Legal experts expect NBA dispute to be settled outside of courts
By Michael Lee,
The NBA moved toward a possible “nuclear winter” this week when a breakdown in collective bargaining negotiations resulted in the players’ union disbanding, players filing two separate antitrust complaints against the league, and the loss of the 2011-12 season becoming more of a possibility.
While many legal experts believe NBA players may be in a better position to succeed in the courts than their NFL counterparts — who also filed an antitrust lawsuit this past summer before eventually coming to terms on an agreement — few think this labor dispute will be settled in a courtroom.
“This is a tactical gambit, a tactical maneuver for leverage,” said Andrew Zimbalist, a professor of economics at Smith College who has written several books on sports economics. “I don’t think anybody thinks this case is going to be litigated through to a final conclusion.”
David Boies, the attorney hired by the players to handle the case involving Carmelo Anthony and Kevin Durant in the Northern District of California, said on Tuesday that he would hope the owners would decide to settle rather than engage in a lengthy court battle that could last for a few years and result in the players receiving damages in the form of three times any lost wages sustained because of the lockout.
“Settling the lawsuit would not give you a collective bargaining agreement, but it would open the way to games being played and it might be a pathway by which an overall resolution could be reached,” Boies said.
The NBA Board of Governors held a conference call on Thursday with the league’s 30 owners to offer an update on the negotiations and the litigation. The NBA filed a preemptive lawsuit in the Southern District of New York, claiming the players intended to take this path all along. NBA Commissioner David Stern called the move by the players’ union an “irresponsible action.”
Robert Boland, a professor of sports business who specializes in antitrust law and collective bargaining at New York University, said the danger in trying to have the labor dispute settled by antitrust law is that the case could be appealed many times before it is finally resolved. He added that all three lawsuits — including the Minnesota complaint involving Caron Butler — could eventually be merged and argued in New York.
“It’s like a wrestling match,” Boland said “Settlement will depend on who can score on multiple successful takedowns. If you lose one takedown, you can always appeal. But if you’re out of effective appeals, then one side or the other will have to capitulate. But my sense is, if both sides are willing to take it this far, I don’t think the first judgment will end things.”
For that reason, Boland believes that the 2011-12 season will most likely be lost.
Gary Roberts, a sports law expert at the Indiana University School of Law in Indianapolis, agreed. He predicted in the summer of 2010 that the NFL would settle in August (it settled in July), and felt that the NBA’s problems were too massive to get resolved without sacrificing a full year.
He felt Stern had too many owners pushing for substantial changes and National Basketball Players Association Executive Director Billy Hunter had too many player agents pushing to keep the old system close to intact.
“When you understand all the key participants are on both sides and the political pressures that Stern and Hunter have to live with, then you look at the broken business model. It’s just very predictable that this is not going to get done this year,” Roberts said.
The lawsuit filed in California alleges that NBA officials informed Hunter in June 2007 — two years after the sides had negotiated its last collective bargaining agreement — that it intended to “substantially reduce” the players’ share of basketball-related income and impose more restrictive salary-cap limits. It also claims Stern and Deputy Commissioner Adam Silver told Hunter that if the players were unwilling to accept the terms, the league was “prepared to lock out the players for two years to get everything” the owners sought and that “the deal would only get worse after the lockout.”
Several agents had pushed for the union to decertify for months, but Hunter elected to file a disclaimer of interest on Monday, which meant the dissolution of the union, thus allowing the legal process to move quicker. Hunter claimed he was forced to move in that direction after Stern said negotiations on the last proposal, which included a 50-50 split of revenues and restrictions on high-spending teams, were over.
“So Stern made it quite easy for the players at this point,” Zimbalist said, adding that NBA players perhaps have a stronger argument than NFL players, who decertified shortly after being locked out and before the collective bargaining negotiations had fully developed. “Am I optimistic on behalf of the players that they can actually take this to court and win it and get triple damages? No, I’m not.”
Hunter and union President Derek Fisher can no longer negotiate on behalf of the players, but the lawyers for both sides could come together and hold discussions and possibly reach an antitrust settlement.
“It’s anybody’s guess, of course,” Zimbalist said. “But my own hunch, if I have to make one prediction: I think they’ll be playing sometime in late January. They are going to go through some huffing and puffing and some grandstanding because one side flexed its muscles and the other side can’t cower. They can’t back off. They are going to both flex muscles for a bit and then I think we’ll get back to bargaining and the owners will make an offer that’s a little bit more generous than the one the players rejected.”