Thursday, June 30, 2011

NBA: Lockout On

NBA owners lock out the players after talks fail on new collective bargaining agreement.


*please note that the use of "shocking" is intended to be facetious.

MLB Will Ask Court to Hand Over Control of Dodgers

Sports Business Journal is reporting that MLB will ask the Court to hand over control of the Dodgers to MLB.


The League would be invoking the "voluntary termination" clause found in its constitution, which provides it may strip an owner of its team if that owner files for bankruptcy.

One thing to remember: even though MLB's rules provide it can take a team away under these circumstances, the Court isn't bound by MLB's rules. Bankruptcy court cares primarily about one thing: getting creditors paid. So that will be its focus on now MLB's constitution. However, MLB may argue that McCourt is part of the MLB club and should follow its rules.

Interestingly, only 5 Dodger companies filed for bankruptcy (owner Frank McCourt has more companies). They own the Dodgers team, Dodger Stadium and Dodgers ticket revenues. They don't own the Dodgers parking lots and the undeveloped land that surrounds Dodger Stadium.

So it's possible that one possible strategy for McCourt is to allow the Dodgers team and the Stadium to be sold out of bankruptcy, while holding on to the Dodgers’ parking lots and land for future development.

Whatever the strategy, ultimately, it would be surprising to see McCourt own this team for a substantial period of time. The team has been subsidizing McCourt personal life to the reported tune of $141 million dollars. The team is obviously heavily in debt. MLB wants him gone.

This is all too bad. The Dodgers are an iconic franchise and with significant historical relevance. This is a blemish on the team and brand.

Tuesday, June 28, 2011

Chara To Be Questioned by Police Over Pacioretty Hit

Zdeno Chara will be questioned by the police in the "coming weeks", and thereafter a decision will be made as to whether criminal charges will be pressed for Chara's hit on Max Pacioretty.

As previously blogged, the reasonable conclusion is that charges (likely assault causing bodily harm) won't be pressed against Chara. This is just not the typical case where you see criminal charges materialize.

Monday, June 27, 2011

Fatigue or No Longer Right Fit: Hulsizer Pulls Out of Bid for Coyotes

Chicago investment executive Matthew Hulsizer has pulled his bid to buy the Phoenix Coyotes.

According to this report, Hulsizer did not want to go through potentially several more months of Glendale of trying to acquire the team.

Sources familiar with the deal said late last week that Glendale was talking to Hulsizer and two other potential owners: Chicago Bulls/White Sox owner Jerry Reinsdorf and another unnamed group.

New Video Footage: When Vancouver Gathering Turned to Riot

Click here to watch footage that shows when the Vancouver gathering turned ugly.

Fox News: Los Angeles Dodgers file for bankruptcy protection

According to Fox News, the Los Angeles Dodgers have filed for bankruptcy protection.

The Dodgers are filing for Chapter 11 bankruptcy protection to keep the team out of the hands of Major League Baseball. Frank McCourt, owner of the Dodgers, will ask the bankruptcy court to approve a media rights deal that he believes will save his team from its liquidity crisis. The team's assets still outweigh their liabilities, but the team doesn't have enough money to meet the June 30 payroll. According to the filing, the Dodgers assets are at $500 million to $1 billion, and lists its estimated liabilities at $0 to $50,000.

The team doesn't have enough money to make payroll on June 30.

If McCourt sued Selig for turning down the Fox deal, the lawsuit would have allowed Selig to seize the team, and that's something McCourt wants to avoid at all costs. Bankruptcy seemed like the team's only real option.

Bankruptcy protection will provide the Dodgers with a process to address its immediate financing requirements and obtain the capital necessary to ensure the baseball franchise's long-term financial stability, the team said.

Some good Wall Street Journal articles to read on the topic: Baseball's Dodger Deal Strikes Out and Dodgers Owner Files for Team Bankruptcy.

Last week, MLB rejected a proposed 17-year, $2.7 billion deal between McCourt and Fox because McCourt planned to use about $150 million from the agreement for personal reasons, namely to settle a divorce from his former wife, Jamie and to pay off outstanding debts. MLB wasn't happy over what it saw as a pattern of doing this on the part of McCourt.

The list of creditors in the filing include former Dodger Manny Ramirez (owed $20,992,086), Andrew Jones (owed $11,075,000), Matt Kemp (owed $216,944) and Vince Scully (owed $152,778).

To read the filing, click here. Here's a snapshot of filing:

Sunday, June 26, 2011

Quick Hits: Around the Web in 80 Seconds

Offside welcomes the Team 1260 from Edmonton. I've appeared on the morning show with Nielsen and Chase, and it's always been a lot of fun. Thanks for the link guys.

One more thank you to Nielsen and Chase. They were kind enough to mention that Offside broke the story that the NHL would announce on Tuesday May 31 the move of the Thrashers to Winnipeg. Here's the short clip from Nielsen and Chase.

You've heard by now that the Winnipeg NHL team will be called the Jets. The name will be the same but the logo will change. With fans strongly in favour of the Jets name, this is a good compromise. It strikes a nice balance between historical recognition and merchandising pressures.

On the To Do list is transferring the WINNIPEG JETS trademarks back to the Winnipeg franchise. Right now, the trademarks are owned by the NHL, which took over ownership when the Jets moved to Phoenix. Here are the trademark registrations:

ESPN has reported that the NFL is proposing giving players "48% of all revenue", and that this percentage would never dip below 46.5%. The NFL is no longer asking for an additional $1 billion off the top. Under the previous CBA, players received approximately 60% of revenue, but that did not include $1 billion that the NFL took off the top as an expense credit. According to the NFLPA, under the old formula, players were actually receiving around 53% of all revenues instead of 60%.

According to ESPN, owners still will get some expense credits that will allow funding for new stadium construction.

NBPA head Billy Hunter on the NBA's CBA proposal: "Their demand is gargantuan, and we just can’t meet it". That sound you're hearing is a chorus of doors being locked around the league. Since many NBA teams have lost money, there is an obvious incentive not to open doors until teams have a deal they feel they can live with.

IMG and Brooks Brothers have reached an agreement for a “line of licensed college merchandise.” The partnership, the first of its kind for Brooks Brothers, will see apparel sold through schools like Harvard, Princeton, Cornell and Georgetown. The clothing line, which is for men only, will comprise sweaters, dress and polo shirts and ties. This feels like Dead Poets Society meets Jerry Maguire.

Pepsi sports marketing chief Jeff Dubiel has resigned from the company after 13 years. Since November 2008, Dubiel headed the sports marketing portfolio for the $57.8 billion beverage and salty snacks company, which includes sponsorship rights for MLB, NFL, NHL and the Dew Tour, and deals with Hendrick Motorsports that include drivers Dale Earnhardt Jr. and Jeff Gordon (SBJ).

“This was entirely a personal decision,” Dubiel said. “I’ve had a lot of fun and satisfaction doing sports marketing for Pepsi, but after 13 years, I just decided it was time to think about something new.”

ESPN continues to expand the live content on its 3-D network with five “Friday Night Fights” telecasts this summer.

World Wrestling Entertainment (WWE) is stepping up its international expansion initiatives, aiming to increase TV broadcasts, live shows, DVDs, merchandise sales and other revenue streams in nations that have some of the world’s largest economies. WWE has enjoyed great success abroad. International business generates about 25%  of WWE’s revenue annually, and reached 28.3% in 2010 with $135.3 million.

The NBA champion Dallas Mavericks saw the biggest gains in the number of Facebook “likes” and number of Twitter followers among all 16 playoff teams during the 2011 postseason, up 156% and 97% respectively.

AT&T's wireless division spent an estimated $366 million in 2010 on sports ads according to The Nielsen Co. Auto makers, telecom and quick service restaurants/pizza are the top 3 spenders when it comes to ad spending. Anheuser-Busch dedicates 80% of its budget to sports ads.

One thing is clear: in an increasingly fragmented viewership marketplace, sports advertising continues to be favorite ad platform for much of corporate America. The top 50 advertisers spent a combined $6.6 billion on sports advertising last year, a 27% jump over 2009.

According to the Sports Business Journal, here are the top 50 spenders on sports advertising:

Saturday, June 25, 2011

Walk in the Park: Bryzgalov's Contract & The New Kovalchuk Rules

Let's look at Ilya Bryzgalov's contract and whether it could be seen as a circumvention of the cap.

Refresher: the cap hit is the average yearly value of the contract and not what a player makes in a specific year. That's why a player's salary can be higher or lower in a particular year than the cap hit.

Here's the yearly distribution on Bryzgalov's new deal:

After the Kovalchuk decision, the NHL and NHLPA agreed to some new guidelines governing long term deals, which are deals that are 5 plus years. Here are the guidelines:

1) For long-term contracts extending beyond the age of 40, the average annual value of the contract for the years up to and including 40 are calculated by dividing total value in those years by the number of years up to and including 40. Then for the years covering ages 41 and beyond, the cap hit in each year is equal to the value of the contract in those years.

2) For long-term contracts that include years in which the player is 36, 37, 38, 39 and 40, the amount used for calculating the average annual value is a minimum of $1 million in each of those years - even if the actual compensation is less during those seasons.

So how does Bryzgalov's contract shake out?

1) The contract takes him to the age of 40, so the first guideline doesn't apply. If the Flyers added a couple of years to the contract, it wouldn't have affected the cap hit.

2) Between the ages of 36 and 40, Bryzgalov's won't make less than $1 million. So the second new rule doesn't apply either.

So does this contract constitute a circumvention and therefore likely to be challenged by the NHL?


While the contract is long, I don't see throwaway years added on that artificially lower the salary cap. As well, goalies are playing longer these days. Dwayne Roloson is 41, Tim Thomas (who arguably had the best season of an NHL goalie in history) is 37 and Hasek is 126.

All that being said, isn't it inherently risky to give a player a 9 year deal? Players break down, fade and fall apart - particularly in their late 30s. On top of that, sometimes personality conflicts drive a wedge between a player and the team/fans.

So while the contract is not a circumvention, it is circumrisky.

Friday, June 24, 2011


“When you see the work that’s going into it, the two sides sitting down behind closed doors, not letting information out, making sure that they’re working to get a deal done that’s right for everybody – the fans, the players, for the teams themselves – that’s what I’m optimistic about”
                            – 49ers President & CEO Jed York, on the NFL labor negotiations (, 6/24).

NHL 2000 Draft: One of Worst First Rounds Ever

Today, we will be introduced to the first overall pick in the NHL Draft, along with the rest of the players drafted in the first round.

As we approach the draft, it's interesting to look back at past drafts. One that stands out is the 2000 NHL Draft, which may well be one of the worst first rounds ever. It had at least 13 busts. Interestingly, all players were over 6 feet tall.

Here's the list:

Thursday, June 23, 2011

Reminder on Circumvention Principle & Bryzgalov

If a contract does not include throwaway years that are designed to artificially lower the cap hit, then that contract may not be seen as a circumvention of the salary cap.

You would look at things like whether the player is even expected to play out his contract. If not, circumvention becomes part of the conversation. Number of years is also important to consider.

In the case of Ilya Bryzgalov, he's 31 (as of today - happy birthday) and his contract runs through to the age of 40. The deal is worth $51 million, which translates into a cap hit of $5.67 million a year. We haven't seen the yearly distribution yet, but I would be surprised to see circumvention as an issue. Bryzgalov will be 40 when the contract is done, and goalies can play into their 40s. Dwayne Roloson is 41 and Hasek is 108.

As well, 9 years is not unusually long.

However, other factors are relevant when determining whether a circumvention has occurred since the analysis takes into account all factors.

We will know more when the yearly distribution of money is released.

Breakdown of Bruins Bar Bill

Courtesy of the website Sixteen Wins, here's a breakdown of the Bruins bar tab:

Wednesday, June 22, 2011

Good Article: Business Moves Your NBA Player Should Make As Soon As He’s Drafted

As we approach the NBA draft, Darren Heitner has written an article entitled, "Business Moves Your NBA Player Should Make As Soon As He’s Drafted".

It's a good article. If you have time, have a read.

Bruins Bar Bill - $156,679.74

After the Bruins won the Stanley Cup, the players went to Shrine's to celebrate. The bar bill is below. It adds up to $156,679.74.

Zdeno Chara says the bill is not accurate. Apparently he was so disappointed, he installed a stanchion near the front door of the bar and steered people into it.

I wonder who had the Corona.

Tuesday, June 21, 2011

Offside Radio Show Debuts Tonight at 6 on Team 1200

The radio show, Offside: the Business and Law of Sports, will debut tonight at 6pm (eastern). AJ Jakubec and I will co-host. The show will air once a week every Tuesday between 6 and 7pm on the Team 1200. You can listen online if you wish at

Tonight, we interview Brian Jennings, the Executive Vice-President of Marketing for the NHL. We will address a number of issues with Brian, including the new TV deal, in-arena advertising, ads on uniforms, marketing strategies for the NHL and bringing back the Adams division.

We will also talk NFL and NBA lockouts and maybe a bit of LeBron and his Q rating.

The show is live and we encourage you to call in at 613-750-1200, email at or hit us on Twitter (@EricOnSportslaw or AJ at @AJonSports).

Monday, June 20, 2011

NBA: Owner Commitment to a Lockout

According to Commissioner David Stern, NBA teams have combined to lose $640 million over 2 years, and 22 of the 30 teams have lost money.

For this reason, expect owners to be committed to a lockout if they don't get their way.

That's a key difference between the NBA and NFL CBA negotiations. The NFL, after all, is doing quite well.

Sunday, June 19, 2011

iQ: LeBron's Sponsor Rating Continues to take a Hit

“At the end of the day, all the people rooting for me to fail, they have to wake up tomorrow and have the same life they had before they woke up today,” James said. “They have the same personal problems they had today. I’m going to continue to live the way I want to live.”
- LeBron James suggesting that he is superior in response to crticism that people were rooting for him to fail after losing in the Finals to the Mavs.

Before the ill-conceived Decision, LeBron was a popular, likable athlete. However, after he announced in July 2010 he was taking his talents to South Beach, LeBron's Q rating dropped by about 40%. It also didn't help that he was part of a flashy production where he said the Heat would win 8 plus championships. On stage were LeBron, Wade and Bosh - and that was it. No other teammates. Just them.

The Q Score is a measurement of the familiarity and appeal of a celebrity (in this case). The higher the Q Score, the more highly-regarded the person. Q Scores can be relied on by sponsors to determine the marketability of a player.

LeBron actually began to see his Q rating recover in March 2011 by 20%. He was still a villain to many, but there was a recovery nonetheless.

After his most recent comments, you would expect that his rating will once again take a hit after belittling the purchasing public the Finals.

If you're his sponsors like Nike, Coke, State Farm, Upper Deck and McDonald's, you might be reviewing your relationship with LeBron, and may schedule a phone call with the basketball star.

Remember one key thing: brand owners are risk adverse. They don't want to associate themselves with a person that is perceived in a negative light, since by extension theirs brands will be perceived in a similar fashion.

Despite his "villain status", LeBron has earned the most among NBA players, taking in $34 million over the past 12 months in endorsements and royalty deals.

Perhaps what is most interesting about LeBron is that while he is seen as a villain, people want to like him. They search for areas of sympathy. This may be in part because people recognize he is getting bad advice. However, at the same time, public patience is not unlimited.

At the age of 26, LeBron is at the age of accountability. We can't say anymore that he's young and doesn't appreciate what he's saying. Maybe he should hang out with Rory McIlroy.

If he wants to stay near the top in sponsor deals, he will need to recalibrate. He just can't keep saying things that alienate people. If his Q rating continues to drop, eventually sponsors may elect to look elsewhere.

We never heard Michael Jordan say this stuff (while he was playing at least). He understood he was a brand. LeBron needs that realization too. People will care about him if he conveys he cares about them.

Saturday, June 18, 2011

By Design? Bruin Role Players Canadian

It always seems top of mind - does an NHL team need a bunch of Canadian players to win the Stanley Cup?

The bottom 6 forwards (role players) on the Stanely Cup champs Boston Bruins were all Canadian: Paille, Thornton, Ryder, Seguin, Campbell and Kelly.

This begs the question: was this done by design?

A little more than half of NHL players are Canadian. My guess is this number climbs significantly if you are looking at the percentage of Canadians on third and fourth lines. I do welcome your comments on this point (if you want to do the math, I'll post your article).

Whether or not the Bruins intended to fill their roll player roster spots with Canadians, you can expect this will become a hot topic of discussion.

Friday, June 17, 2011

Co-Hosting Scratches Today

I will be co-hosting the Healthy Scratches today with Steve Lloyd from 3 to 6 on Team 1200. Peter Chiarelli is on tap, as is Jay Busbee talking golf.

Steve has indicated that he will spend most of the time berating me for my choice of shoes.

I look forward to it.

Wednesday, June 15, 2011

NFLPA & NFL Joint Press Release

Here's the release:

"Discussions between NFL owners and players under the auspices of Chief Magistrate Judge Arthur Boylan took place again this week and will continue. At the request of Judge Boylan, both sides have agreed to maintain the confidentiality of the substance of the talks."

So not much there.

More, though, can be found at, where the NFL issued its own report today. Here's a key piece of it:
...the NFL and NFL Players Association are evaluating and strongly considering concessions on all fronts, and that has led to a belief that a deal could be done in two to four weeks. The return of the legal teams for both parties, after sitting out the sessions in suburban Chicago and Long Island, N.Y., the past two weeks, is seen as a sign of progress.
I've said a few time you can be optimistic, but sprinkle it with caution. I'm not the only one:
"Much can still go wrong -- every negotiating session is unique to itself," said Don Yee, who represents Tom Brady and is an adjunct law professor at USC. "Just because one day was good doesn't mean the next day will be, too."
Getting an agreement hammered out makes sense for both sides after one Appeals Judge warned neither side may like the Court's ruling. If the sides are close to getting an agreement, expect the Appeals Court to delay issuing its Decision.

NFL Lockout Update

There have been reports that a deal in the NFL CBA matter could be "days away".

There is certainly cause for optimism. However, if you are expecting to give your dad the new CBA for Father's Day, don't get your hopes up. The CBA negotiation is a complex one and there are lots of details to iron out before both sides say that have an agreement - even one in principle.

As I've said before, I see a deal getting done by mid/late July. Perhaps earlier now given reports that the sides are getting along. However, things could go south in a hurry too.

Fundamentally, my belief is that we would see a deal because this case has a profile of settlement. There are areas where the sides can compromise. This isn't the NBA, or worse, the NHL in 2005.

Here's a CBS report reminding everyone of the fragility of these negotiations.

Adult Expo Using NFL Trade-marks

Five NFL players have been featured in an advertisement for a party put on by Exxxotica Expo 2011 in Miami. The event was promoted as the official launch party for the Expo, which will be held in July in Chicago.

The ad featured the players Chiefs cornerback Brandon Flowers, Bears safety Major Wright, Chiefs safety Eric Berry, Texans cornerback Kareem Jackson and Raiders WR Jacoby Ford. According to the ad, these players were the hosts of the party.

The issue is that the ad, which can be viewed here, featured the players in uniform, complete with the teams' trademarks.

Unless the event organizer had the permission to use the various NFL trademarks, it cannot use the marks as doing so suggests that the event is affiliated with, or otherwise endorsed by, the NFL.

The ad also prominently featured the text "Hosted by NFL Stars & 2011 NFL Draftees". This might also be an issue, as featuring it in this manner may also suggest the NFL has sponsored the event.

While players are generally free to endorse whatever events they wish (so long as they are not featuring the team marks or colors), there is also the issue as to whether a team would want a player associated with an adult event.

In order to try and prevent a player from associating himself with the event, a team could consider relying on the moral clause in the player's contract. A moral clause is a provision in a contract that prohibits certain behavior in a person's private life that may reflect negatively on the employer.

Morals clauses enable one party to unilaterally terminate the agreement if the individual engages in conduct that could have some sort of negative impact upon the particular company or organization.

It's not always clear as what constitutes immoral behavior. Morals are usually defined by the society and the prevailing attitudes that dominate at that time. This event, however, may not be deemed immoral.

So it might be tough to rely on the moral clause as a legitimate enforcement tool, although it can be effective in making a point. That, or just ask the player politely not to do it given the kids that watch the game.

Monday, June 13, 2011

Miami Herald Congratulates Heat on Championship

The Miami Herald ran an advertisement today congratulating the Miami Heat on winning the championship.
The ad is framed by a report of the Heat's loss.

Here's the ad:

Forbes: Top Paid Athletes - Woods, Kobe & LeBron

According to Forbes, over the past 12 months, the top paid athlete is Tiger Woods at $75 million. Despite losing Gillette, AT&T and PepsiCo as sponsors, plus being mired in a 20 month winless streak and putting the finishing touches on a second wasted year, Woods still tops the list.

For the record, Woods' income has dropped $50 million over the past 2 years.

According to the article, Woods can thank his sponsors Nike and Electronic Arts:
The two companies have built significant businesses on Woods’ back, and his paychecks from both have grown. Nike launched its golf division with Woods essentially holding up the brand; last year it reported sales of $638 million. EA released its 14th Woods video game in March, and the game racked up record first-week sales of 225,000 units; that topped the old sales record, set in 2007, by 17%. EA and Nike combined are responsible for more than half of Woods’ $75 million in earnings.
Forbes derived income from salaries, bonuses, prize money, appearance fees, licensing and endorsement income in the 12 months ending May 1.

At number two is Kobe Bryant at $53 million. His "I'm sorry" rock he bought his wife would probably be third on this list.

Rounding out the top 5 are LeBron James, $48 million, Roger Federer, $47 million, and Phil Mickelson, $46.5 million.

The only woman on the list is Maria Sharapova. She's number 29 at $24.2 million.

Here's the entire list:

1. Tiger Woods, $75 million
2. Kobe Bryant, $53 million
3. LeBron James, $48 million
4. Roger Federer, $47 million
5. Phil Mickelson, $46.5 million
6. David Beckham, $40 million
7. Cristiano Ronaldo, $38 million
8. Alex Rodriguez Baseball 35 $35 million
9. Michael Schumacher, $34 million
10. Lionel Messi, $32.3 million
11. Fernando Alonso, $32 million
12. Rafael Nadal, $31.5 million
13. Valentino Rossi, $31 million
14. Tom Brady, $31 million
15. Lewis Hamilton, $30 million
16. Derek Jeter, $29 million
17. Dale Earnhardt Jr., $28.5 million
18. Yao Ming, $27.7 million
19. Dwight Howard, $27.6 million
20. Dwayne Wade, $26.2 million
21. Peyton Manning, $26.1 million
22. Ichiro Suzuki, $26 million
23. Carmelo Anthony, $25.1 million
24. Kaka, $25 million
25. Manny Pacquaio, $25 million
26. Jeff Gordon, $24.9 million
27. Rinaldinho, $24.7 million
28. Amare Stoudemire, $24.5 million
29. Maria Sharapova, $24.2 million
30. Wayne Rooney, $24.1 million
31. Jimmie Johnson, $24 million
32. Kevin Garnett, $23.8 million
33. C.C. Sabathia, $23.6 million
34. Jim Furyk, $23 million
35. Vince Carter, $21.8 million
36. Johan Santana, $21.5 million
37. Tim Duncan, $21.2 million
38. Chris Paul, $20.9 million
39. Mark Teixeira, $20.8 million
40. Ryan Howard, $20.8 million
41. Miguel Cabrera, $20.3 million
42. Rashard Lewis, $20.1 million
43. Todd Helton, $19.6 million
44. Ernie Els, $19.6 million
45. Joe Mauer, $19.3 million
46. Dirk Nowitzki, $19.3 million
47. Barry Zito, $19.2 million
48. Jahri Evans, $19.1 million
49. Pau Gasol, $18.9 million
50. Michael Redd, $18.8 million

Sunday, June 12, 2011

Positive Momentum in NFL Lockout Talks

Danny Kelly of Field Gulls has authored an article where he builds on reports from earlier in the week that NFL labor talks have enjoyed some positive momentum.

As addressed on Offside earlier this week, a chief reason we may be seeing progress is the prospect of an indefinite lockout imposed by the Appeals Court - or at least a lockout that could last for a substantial period of time. If the lockout were to stay in place for a long time, the players would suddenly be facing the possibility of a lost season - or more - if they wanted to continue to fight.

The reason for a possibly extended lockout? The majority of the Appeals Court has made it pretty clear that they side with the owners. They went so far as to say at one point that the NFL "has made a strong showing that it is likely to succeed on the merits".


Now that doesn't mean that the Appeals Court will ultimately find for the owners and keep the lockout in place. In fact, Judge Kermit Bye urged the owners and the players to get together and because the ruling may be something that "neither side will like".

However, the reasonable conclusion is that the owners would ultimately be awarded some type of extended lockout (the length of which is unclear).

So the possibility of an extended lockout has likely inspired the parties, and particularly the players, to kick negotiations into high gear.

Saturday, June 11, 2011

Fired Clippers GM/Coach Dunleavy Gets $13 Million Arbitration Award; Sounds Like Appeal Being Considered

An arbitrator has awarded former L.A. Clippers general manager and coach Mike Dunleavy $13,517,000.00 in compensation.

The Clippers dismissed Dunleavy in 2010, who was in the fourth year of a five year $22-million deal, and stopped paying him. Dunleavy then exercised his option to take the Clippers to arbitration with a view to recovering what he believed he was owed.

Clippers General Counsel Robert Platt issued the following statement: "We do not agree with the arbitrator's decision. We intend to review the decision carefully and explore the team's various options."

That probably means that the Clippers are considering whether they have sufficient grounds to appeal the decision.

Friday, June 10, 2011

A Stroll Down Manning Lane: NFL Opts Out Of CBA - May 20, 2008

With the NFL and its players still trying to hammer out a new CBA, I decided to take a glimpse back in time to May 20, 2008, when the NFL announced it would opt out of the 2 year old CBA (set to expire at the end of the 2012 season).

Sometimes it can be fun to reminisce.

Here's an excerpt from the NFL's press release entitled, "NFL owners opt out of CBA":
The current labor agreement does not adequately recognize the costs of generating the revenues of which the players receive the largest share; nor does the agreement recognize that those costs have increased substantially -- and at an ever increasing rate -- in recent years during a difficult economic climate in our country. As a result, under the terms of the current agreement, the clubs’ incentive to invest in the game is threatened.
The press release goes on to state,
There are substantial other elements of the deal that simply are not working. For example, as interpreted by the courts, the current CBA effectively prohibits the clubs from recouping bonuses paid to players who subsequently breach their player contacts or refuse to perform. That is simply irrational and unfair to both fans and players who honor their contracts. Also irrational is that in the current system some rookies are able to secure contracts that pay them more than top proven veterans.
The NFL also declared that it was "resolved to do our best to achieve a fair agreement that will allow labor peace to continue through and beyond the 2011 season".

Ok - maybe not that much fun.

Pats Owner on Lockout: "I think we’re getting close to having to put this thing to bed"

“I think we’re getting close to having to put this thing to bed, so we don’t miss any events."
- Robert Kraft, owner of the Patriots as per Boston Herald article

On the NFL lockout, Kraft feels that the NFL and players are "further along than they had been when the lockout started in March". This is according to Karen Guregian’s article in the Herald.

Kraft also addressed the ongoing litigation: “… the good news is we’re talking. I think we went 34 days without having communications, and the lawyers on each side were doing stuff. That, to me, isn’t progress”.

It is important to remember that the players sued the owners, and the owners were forced into litigation. Once the Appeals Court dropped the lockout back in place, and suggested that it may stay there for an indefinite period of time, the players were given a serious incentive to start negotiating in a meaningful way.

So  litigation did serve a purpose in this case - providing that incentive to talk. Of course, there is the argument that the parties should have never been involved in litigation in the first place. Deals are not made in the Courts, but rather at the negotiating table.

Tough to argue with that.

Thursday, June 9, 2011

Discredited: Paper Reports NFL Lockout "Over"

The North Andover, Massachusetts newspaper, the Eagle-Tribune, has reported that the NFL "lockout is over". The article states that "according to an NFL source, owners and players have tentatively reached an agreement to end the lockout".

Not so fast.

This report has been widely discredited. Pats owner Bob Kraft has said that the parties have “a lot of hard work” ahead of them.

George Atallah, who works for the NFLPA, today tweeted, "There's a report that the lockout is over.".

The article also says that the parties met in Manhattan, when in fact they met in Long Island. The article also provides that some "coaches and players have been contacted about returning to work probably early next week and as soon as this weekend'. If players and coaches were indeed contacted, this story would have broken quicker than my confidence at a speed dating event.

So it looks like a false alarm. The lockout continues.

I still see settlement in principle no later than the end of July, followed by a full NFL season filled with Brett Favre rumours of a comeback and stories of Clinton Portis battling injury (wherever he may sign). 

Given that there are clear areas of compromise, this case has a profile for settlement.

Tuesday, June 7, 2011

Drudge Report Features Horton Hit

Drudge Report is a massively popular website. It's generally considered right wing (for response to site see Huffington Post) and today received 32 million hits. It's more popular than Yahoo! for news receiving over 800 million hits over the past 30 days.

Today, Drudge ( featured a story on Rome's hit on Horton that left the Bruins' forward on the ice unconscious. The site also has a link to the video of the incident.

You can imagine that parents that are considering putting their kids into hockey, or more generally, looking to engage in the sport, might seriously think twice after seeing this story.

The headshot list continues to grow (Matt Cooke on Marc Savard, Mike Richards on David Booth, Matt Cooke on Ryan McDonagh, Zdeno Chara on Max Pacioretty, Patric Hornqvist on Tyler Seguin, etc.). The cumulative effect of seeing these hits on television is not great for a league looking to increase its market share. Of course, I'm not saying anything most don't know.

Sunday, June 5, 2011

Breaking News: Jason Bailey Dismisses Anti-Semitism Suit Against Ducks; Continues Against Balance of Defendants

In keeping with Plaintiff Jason Bailey's request, the Court has dismissed the Action against the Anaheim Ducks. Bailey, however, is continuing with his lawsuit against the balance of the defendants, coaches Martin Raymond and Mark Pederson, as well as Flying Pucks LLC.

Bailey moved to have the Action dismissed against the Anaheim Ducks on May 3, 2011.

The focus of the action is that Bailey was subjected to harassment and anti-Semitic remarks by the Condors coaches. The lawsuit contends that Bailey was the victim of religious discrimination, harassment based on religion, intentional infliction of emotional distress and retaliation. Bailey claims he lost income and suffered humiliation. Bailey is suing for unspecified monetary damages.

When the lawsuit was filed, Flying Pucks was not a defendant - it was the Bakersfield Condors hockey team. It seems this defendant was updated to reflect the owner of the team. This is not unusual.

On why he dismissed against the Ducks, ultimately, it may have been that Bailey did not feel he could establish a reasonably sufficient link between the Ducks and the complained of events. According to the Complaint (lawsuit filed by Bailey), the Ducks made the coaches apologize. That may have been a consideration in making this decision. So this may turn on the Ducks' insufficient proximity to the alleged events.

Here is the official Court document dismissing the Action against the Ducks:

Saturday, June 4, 2011

Weekend Quick Hits: Around the Web in 80 Seconds

Gone In 17 Minutes: The Winnipeg Franchise, formerly known as the Jets, sold out tickets in 17 minutes. The luxury boxes are also gone for the next 10 years and there is a wait list of 7000.

This begs the question: how much did this help Quebec? I'm guessing immensely. Other owners are now seeing serious revenue/interest coming in from a traditional hockey market, and support for other traditional hockey markets will likely gain some serious traction from inside the NHL.

Knowing hockey would get support is one thing. Seeing it crystallize so dramatically is another.

This type of success is very hard to ignore.

NFL Sponsors Groced Out: AdAge has a good article entitled, NFL Lockout Threatens In-store Promos for Pepsi, Mars, P&G and More.

The story addresses how in-store marketing people are being affected by the possibility of no football in September. Major brand owners aren't sure exactly what they should be doing after having poured millions of dollars into promotion. One thing is clear - unlike anywhere else in sports, sponsors are all hanging around because the NFL brand is immensely strong from a co-promotion standpoint.

Here's an excerpt:
After spending millions in advance on multibrand, in-store promotional deals with the National Football League, Procter & Gamble, Mars and PepsiCo, among others, now find themselves faced with the possibility of a truncated season that could do more damage to their plans and brands than those of the networks and TV buyers.

Networks can schedule alternate programming and marketers can apply media analytics to follow their target audiences wherever they go when they're not watching NFL football. But shopper-marketing events have calendars set a year or more in advance. Product has to be produced and displays have to be filled, regardless of whether games get played.

..."There is going to be a season," she said. "The issue is how late it will start and how it will impact our business." Normally, Mars uses TV ads to plug in-store promos, but the media buying will get tricky if the season is delayed.
...P&G, for example, was aware of the potential for a labor dispute when it negotiated its deal, he said. And one factor behind doing it anyway is the belief that the NFL brand is strong enough to survive "well beyond a game or a few games or even part of the season," he said.
Tebow Can Pitch: According to the Sporting News, Broncos QB Tim Tebow has joined Colts Peyton Manning, Steelers Troy Polamalu and Saints Drew Brees "in the NFL's group of most marketable pitchmen". This is just after one season, which included 5TDs and 3 picks. He promotes Nike, FRS Energy Drinks and Jockey.
One expert says a reason for his appeal:  he has an "embraceable wholesomeness".
I'm not sure what that means but it makes me want to eat a muffin.
Kindly Scratch My Head: The NFL is ahead of the pace on season-ticket sales compared with this point last year. This is fascinating given that the season may start late. However, as I've said all along, I see the season starting on time and a deal in principle being reached in late July.
NBA in India: The NBA continues to grow in India. In keeping with its growth, the NBA signed a deal with Times Internet Ltd., one of the country’s largest media companies. The agreement "will create a dedicated digital NBA section on The Times of India and the IndiaTimes English language websites, with the content expected to be featured on other Times Internet Ltd. digital outlets." This is according to the Sports Business Journal.

As we head into a possible NBA lockout, remember one thing - the NBA is very popular overseas. See below for one such indication.
Let's Be Friends: And here's your social networking update on the coolest kids on the virtual sports block with respect to Facebook and Twitter combined:
Sports Top 10

NHL Top 5

1) NHL
2) Hawks
3) Bruins
4) Habs
5) Flyers

NBA Top 5

1) NBA
2) Lakers
3) Celtics
4) Heat
5) Bulls

MLB Top 5

1) Yanks
2) Red Sox
3) Cubs
4) Giants
5) Phillies

NFL Top 5

1) NFL
2) Cowboys
3) Steelers
4) patriots
5) Bears

And here are your top 10 Facebook/Twitter accounts across the virtual board:

Friday, June 3, 2011

NFL Update: Players May Need to Recalibrate

When I listened to DeMaurice Smith speak recently, he said "we are prepared for a lockout" and have been all along. If that's the case, today's events may not phase him. At the very least, they are not a surprise.

If you are an NFL player, today, on its face at least, didn't go so well.

The NFL and its players were in Appeals Court today arguing over the legality of the lockout. The players say the lockout isn't legal; the owners disagree.

You might remember that the Appeals Court converted a temporary stay (or suspension) of the ruling to lift the lockout into a longer one pending the resolution of today's bigger question - is the lockout is legal. When they made that ruling, the majority of the Court remarked that the NFL "has made a strong showing that it is likely to succeed on the merits."

So the thinking was today the Appeals Court (or at least the majority of the 3 judges) would suggest that they are likely to maintain that position. And by all accounts, that's what happened. The majority of the Judges questioned the players pretty heavily on their position. That of course doesn't mean they will find against the players. Still, that together with the remark they made last time around that the NFL was likely to succeed, it's not unreasonable to put your money on the owners.

So what if the NFL owners win?

That would mean that the lockout would stay in place for an indefinite period of time (as long as the owners want basically). The players could appeal the decision to the U.S. Supreme Court. It is doubtful it would accept the case, and even if it did, it wouldn't be heard for some time.

So all this means that if the NFL is successful, then the players may need to rethink their strategy. Do they dig their heels in and continue to resist the NFL's latest proposal or do they decide to offer up some further concessions.

If the players want to play, they will need to make concessions. Don't forget, the last time the owners signed a CBA, some owners didn't like it - at all. They don't want to sign another bad deal (in their eyes) that they will have to live with for a long time. So I expect the owners will continue to dig in their designer heels. Unlike the last time, they seem unlikely to bend in any meaningful way. So if they want to play, players may need to recalibrate their expectations.

The reasonable cutoff to have a full NFL season is around August 15. The season starts September 8, and teams need about 3 weeks to get ready. So stay tuned.

My feeling all along has been an agreement in principle will be reached sometime in mid/late July. I say that because there are fairly obvious areas of compromise and we are not dealing with a major overhaul of the NFL's business model like we had with the NHL in 2004-05 or like we are seeing with the NBA. This is just about splitting up the revenue pie. While of course not a trite issue, that may suggest that this case has a profile for settlement in the short term.

Oh yes - and don't forget half of the 1900 NFL players make $500,000 or less. They will want to play as they understand they have limited earning potential and careers. Their voices will be heard the closer we get to July 23rd, the first day of training camp.

Wednesday, June 1, 2011

NBA Union Head Hunter: CBA Proposal “Regressive”, “Repressive” & “Non-Starter”

Next week, the NBA and NBPA will meet to try and find common ground on a new CBA.

The issues dividing the parties are significant. The NBA is looking for major changes to its business model, very much like the NHL did in 2004-05, when the league shut down for an entire season.

Here are 3 key demands being made by the NBA:

1) Reduce the salary cap from $58 million to $45 million
2) Non-guaranteed player contracts
3) $800 million rollback in salaries

As mentioned in my column on Bill Daly’s year in review, Hunter spoke two weeks ago at a conference. Below is a breakdown of his comments. As we approach next week, his comments are relevant. As well, NBA Commissioner David Stern acknowledged that it will be “a challenge” to reach a deal on a new CBA before the current one expires in a month (source: Yahoo!).

Listening to Hunter in person, I did get the sense that the Union is looking to make a deal and might be amenable to certain concessions.

Here are Hunter’s remarks:

On the State of the NBA

“Things are going extremely well in the NBA”. It has been the “best year in history”. Television “ratings are up” and “attendance is up”. The NBA has exciting new talent in "Blake Griffin and Kevin Durant”. The NBA has also enjoyed strong market penetration in “China and India”.

On the Big Issue Under CBA

The “big struggle between us and the NBA is how we divide up the revenue being generated”.

On the NBA’s First Proposal 2 Years Ago

“As many of you know, we started our labor negotiations two years ago”. The first proposal made by the NBA was “draconian”.

Last summer, the Union responded with a counter proposal, and about a month ago, the NBA made a “new proposal”. The proposal was a “regressive proposal…and we thought first proposal was bad”. The second proposal made “repressive demands” and was “worse than the first proposal”.

On Expectations Moving Forward

“There has not been any movement and I don’t know whether there will be any between now and June 30”. The NBA has not provided any indication as to whether it is “inclined to soften its demands”.

One Word to Describe the Current Proposal


On the Ongoing NFL Litigation

NFL antitrust litigation is “casting a giant shadow”. We were “high-fiving when Nelson ruled”.

On the Possibility of Not Reaching an Agreement

It would be “asinine for us not to reach an agreement".

On a Possible Lockout

“We are ready for the lockout”. If the options are the current proposal or a lockout, “gimme the lockout”.

On Striking

The Union would not expect to “strike in the face of the expiration of the agreement”, although “all options are on table…and we will continue to engage in hard knuckle bargaining”.

Our Revenue Sharing

“Our contention is that there may be some teams losing money but that can be resolved through revenue sharing”.

The Union is “prepared to back off the 57% guarantee” but that’s not enough for the NBA.

On Players Playing Overseas During Lockout

The NBA should be “very concerned” with players playing abroad during a lockout.

Final Message

“Put the message out – we very much want a deal - a fair deal”.

NHL Owns JETS Trademarks

There have reports over who owns the JETS trademarks. Some have said that the JETS trademarks are owned by the old Jets owner and as a result the new owners can't use the name.

That's not the case. As per my column a few slots down, the NHL owns the JETS trademarks. In fact, the NHL filed new trademark applications for the WINNIPEG JETS marks after the team moved.

All this means is that if the new owners want the JETS marks, they can have it. The NHL would just need to transfer them over.

See below for more details.