The Indemnity Agreement: What Does It Truly Say?
Ben Frederickson, writer for the St. Louis Post Dispatch, uncovered the indemnity agreement that Stan Kroenke signed to gain permission from the NFL Commissioner, Roger Goodell, and the other thirty-one owners. The indemnity agreement was one page long, and Stan Kroenke is facing hundreds of millions in legal fees alone. All thirty-two teams in the NFL are defendants in this lawsuit St. Louis and the other plaintiffs brought. Stan Kroenke is trying to bring an action against the other owners, and as stated in the indemnity agreement, should he do so, Commissioner Goodell would rule upon this. He argues the word “costs” does not apply to him paying all the bills in this lawsuit for all thirty-two clubs, although his net worth alone is around $7 billion, according to Forbes.
The other 31 owners argue the opposite. New York Giants owner John Mara stated in Seth Wickersham’s article about a month ago that if it was not for that clause, the owners would not have agreed to let Kroenke move to Los Angeles. Stan has a legitimate chance, the NFL drafted this clause, and normally, the wording in an ambiguity is construed against the drafter. As crazy as this may sound, St. Louis, the CVC, and the RSA may want Kroenke to prevail in this action. As earlier mentioned by AJ Perez from FrontOfficeSports.com, Kroenke offered to settle with the plaintiffs for $100 million. However, should he prevail in an action against the other NFL owners, he does not have to pay their lawyer fees, and other “costs” that go along with it.
Although Stan Kroenke “won” that battle against the NFL, it also means he has more money in his pockets the St. Louis side could go after. Dan Wallach and Dan Lust brought up an interesting hypothetical on their podcast, “Conduct Detrimental.” They said that if Kroenke is not on the hook due to the ambiguity within the indemnification clause, the plaintiffs may pursue him not only for the money and franchise he took from St. Louis, but they could use his money to get an expansion team. They could pressure him into funding the expansion team, saving St. Louis and its residents millions, if not billions, in tax dollars. This is an interesting side topic within this almost five year legal saga. Personally, I want Stan Kroenke to win this argument. This lawsuit has the other clubs in it to strip them of their gains from when the Rams relocated. The relocation cost was $550 million, so it averages to around $37.5 million per team in restitution damages.
Kroenke’s payments are more severe. He would not only pay the $37.5 million, but all damages determined by a St. Louis jury or a pre-trial settlement. If he is offering to settle at $100 million already, he knows he is on the hot seat. These damages could range from $8-$12 billion.
Alex Patterson is a 3L at Thomas M. Cooley Law School in Lansing, Michigan. He played football for seventeen years as an offensive and defensive lineman. He graduated from Lindenwood University-Belleville in 2018 with a Bachelor's in Sports Management. He can be followed on Twitter @alpatt71.