Players' California antitrust case reassigned
Updated Nov 17 2011 4:55PM
The antitrust case filed in California earlier this week on behalf of NBA players against the league seeking treble damages was moved Thursday from the Oakland Courthouse to the San Francisco Courthouse, with a change in judges from Magistrate Judge Donna M. Ryu to Senior District Judge Samuel Conti. No date for a preliminary hearing before Judge Conti has been determined; a Feb. 29, 2012 date had been set in Judge Ryu's court. Cases such as this that are randomly assigned to judges can be reassigned if one or more parties involved ask for another judge to hear the case.
The lawsuit, Carmelo Anthony vs. National Basketball Association, was filed Tuesday in the Northern District of California, along with a similar case filed in Minnesota, Caron Butler, et al, vs. National Basketball Association. The two lawsuits were filed after the National Basketball Players Association filed a "disclaimer of interest" that dissolved the union as a bargaining unit for players, morphing it into a "trade association." But by doing so, individual players become free to file antitrust lawsuits against the league.
In an ESPN interview Monday, NBA Commissioner David Stern dismissed the move as a "negotiating tactic" and a "sham" only designed to try and force the league back to the bargaining table.
"Frankly, by this irresponsible action at this late date, Billy Hunter (the executive director of what used to be the NBPA) has decided to put the season in jeopardy and deprive his union members of an enormous payday," Stern said.
Meanwhile, the NBA's Board of Governors held a regular scheduled conference call Thursday with the league's 30 owners, updating them on where things stand regarding both collective bargaining and the impending litigation. It is not clear whether the NBA has gone ahead and established its "reset" offer of 47 percent of Basketball-Related Income for the players and a National Hockey League-style "flex cap" that acts, in essence, as a hard cap, as its official new negotiating stance with the players going forward.
The California lawsuit also revealed that the players' union has withdrawn an unfair labor practices charge against the National Labor Relations Board that it filed last May. That charge claimed the NBA had not negotiated on a new collective bargaining agreement in good faith.
Withdrawing the NLRB charge will make it easier for players to, officially, begin the process of decertifying the union as well. The NLRB, according to the lawyer handling the unfair labor practice charge before it was withdrawn, may not have allowed a decertification vote to take place while there was a pending charge by the union against the NBA.
Several player agents have been pushing for decertification for several months, hoping it would produce enough leverage to compel the league back to the bargaining table. It is believed that agents have obtained the signatures of approximately 200 of the league's 450 players, more than the 130 required to force a decertification vote within 45 days of filing. However, since the union has already disclaimed, and has already filed the antitrust lawsuits, it's not clear how strong the impact of decertification on top of that will be.
"If the disclaim is valid, there's no point for decertification," said Lawrence Katz, the attorney who has been handling the NLRB case for the union, on Thursday.
Along those lines, the NBA has amended its own lawsuit, initially filed against the players last August in the Southern District of New York, this week, with attorney Jeffrey Mishkin writing a letter to the District Court which cited the union's disclaimer as proof of the league's initial claim that the union had planned all along to disclaim or decertify, after allegedly threatening to do so on more than two dozen occasions over the past few years. The union responded with its own letter saying the decision to disclaim was only reached during Monday's meeting of the union's executive committee and player representatives for its teams.
Agents were mulling whether to proceed with decertification, polling their players this week to see how many wanted to take that next step. A vote of 50 percent of participating players would be required for the decertification to take place. During the 45-day window, however, the players and league could continue to negotiate a new CBA.
David Boies, the celebrated attorney working as lead lawyer for the players, said in a Tuesday media availability that he hoped the league would come back to the bargaining table before the joint cases proceeded further. It's likely that it would take months, if not years, for the antitrust cases to be fully adjudicated. Such actions would certainly destroy any chance of salvaging any part of the 2011-12 NBA season and could put future seasons in jeopardy.
"I think it is in everybody's best interest to resolve this promptly," Boies said. "The longer this goes on, the greater damages the teams will face..."
In the California and Minnesota lawsuits, the players are charging the NBA with violating the Sherman Antistrust Act when the league allegedly "boycotted" the collective bargaining proceedings by giving what was then the National Basketball Players' Association a "take it or leave it" final offer last week. If the union didn't accept the offer, the lawsuit charges, the league would then have imposed its "reset" offer with a lower percentage of Basketball-Related Income (47 percent) for the players, rollbacks of contracts and an National Hockey League-style "flex cap" that acts, in essence, as a hard cap. Once the NBPA disclaimed, the players' attorneys argue, the league's negotiating stance made it liable for treble damages. If the league was found liable it could be forced to pay damages of up to three times the amount of salaries that players have lost during the lockout.
The players' suit against the league cites as evidence alleged comments NBA officials made to Hunter in a June, 2007 meeting, just two years after the two sides had completed the 2005 CBA that averted a near-lockout that year. During the meeting, the lawsuit alleges, the league warned Hunter that it intended to reduce the players' BRI share signficantly, tighten salary cap rules and remove or restrict "system" provisions. If the league didn't get those concessions, the lawsuit charges, the league threatened to lock the players out "for two years to get everything" and would make subsequent offers worse and worse.
As part of the league's lawsuit in New York, the NBA has asked the presiding judge, Paul Gardephe, that even if he determined the lockout to be illegal, the contracts of existing players should nonetheless be voided.
Both sides have filed cases in venues that have historically been friendly to each side's participants. The Northern District in California is within the jurisdiction of the U.S. Ninth Circuit Court of Appeals, generally viewed as the most liberal of all appelate courts in the country. Minnesota's courts, led by Judge David Doty, have been viewed as player-friendly in numerous cases involving National Football League players for the past two decades. Another judge, Susan Richard Nelson, granted NFL players an injunction last June which temporarily ended the NFL's lockout of its players. However, an appeals court in Missouri overturned Nelson's order and reinstated the lockout until it was ended through joint negotiation of a 10-year CBA in July.
The New York court is under the jurisdiction of the U.S. Second Circuit Court of Appeals, which has consistently ruled in favor of sports leagues, including the NBA, in several recent cases. The Second Circuit ruled for the NFL when it was taken to court by former Ohio State running back Maurice Clarett and former University of Southern California wide receiver Mike Williams, who challenged the NFL's age limit for its Draft in hopes of being able to enter the Draft following their sophomore seasons. The NBA won an antitrust case against players in the Second Circuit in 1995, with a judge ruling that the players had to dissolve their union before challenging the league's salary cap and Draft. Several star players, including Michael Jordan and Reggie Miller, subsequently joined their agents in attempting to decertify the union, forcing a players' vote. However, players overwhelmingly voted to preserve the union.
Longtime NBA reporter and columnist David Aldridge is an analyst for TNT. You can e-mail him here and follow him on twitter.
