Did Stern's ultimatum hurt the league's legal battle?

Did Stern's ultimatum hurt the league's legal battle?

The NBTA(?) has filed its court documents in the states of California and Minnesota in order to secure a favorable venue in which to attack the NBA. The court filing

The documents were emailed to me by a reader [thanks!], and I could immediately find them online, so I uploaded them to one of my websites, you can view them here:

Minnesota filing
California 1.1
California 1.2
California 2.1
California 2.1

I haven't thoroughly researched all documents, but the California 1.2 document spells out the players case fairly succinctly starting at point 26.

They first show that the NBA is in fact a monopoly. This seems fairly obvious, but it's certainly key to the anti-trust law suit.

They discuss the threats by the NBA to drastically lower wages and restrict working conditions up to four years prior to the CBA expiring, then discuss the NBA's follow through on that threat.

what is interesting is they continually say the NBA has failed to make concessions in negotiation which seems fairly laughable given the complaint notes the NBA tried to remove guaranteed contracts, but in a hard cap, and drastically lower revenue. Regardless of how bad the NBA's initial position was, they did lift the remove many of the restrictions mentioned in the complaint, so it seems somewhat silly to pretend they didn't negotiate at all.

The NBA move off rollbacks, non guaranteed deals, 37% BRI, and a hard cap. Yes those may have been fake positions, but the league moved very significantly from the time bargaining started so why are we discussing how they didn't move? Presumably a judge won't be fooled and also feel this looks ridiculous.

The one point they do strike over and over though is that David Stern gave them an ultimatum. He effectively ended collective bargaining by offering a take or leave it offer with the threat that any other offer would result in the NBA resetting its position to something considerably worse than what is on the table.

From a purely reasonable [ie, completely non legal and might be laughed at by an actual lawyer, but sounds good to me] stance, this would appear to be a fairly large flaw in the owners position. Unlike the NFL who's decertification was a clear sham. The players can certainly make the case that their dissolution of the union is legitimate and comes after an impasse in bargaining.

While the Norris LaGuardia Act may prevent the courts from putting in an injunction to stop the lockout, they don't prevent the courts from awarding damages if the NBA players legitimately want to dissolve the union, and the NBA has put them in a position where the union must accept the league's offer or the bargaining process is over making the players dissolution of the union not seem so fake. Especially if they are still under a trade association come July.

While both sides will still likely reconvene and create a collective bargaining agreement, if that doesn't happen, the players would seem to have a gained considerable leverage if the owners are to continue to lockout the players for a missed season. If a ruling goes against the owners in the summer then they could face 6.5 billion in damages [trebled actual damages of the 2.17 billion the players made last year].

Lets hope both sides pull their collective heads out their asses and get something done instead.

Comments

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  • Doug,

    I am an actual lawyer, although not a labor lawyer. I don't buy that Stern's ultimatum ended the bargaining. It was simply a misguided attempt at hardball. It would be different if he had threatened to cancel the season, since there was still time to play. But I think they can make a plausible case that the "reset" was necessary due to the lost revenue. Hardball doesn't equal the end of bargaining. If I were the judge I would wonder why the players didn't counter.

  • In reply to Tyler Soze:

    Hi Tyler,
    Stern told the players: negotiations were over, the NBA would not entertain any counteroffers, and if the players did not accept the NBA's proposal within a few days threatened to substitute a worse offer.

    Stern did indeed end the bargaining. And if you read the complaints from CA and MN this allegation is included. Specifically, in the CA Complaint (California 1.2 above) read paragraphs 1-8 and 50-58.

    Stern also did make repeated threats to cancel the season (and perhaps two seasons) as far back as 2007, this is also outlined in the complaints. See CA Complaint paragraphs 36-46.

  • Edward,

    Thanks. I did read the complaints, but I don't think it's as clear cut as the players would like. Stern had issued other threats and ultimatums before and still came back to the table. The players have consistently said that "all options" (including decertification) were on the table, and that they wouldn't take a bad deal just to save the season. In other words, both sides have indicated a willingness to walk away if they didn't get a deal they liked. It's a cliche in negotiations that the winner will be the guy who isn't afraid to walk away; they were both trying to show that they were that guy. I don't think that you can say the process broke down until 1) the owners canceled the season or 2) the players decertified/disclaimed; or maybe 3) the players made a formal counter-offer that was rejected.

  • In reply to Tyler Soze:

    I think the players lawsuits are in a much better position due to the fact that they actually (and somewhat naively) negotiated in good faiths for months. I also think a lot hinges upon the New York lawsuit and whether the judge grants the players motion to dismiss. The NBA went forum shopping with that premature and speculative lawsuit.

  • Stern did not issue an ultimatum. Quite simply, Stern told the players "This is the best we can possibly do" & it's true. He barely had enough owner votes to get that deal pushed through & he desperately wanted this whole mess to be over. I'm not a Stern supporter by any means, but understand that he's been in a precarious position during these tenuous negotiations. They players have taken this lockout personally, while the owners have done what they've always done, look out for #1. This personal disdain for not only Stern, but the majority of owners as well, has caused a grand canyon-sized rift between the two sides during negotiations. Sterns tactics may not have been the best but make no mistake, this was the BEST possible deal the players could get. Stern knew it & that's why he pushed it hard, sent emails to every player urging them to look it over & discuss it with their player reps. And with egregious lack of communication between Union leaders & the players they represent, this season was destined to be lost from the get-go. I'm just hoping & praying that multiple seasons are not lost if this lawsuit drags on.

  • Whoever is at fault, the NBA is quickly losing the casual fans. And the die-hards do not make them that billions they are fighting about. It is the casual fans. In 1999, there was the MJ effect and if both the owners/players don't realize this...the 50/50 split will be for 2 billion instead of 3 billion or whatever the amounts they are fighting for.

    If they lose a year or season or two, it might take probably five more years for them to get the amount of casual fans they had last year. Sometimes, people like Stern and Hunter have to leave it to the younger guys and be advisers rather than leaders. Being on top for too long makes them stale like Joe Paterno.

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