Judge Rules Against NFL -- Lockout Unlikely Now
by Mo Johnson
A U.S. Federal District Court Judge in Minnesota may turn out to be the key player in resolving the standoff between the NFL and the NFLPA. Before his March 1, 2011 ruling -- it appeared the owners had a stranglehold on the union and actually wanted the current negotiations to fail so they could lockout the players and break the union.
It appears this has been the owners strategy all along and in fact was the reason they forced the TV networks to renegotiate their TV deals last year. The NFL insisted that the Networks agree to pay the owners -- even if their was a lockout in 2011. The owners would have to pay the networks back if no games were played -- however, crucially, their cash flow would continue through a lockout; whereas the cash flow of the players would terminate when the lockout began.
Naturally, the NFL calculated that in that situation the players would have to fold and the union would be broken.
Network executives stated that the NFL has a stranglehold monopoly like none other and it made this lockout payment provision a "dealbreaker." The Networks had no choice but to agree to it if they wanted to broadcast NFL games.
Anyway, it appeared the NFL would get its way and the players union would be busted until Judge David S. Doty (a tough SOB; 82 years old and a former Marine) stood up to the NFL as no one else has or could.
However, it was the greediness of the NFL in insisting on this lockout provision (payment by networks even after a lockout) that proved to be its achilles heel.
Judge Doty ruled that by insisting
on this lockout provision, the NFL had breached its collective bargaining agreement with the NFLPA. Article X of the CBA required both parties (players and owners) to act in good faith to maximize total revenues that both parties would receive. By insisting on a restructure of the TV contracts with DirecTV, CBS, FOX, NBC and ESPN -- a restructure that required the lockout payments -- THAT was not acting in good faith to maximize revenues. Instead, the Court ruled the NFL did that in order to improve its negotiating position in the future (now current) negotiations with the NFLPA. So, the NFL insisted on the lockout provision in order to benefit itself and not to maximize revenue of both players and owners.
So, bingo -- that was it. The owners were just a bit too greedy.
To summarize, Judge Doty found the NFL breached it's agreement with the players and the Court ordered:
...that a hearing be held concerning relief to be granted to the Players arising from the NFL's breach of the SSA. The hearing shall consider the award of both money damages and equitable relief, including injunction.
Click here to read the full opinion:Federal Judge Rules Against NFL on TV Contracts
You can find the conclusions on page 28.
Now, if the owners want to impose a lockout, of course they still can. But, thanks to this decision -- now they won't be receiving hundreds of millions from the networks during the lockout. Big difference. A more even playing field.
Now, I think a deal will get done. Thank you Judge Doty. Semper Fi !!
Here's more stories about this:Will New NFL Mediation Lead Anywhere?NFL Lockout SummaryNFL Lockout Breakdown