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  • Permission To Interview? Discrepancy Between Pro and College Hiring Process

    Part of what makes sports so special and different from almost every form of entertainment is the element of hope. Even if you’re team is buried in the standings, there’s always optimism for next year and the hope that a championship is coming down the road. But over time, if the results aren’t there and the losses continue to add up, change becomes inevitable and new leadership is necessary. All the hope for the present turns into hope for the future and fans begin to wonder what great coach or GM their team can hire to turn things around. Over the past few months, we’ve seen some moves on the coaching front that have made national headlines. In college football, 28 schools have hired new head coaches so far in one of the craziest “coaching carousels” we’ve seen to date. USC, a historical powerhouse that has lost its elite status recently, was able to pry Lincoln Riley away from another blueblood in Oklahoma. After firing Ed Orgeron less than 2 years removed from a national title, LSU poached Brian Kelly away from Notre Dame, one of if not the biggest brands in college athletics. Did Oklahoma or Notre Dame have any way of knowing that USC and LSU respectively were coming after their coaches? No, and the reasoning for that is that hiring process in college sports doesn’t abide by the same formalities that they do in pro sports. This came to light by recent news coming out of the New York Mets quest to fill their out coaching staff for their new manager, Buck Showalter. Reports from the Athletic’s Ken Rosenthal over the past week stated that the Mets were denied permission to interview Padres Quality Control Coach, Ryan Flaherty and Giants Co-Pitching Coach, Andrew Bailey for their vacant bench coach position. In Major League Baseball, teams are required to “ask permission” to interview coaching and executive positions. Normally, when it involves a promotion (i.e. a bench coach interviewing for a manager or an Assistant GM interviewing for a GM), a team will grant the rival team the right to interview. But they don’t have to. Because we are past the “normal” hiring cycle in the MLB offseason, the Padres and Giants decided not to grant the Mets the permission to interview their respective coaches. Even though the Mets were offering what would be a promotion for both Flaherty and Bailey, MLB rules permit a team from blocking another team from interviewing their staff members if they are under contract. If this were in the NFL, the Padres and Giants would not be allowed to deny the Mets this permission. Current NFL rules state that a team can only block a candidate from interviewing for a position that would be a lateral move and cannot stop assistant coaches from interviewing for a position that would be a promotion. MLB is able to do this mainly because of their antitrust exemption it’s had since 1922’s “Federal Baseball Club of Baltimore, Inc. v. National League of Professional Baseball Clubs” case. While Flaherty and Bailey haven’t released public animosity towards their current employers from blocking them the opportunity to advance in their coaching careers, many around the game believe they would’ve jumped at the opportunity to head to New York. Flaherty played under Buck Showalter in their time together in Baltimore and Bailey would’ve returned closer to his home roots while working under new GM Billy Eppler, who gave him his first coaching opportunity a few years ago. All of this goes to show just how different the hiring process is between college sports and professional sports. Baseball’s antitrust exemption is widely believed to be outdated and could be in danger moving forward. If a coach sees a better opportunity for their careers, themselves, and their family, they should be able to take that opportunity. Oklahoma and Notre Dame couldn’t block Lincoln Riley and Brian Kelly from interviewing for another job, and maybe that’s the way it should be. If the buyout language is clear and honored, a coach, just like any of us, should be able to advance in their chosen profession.

  • Topps Takes Gamble, Purchased by Fanatics for $500M

    Cards. You gotta know when to hold ‘em, know when to fold ‘em. Not many days long after the clock struck midnight in 2022, Fanatics struck a deal of their own with Topps, a company synonymous with baseball cards and baseball history, as reported by Forbes, ESPN, Sportico and more. They bought the company for a price tag of $500 million, along with Topps’ expiring license to exclusively produce trading cards with Major League Baseball logos and trademarks. Topps has an extensive 70-year legacy as the manufacturer of baseball cards dating back to 1949 when they released a set of “Magic Photo Cards” in their bubblegum packs, in which images appeared on cards when exposed to water and light. These cards showed now-historic greats, such as… “The Sultan of Swat, The King of Crash, The Colossus of Clout, Babe Ruth, the Great Bambino!” Fun fact: Sandlot director, David Mickey Evans, was born in 1962. In case you need a reminder of how long traditional baseball cards have been around, remember that they pre-date the creator of one of the most iconic baseball movies of all time. Fast forward through rosters upon rosters of players, the historic sales of highly valued cards and the proliferation of the digital age, there now exists a thorough history with Major League Baseball and Fanatics to unpack, much like that of a newly released Topps Annual Set. 1951-1952: Topps Produces and Releases the First Full Set of Baseball Cards Until 1952, Topps had only released single baseball cards at a time, never a full collection. The first annual set released in 1952 featured 407 cards in total that were released in batches. Through the present day, this annual set has become a staple for collectors with each passing season. These anticipated sets continued to grow in popularity and caused people to fall in love with collecting baseball cards and of course, the game of baseball. “Generations of baseball fans have grown more connected to the game through collecting baseball cards. We look forward to partnering with Topps to restore baseball cards as the game’s premiere collectable.” -Bud Selig January 2010: Topps Granted Exclusive MLB License Topps was granted the exclusive rights to produce baseball cards featuring Major League Baseball logos and trademarks. Reports of this exclusive license started circulating in the summer of 2009 with the exclusivity starting on January 1, 2010. This made Topps the first exclusive multi-year license holder of MLB intellectual property to be reproduced on baseball cards, stickers and other collectibles. The duration of the license was never disclosed. Why give exclusivity to one brand? Then-Commissioner Bud Selig wanted to give Topps market exclusivity, effectively shutting out other competitors in the market, such as Panini and Upper Deck: “Generations of baseball fans have grown more connected to the game through collecting baseball cards. We look forward to partnering with Topps to restore baseball cards as the game’s premiere collectable.” It was speculated that having kids peruse shelves with baseball cards from multiple brands would confuse them as early consumers of the sport. Exclusivity over league intellectual property wasn’t unheard of in this time, as Panini and Upper Deck worked on deals with the National Basketball League and the National Hockey League, respectively. Important thing to note is that Panini and Upper Deck still held licenses with the MLB Players’ Association, which means they could use player imagery but not MLB trademarks, now held exclusively by Topps…or well, let’s keep going with this storyline. March 2013: MLB Extended Topps’ Exclusive License The exclusive license that Topps acquired in 2010 was extended through 2020 in an effort for consistency and long-term business goals. Their venture as an exclusive licensor was comparatively short, but substantially lucrative. Mark Sapir was quoted on Cardboard Connection Radio during a 2013 Sports Industry Summit, “Having a long-term deal and a long-term partnership allows you to invest in the business and plan the business." The impact that baseball cards had on the league’s revenue and its players’ income would be revealed soon enough. April 2013: MLBPA Pays Players Their Licensing Income Previously Withheld During Labor Negotiations The union disclosed the disbursement of licensing-related income withheld from players over the course of their most recent labor negotiating cycle in 2011. Their next annual report to the U.S. Department of Labor showed large increases in revenue for licensees, such as Take-Two Interactive video game developer for MLB 2K, Majestic licensed apparel company, MLB Advanced Media and last but not least, Topps. Topps brought in $9.6 million over the 2012 fiscal year to be distributed amongst players in the form of “special dues refunds” that are usually held out in between labor deals. July 2018: Topps’ Exclusive Rights are Extended (Again) Profits and check distributions continued for all parties involved, and MLB once again extended Topps’ exclusive license. This time, through 2025; or so they thought. 2020: Topps Reaches a Record Year In Sales Topps saw a record year of sales, totaling $567 million. This 23% increase in sales resulted from a change in e-commerce and overall digital strategy amidst preparations to enter the world of non-fungible tokens (NFTs). April 2021: Topps Announces Plans to Merge with Mudrick Capital Acquisition Corporation II Valued at about $1.3 billion by Mudrick Capital, Topps was expected to merge with Mudrick late in the second quarter or early in the third quarter. Topps president, Michael Brandstaeder, is quoted “The strategies we have implemented in recent years, including building a digital business that has deepened consumer engagement, have driven excitement and innovation across Topps, fueling strong and increasing revenue with accelerating profitability. The future for Topps has never been brighter, and, with a talented and dedicated management and employee base, we are excited for the road ahead.” Jason Mudrick, founder and Chief Investment Officer of Mudrick Capital is quoted alongside him, “[Topps] is well situated with a universally recognised brand to capitalize on the fast emerging market for collectible NFTs. We are excited to partner with this exceptional organization to help write the next chapter in the long history of its truly iconic brand.” The mutually-beneficial merger was predicted to more than double Topps’ valuation from $1.3 billion to $2.7 billion. A huge reliance of that valuation was that Topps’ would maintain its licensing deals with Major League Baseball and the MLB Players’ Association. August 2020: Fanatics Buys Exclusive Trading Card License from MLB Fanatics worked a behind the scenes deal with Major League Baseball to become the exclusive licensee for baseball trading cards after Topp’s license was set to expire at the end of 2025. That means that starting January 1, 2026, Fanatics would own the exclusive rights once held by Topps for more than a decade at that point, and a right that they held onto for decades prior. Topps’ similar license with the MLBPA runs through the end of this year. Topps claims that they were not aware that this deal was happening until the headlines were about to surface on our smart devices. In an official statement by Andy Redman, executive chairman of Topps, and as reported by the New York Times, “[we were] unaware that Major League Baseball was negotiating with anybody other than Topps regarding our rights beyond 2025.” Topps and Mudrick Capital promptly called off their merger. Without holding the MLB license past 2025, Topps would not be able to produce the very baseball cards that made their business blossom over the decades. Knowing that their MLB license had an ending date, Topps’ future was in question. September 2021: New Fanatics Trading Cards Company Valued at Over $10 Billion After acquiring the future title to MLB intellectual property, Fanatics raised $350 million for their new trading card business in a Series A funding round. This round of investments brought their new company, Fanatics Trading Cards, at a valuation of $10.4 billion before even producing a single card. January 4, 2022: Fanatics Buys Topps At a Price Tag of $500 Million On January 4th of this year, the inevitable happened. Fanatics announced that it would be purchasing Topps for $500 million. With this purchase, they have acquired Topps’ entire sports and entertainment department and with it, the remaining years of their exclusive MLB license and the final year of their MLBPA license. Fanatics now can start producing and distributing trading cards using MLB logos and trademarks now instead of waiting until 2025. Not only did they acquire Topps’ intellectual property, but Fanatics now owns the human capital that Topps once had, specifically employees of various tenures at Topps. Per ESPN, all of the approximately 350 Topps employees will shift over to Fanatics Trading Cards. Michael Rubin is full of optimism in Fanatics’ future, as if it were ever in question before acquiring Topps. His statement announcing the purchase is quoted in CNBC: “With trading cards and collectibles being a significant pillar of our long-term plans to become the leading digital sports platform, we are excited to add a leading trading cards company to build out our business.” The sweet crumbs left in this Fanatics’ fairy tale are the leftover candy and gift cards divisions still in Topps’s ownership. Even with crumbs there, it’s questionable if Topps might ever find its way back to home plate. Moving Forward This entire saga, having ballooned significantly since Fanatics announced its eventual license to be the exclusive trading card producer of Major League Baseball in August, is an example of how valuable exclusivity and intellectual rights are for a brand to create, distribute and sell licensed products that consumers love. Just before losing their license with MLB beyond 2025, Topps was valued at $1.3 billion. Topps was purchased by Fanatics for $500 million, over half than less what they were valued back in April by Mudrick Capital. When Fanatics acquired the rights in a backdoor deal with the league, Topps’ brand became obsolete. I don’t mean to burst their bubblegum, but their standing as a baseball card company was well-known and celebrated. You, the reader, most likely look at a Topps baseball card differently than you would a piece of Bazooka bubble gum. Topps did not know that Major League Baseball was considering passing off the exclusive rights to another party. It was a gamble that Topps didn’t start negotiating to extend their rights as they had done twice in the last near-decade before negotiating a merger with another company. If I learned one thing in 1L property: it’s that nothing lasts in perpetuity. It’s hard to not feel bad for Topps when you consider the power dynamics of an e-commerce behemoth taking away intellectual property rights that transformed what was once a family-owned candy store in Brooklyn to a top, global licensor for a major sports league. On the other hand, it may have been the most strategic move that Fanatics has made in recent years. Instead of buying out Topps outright, they acquired the license that made them valuable. When Topps lost their value, Fanatics was able to sweep in and buy them out at a discount. So now, not only does Fanatics have a league license for baseball cards years ahead of schedule. From an outsider perspective, they have the human capital needed to transition themselves and win loyalty from longtime Topps consumers: creative individuals previously working for Topps who’ve made these cards so successful over the years, relationships with manufacturers, printing machines and everything that went into a 2.5” x 3.5” card. Some still say they’ll never buy a baseball card with a Fanatics logo where a Topps logo should be. Others see potential for Fanatics to bring baseball cards into the future, namely through NFTs. And it’s an added point on where intellectual property is needed as new digital ventures open a wild, wild west. A big motivator for Fanatics to purchase Topps right away is for them to develop baseball cards in the booming NFT and crypto space through their digital collectible arm, Candy digital. On January 13th, Candy Digital announced the opening of its secondary marketplace for Major League Baseball NFTs. That marketplace opened to consumers on January 15th, as announced by Fanatics and Candy Digital social media. Who knows what’s next for licensed MLB trading cards, physical and digital alike. Baseball Cards. Topps didn’t fold them. Rubin now holds them. ______________________________ Andrea is a FLEX-2L at the Elisabeth Haub School of Law at Pace University and the President of the Pace Sports, Entertainment and Arts Law Society (@Pace_SEALS on IG and Twitter). She is in her third season as an Email Marketing Coordinator at BSE Global for the Brooklyn Nets, Barclays Center and Long Island Nets. Prior to BSE, she spent over a year at Steiner Sports Memorabilia before they were acquired by Fanatics in June 2019. You can find her on most social media channels as @dreagarcia21.

  • Edmonton Oilers May Have Consequences If They Sign Evander Kane

    Evander Kane, once a prolific player for the Buffalo Sabres and the San Jose Sharks, is facing legal issues after his gambling issues forced him into bankruptcy, per the Edmonton Journal and other sources. The Sharks originally waived him, which meant he was placed on waivers for any team to claim him, and no team did. The Sharks sent him to their minor league affiliate. After a few months there, the Sharks outright released him after he violated the NHL’s COVID protocols for a second time this season. The Edmonton Oilers want to sign him, but he could be facing legal issues as he needs to cross the border from the United States into Canada. Mr. Kane’s controversies and legal issues include assault and harassment, gambling debts and bankruptcy, NHL game betting, domestic violence, as well as multiple violations of NHL COVID-19 protocols. Mr. Kane was a prominent player with the Buffalo Sabres before they traded him to the San Jose Sharks. Going back to his issues with the NHL’s COVID protocols, the league suspended him for 21 games to start the 2021-2022 season for submitting a fake vaccination card. The straw that broke the camel’s back in San Jose was his subsequent transgression of crossing the border without proper medical clearance on December 29th, and this lead to his contract termination with the Sharks. Now, the Edmonton Oilers expressed interest in Mr. Kane. They want another winger to complement their dynamic duo of Connor McDavid and Leon Draisaitl. Oilers general manager Ken Holland believes Mr. Kane deserves a second chance in the National Hockey League, but this would be his third team should the Oilers decide to sign him. Also, Canada’s government is stricter about COVID than the United States. For example, the Canadian arenas either allow a partial crowd or no crowds at all where the majority of the arenas in the United States are allowing full capacity. Regarding Mr. Holland’s statement about Evander Kane earning a second chance, one could argue his second chance came in Buffalo, and his third and fourth came in San Jose. This would be his fifth chance to prove he is not the gambler who blows all his money at parties and other events. His wife is demanding money from him, and he has shown that off the ice, he is a troublemaker. Although his on the ice skillset is fantastic, it is the off the ice character that is dragging him down from another NHL pursuing him. With his talents, another team would have grabbed him off waivers, but due to his character they did not. This is similar to the Antonio Brown saga in the NFL. Both athletes are great at their respective sports, but their off the field/ice personalities hinder their presence on a team and within a locker room. 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.

  • Mohamed Sanu Wins $1.1 Million Arbitration Award Against Fantex

    On November 21, 2021, 49ers’ wide receiver and NFL veteran Mohamed Sanu was awarded $1,147,593.60, resulting from a JAMS arbitration proceeding against Fantex. Last month, Sanu filed a petition in San Francisco County Superior Court to confirm the arbitration award and enter a judgment thereon. The arbitration was entitled: Fantex Inc. v. Mohamed Aasin Sanu, and related Counterclaims, JAMS Arbitration No. 1100107319 (Hon. Jay Gandhi (Ret.) presiding). The Arbitration Hearing was conducted over three days, on June 25, June 28, and July 2, 2021. Fantex was launched in 2013, providing a unique investment opportunity to sports fans: the ability to buy and sell stock in individual athletes. The year Fantex was founded, Mohamed Sanu was selected in the third round of the NFL draft to play wide receiver for the Cincinnati Bengals. Sanu was the third athlete to sign a brand contract with Fantex. Only Vernon Davis and EJ Manuel had deals with the company before him. Sanu signed in May of 2014; a $1.6 million fee to Sanu in exchange for a 10% equity stake in Sanu’s future brand-related earnings. In November 2014, Sanu’s initial public offering went up and fans could officially “trade” his stock. Sanu spoke with Fortune.com about his vision and taste for business: “Definitely, Fantex is part of that, because I’m using football as my platform to catapult myself into business and learn more about business. I want to be a successful businessman outside of football. I’ve done being a successful football player, but I’m just learning about how business works. Even doing interviews like this, and talking to other business owners and picking their brain, learning how they established themselves, how they got started… You have to be real gritty with things like that, you need the determination to learn these things.” Player stock prices mirrored their on-field production or popularity. This was a novel and creative idea from Fantex, though one that didn’t work out long-term. Sanu’s stock started at about $10 a share. After he posted career-highs in catches (56), yards (790) and touchdowns (5) in 2014, the stock rose to $13 a share. According to the Arbitration decision, though Fantex sold 164,300 Sanu shares at $10 per share, the IPO failed to raise the amount necessary to pay Sanu under the Brand Agreement. Instead, as disclosed in Fantex’s Prospectus, certain Fantex directors entered into standby purchase agreements to purchase up to approximately 59% of the Offering, thereby raising the remainder necessary to pay Sanu and close the deal. That day, Fantex paid Sanu the $1,560,000 purchase price pursuant to the Brand Agreement. Overall, Fantex signed contracts with eleven athletes and completed six IPOs worth a total of $25.8 million. However, in August 2016, the company closed its platform to individual investors, and in March 2017, the company's CEO and co-founder, Cornell French, left Fantex. Sanu stopped paying Fantex 10% of his future brand income in January 2019. On October 28, 2019, Fantex filed a demand with JAMS. Fantex claimed Sanu breached the parties’ Brand Agreement by failing to continue making brand income payments after January 2019. Fantex sought an accounting and payment of what Sanu owed under the Brand Agreement to that point. Sanu filed his counter-claims on November 4, 2019. Sanu claimed Fantex (1) breached the Brand Agreement by shutting down the Platform in August 2016; (2) breached the covenant of good faith and fair dealing by refusing to factor the shutdown of the Platform into negotiations with Sanu to terminate the Brand Agreement; and (3) fraudulently induced Sanu into entering the Brand Agreement with promises of endorsement deals. Sanu also alleged Fantex violated California’s Miller Ayala Athlete Agents Act. On the heels of Fantex's trading shutdown, Sanu attempted to terminate the agreement between the parties. The parties could not agree to mutually satisfactory terms. Sanu was aggrieved that he was obligated to pay 10% of his future earnings in perpetuity to Fantex, without the benefits of the trading platform. Litigation followed. According to the Arbitration decision, Fantex contended that Sanu breached his contractual obligations by refusing to continue payments to Fantex and sought its percentage of the remainder of Sanu’s earnings owed to date. Sanu believed the benefit for which he bargained no longer existed and that he was deceived into signing with Fantex in the first place. Sanu sought the nullification of the Brand Agreement and a return of the monies paid to date or, at the very least, a finding of no further obligations owed. Arbitrator Gandhi held the following: “[O]ne must give due credit to the Brand Agreement as written and the parties’ course of conduct surrounding that contract. Accordingly, in the face of Sanu’s contractual and fraudulent inducement claims, the law and the evidence support Fantex’s position. Equally, one must give due credit to the Miller-Ayala Athlete Agents Act (the “Act”) as written and the parties’ course of conduct surrounding that Act. The Act is a broad and sharp statute enacted in California to govern athlete agents and protect athletes. While, for instance, Fantex may assert that it engaged in holistic brand advancement only, Fantex’s internal records, among other things, exhibit that Fantex acted “on [Sanu’s] behalf” to secure particular endorsement deals, including a “paid appearance” – conduct within the purview of the Act. That evidence and similar evidence cannot be lightly cast aside. The Arbitrator is understanding of Fantex’s viewpoint. The Arbitrator is mindful that any line crossing of the Act may seem unintended, or de minimis, or unequal. In the end though, on this specific record, including the entirety of the factual circumstances here, Sanu’s position that Fantex ran afoul of the Act is supported by the law as written and the proffered evidence. In the end, the Arbitrator is bound to follow both.” The Final Award thereupon declared that: “As a result of Fantex’s violation of the Act, Sanu [sought] a finding that the Brand Agreement is null and void, .... Sanu is entitled to the remedy he seeks pursuant to Section 18897.9 of the Act. [ .... ] Accordingly, the Brand Agreement is void and unenforceable.” Sanu successfully claimed that Fantex acted as an athlete agent under the Miller-Ayala Athlete Agents Act. Cal. Bus. & Prof. Code § 18895, et seq. The Act is a quasi-criminal statute that encourages private litigants to protect their interests in the face of improper or unethical contracts involving professional athletes. Cal. Bus. & Prof. Code § 18897.8. Specifically, Sanu pointed to examples of Fantex’s interactions with third parties and contended that Fantex promised, offered, attempted, and negotiated with potential endorsers to obtain endorsement contracts for Sanu in violation of the Act. Fantex argued the Act is not applicable to the relationship between Fantex and Sanu because the Brand Agreement and Fantex’s relationship with Sanu did not meet certain contractual definitions described in the Act. According to the Arbitration decision, the reasoning for the final award is summarized by the following: “As a result of Fantex’s violation of the Act, Sanu [sought] a finding that the Brand Agreement is null and void, as well as a return of the monies paid by Sanu to Fantex in the amount of approximately $1,970,000. Sanu is entitled to the remedy he seeks pursuant to Section 18897.9 of the Act. Bus. & Prof. Code § 18897.9(a) (“Any agent contract that is negotiated by an athlete agent who fails to comply with this chapter…is void and unenforceable.”). The Arbitrator has found that Fantex acted as an athlete agent and that the Brand Agreement was an agent contract under the Act’s language. Accordingly, the Brand Agreement is void and unenforceable. The parties should return to the financial state in which they found themselves prior to execution of the Brand Agreement. Fantex must return the amount paid by Sanu to Fantex during the life of the Brand Agreement. Similarly, Sanu must return the amount paid by Fantex to Sanu in connection with the Sanu IPO.” The Arbitrator also awarded $533,775.00 in total attorney’s fees to Sanu’s counsel for services relating to this matter and $203,818.60 in costs. Sanu is currently on injured reserve and is questionable to return for the 49ers' divisional round playoff game against the Green Bay Packers. Jason Morrin is a third-year law student at Hofstra Law School in New York. He is the President of Hofstra’s Sports and Entertainment Law Society. Additionally, he is a Law Clerk at Geragos & Geragos. He can be found on Twitter @Jason_Morrin.

  • Michigan Reaches $490 Million Settlement With Robert Anderson Sexual Abuse Survivors

    The Athletic’s Austin Meek reports more than 1,000 survivors, who were sexually abused by former Wolverines doctor Robert Anderson, reached a $490 million settlement. Dr. Anderson became the official Wolverines team doctor in 1966, three years before the school hired Bo Schembechler to be the football team’s new head coach. An alleged victim is Coach Schembechler’s son, Matt Schembechler. $460 million will be dispersed among the 1,050 sexual assault survivors that came forward, and the other $30 million will be saved to be handed out to future sexual assault victims that come out and say they were abused by Dr. Anderson. Meek in a separate article wrote the school’s officials failed to heed these warnings, and many sexual abuse victims were athletes, and Dr. Anderson abused them during their annual physicals that were required by the athletic department. The student-athletes were afraid to report his behavior because they thought if they reported his actions, they would lose their scholarships. Others expressed discomfort with his examinations, but school officials dismissed those concerns. The report mentions three different occasions in the 1970s and the 1980s when Wolverine football players brought these issues and concerns to Coach Schembechler, which was added to a previously documented conversation Coach Schembechler had with a student broadcaster in the early 1980s about Dr. Anderson possibly sexually abusing Michigan student athletes. Every time this issue was brought up to Coach Schembechler or other Michigan officials, they refuted it and shot it down. Who knows how many student athletes were sexually abused by Dr. Anderson during his tenure as the head physician at the University of Michigan from 1966 to 2003, but I commend the students who had the guts and courage to bring their experiences then and now. No monetary amount will erase the pain and embarrassment they suffered from Dr. Anderson’s actions and the school turning a blind eye to the program. The school relied on their football program to bring in revenue, especially when Bo Schembechler coached there from 1969-1989. The football program thrived under his tenure at Michigan, and it seems like he feared that if Dr. Anderson’s actions were brought to light, he would have had to resign, like Joe Paterno did at Penn State when Coach Sandusky’s actions were brought to light just over a decade ago. The coaches need to set their ego aside, and do what is right for their players and students, not for their job security. Lloyd Carr, who succeeded Bo Schembechler, is guilty as well. Although he brought the program a national championship in 1997 and had great success against Ohio State until Jim Tressel took over the Buckeye program in 2001, he should have voiced the players’ and students’ concerns about Dr. Anderson and the way he conducted physicals. Although Dr. Anderson has passed, his legacy still remains and the students and athletes he abused are still reminded of what he did to them to this very day. This is why the university settled with the plaintiffs. They did not want their dirty laundry aired at trial. They would lose not only recruits and students, but they would lose sponsors, their reputation, boosters, and other things that make the school profitable due to their programs and students in those programs. This settlement is not a win for the students and alumni who were abused by Dr. Anderson. They deserve a day to tell their stories about Dr. Anderson, or the school must report their findings about Dr. Anderson, so the public really knew what went on in Ann Arbor from 1966 to 2003. 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.

  • NWSL CBA Negotiations Are Headed For A Dramatic Turn

    To say the world of sports and labor law often intersect would be an understatement, and in its current state, you may think the MLB lockout is the biggest story sitting at this intersection. But by the beginning of February, you may be incorrect. The NWSL preseason is set to start on February 1st, and it now appears the players will not report to their clubs if a Collective Bargaining Agreement is not in place. If this were to occur it would be the league’s first work stoppage. The Player’s Association hopes that with less than two weeks before the preseason starts, this will help push the league to figure out the details. The NWSL was established in 2012 and had its first game on April 13th, 2013. Interestingly, the league has operated for nine years without a collective bargaining agreement to this point. CBAs are usually an integral part of any sports league, from the WNBA to the NFL. So, it is evident that the player’s frustrations about not having an agreement are not without merit. Negotiation of the league’s first collective bargaining agreement was first announced in April 2020, but over a year later, there is still no agreement. Without such an agreement, the players feel as though they are being left in an uncomfortable and insecure position. So, the players rightfully want to ensure the league takes steps towards improvement before providing their labor. Especially after a tumultuous 2021 season in which the league saw consistent, valid criticism. A point of further frustration stems from the fact that through October, none of the twelve-team owners had attended a single bargaining session, according to the Executive Director of the NWSL Players Association, Meghann Burke. Meanwhile, players have participated in every bargaining session, with one session having more than 25% of the players attend. To this point, there has been agreement on certain issues, but certain major points remain in contention. With neither side claiming to have reached an impasse withholding their labor or striking is the next option on the table for the players. The league is young, and some may fear that the league would be unable to recover from a strike properly. But there are three reasons why now may be the players and the players association’s best opportunity to pressure the league through a strike. The public support for the players is at an all-time high. So, if they strike, the “court of public opinion” would likely be in their favor. With a long preseason ahead of them, there would still be hope that a deal could be made, and the strike wouldn’t affect the regular season, which doesn’t start until May. In a more recent development for the league saw that the U.S. Soccer Federation would no longer be paying USWNT players NWSL salaries. Because of this, USWNT stars such as Megan Rapinoe are allowed to join the NSWLPA for the first time in league history. Opening the strike to have stars and new players alike join together. Both sides likely prefer to get a deal done without disrupting the 2022 season. But the point remains that this may be the player's first opportunity to profoundly change what it means to be an NWSL athlete—ultimately creating an unprecedented opportunity to put pressure on the league for a meaningful change!

  • Women’s College Basketball Players Love NIL. So Why Doesn’t Women’s Basketball?

    A lot remains unclear in the NCAA athlete name, image, and likeness (NIL) space. States are unsure how their laws interact with NCAA policy. Schools remain confused in the role they play in brokering these deals between athletes and third parties. The NCAA has requested Congress to step in and provide uniformity, but so far their begs have gone unanswered.[1] Despite all this uncertainty, one group has emerged to reap the benefits from NIL – women’s basketball players. Haley and Hanna Cavinder are members of the women’s basketball team at Fresno State. The twins share a backcourt and lead the Bulldogs in points and assists. But even more impressive than their on-court work is their off-court following. Their joint TikTok account @cavindertwins has nearly 4 million followers. To place that into perspective, two-time NBA MVP Steph Curry’s TikTok account has 2.2 million followers. These sisters are social media superstars. The Cavinder twins have pounced on the opportunity to profit from their name, image, and likeness more than any other college athlete. They were the first college athletes to sign an NIL deal with Boost Mobile on July 1. Since then, they have signed deals with Champs, Eastbay, the WWE, and even had their images plastered onto a billboard in Times Square. The old guard at the NCAA must be sick to their stomach. The Cavinder twins aren’t the only women’s hoopers growing their brand while also lining their pockets. Paige Bueckers, the UCONN superstar and widely considered best player in the country, has inked NIL deals with StockX and Gatorade. Bueckers, the former Gatorade Player of the Year in high school, joins athletes such as Michael Jordan, Zion Williamson, and Serena Williams representing the brand.[2] Brands have taken notice of the obvious – women’s basketball players are marketable. They can reach a young following through social media that not even the best men’s basketball players on the planet can accomplish. Women’s college basketball players are bigger digital media stars than their male counterparts, and the numbers back it up. Since the NIL floodgates opened this past summer, women’s basketball trails only football in compensation for deals signed. There could be a variety of factors as to why women’s basketball comes in higher than men’s when it comes to NIL. First and foremost is the social media presence mentioned above. But the chart above also reveals a lot about the current landscape of men’s basketball. The combination of the one-and-done era and the rise of alternative routes to the NBA has resulted in men’s college basketball players not having the same national star power they once had. If Zion Williamson stayed four years at Duke, he likely would have been the first collegiate men’s athlete to sign with Gatorade. Instead, stars like Zion are on campus for a couple months and then sign their lucrative endorsement deals once they hit the NBA. Conventional logic would follow that the sport of women’s basketball must be benefitting from this added exposure to their athletes. Well, not so fast. NIL goes against everything that the NCAA has always stood for, so they are refusing to embrace the benefits while simultaneously placing unnecessary roadblocks to halt progress. Likewise, schools seem afraid of breaking the law or NCAA policy and are also missing out on valuable opportunities. Fresno State has a strict Intellectual Property use policy when it comes to athlete NIL deals: As a result, the Cavinder twins can’t promote the school or their conference in any fashion through their brand deals. You would think Fresno State would love the free publicity that comes with their famous backcourt’s exposure. Apparently not. The Cavinder twins recently signed a groundbreaking NIL deal with the sport apparel company Baseline Team, making themselves co-founders and granting themselves a 25% ownership stake. Baseline Team’s main business focus is developing retro basketball shorts. Due to Fresno State’s NIL policy, even after Baseline Team acquired a license to use Fresno State’s logo, as student-athletes the twins must black out the logo when promoting their merchandise.[3] Below is the home page of Baseline Team’s website found at: https://baselinecpg.com/ If companies are investing in these athletes to grow their brand exposure, why isn’t Fresno State or the NCAA utilizing the same methods to grow the sport they play? The social media engagement could go a long way in increasing the popularity of women’s basketball. It doesn’t take a marketing genius to think that the Cavinder twins or Paige Bueckers should be all over NCAA social media accounts and other media outlets. Women’s basketball has constantly battled with the NCAA for equal treatment with the men’s game. NIL is an area is where the women’s game has growth potential even over the men’s game. Just recently the NCAA surrendered to mounting pressure and changed its Final Four logos and social media accounts to separate the men’s and women’s game. Previously, the logos were the same and the twitter account @FinalFour called it’s itself the “official” feed of the NCAA Final Four but only tweeted about the men’s sport with no updates about the women’s tournament.[4] NIL is commonly thought of as a groundbreaking mechanism that allows players to take power back from the NCAA and profit off their own brands. But NIL also provides opportunities for schools and the NCAA to grow their sports. The NCAA needs stop being hesitant and start developing plans to embrace NIL to grow women’s basketball. The players are becoming superstars – Why not grow the game alongside them? Matt Netti is a 2021 graduate from Northeastern University School of Law. He currently works as an attorney fellow at the Office of the General Counsel for Northeastern University. You can follow him on twitter and instagram @MattNettiMN and find him on Linkedin at https://www.linkedin.com/in/matthew-netti-ba5787a3/. You can find all his work at www.mattnetti.com [1] Dan Murphy, Everything You Need to Know About the NCAA’s NIL Debate, ESPN (last visited Jan. 23, 2021) https://www.espn.com/college-sports/story/_/id/31086019/everything-need-know-ncaa-nil-debate. [2] Scott Polacek, UConn's Paige Bueckers Becomes 1st College Player Ever to Sign Contract with Gatorade, Bleacher Report (last visited Jan. 23, 2022) https://bleacherreport.com/articles/10019464-uconns-paige-bueckers-becomes-1st-college-player-ever-to-sign-contract-with-gatorade. [3] Kristi Dosh, Cavinder Twins Flex Their Muscles as Entrepreneurs With Latest NIL Deal, Forbes Sports (last visited Jan. 23, 2022) https://www.forbes.com/sites/kristidosh/2022/01/18/cavinder-twins-flex-their-muscles-as-entrepreneurs-with-their-latest-nil-deal/?sh=1602564f17fa. [4] Matthew VanTryon, The NCAA Changed It’s Final Four Logos. It’s Another Step For Women’s Basketball Equality, IndyStar (last visited Jan. 23, 2022) https://www.indystar.com/story/sports/college/2022/01/05/ncaa-changes-final-four-logos-social-media-handles-womens-equality-march-madness/9101782002/.

  • Bonds That Tie: The Cooperstown Reformation Project

    Something that we knew was likely coming for a decade finally happened this week, as Barry Bonds was left out of the Hall of Fame by voters from the BBWAA. The baseball media controls who enters Cooperstown via the most traditional path. Writers who have spent ten consecutive years involved in the BBWAA receive a HOF vote and are able to vote for a decade even once they are no longer active. This means that some people who aren't tuned into the game are able to cast ballots on what enters the museum...and that's what this is really about. The Baseball Hall of Fame and Museum is a museum. The Hall claims that it's all about "the relationships forged, stories shared, cherished memories created..." Who amongst us hasn't joked about the fact that Barry Bonds was regularly walked even when it would put runners in scoring position? Or even more hilariously when the bases were loaded. Aren't stories (positive and negative) shared about Bonds' efforts in the Pirates' loss to the Braves in the 1992 NLCS? The Pirates' last winning season for two decades? About the fact that Bonds had more intentional walks than the Tampa Bay Rays' entire franchise in several thousand fewer at-bats? Don't cherished memories of Bonds exist in San Francisco, where he saved the Giants' franchise and helped them build their beautiful ballpark downtown? Didn't we forge relationships rooting for or against Bonds? Here are the facts: Barry Lamar Bonds is by far the greatest player ever based on bWAR at 162.7 wins above replacement (WAR), even better than his Godfather, Willie Mays (156.1). In an era that was tainted by performance enhancing drugs (which were largely ignored by the powers that be at the time), Bonds was far superior to his colleagues. Hitting a baseball is near impossible, and Bonds was the best at that skill. But Bonds was more than who he was at the plate. He was a marvelous athlete, winner of eight Gold Gloves. Young Barry was a terror on the basepaths. He's the only player to belong to the 500/500 home run/stolen base club. The case against Bonds is simple in its scandalous nature and lack of ability to process context. The guy was alleged to use steroids, he wasn't nice to the media, and he had a huge ego. I won't touch the last one because these are professional athletes, and ego is a driving force for a lot of them to achieve great things. It's not good, but it's everywhere. The first point, I understand. It would be one thing if that were a consistent rule, though. At this point, there is almost certainly an inductee who used performance enhancing drugs. Whether that's anabolic steroids, or amphetamines, or they were spitting tobacco juice to affect the rotation of the ball. That happened, and the Hall is in the perfect spot to be able to give context to the achievements of those players. If necessary, they could put the Steroid Era guys in their own wing. It's just an improper use of the Hall to tell half the story and leave players who are otherwise deserving out based on suspicion. Also bothersome in relation to steroids is that there's a lack of consistency that is particularly evident this year. David "Big Papi" Ortiz, the jovial giant who broke the Curse of the Bambino with his clutch hitting against the Yankees in 2004 and proceeded to win three more World Series' in Boston while clubbing 541 Home Runs, was elected on the first ballot this year. Most notably, Ortiz rose to be a leader in Boston, helping to heal the city after the 2013 Boston Marathon Bombings. Ortiz was always friendly with the media in Boston and nationally. His easygoing nature, hearty laugh, and thousand watt smile are disarming, charming, and endearing. Kenan Thompson plays a friendly caricature of the heavily accented Ortiz on Saturday Night Live. Ortiz is part of the media analyzing baseball now, appearing on FOX and on a podcast with Barstool Sports. Papi is almost universally liked. I like Ortiz. I think he's one of the most lovable characters in baseball during my lifetime and was a fearsome slugger. I think he belongs in the Hall for the exact reason that you can't talk about baseball history and the curse-breaking Red Sox without discussing Ortiz's prowess for the clutch hit. The thing is that Ortiz registered a positive PED test when MLB finally attempted to reign in the steroid issue, beginning with an effort to recognize how widespread the issue was with anonymous submissions in 2003. The failed test became public knowledge in 2009. Ortiz never tested positive once MLB implemented a formal testing scheme in 2004. Bonds was alleged to have registered positive tests in 2000 and 2003 that became public knowledge during a perjury trial. He never tested positive under MLB's formal testing scheme. Bonds ultimately had his conviction of obstruction of justice overturned in 2015. So where is the biggest difference here? Is it that Bonds wasn't friendly with the media? It certainly can't be that Ortiz was a better player than Bonds. Ortiz's WAR counter places him in the bottom five of all inductees. In fact, Bonds nearly achieved Ortiz's entire career WAR (55.3) in just his seven seasons with the Pittsburgh Pirates (50.3). Bonds has 7 MVP awards to Ortiz's zero. In fact, if you just took Bonds' achievements prior to the alleged November 2000 positive test, Bonds would be the only member of the 400/400 home run/stolen base club. Bonds had 3 MVP awards before he was ever alleged to have cheated. We have to do better to fulfill the missions stated by the Baseball Hall of Fame and Museum. With that in mind, I have a handful of changes that I'd like to see. First, I'd like to see all ballots be made public after the results are announced. In 2016, the BBWAA voted by a significant (80-9) margin to publish all ballots publicly by 2018. The Hall of Fame refused to do so. The results of private vs. public ballots may surprise you. Bonds appeared on 77% of public ballots, which means that he would have surpassed the 75% threshold required for induction. However, he only appeared on 53% of private ballots. That is a 24% difference. On the other hand, Omar Vizquel, who allegedly sexually assaulted a former batboy, benefitted from secret ballots, outperforming his public ballots by 28%. Second, I think we should go back to a 15 year tenures for possible inductees. I believe that as younger members of the BBWAA achieve voting power, they may let their positive memories, connections, and stories about great players of the Steroid Era like Bonds or Roger Clemens guide them. We have already seen anger over the players in the Steroid Era dissipate. An additional five years may very well allow passions to be relaxed and time to provide context. Third, I think that expanding the number of votes per year beyond the cap of ten players is a good idea. In crowded years, that could allow good players like Johan Santana to receive additional consideration. Fourth, lower percentage thresholds may provide players deserving of additional consideration like Nomar Garciaparra with valuable time to be discussed. A one percent threshold to stay on in the first three years, and then a five percent threshold to stay on the ballot beyond year three is something that I've seen proposed and makes sense. Finally, I believe that some players should vote. One idea is to allow players who achieve at least 10 years of service time at the Major League level the opportunity to vote on their colleagues. If some of these proposals are adopted by the Hall, I believe we can make Cooperstown more representative of the game and more likely to achieve its stated goals. Tarun Sharma is a current 3L at the University of Minnesota and former Baseball Operations Professional for the San Francisco Giants and Arizona Diamondbacks. He is an occasional co-host on the Conduct Detrimental podcast and handles some social media and legal research for the Conduct Detrimental Group, as well. You can find his thoughts in the weekly Sports Law Review Newsletter by Conduct Detrimental or on twitter @tksharmalaw. Sign up at conductdetrimental.com to get the week’s biggest sports law news in your inbox!

  • UConn's Handling of Kevin Ollie a Critical Warning to Athletic Departments

    In the Spring of 2018, UConn fired head basketball coach, Kevin Ollie, after the school self-reported numerous NCAA violations that occurred in the program under Ollie’s watch. At the time, Ollie still had more than a year left on his contract at the time of his dismissal, but UConn insisted that the firing was for cause due to the violations which would void the buyout provisions in his contract. However, after a lengthy legal battle, an independent arbitrator has ruled that UConn improperly fired their former coach and must pay him more than $11 million. Attorney Jacques Parenteau called the ruling a “total vindication” for Ollie and that it proves the NCAA’s decision to place UConn on probation and sanctioning Ollie in 2019 was “erroneous and unfounded.” UConn officials adamantly disagree with the decision and believe they were in the right to fire Ollie with cause due to the alleged violations. Instead of waiting for the conclusion of the investigation into the program, the school claims it did not have “the luxury of waiting more than a year before terminating Ollie for the misconduct the university was aware he had engaged in.” “The arbitrator’s decision is nonsensical and seriously impedes the university’s ability to manage its athletics program,” the university said in a statement. “It also sends a signal to other coaches in Connecticut that they may ignore NCAA rules with impunity and continue to be employed and paid.” While UConn can insist on its innocence all they want, they’re still on the hook for the $11 million. But in the bigger picture, this ruling should serve notice to athletic administrators and university presidents moving forward. In the last couple months, we’ve seen numerous coaches sign massive contracts to either stay at their current school or take over a new program. With these massive contracts comes massive buyouts. With many schools across the country having quick triggers, agents representing these coaches are placing more emphasis on protecting them with strong buyout provisions in their contract. For example, if Texas A&M’s Jimbo Fisher were to be fired without cause prior to next season, the Aggies would be on the hook for north of $80 million. Now, it’s extremely unlikely that A&M would let Fisher go now, but it goes to show how big these buyouts are getting. But a way for schools to get around paying these buyouts when their coach’s programs start struggling is firing them for cause. And in some cases, schools attempt to dig up dirt to avoid the liability. We saw this as recently as 2020 when Tennessee self-reported recruiting violations allegedly committed by then head coach Jeremy Pruitt. After signing him to a contract extension after his team started 2-0 earlier in the season, the Vols lost 7 of their final 8 contests. Of course, the news of Tennessee’s self-reporting came after their 7th and final loss. The similarities are striking in the Kevin Ollie/UConn situation. After winning the national championship in 2014, UConn only returned to the NCAA Tournament one more time and slumped to two consecutive losing seasons before Ollie was terminated in 2018. With significant money still owed to Ollie heading into the next season, UConn pulled the “self-reporting” card to fire him with cause. But here’s the question that looms large: If UConn was competing for conference titles and making deep postseason runs in Ollie’s last few years on the job, would UConn have self-reported violations? I don’t think so. For any school looking to get out of paying a fired coach’s buyout, you’d better have a real reason to do so. The arbitrator's ruling in the Kevin Ollie/UConn case should send a message that “digging up dirt” to save money on an underperforming coach is risky business. A contract is a contract, and if a school is not happy with the buyout language in, they probably shouldn’t have agreed to it. Coaching college ball is a tremendously hard profession, especially in today’s environment. People sometimes criticize coaches for making “too much” money, but the amount of time and effort they put into their job deserves some protection. Improperly firing a coach for cause is simply an unethical move. To make matters worse, UConn doesn’t just owe Ollie $11 million over a prolonged stretch, they owe it in the next 10 business days. Not ideal for athletic department that reported that its budget deficit rose from just over $43 million to nearly $47 million in 2021.

  • What the NFL’s Motion in the Gruden Case Indicates about the WFT Investigation

    Last week, the NFL responded to Jon Gruden’s lawsuit alleging the NFL was the true actor behind the leaks that ultimately led to his termination with the Las Vegas Raiders. The NFL filed a multi-faceted motion to dismiss, in which they argued that the suit should be moved into arbitration in accordance with the NFL Constitution and Bylaws (which we won’t address here) and that Gruden’s lawsuit lacked cause. Specifically, they reasoned that Gruden cannot deny that he wrote the terrible statements in those emails and that those comments by themselves constituted enough cause for the Commissioner, Roger Goodell, to terminate Gruden’s contract under his executive powers.[1] This admission by the NFL gives us a significant indication on not only how they intend to proceed with Gruden’s lawsuit, but also the possible reasoning behind the NFL’s aggressively defensive strategy with regards to the contents of the Washington Football Team investigation. This admission by the NFL indicates to some extent what we already suspected, that the NFL has (or at least indicates that they have) a detailed knowledge of the WFT Investigation emails. Further, they understand that the contents, when exposed, were cause enough for league personnel to lose their jobs (whether due to the Commissioner’s hand, as they argue they had the right to do, or Raiders Owner Mark Davis’ after the situation became untenable for his franchise). If the NFL does not now release the rest of the emails knowing they contain no further nefarious information, then I only see the following three scenarios as possible reasons why: The contents, or the inaction shown by the NFL in response to reported misconduct, are so damaging to the league itself that they must do everything possible to prevent their publication. Some have already argued this is the real reason, including Pro Football Talk’s Mike Florio.[2] The NFL (see: owners) do not want to create a precedent where public pressure, warranted or not, could cause the sale of an unwilling owner of a franchise (as the contents of the WFT investigation may force Owner Dan Snyder to do). The NFL (again, see: owners) do not want to ever reach the discovery phase of any lawsuit they are involved in, no matter the gravity of the underlying documents (as they attempted to avoid in the St. Louis Rams lawsuit).[3] If Scenario 2 or Scenario 3 are reality, then I think there have been (or need to be) some serious discussions at the NFL Headquarters about what is ultimately best for the organization. I say “organization” in reference to the NFL itself, as much as you consider it that and not an association of 32 separate individual businesses (as Federal Courts have found).[4] But if you consider what’s best for the organization, then there’s a legitimate argument to be made that transparency in this case, aka the release of the WFT investigation emails, may begin the long, slow, painful process of rebuilding public trust in the institution of the NFL to handle these issues on their own in a morally-correct way (assuming they care about that sort of thing). This is not a new concept for the NFL. They have released extensively detailed reports on investigations in the past, with the Ray Rice investigation being a prime example.[5] To do so now would be a wholistic recommendation that would need concurrence from the PR, Legal, and Organizational Management teams, but its not absurd to think that we’re reaching a point where that is the reality. The cost of protecting Dan Snyder (or any other league personnel implicated by these documents) or the privacy of these documents purely to avoid discovery in Scenario 3 is most likely no longer outweighing the benefit of restoring some semblance of public faith in how the NFL treats its employees and players by releasing the contents of the investigation. If their leadership team has an interest in being (much less being viewed as) a morally-conscious or value-based organization, they should be able to see that. I realize that may be naïve to think they care, but let’s assume based on their various community service and engagement initiatives that they might.[6] To continue to dig in based purely on avoiding precedent or discovery would be an indication by Roger Goodell and his team that they are more interested in the individual desires of the 32 NFL franchise owners than what is ultimately “good for the gander,” something that we suspect is part of the job description of NFL Commissioner and comes with Roger Goodell’s rumored $60 million dollar salary.[7] The NFL is a conglomeration of smart people, which is why everything I just said is unlikely to have played out, because ultimately someone smarter than me (an ever-growing segment of the population) would have figured out by now that this is hurting the NFL way more than it’s helping. That’s why Scenario 1 starts to look more and more likely, whether due to the heinousness of the original offense or the lack of action by the NFL, which if it is the latter continues to grow by the day. If that inaction is the root of all of this legal maneuvering, then I would only advise that there is a saying about bad news and time. As Dan Wallach pointed out, this information will come out eventually, there’s too much public interest now for it not to.[8] The end of that bad news not getting any better with time may be when the leaders of the NFL are sitting in front of Congress or emptying the contents of their desks and walking out onto Park Avenue. Michael DiLiello is an Army Officer transitioning to the Sports Law field and will enroll as a 1L in the Fall of 2022. His opinions are purely his own and do not reflect the opinions of the United States Army, the Department of Defense, or any other external agency. Twitter: @Mike_DiLiello LinkedIn: http://linkedin.com/in/michael-diliello-1057b439 [1]Mohr, Dani. 2022. NFL files motions to dismiss Jon Gruden's 'baseless' lawsuit: 'He has no one to blame but himself'. January 09. Accessed January 28, 2022. https://www.sportingnews.com/ca/nfl/news/nfl-motions-dismiss-gruden-lawsuit/21ems6gzx8nw12wztnm098fyk [2] Florio, Mike. 2021. Former WFT employee possibly sheds light on why NFL is covering up the results of the investigation. December 23. Accessed January 28, 2022. https://profootballtalk.nbcsports.com/2021/12/23/former-wft-employee-possibly-sheds-light-on-why-nfl-is-covering-up-the-results-of-the-investigation/. [3] Wallach, Dan, and Dan Lust. 2022. Conduct Detrimental: S3 E68; 10:05-22:40. [4] Wallach, Dan. 2021. NFL Can’t Transfer Gruden Lawsuit to Federal Court Due To Corporate Status. November 19. Accessed January 28, 2022. https://www.conductdetrimental.com/post/nfl-s-status-as-unincorporated-association-may-bar-removal-of-gruden-lawsuit-to-federal-court. [5] Mueller, Robert S. 2015. REPORT TO THE NATIONAL FOOTBALL LEAGUE OF AN INDEPENDENT INVESTIGATION INTO THE RAY RICE INCIDENT. WilmerHale. [6] NFL. n.d. NFL In The Community. Accessed January 28, 2022. https://www.nfl.com/community/. [7] Saul, Derek. 2021. NFL's Roger Goodell Reportedly Makes $63.9 Million Per Year — Here's How That Compares To Other Top Execs And Sports Commissioners. October 29. Accessed January 28, 2022. https://www.forbes.com/sites/dereksaul/2021/10/29/nfls-roger-goodell-reportedly-makes-639-million-per-year---heres-how-that-compares-to-other-top-execs-and-sports-commissioners/?sh=453f25cd5702. [8] (Wallach and Lust, Conduct Detrimental: S3 E68; 10:05-22:40 2022)

  • MLB's Proposed Pre-Arbitration Bonus Rule Echoes Tumultuous Offseason

    Tumultuous Times in the Diamond Sport Things are certainly busy in Major League Baseball ("MLB"). Following the difficulty of the 2020 Covid-altered season, the 2021 season was largely a success. However, the beginning of the 2022 season is proving somewhat tumultuous. In addition to the filing of a new lawsuit challenging MLB's federal anti-trust exemptions[1] and the non-admission of two of MLB's greatest statistical performers to the Hall of Fame,[2] MLB and the Major League Baseball Players Association (the "Union") have failed to agree on a successor collective bargaining agreement, resulting in the present ongoing lockout. Negotiations have centered around various long-standing rules, such as free agency eligibility and uniform use of the designated hitter. Notably here though, is a significant proposed change to the potential compensation for pre-arbitration eligible players. MLB's Compensation and Arbitration Structure To understand the proposed rule and its implications, a brief overview of MLB's early compensation and arbitration process is warranted. Generally, minor league and MLB players without the requisite service time for free agency play on one-year contracts.[3] The MLB calendar typically has 187 days and a 'full season' for service time purposes constitutes 172 days.[4] Between 172-187 days constitutes a maximum of 1.00 years of service time in any season.[5] Compensation is dictated by the level of competition and its associated minimum salary. In 2021, for instance, players in A-ball received $500 weekly, while in AAA, it was $700.[6] In MLB, the minimum salary for 2021 was $563,500.[7] Salaries prorate as players progress or demote through the various competition levels. Following any season, clubs generally have the unilateral right to renew minor league and young MLB player contracts.[8] Thus, clubs retain robust control of the early careers and earning potential of their young players. Once a player accrues 3.00 years of MLB service time, that player is eligible for salary arbitration following the season.[9] This formal arbitration process is the player's first chance for a significant raise. MLB players are continually eligible for salary arbitration after each season until they reach 6.00 years of service.[10] At this point, a player becomes eligible for free agency and generally may sign with any club and on any agreed upon terms.[11] The period before reaching 3.00 years of MLB service time is generally known as the 'pre-arbitration eligibility period.' Now, MLB and the Union are negotiating a proposed rule change where a pre-arbitration eligible player can earn additional compensation more commensurate with their actual performance.[12] This is particularly important when considering that many players were drafted at 18 years old and may not make it to their first season of salary arbitration (if ever) until aged 22, 28, or even older. In that time, most young professional baseball players hardly make enough money to get by, let alone make any contextual decent compensation. As an example, Yankees slugger Aaron Judge was drafted in the 1st round of the 2013 draft and briefly made his debut in the majors in 2016. His first full, and rookie eligible, season came in 2017. In that year, while on a Yankees' controlled and renewed contract for $544,500, Judge would lead the American League in walks, runs, and home runs.[13] He additionally earned an All-Star appearance, a Silver Slugger Award, was named the American League Rookie of the Year, and finished 2nd in the American League MVP voting.[14] All this while the average MLB salary for 2017 was $4,450,000[15] and players performing similarly, but free agency eligible, could easily earn $20,000,000 or more. Of course, there are legitimate arguments in favor of the clubs' player and contractual control. Perhaps most appropriately is the preservation of parity and competition in a game where the clubs are not limited by a uniform salary cap, which favors larger market clubs with deeper pocketed ownership. Still, it is a hard reality for a player performing as well as Judge did in 2017 to earn orders of magnitude less than his lesser performing peers. Proposed Pre-Arbitration Bonus Pool Fortunately for the players, additional pre-arbitration eligible compensation is presently being negotiated by MLB and the Union as part of the larger effort to end the lockout. However, perhaps in keeping with recent MLB curiosities, the mechanics of such additional compensation is potentially problematic. Broadly, the proposed mechanics are essentially the following: the top 30 performing pre-arbitration eligible players receive tiered compensation bonuses from a central fund, the amount of which is currently being negotiated.[16] Additional bonus compensation can be earned for winning awards such as the MVP or Rookie of the Year. Wins Above Replacement ("WAR"), an advanced baseball statistic, would be the basis for determining the top 30 players, while the writers of the Baseball Writers' Association of America ("BBWAA") select award winners. Essentially, what the formula for WAR attempts to quantify is how many wins (positive WAR) or losses (negative WAR) a player’s performance is worth, relative to the average performing replacement level-player in MLB.[17] The Potentially Problematic Use of WAR Using WAR, however, is potentially problematic. WAR is both a proprietary and dynamic formula. Measures of WAR are not constant, since the formulas continually undergo recalculation to better quantify performance value in a game with ever-changing rules and circumstances. Further, WAR’s proprietary formula is created, used, and continually re-formulated by multiple non-MLB entities. MLB's website glossary alludes to three of the most common WAR formulations, from FanGraphs, Baseball Reference, and Baseball Prospectus.[18] Thus, there is no uniform WAR calculation. Further, it remains to be seen which WAR measure would be used and whether any of the entities promulgating WAR would want their statistic being the direct basis of an MLB player's compensation. The Baseball Writers' Association of America Adding further complication, season awards, the basis for potentially additional pre-arbitration eligibility compensation, are voted on by the BBWAA writers. This is significant given that the BBWAA writers, rightly or wrongly, often seem to take virtuous positions on certain votes, such as the Hall of Fame entrance for retired players. This offseason, the BBWAA writers collectively voted not to allow Barry Bonds and Roger Clemens into the Hall of Fame, two of the greatest statistical players the game has ever seen, for their perceived use of performance enhancing drugs.[19] The merits of such action is better covered in another article. However, for present purposes, it shows a general willingness on behalf of the BBWAA to consider non-performance circumstances in bestowing awards and recognition on players, which, given the structure of the proposed pre-arbitration compensation awards, would have additional financial implications for these pre-arbitration eligible players. This could be particularly impactful in an environment where young players are perceived to be more outspoken and brash than in years past. Conversely, it could motivate some BBWAA writers to vote for a pre-arbitration eligible player over a veteran player for a major season award such as MVP in order to provide some additional bonus compensation to a young player. In any event, MLB and the Union are running out of time to agree on a new collective bargaining agreement. Without a new agreement in the very near future, the 2022 season may be delayed. Assuming, a new agreement is reached, it will certainly be interesting to see which long-standing rules of the game, such as the pre-arbitration system, undergo significant amendment. Matthew D. Batista, Esq. is a transactional associate attorney in the San Diego of Klinedinst PC. His practice ranges from general corporate law, to M&A, intellectual property, and real estate across a range of industries, including sports & entertainment. Mr. Batista can be contacted at the following link https://klinedinstlaw.com/profiles/attorney/matthew-batista?all=1. [1] See https://images.law.com/contrib/content/uploads/documents/389/152201/MLB-Antitrust.pdf (the Complaint). [2] See https://www.espn.com/mlb/story/_/id/33138890/hall-fame-voting-winners-losers-david-ortiz-gets-else-got-good-bad-news [3] https://www.mlb.com/glossary/transactions/contract-renewal [4] https://www.mlb.com/glossary/transactions/service-time [5] Id. [6] https://www.espn.com/mlb/story/_/id/28702734/mlb-raising-minimum-salary-minor-leaguers-2021 [7] The Basic Agreement 2017-2021 (the Collective Bargaining Agreement) can be accessed here: https://www.mlbplayers.com/cba; https://www.espn.com/mlb/story/_/id/28702734/mlb-raising-minimum-salary-minor-leaguers-2021 [8] http://m.mlb.com/glossary/transactions/contract-renewal [9] Assuming the player does not reach 'Super-Two Status,' also potentially under negotiation for a new collective bargaining agreement, see http://m.mlb.com/glossary/transactions/super-two; see also http://m.mlb.com/glossary/transactions/salary-arbitration [10] This assumes that the player and their Club don't agree to a contract that 'buys out' that player's arbitration eligibility; http://m.mlb.com/glossary/transactions/salary-arbitration [11] Though MLB compensation must at least reach the minimum threshold; see http://m.mlb.com/glossary/transactions/free-agency [12] See generally https://www.mlbtraderumors.com/2022/01/mlb-lockout-rumors-bonus-pool-pre-arbitration-minimum-salary.html; see also https://theathletic.com/news/mlb-willing-to-introduce-bonus-pool-for-pre-arbitration-players-but-at-fraction-of-mlbpa-proposal-sources/iZVNnxqa8cCt/ [13] See https://www.baseball-reference.com/players/j/judgeaa01.shtml [14] Id. [15] https://www.espn.com/mlb/story/_/id/31270164/average-mlb-salary-417-million-48-2019 [16] See https://www.mlbtraderumors.com/2022/01/mlb-lockout-rumors-bonus-pool-pre-arbitration-minimum-salary.html [17] See generally https://www.mlb.com/glossary/advanced-stats/wins-above-replacement [18] See Id. [19] See generally https://www.espn.com/mlb/story/_/id/33138890/hall-fame-voting-winners-losers-david-ortiz-gets-else-got-good-bad-news

  • Futbol Finance: The American Dream

    Many young American soccer players aspire to play professionally in Europe. This January transfer window saw a lot of young Americans achieve their dreams. This goes to show that MLS’ commitment to academies and developing young players has proved to turn a profit and become a benefit of playing in the league. As each season goes on, more and more homegrown players have been sold as European clubs start to key in on American and Canadian talent. We’ve seen big clubs like Bayern Munich and Manchester City come in for young talent from MLS. This has established MLS as a good league for development for young players and where young players can play for a few years before securing a big move. Someone like Ricardo Pepi, who has gone through the FC Dallas Academy, played for the USL team and then showed his talent for the first team got a big move to Augsburg. Augsburg shattered their club record to bring in the young American striker. It’s a win-win for both the club and player. Pepi gets his move to Europe while FC Dallas gets to keep the entire $18 million fee because Ricardo Pepi was signed as a homegrown player. This rule was recently implemented for MLS teams to be encouraged to sign homegrown players and play them in hopes to get them a big transfer to Europe. Pepi became the most expensive American sold in MLS history, while being the 2nd most expensive MLS sale behind Miguel Almirón’s transfer to Newcastle in 2019. Pepi isn’t the only national team striker to get a move to Europe. Daryl Dike also got his move to Europe to West Bromwich Albion, who play in England’s 2nd division. Dike’s path to Europe was a bit different than Pepi’s. Dike went through the college system, which has become a lot less likely for top American talents. Dike was selected 5th overall in the 2020 MLS SuperDraft by Orlando City after having signed a Generation Adidas deal, which is for college players who would like to play professionally but are not eligible for the SuperDraft. Although Dike did not make a move to a top five league, his move to West Bromwich Albion could pay off dividends as they are currently in position for the EFL Championship playoff, with the winner of it being promoted to the English Premier League. The most interesting part about these two moves is how the performances of these two will affect the battle for the striker position as the United States look to qualify for the World Cup in November. Another player who went a similar route to Dike is goalkeeper Matt Turner. Turner’s story is a bit different as he wasn’t a highly coveted player coming out of college, even going undrafted in the SuperDraft. This didn’t stop him as he’s been one of the best shot stoppers in MLS in the past few years. It’s been reported that he will be joining Arsenal in the summer by multiple outlets including Taylor Twellman and Fabrizio Romano. This is a very interesting move as he will likely be a backup to Aaron Ramsdale at Arsenal while in the middle of a position battle for the national team. Turner is battling fellow Premier League backup goalkeeper Zack Steffen. With both of them getting very little, if any, Premier League action, it will be tough for both to cement their spot as the starter for the national team by being in good form at club level. Matt Turner isn’t the only MLS player to transfer to Arsenal, with Colorado Rapids defender Auston Trusty also getting a transfer to the London club. Trusty will stay on loan with the Rapids until July 17, 2022. This move came out of nowhere without any reports linking Trusty to Arsenal, but it could possibly be explained by Stan Kroenke being the owner of both Arsenal and Colorado. Trusty has zero caps for the US national team, so Arsenal will likely loan him out once he joins in the summer. Other MLS players who have earned big moves to Europe includes James Sands to Rangers, Kevin Paredes to Wolfsburg, Justin Che to Hoffenheim, Cole Bassett to Feyenoord and George Bello to Arminia Bielefeld. While it’s been a huge window for MLS exports, Toronto FC made one of the biggest signings in league history when they captured the signature of European champion Lorenzo Insigne. His reported salary of $15 million is more than double the previous record for biggest salary in league history. Insigne is a great player who featured on Italy’s triumphant run in last summer’s European Championship. Italy are still vying for a spot in the World Cup after having failed to qualify in the group stages. Insigne will need to have an even bigger role in Italy’s attack after national team teammate Federico Chiesa suffered an ACL injury which will cause him to miss the World Cup Qualifying playoffs. Just five years ago, MLS and United States soccer fans were excited at the thought of players going on trials to European clubs. Now, multiple players per transfer window are getting moves to European clubs and featuring for them. With the World Cup being in North America in 2026, it will be an interesting few years leading up to it to see how much MLS grows between now and then. Greg Termolle is a 2L at the Elisabeth Haub School of Law at Pace University. You can follow him on Twitter at @GregTerm.

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