To: Attorneys All
From: Marc Edelman
Re: A Hearty Farewell

Dear Friends:

Today marks the end of my six-month externship as sports editor at Above the Law. On Monday, August 18, I will begin the next stage of my career as a visiting assistant professor at Rutgers School of Law in Camden, NJ. I will also continue my current affiliation with the Institute for Information Law and Policy at New York Law School.

During my brief stint as your sports law blogger, I enjoyed the opportunity to interact with many readers. To those of you that have reached out, thanks. It has been a pleasure to exchange ideas and share advice on breaking into the sports industry.

To David Lat, thanks as well for taking a leap of faith and inviting me, as an academic, to guest blog on your self-described "tabloid." I know not all of our experiments worked perfectly (see, e.g., Monday Morning Quarterback); however, more often than not, the readership survived their traditional and sensationalist worlds colliding.

For those wishing to stay in touch, the best way to reach me is via email at either MarcEdel at camden dot rutgers dot edu or Marc at MarcEdelman dot com.

All the best,
M.E.

P.S. For one final time ... take it away, Statler and Waldorf.

* * * * *
Marc Edelman is an attorney, business consultant, published author and professor, whose focus is on the fields of sports business and law. You can read his full bio by clicking here.

If you're a Biglaw associate, you probably know that feeling when all of your matters heat up at once. In academia, that feeling comes far less often. This week, however, there has been an unusual amount of movement in the world of sports law. Here is some of what is going on (and without even delving into Rudy Giuliani's son's lawsuit against the Duke Golf Team -- we may have more on that later -- or today's prison sentences for NBA referee Tim Donaghy's alleged co-conspirators).

Judge Places Marlins New Stadium on Hold

Although Miami-Dade Circuit Judge Jeri Beth Cohen was originally expected to rule this week in Norman Braman's fight to keep Miami-Dade County from building a new ballpark for the Florida Marlins (previous blogged about here), Judge Cohen announced that she would delay her ruling on one particular issue -- whether Article VII, Section 12 of the Florida Constitution requires a public vote before the county could pledge stadium bonds -- until the Florida Supreme Court announces its decision in a rehearing of an important case on the matter, Strand v. Escambia (PDF). With the Florida Supreme Court on recess until the third week in August, Marlins president David Samson is angered -- even if Judge Cohen eventually rules in the Marlins favor, the team may not have enough time to get their new stadium ready for Opening Day 2011. (Then again, a recent survey indicates more than half of Miami-Dade County residents would be upset if their tax dollars went to build this new stadium).

Bonds's Agent Renews Collusion Concerns

On the eve of baseball's all-star game last Tuesday, the agent for Barry Bonds renewed his concerns of collusion by MLB club owners (previously blogged about here). Bonds's agent Jeff Borris claims he recently offered Bonds' services to "numerous" clubs for the major league-minimum salary of $390,000, but there were no takers. It remains very surprising that not a single one of Baseball's thirty teams is interested in Bonds' services, especially now that Bonds's perjury case has been delayed until next year. Although a successful collusion grievance would require showing that club owners had a common understanding to boycott Bonds, MLB clubs should be mindful of language from Arbitrator George Nicolau's famous Collusion II ruling (decided Aug. 31, 1988) that explains "it is not one piece of evidence, but the evidence taken as a whole that tells us where a common understanding exists," and lack of offers where, in a free market, offers would be expected helps to prove collusion.

Read more -- about Oscar Pistorius, Brandon Jennings, and the Seattle Sonics settlement -- after the jump.

Miami-Dade Circuit Judge Jeri Beth Cohen is expected to rule this week in a trial between county taxpayer and former Philadelphia Eagles owner Norman Braman and the county itself, as to whether the county must put to referendum its plan to spend $347 million in taxpayer money to build a new baseball stadium for the Florida Marlins. The stadium initiative is part of a wider county spending package that is intended to rebuild much of Little Havana, as well as create a tunnel to the Port of Miami and a new streetcar system.

For those of you not following this case, in February 2008 the thirteen Miami-Dade County commissioners approved plans to build a new 37,000-seat, retractable-roof baseball stadium to induce Marlins owner Jeffrey Loria to keep his team in Miami beyond expiration of the club's 2010 lease (previously blogged about here). Although the deal only calls for Loria to contribute $155 million toward the new ballpark, it offers Loria full rights to all stadium revenues throughout the year, including permission to keep all proceeds from selling ballpark naming rights. Even when compared to most recent public-private stadium partnerships, this agreement is a sweetheart deal for Loria, an owner who never invested much of his own money into the team.

Last week, Braman argued in court that Miami-Dade County cannot approve this spending package without a public referendum for two different reasons. First, a recent Florida Supreme Court ruling in Strand v. Escambia County (PDF) (2007) holds that Article VII, Section 12 of the Florida Constitution requires a referendum on any property tax money pledged to finance bonds for a project extending beyond one year. Although funding for the new Marlins stadium technically comes from tourist taxes (and not property taxes), Braman contends this distinction is irrelevant because, according to him, Miami-Dade County is playing a "shell game" by shifting tourist tax funding for other projects to the stadium bonds, and then replacing lost funding from those other projects with property-tax money.

In addition, Braman claims the stadium project does not serve a paramount municipal purpose, as is required for public funding under the Florida Constitution. This claim relies heavily on the 1966 Florida Supreme Court decision in Brandes v. City of Deerfield Beach, which held that building a professional baseball stadium is not a predominantly municipal purpose. A more recent Florida Supreme Court decision, Poe v. Hillsborough County (1997), actually allowed public spending to build a football stadium for shared use between the Tampa Bay Buccaneers and various public high school teams. However, Braman, in a recent Miami Herald editorial, differentiates Poe because in Poe the funding was first put to public vote. (Note: one could also differentiate Poe because building that stadium benefited public high school football players.)

Read more, after the jump.

Three years ago, NBA member clubs and the National Basketball Players Association ("NBPA") got together and added a rule to their collective bargaining agreement that requires all prospective NBA players to wait a full year after graduating high school before entering the league draft.

The NBA's age / education requirement benefits just about everybody, except prospective NBA entrants and the league's fans. Under the rule, individual club owners get to scout young players for at least one additional year before deciding who to draft. Fringe veterans avoid competing for jobs against 18-year olds with raw talent. And, even the NCAA gets to squeeze a year's profit out of young men with no interest in otherwise attending college, such as Derrick Rose, Michael Beasley, and O.J. Mayo. (It is no wonder the NCAA filed an amicus brief in support of the NFL age/education requirements in the Clarett case).

Last week, however, one prospective college freshman, Brandon Jennings -- a young man from a poor family in Compton, CA -- decided that rather than provide free labor to the NCAA, he would seek to sign an overseas contract with a professional basketball team based in either Israel, Italy or Spain. Jennings also expects to sign a lucrative sneaker contract with a major American company in the near future -- something not allowed of college basketball players under the NCAA Principle of Amateurism.

If Jennings plays well abroad, he may be able to turn the future of the NBA's age / education requirement on its head. If he becomes a star, the NBA runs the risk that one of the more affluent international basketball clubs may begin to sign premier American talent to long-term contracts directly out of high school -- a result that may encourage some NBA owners to want to scrap the age/education requirement altogether. At the same time, Jennings makes NBPA executive director Billy Hunter look foolish, if not morally flexible, for agreeing to an age / education requirement that forces young adults like Jennings to fly over 5,000 miles just to practice their trade.

In a complete about face from his 2005 decision to accept an age/education requirement, Hunter last week told the Los Angeles Times that "I'm against [an age limit]. It's going to be a very big issue the next time we negotiate." Hunter's change of heart is critical, because, without the union's support, a court would likely find any NBA age/education requirement violates antitrust law.

As you may remember, the NBA did not have an age/education requirement from 1971 until 2005. That's why during this period players such as Darryl Dawkins, LeBron James, Kevin Garnett, Rashard Lewis and Kobe Bryant entered the league draft directly from high school -- an opportunity that is now denied to young players such as Jennings.

Read more, after the jump.

Yesterday, at 4 p.m. Pacific time, Judge Marsha Pechman was supposed to issue her ruling in City of Seattle v. Professional Basketball Club, LLC, regarding whether the City of Seattle could specifically enforce its lease agreement and require the Sonics basketball team to play in KeyArena through the 2009-10 season. After waiting more than an hour for Pechman's ruling, however, it was finally announced that the parties had privately settled the matter.

According to several published reports, the City of Seattle agreed to allow Clay Bennett's ownership group to get out of their lease, opening the door for the Sonics to immediately move to Bennett's hometown of Oklahoma City, OK. In exchange, Bennett will have to pay the city $45 million in immediate damages, as well as potentially an additional $30 million in future damages, if the Washington legislature authorizes at least $75 million in public funding to renovate KeyArena and the City of Seattle still does not obtain a new NBA franchise by 2013.

Bennett's ownership group will also have to leave the Sonics name and colors behind in Seattle -- something the group probably does not mind in the least.

An assessment of the settlement, below the fold.

Last week, the National Hockey League filed a counterclaim in the Southern District of New York, seeking permission to sanction Madison Square Garden, L.P. ("MSG") -- the parent company of the New York Rangers -- for violating the NHL Constitution by failing to follow league rules, including a rule against suing the league. According to an MSG spokesperson, the NHL's counterclaims are just "bullying tactics," intended to intimidate Rangers ownership into dropping its original lawsuit.

As some of you may remember, back on September 28, 2007, MSG -- through its attorneys, Jones Day -- filed a 35-page antitrust complaint, arguing that the NHL had acted anti-competitively by voting to implement a New Media Policy that required all teams to turn over control of their independent websites to the NHL. MSG contended that it uses the Rangers website "as a competitive tool to generate and maintain fan interest in the Rangers in competition with other NHL teams," and that by seeking to control competition in Internet and new media markets, "the NHL has become an illegal cartel."

Ironically, MSG has not sued the NBA, which for years has enforced a nearly identical policy. (Note: MSG also owns the NBA's New York Knickerbockers.)

MSG's antitrust lawsuit has already led to its share of rulings in favor of the NHL. First, on November 2, 2007, Judge Loretta Preska (S.D.N.Y.; the same judge from Cleary Gottlieb fame) rejected the Rangers' motion for a preliminary injunction against the NHL, finding that under antitrust law's Rule of Reason, "it is far from obvious that [the New Media Policy] has no redeeming value." On March 19, the Second Circuit affirmed her ruling. The Rangers have now proceeded toward a full trial on the merits.

This is not the first time that a professional sports club has sued a league under antitrust law for purportedly encroaching on club-based property rights. In the mid-1990s, the Dallas Cowboys, New York Yankees, and Chicago Bulls each brought separate antitrust lawsuits against their respective leagues for attempting to reallocate property rights. The Cowboys and Yankees claims involved the use of club trademarks for sponsorship purposes. Meanwhile, the Bulls' suit involved an attempt to limit the club's television broadcast rights. Ultimately all three cases settled out of court, although the Seventh Circuit first issued several rulings in the Bulls case. In none of these cases did the league then seek to punish the plaintiff club.

Here, the NHL is seeking the court's permission to vote on at least the following three sanctions: (1) fining Rangers ownership; (2) requiring MSG to sell the Rangers; and (3) terminating altogether the Rangers franchise. Although these remedies are purportedly each allowed by the NHL Constitution with a three-fourths vote of approval, actually enforcing the two latter sanctions would cross into nearly uncharted territory.

So, what are the NHL's chances of being allowed to impose these sanctions?

Find out, after the jump.

Two weeks after the start of Monday Morning Quarterback, and the Chicago White Sox collapse continues much as I had predicted (41-34 overall; 4-8 in last 12 games). The Twins are now within 1 1/2 games of first place in the AL Central (40-36). The Tigers are quietly inching back (36-39, 5 games out). And even the Cleveland Indians are within reach (35-41, 6 1/2 games out). I'm still sticking with Detroit to win the division.

Last week, most commenters strongly opposed my suggestion for the Yankees to move Joba back into the bullpen. On Thursday, Joba made a strong case for why our readers might be right, pitching 5 2/3 innings of one-run ball against the San Diego Padres. Even more impressive for the Yankees, Joba's outing was followed by 2 1/3 innings of one-hit ball from relief pitchers Jose Veras and Kyle Farnsworth, who then turned the game over to Mariano Rivera in the 9th.

With that said, here are the arguments presented in this week's brief:

1. K-Rod will set baseball's all-time single-season save record in September. Currently, Bobby Thigpen holds baseball's record for saves in a season with 57. K-Rod, who already has 30 in less then than half of 2008, will not only break this record, but he will break it with time to spare. It's not about K-Rod being baseball's best reliever (that isn't the argument, although he is probably no. 2). It has to do with the Angels having a great starting rotation that keeps the team in almost every ballgame. Plus, with K-Rod likely to leave the Angels as a free agent after this season, don't expect manager Mike Scioscia to feel the need to save his arm for the long-term.

2. Tiger Woods's injury is actually a good thing for the PGA Tour. Although many sports analysts think Tiger missing the rest of the PGA season is the worst thing that could happen to golf, Tiger's absence is only going to build interest in the world's best golfer, leading up to his 2009 return. Look for Tiger to return in 2009 with a ratings bang, as even many non-golf fans tune in to see if Tiger regain his old form.

3. Laurence Maroney will rush for more than 1200 yards this season. I know Maroney has never rushed for many than 835 yards in a season; however, the shoulder and groin injuries that plagued him for the first half of last season finally seem healed. As opposing defenses focus more on stopping the Patriots passing game, look for Bill Belichick to counter with more running plays, making this the year that Maroney really breaks out. A strong season from him will be the Patriots key to making another Super Bowl run.

So that's my opening brief. File your respondent's brief, or amicus brief, in the comments.

Baseball is America's national pastime. So is litigation. In recent years, the two have converged in the most obnoxious way, with fans suing each other for ownership of home run balls.

On Monday, the Florida Marlins received a subpoena for video footage from Justin Kimball, a 25-year-old fan who attended the team's June 9th game. According to Justin, on that day he caught Ken Griffey Jr.'s monumental 600th career home run in his wool cap, but the ball was ripped away from him by a fan identified only as "Joe." Joe, however, contends that he caught the ball in his glove.

Last Wednesday, Justin filed a motion in Miami-Dade court, seeking a temporary restraining order prohibiting Joe from selling the disputed baseball. Although Justin's motion was denied, he plans to continue litigating.

This is not the first time that grown men have fought over a baseball. In December 2002, a California judge in Popov v. Hayashi (PDF) ordered two men, each of whom claimed to own Barry Bonds's historic 73rd home run ball, to equally split the proceeds. In that case, Alex Popov, owner of a Berkeley, CA health food restaurant, brought suit against Patrick Hayashi, a software engineer from Sacramento. Popov alleged that he owned Bonds's baseball because he was the first to get his glove on the ball, and that Hayashi tore the ball from his glove during the ensuing melee. Hayashi argued that he was the first to have actual possession.

Read more about the law of history-making baseballs, after the jump.

[Ed. note: Welcome back for week two of Monday Morning Quarterback. As explained in the inaugural post, each week law professor Marc Edelman will make three bold claims related to sports. You can agree, disagree, or discuss, in the comments. Think of it as a weekly open thread about specified sports subjects. (Yes, there was some grumbling about sufficient legal nexus for this feature in the comments; but there's always grumbling in the comments, and pageviews don't lie. So, onward.)]

Last week, most commenters agreed that Paul Pierce is one of the NBA's toughest players and that Kobe Bryant should not have won the league's MVP. However, you disagreed that the Tigers would eventually overtake the White Sox in the AL Central.

Since then, the Tigers have gone on a six-game winning streak, including a three game sweep of the White Sox. My gut is the Tigers will keep going.

Here are this week's claims:

1. The Yankees Should Put Joba Back In The 'Pen. Forget the fact that Joba Chamberlain only allowed one run in six innings on Friday night; his value is greatest to the Yankees in the bullpen. Before the Yankees moved Joba into the starting rotation, they should have thought about their 1996 recipe for success. That season, the Yankees won the World Series despite mediocre starting pitching because Mariano Rivera and John Wetteland dominated games from innings seven through nine. In the 'pen, Joba is just as dominant as a young Mariano Rivera. However, as a starter, he is a question mark at best.

2. Even Without His Two Arrests, The Bears Should Have Cut Cedric Benson. Even if Cedric Benson was not arrested twice this off-season, Benson had no business competing for the Bears starting running back job. Last season, Benson averaged a putrid 3.4 yards per carry on 196 rushing attempts. Amongst starting running backs, only Warrick Dunn (3.2 yards/carry) was worse. With Benson finally gone from the team, the Bears could sign a proven free agent back like Travis Henry (4.1 yards/carry in 2007). Of course, Bill Swerski may still prefer the team hand the ball off to Mini-Ditka.

3. Phil Jackson Has Been No Zen Master In The NBA Finals. Although the Lakers took 2-of-3 games in Los Angeles, they blew a 24-point lead in Game 4 and another 19 point lead in Game 5. Doc Rivers made all kinds of adjustments to get the Celtics back into both games. However, Phil Jackson rarely had any answers. Jackson was lucky that the Lakers survived elimination last night. If the Lakers play as inconsistently in Boston, his team is toast.

So that's my opening brief. File your respondent's brief, or amicus brief, in the comments.

Last week, the Major Indoor Soccer League ("MISL") (disclosure: my employer for one summer) announced it was ceasing operations after seven seasons as a single entity. This comes as bad news for Game Plan LLC, the investment banking and consulting services group that helped MISL to restructure into a single-entity league during the summer of 2001, as well as for any startup league that is considering adopting the single-entity structure.

With last week's at least temporary collapse of the MISL, just about every single-entity sports league in America is now gone. Although the "single entity" concept was intended to turn niche-based professional sports leagues into profitable businesses, that result clearly has not happened.

The single-entity structure was first envisioned to allow sports leagues to act unilaterally without risking liability under Section 1 of the Sherman Act. Because the single-entity structure consists of a single limited liability company and investors that purchase shares in this company, the structure's purported advantage is that investors could not be found guilty of illegally colluding with one another by unilaterally setting league ticket prices, player salaries, or league entry rules. This is because the clubs are wholly-owned subsidiaries of the league. As a matter of law, a wholly-owned subsidiary cannot collude with itself.

Beyond this purported legal advantage, the single-entity league is also believed by some to have certain business advantages.

Read more, after the jump.