Several weeks ago, Aware Gaming sold its spot in MLG's Pro League Season 2 to TCM Gaming. Effectively, this left half of Aware's roster without organizations to compete with in Season 2. Unfortunately, judging by the tweets of players like TJHaly and Huke, Aware's players may not have known about the sale of the pro league spot until it happened.
Aware selling its spot in Season 2 highlights the fact that players need to have protective measures built into their contracts. Nothing can ensure that a team won’t sell their league spot, but measures can be taken to protect players (at the contract negotiation stage) should these events ever occur. Obviously different players will have different leverage to seek any protections, and teams may be resistant to offering any protections, but protective measures are worth exploring.
Building protections into contracts
Aware has every right to sell its league spot. However, players have every right to request provisions in their contract that they be compensated should such an event occur, especially within defined windows of time prior to the season. For instance, if the team sells the league spot within X days/weeks of the start of the season, then a defined amount of money must be paid to the player. As most teams aren't flush with cash, this would act as a disincentive for teams to sell their season spots. However, teams could push back against this (especially the less established teams) so that they would have the freedom to do as they please with their season spot. Realistically, a team that is 100% secure about participating in the season has no reason not to include such a provision if requested, since they know the triggering event (the sale of the spot) is not going to occur. Its important to note that such a provision does not necessarily have to require money, but can instead require specific goods.
One of the simplest but significant provisions which should DEFINITELY be negotiated are escape clauses. (I talked about escape clauses here).Those clauses allow the player to cancel the remainder of the contract should defined situations arise. For instance, such a clause can allow a player to cancel his contract with a team should the team sell their league spot. Other triggering events can include nonpayment, benching for a portion of time, etc. Using the example of such a clause that is triggered by the sale of a league spot, teams may be resistant to implementing such a clause in a player’s contract. The team’s goal would be to retain the players so that they can still have something to draw viewership, despite not competing in the league. However, the player, who obviously would want to join a new team, may have a stronger position here. Not wanting to agree to such a provision conditioned upon selling a league spot shows uncertainty, which can lead to a great deal of bad PR for the team. The last thing the team wants is bad PR because it hurts its viewership and could keep talented players from joining. Importantly, escape clauses are time sensitive. Once a triggering event occurs, the player would have a defined window by which to exercise the clause and cancel the contract. If that window is missed, the player can’t cancel the contract without breaching it.
These are only two brief examples of how players can protect themselves in their team contracts. Players should always seek to incorporate protections into all of their contracts, especially their team contracts. It is not the team’s responsibility to protect a player’s rights, and even if a union were to exist, it is the responsibility of the player to seek rights beyond what a union can guarantee. Like pro athletes, players should protect themselves through their contracts, even if that means bringing in someone else to help them do so.
TL/DR- Players should seek protections in their team contracts. Here are two examples.
On September 8, 2014, TMZ Sports released the video of Ray Rice striking his fiance in the elevator of an Atlantic City Casino. Until this point, the NFL claimed it had not seen the video, despite requesting it from the police. Thus, the video played no part in determining Rice's initial two game suspension (which I initially discussed here).
Although the NFL now faces questions about the sufficiency of its investigation process, the League should also be faced with a lawsuit. After TMZ released the video, Rice was released by the Baltimore Ravens. More importantly, the NFL indefinitely suspended RIce from the League, despite having initially suspended Rice for two games. In other words, the NFL punished Rice for the same offense twice.
Conceptually, punishing a player twice for the same offense is a problem. This would allow the League's Commissioner to reserve seemingly unending power to exact punishment and then change his mind as he sees fit. Importantly, although the Commissioner is granted the authority to punish players under Article 46 of the Collective Bargaining Agreement ("CBA") entered into by the NFL and the NFL Players Association ("NFLPA"), which is further specified in the NFL Personal Conduct Policy, the CBA is silent as to multiple punishments by the Commissioner for the same offense.
The Commissioner's second punishment should be challenged in court. In order for Rice to succeed in challenging that the Commissioner exceeded his authority by disciplining Rice a second time for the same offense, he would have to prove that the indefinite suspension was arbitrary and capricious. This burden of proof, although deferential to organizations as decision makers, may be achievable for Rice.
In support of his claim, Rice would rely heavily on the NFL's investigation process which led to his first suspension. During the investigation, the NFL gathered evidence it deemed necessary to discipline Rice. The NFL recently stated that it requested "any and all information about the incident, including the video from inside the elevator" and that "[The elevator] video was not made available to us and no one in our office ha[d] seen it until [TMZ released it]."
Despite being aware of the existence of the elevator video and knowing the League had not seen it, the Commissioner decided to discipline Rice by suspending him for two games. Therefore, the Commissioner's second disciplining of Rice can be seen as arbitrary and capricious because there is no rational connection from the indefinite suspension to now seeing the contents of the video they implicitly rejected to pursue. In essence, the NFL cannot claim that the contents of the video are new evidence, as they were aware of the video's existence and chose not to ensure they saw the video before exacting discipline.
Another point that Rice could raise, albeit a weaker one, is that he was disciplined a second time absent any investigation, which is arbitrary and capricious as the League violated its own rules. Within less than a day of the tape's release, the NFL suspended Rice indefinitely. The NFL Personal Conduct Policy states that "Upon learning of conduct that may give rise to discipline, the League may initiate an investigation" and "Upon conclusion of the investigation, the Commissioner will have full authority to impose discipline as warranted." The Personal Conduct Policy only discusses an expedited disciplinary process with respect to repeat offenders. However, Rice's single incident of known domestic violence is the only time his conduct had given rise to an investigation or discipline. Therefore, under its own terms, the NFL would be treating the viewing of the elevator video as a separate disciplinary incident due to the lack of an investigation. However, as the video portrayed the known actions in the same event as the first disciplinary matter, any additional discipline would be arbitrary and capricious.
Further evidence that the NFL is treating the elevator video as a separate discipline-worthy incident comes from the recent changes to the Personal Conduct Policy. In the fallout from the perceived leniency of Rice's initial two game suspension, the Commissioner mandated that enhanced penalties for domestic violence be placed within the Personal Conduct Policy. Under these enhanced penalties, a second domestic violence offense mandated that the player would be indefinitely suspended from the NFL, and would only be allowed to apply for reinstatement after a year. Such discipline is identical to that received by Rice following the release of the elevator video. However, as noted above, the release of the elevator video cannot be effectively said to be a separate disciplinary event.
Should Rice be able to meet the arbitrary and capricious burden, the Court would then overturn his indefinite suspension and instead, his previous two game suspension would hold. However, Rice may not wish to bring suit out of public relations concerns. Certainly, his image has been rightfully tarnished by his actions, and bringing suit to be reinstated in the NFL may create additional negative perceptions. However, the NFLPA has the ability to bring suit on his behalf. The NFLPA is particularly interested in this matter because of the precedent that it could set on player discipline. Simply put, the NFLPA does not want the Commissioner to be able to discipline a player twice for the same offense. Should it bring the suit on behalf of Rice, he would still have the benefit of having his indefinite suspension overturned if the NFLPA succeeds.
Although Rice's actions were truly despicable, League officials must be forced to correctly discipline players on their first attempt. Otherwise, no discipline is ever final.
Earlier today, I added a Media page to the website, where I will post videos and articles I am featured in. Currently, there are two videos and an article posted. Stay tuned for more, and also keep an eye on the blog for video posts.
Below is the most recent video, which you can find on the Media page. In the video, I discuss my practice and the O'Bannon v. NCAA ruling on the Price of Business show on Business KTEK 1110 in Houston.
On August 8, 2014, one of the most important Sports Law cases was decided. The case, O'Bannon v. NCAA, was a class action lawsuit brought by current and former college athletes that sought to challenge the NCAA's rules prohibiting compensation for FBS football and Division 1 basketball players on antitrust grounds. Specifically, the athletes were challenging the rules that disallowed athletes from receiving a portion of the revenue the NCAA, and its institutions, receive for the use of the athletes' names, images and likenesses in video games, game broadcasts, and other forms of media. The athletes alleged that these rules violated the Sherman Antitrust Act.
Ultimately, the Court found in favor of the athletes, holding that "the challenged NCAA rules unreasonably restrain trade in the market for certain educational and athletic opportunities offered by NCAA Division I schools. The procompetitive justifications that the NCAA offers do not justify this restraint and could be achieved through less restrictive means." Based on its findings, the Court imposed an injunction to:
This case is notable for the implications it has on college sports in both the present and the future. Although the remedies were limited in scope, much of the decision reads of contempt for the NCAA's business practices under the guise of amateurism. This decision may not be the deathblow to the NCAA and/or its practices, but it certainly provides a step in the right direction for athletes to be compensated. Further, and perhaps more importantly, this decision provides the foundation for future legal challenges to the NCAA's practices. Currently, there are multiple challenges to the NCAA's business practices, and since the O'Bannon decision was filed, another class-action antitrust suit has been commenced against the NCAA.
Effects of the O'Bannon decision
Unfortunately, this ruling does little to put money in the players' pockets during college, when they need it. Athletes who have full scholarships can struggle financially during their time in college, as scholarships do not cover the full cost of attendance. Further, there is a public perception that all collegiate football and basketball players are scholarship athletes. This notion is simply untrue. Many athletes, even at the Division 1 level, do not have scholarships. For instance, per NCAA regulations, a FBS football team can have up to 85 players on full scholarship at any given time. However, prior to the college's first day of classes or the team's first game (whichever is sooner) a team's roster cannot exceed 105 players. This means that football teams are allowed to have 20 athletes, approximately one-fifth of the total roster, who are not on scholarship prior to their first game. These walk-on athletes must attend college on their own dollar, and many struggle financially to do so.
However, this decision is still a victory for players' rights. The NCAA has hidden behind its principles of amateurism and the "student-athlete" since its inception, and has vehemently refused (by both actions and omissions) measures that it believed would align it with professional sports leagues. Some of these measures include:
Although this decision did not provide remedies that impact athletes during their college careers, it effectively obliterated the NCAA's concept of amateurism. In discussing the inconsistencies of how the NCAA has defined amateurism throughout its history, Judge Wilken opined that "Rather than evincing the association's adherence to a set of core principles, this history documents how malleable the NCAA's definition of amateurism has been since its founding." The NCAA's convenient principle of amateurism is the foundation of many, if not all, of players' rights issues that should be addressed in further litigation. Most notably, amateurism is one of the NCAA's primary oppositions to the unionization of college athletes.
Importantly, the O'Bannon case has provided a roadmap for future lawsuits on how to challenge many of the NCAA's practices. The decision itself has provided a large amount of language for Courts to utilize in decisions for years to come. The NCAA is currently facing several similar class action cases. One of the current class action antitrust cases alleges that the NCAA has unlawfully capped player compensation to the value of the scholarship. This effectively seeks a free market for player compensation. This case is similar in theory to the O'Bannon case, and could benefit from utilizing the analysis of the O'Bannon decision, particularly Judge Wilken's discussion of amateurism. Certainly, at least some of Judge Wilken's analysis from the O'Bannon decision will be used to frame that case moving forward. Time will tell whether or not the case succeeds, but the O'Bannon decision has exposed a weakness in what has been the NCAA's strongest argument.
Changes through legislature?
In her conclusion to the O'Bannon decision, Judge Wilken opined "It is likely that the challenged restraints, as well as other perceived inequities in college athletics and higher education generally, could be better addressed as a policy matter by reforms other than those available as a remedy for the antitrust violation found here. Such reforms and remedies could be undertaken by the NCAA, its member schools and conferences, or Congress." This statement, while not a ringing endorsement of change through antitrust challenges, also highlights the ease (technically speaking) by which the NCAA's inequitable practices can be remedied, or solidified, through negotiation or petitioning Congress. As the NCAA has refused to budge thus far on these athletes' rights issues, the only remaining path (other than litigation) is by seeking Congressional action.
In light of the several cases the NCAA was facing recently, the NCAA spent $240,000 on lobbying in the last six months. Not only is this amount approximately $80,000 more than the NCAA spent all of last year on lobbying, it is also the most the organization has ever spent on lobbying. There are likely two reasons the NCAA is pursuing this lobbying campaign. Either the NCAA is attempting to solidify its practices with respect to athletes by seeking Congressional action, or their lobbying is a means of damage control.
Despite the NCAA's lobbying, college athletes' rights have become a topic of discussion in Congress. Recently, Congress formed a bipartisan caucus "to inform Congressional members about physical, academic and financial issues college athletes face so they're treated fairly." The Congressional Student-Athlete Protection Caucus, as it has been named, was designed to foster discussions that would "lead to greater accountability on the part of the NCAA" (Charles Dent [R-Penn]). Perhaps as Judge Wilken opined, Congressional action may obviate the need for further litigation to give athletes the rights they are entitled to.
Although the O'Bannon decision did not result in sweeping changes to NCAA practices, the ruling importantly exposed a weakness in the NCAA's arguments that future litigants may be able to utilize to their advantage. Certainly, the several ongoing actions against the NCAA will borrow some of the analysis from the O'Bannon decision. However, as Judge Wilken opined, Congressional action may obviate the need for further litigation. Hopefully, the Congressional Student-Athlete Protection Caucus yields legislation supporting college athletes' rights. Otherwise, the lawsuits will continue until these athletes get the rights they deserved.
Quiles Law is an esports and content creator law firm headquartered in New York City, representing a global clientele.
1177 Avenue of the Americas
New York, NY 10036
(P) (917) 477-7942
(F) (917) 791-9782
Attorney Advertising. The information presented in this site should not be construed to be formal legal advice nor is it intended to form any attorney/client relationship. Our attorneys are licensed to practice law in the States of New York, New Jersey, Texas and Wisconsin. Copyright Quiles Law, 2022. All rights reserved.