Rutgers Camden for Barry Law School? Did you get flushed?
There is no doubt in my mind that Memphis re-signed Miles precisely to avoid the legal problems you mention in the post. After all, the Grizzlies just cut the guy. Now they think he's good again? I think the league -- David Stern -- orchestrated (i.e mandated) this move.
The funny thing is that it's obvious from Edelman's analysis that he's never actually studied the Sherman act. Had he done more research rather than, you know just asserting that something is anticompetitive, he'd know this email is not per se illegal. Under rule of reason analysis, there's no way a plaintiff could show an effect on consumers.
Or maybe I'm expecting too much from a legal commentator and law professor.
Marc,
Interesting points, but what about this part of the e-mail--The Blazers are going after this:
"signing Darius Miles to a contract for the purpose of adversely impacting the Portland Trail Blazers Salary Cap and tax positions"
In other words, he's afraid that another team would sign Miles, not for his basketball services, but rather solely to mess up the Blazers' salary cap and taxes. Sounds like the possible basis for an unfair competition claim, though I haven't studied it.
Perhaps the theory is no good, and perhaps any injuries the Blazers suffer would be self-inflicted through their decision to release Miles, but just intuitively I'm wondering if you're being a bit unfair.
The Grizzlies did NOT re-sign miles for the remainder of the season. They signed him to a 10 day contract. The reason they had to release him is that the NBA has a deadline at which all players with non-guaranteed contracts must either be released or their contract is guaranteed for the rest of the year. Upon being released, the players must sit on waivers so that all the other teams get a chance to sign them. When noone else signed Miles, the Grizzlies were then free to then re-sign him to a non-guaranteed contract for as long as they wanted. This is exactly what they did and it is a) perfectly reasonable from a team standpoint and b) not a clear sign that they were doing something just to spite Portland.
7- teams do that all the time. If Memphis hadn't cut Miles before last Wednesday the 7th, his contract would become guaranteed for the remainder of the season. By cutting and resigning him to a 10-day contract, they retain his services without having to pay him for the rest of the season.
10 just pwned 7's conspiracy theory.
What does "pwned" mean?
-10
I feel like this should have more meat. Both cases are not given the examination they're due.
While the Jailblazers' email was stupid because of the collusive aspects, you've mischaracterized it. It told other teams not to sign Miles only if their purpose in doing so was screwing up the Trailblazers' salary cap. It said nothing about signing Miles simply because you thought he would improve your team.
If Miles plays two more games, the Jailblazers are obligated by contract to pay him $18M. How is this equivalent to there not being a contract for state law tort claims? I'm not asking this facetiously, I'm assuming there's some doctrine or CBA provision you didn't mention.
Likewise, Schuerholtz's comment being stupid hinges on a player's agent being a union representative. It may be smart from a business perspective.
As a non-sports lawyer, its not immediately clear that a player's agent is related to the union (IIRC, I have very dim memories that they are certified by the union, but its a far cry from that to say they represent the union). This should be explained.
14 - The Trailblazers are already paying Miles his full contract, albeit with the majority being covered by insurance. The only issue here is the salary cap, which has both financial and roster implications.
Yeah but all Miles has to show is that one team was deterred from signing him based on the email and then he can show that he was injured because more bidders means a higher price.
http://amlawdaily.typepad.com/amlawdaily/2009/01/the-am-law-litigation-daily-january-12-2009.html
QUINN RULES MUNGER DROOLS!
It would seem that 10 actually helped prove 7's conspiracy theory, you dolt.
If Stern orchestrated the move to have the Grizz resign him, it would make perfect sense if the goal is to end this fiasco. The Grizz are the only logical team to sign him, since they are the only team who sees actual value in retaining his services. Otherwise, another team signs him to a 10-day, plays him the two games while the Blazers get all uppity and file a lawsuit.
15 is correct and the insurance will still pay Miles even if he plays those 2 more games. I think insurance pays 80%... not sure.
The cap is the biggie though, Blazers will go from lots of cap space and getting a free $3million check, to no cap space and paying a few mil. Pretty big swing.
Edelman -- Your NLRA claim is patently absurd. There are official union representatives who represent the players' collective bargaining interests against the league as a whole. Agents represent individual players in their search for employment. There is no sense in which a team refusing to sign players represented by a particular agent is remotely close to a violation of the NLRA.
18, hard to say I helped prove that conspiracy theory. The Grizzlies are the most logical team to have re-signed him because of legitimate basketball reasons, both on the court and in the front office. Of course that also makes them the most logical team to use for some crackpot conspiracy... but that doesn't make the conspiracy any more crackpot.
-10
p.s. If Miles plays two more games, the Blazers will have to pay about $7 mil in luxury tax, instead of collecting about $3 mil. Net loss $10 mil plus limited ability to sign free agents... I might be writing irrational emails too.
No wonder Cahill layed him off
Whoops, I meant "any less crackpot." Oh well, you win some, you lose some.
How can you people get yourselves so worked up over an activity that involves a bunch of inbred, nappy-headed, flat-nosed apes bouncing a ball up and down a hardwood surface. Wait... I think I just answered my own question. Basketball should be in the center ring of a three-ring circus.
/s/ Massa
Hooray!
Congratulations to 24 for being the winner of today's "First racist to rear their ugly little ignorant head" award.
Come on down and collect your prize tard-boy.
20: You are completely 100% wrong. There are cases on this. Since the union has the exclusive authority to negotiate salaries on behalf of all players, all agents for players are negotiating solely by delegation from, and at the suffereance of, the union. Player agents are both agents of the players and representatives of the union in negotiating player contracts. You FAIL.
25, seriously. I mean no disrespect to these hard-working darkies. People have known for hundreds of years that the only thing a spear chucker is good for is manual labor and physical activities. Their brains are too tiny and their lips are too big to make them effective communicators.
13 - What does "pwned" mean?
It's a video gaming term. It was a mis-spelling from the text in Warcraft way back in the day of the word "owned". Cocky video gamers use it when one player dominates over another:
"You were pwned!"
HTH
13 - What does "pwned" mean?
It's a video gaming term. It was a mis-spelling from the text in Warcraft way back in the day of the word "owned". Cocky video gamers use it when one player dominates over another:
"You were pwned!"
HTH
27 - Sure, that's kind of true I guess. Well, it is if you replace the word "people" with "ignorant hicks like me", and "known" with "fervently wished".
That said, that still only makes it vaguely true. To make it 100% accurate you'd have to add "By the way: the person who wrote the above post is a bona fide retard" as a footnote.
You don't have to agree with me 27; I suspect though that you are a few shades darker than a lump of coal yourself. Since the sambo was plucked from the obscurity of the Dark Continent, he has been nothing but a plague on all law abiding, respectful white people. The Negro knows nothing of morals, self-denial and self-discipline and lives only to satisfy their lustful appetites for food, drink, narcotics and women.
Since poster 31 was plucked from the obscurity of the internet, he has been nothing but a plague on all law abiding, respectful netizens. The retard knows nothing of wit, humour, or englightened thought and lives only to remind us of the horrors of racially motivtated penis-envy.
Who cares? Are we now going to start examining substantive law? I can read Lexis for that. Now back to the scuttlebutt.
28,29 -- Please l2p, srsly
pwned (or better yet, p0wned) is not actually a mispelling of "owned."
It predates WoW to the original Warcraft game series and specifically refers to the competitive tactic of overwhelming an opposing online player using only the units known as Peons -- the weakest unit in the original game. The actual linguistic history of the term went like this, you go from "owned" to "Peon0wned" to "peowned" to "powned or p0wned."
It signifies not only beating another player badly, but that doing so did not even require the use of skill or superior weapons. While the meaning has gotten watered down through overuse, that's the origin.
This story is from last week.....Heaven forbid you post something on it then of *gasp* over the weekend
34 - WRONG.
13, 28, 29, 34, 36, The term started in the chess world and actually predates WoW and computers all together. The term "pawned" refers to when someone can checkmate their opponent using only pawns. All other similar terms are variations on this original. The first variation was "pwned" and then progressed from there.
1-37 = GULCer living in parents basement
38 = pederast
40 = NAMBLA 3L
39 = Yes
Is NAMBLA a school in Texas?
42 - no being a part of NAMBLA in Texas would probably get you killed.
37 is right.
Lets see now.
First, the TrailBlazers' position isn't "sign Miles, get sued" - it's "sign Miles for the purpose of harming us (by making us incur cap penalties and luxury tax payments) and get sued." There's a difference there (though the threat itself isabsurd, given the impossibility of proving motivation if Miles plays any minutes at all for his new team), and its the difference between an antitrust violation and something that's just a stupid PR move. Way to focus on the details.
As for the MLB story, Atlanta is not "refusing to negotiate in good faith" on a collective bargaining issue. They are refusing to negotiate with a particular agent based on experience with that agent establishing (in their minds) that the agent is not trustworthy. That's not a labor law violation
26, you're a fool, and therefore probably Edelman. The cases you're referring to speak to the union's authority to bar uncertified agents from negotiating on behalf of players, something the union can do without violating the Sherman Act because of the delegation principle you identify. The point you and Edelman (or you and you) are trying to establish is different, and unsupported by those cases. You are arguing by implication that if a team is barred from declining to negotiate with the union it is equally barred from refusing to negotiate specific player contracts with the specific player agents exercising union-delegated authority. There is nothing that says that. As long as the team does not attempt to negotiate with any players independent of their union representatives, they are free to ignore any specific player they wish on any basis including a distaste for the specific agent that player retained. That is not a refusal to deal with the union as any player they hire as a substitute will also be union represented and part of the same collective bargaining process.