Brady et al v. National Football League et al

Filing 111

DECLARATION of Richard A. Berthelsen in Support of 110 Memorandum in Opposition to Motion, filed by Tom Brady, Drew Brees, Vincent Jackson, Ben Leber, Logan Mankins, Peyton Manning, Von Miller, Brian Robison, Osi Umenyiora, Mike Vrabel. (Attachments: # 1 Exhibit(s) A-F). (Berens, Barbara) Modified text on 4/27/2011 (lmb).

IN THE UNITED STATES DISTRICT COURT
DISTRICT OF MINNESOTA
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - --x
:
Tom Brady, Drew Brees, Vincent Jackson, Ben :
Leber, Logan Mankins, Peyton Manning, Von :
:
Miller, Brian Robison, Osi Umenyiora, and
Mike Vrabel, individually, and on behalf of all :
:
others similarly situated
:
:
Plaintiffs,
:
:
vs.
:
NATIONAL FOOTBALL LEAGUE, et al.,
:
:
Defendants.

No: 11-cv-00639-SRN-JJG

Declaration of Richard A.
Berthelsen in Opposition to
Defendants’ Motion For a Stay

--------------------------------- X
Richard A. Berthelsen, being duly sworn, deposes and states as
follows:
1.

I am General Counsel of the National Football League

Players Association (“NFLPA”), and have served in that capacity since 1983. In
addition, from August 21, 2008 to March 15, 2009, I served as Interim Executive
Director after the death of Executive Director Gene Upshaw. I have been an
attorney for the NFLPA since 1972. I make this declaration in opposition to the
Defendants’ motion for a stay of this Court’s decision to enjoin the NFL’s
“lockout.” See Brady v. NFL, No. 11-639 (SRN/JJG) (D. Minn. filed on April 25,
2011); see also Exhibit A (Lockout Letter).

2.

As one who has experienced the opening of free agent

negotiations every off-season in the past 18 years, I believe there will be no
detriment to any NFL club by the Court’s lifting of the current lockout. I also
believe that lifting the lockout immediately is the only way to preserve the 2011
season announced by the NFL, given the need to sign free agents, to complete the
NFL draft and sign drafted players, to plan and to hold training camp, and to plan
for the season itself.
3.

In fact, any stay of the injunction and continuation of the

lockout would actually be a detriment to NFL clubs, as the league has stated that it
will lose money during the lockout totaling $1 billion before a single game is even
cancelled. See NFL: Staggering Financial Losses would Follow Lockout, USA
Today, January 28, 2011, attached as Ex. B. With the lockout enjoined, the clubs
can go back to operating their multi-billion dollar business and making enormous
amounts of money, as they did previously. If the lockout is lifted and then this
Court’s ruling were to be overturned, the NFL presumably would reinstitute the
lockout, and some players who were previously locked-out free agents or unsigned
rookies would possibly then be locked-out players with contracts. This would
simply move these players from one sub-class in this action to another. See
Compl. at ¶ 25 (defining “Under-Contract Subclass,” “Free Agent Subclass,” and
“Rookie Subclass”).

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4.

The NFL’s argument that lifting the lockout, even

temporarily, will have a purported effect on “competitive balance,” because
allegedly a small number of teams will sign all of the top free agents, is unfounded
and contrary to all NFL historical evidence. There is absolutely no evidence
suggesting that this would come to pass. In fact, the two most recent seasons that
were played without a salary cap in place (where a limited number of teams could
theoretically dominate the free agent market) suggest just the opposite. In 2010,
the last season covered by the expired Collective Bargaining Agreement (“CBA”)
and White Stipulation and Settlement Agreement (“SSA”), the league operated
without a salary cap and there was no harm to competitive balance. Indeed, the
teams in the Super Bowl were the Green Bay Packers and the Pittsburgh Steelers,
two small market teams. There was also no salary cap in 1993, the first year of the
recently expired White SSA and CBA, without any discernable harm to
competitive balance. For example, in that year, Hall of Fame defensive end
Reggie White, at that time the most high profile free agent in NFL history, chose
to sign with the small market Green Bay Packers.
5.

The NFL’s arguments that without a stay the NFL would be

thrown into a state of chaos are also wrong. First, the NFL dramatically overstates
the complexity of implementing a new system. All that is required is for the NFL
to inform its teams of the rules it intends to implement, as it has done in the past.
Indeed, as described below, it appears that the NFL has already decided what

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player system it intends to implement if the lockout is lifted, including at least
some of the aspects of the system that was in place in 2010. The NFL also has a
history of smoothly adopting new player systems, including implementing “Plan
B” in 1989, the White uncapped system in 2003, the imposition of a cap in 2004,
the changes to the system in 2006, and the removal of the cap and new free agency
rules in 2010.
6.

Prior to the scheduled end of the 2010 league year on March

3 of this year, all 32 clubs sent contract tenders for the 2011 season to free agent
players, treating them as if the NFL intends to keep in place 2010 rules relating to
so-called Restricted Free Agents, Franchise Players, and Transition Players. They
did so by following the free agent rules which were in effect during the last year of
the CBA and SSA. Under the 2010 system, players who were not under contract
and had less than six accrued seasons in the league were considered to be
“restricted free agents” and were subject to certain rules that limited their ability to
sign with clubs other than their immediately preceding club. Before March 3 of
this year, the clubs sent Restricted Free Agent Tenders to players with expiring
contracts who had less than six accrued seasons. Also under the 2010 system,
each club had the right to designate one player with an expiring contract as a socalled “Franchise Player” and one player as a so-called “Transition Player.”
Before March 3 of this year, those designations were again made by various clubs,
with an example being the Philadelphia Eagles, who designated Michael Vick as a

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Franchise Player and David Akers as a Transition player. In addition, Plaintiffs
Jackson, Mankins, and Manning all have been designated as Franchise Players.
7.

By making the Restricted Free Agent tenders and the

Franchise Player and Transition Player tenders described in the preceding
paragraph, the 32 Clubs appeared to be acting as if they have already been told by
the NFL that the league intends to continue, at least in part, the 2010 player system
if the lockout is lifted. Also, talent evaluators and coaches for all 32 NFL Clubs
have no doubt spent considerable time evaluating their rosters since the end of the
2010 season, and decided which free agents they would be interested in pursuing
once the 2011 League Year begins and the free agent signing period opens.
Indeed, they have had even more time to do so in 2011 as compared to prior years
because of the lockout. It will thus be easy for the 32 Clubs to immediately
proceed with the free agent signing period and other business if the lockout ends.
8.

The NFL clubs and the league have taken other significant

steps to prepare for the upcoming season. For example, the NFL announced the
complete pre-season schedule for 2011 on April 13 of this year, and the regular
season schedule was released one week later. (See articles from NFL website,
attached as Exs. C-E). The league is also conducting the annual college draft
beginning on April 28, 2011 and running through April 30, 2011. Approximately
254 college players will be selected in that draft by the 32 NFL clubs, and the
draftees will eventually be signed to NFL player contracts. Although the clubs

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have historically been allowed to begin negotiations with a drafted player
immediately after the draft, most of the signings of drafted players occur in July of
each year, shortly before pre-season training camps typically begin. This would
likely be the case in 2011 as well, giving the clubs several months in which to sign
their drafted players.
9.

It is therefore simply not credible for the NFL to claim that

they are unprepared to resume operations and to conduct their normal off-season
activities. In fact, the league has announced that it expects to play a full season in
2011. See Exclusive: Roger Goodell criticizes NFL players' legal strategy, USA
Today, April 22, 2011 (hereinafter “Roger Goodell Exclusive”) (quoting NFL
Commissioner Roger Goodell as stating “we're planning to play a full 16-game
regular season and playoffs”), attached as Ex. F. In order to accomplish this,
unsigned players must be given the opportunity to sign with teams and teams must
hold training camps. In order for the NFL to meet its just announced schedule
(under which the first pre-season game will be played on August 7, 2011 and the
first regular season game on September 8, 2011), it is necessary to permit the
signing of free agent and rookie players very soon. No one knows when the 8th
Circuit would rule in the NFL’s appeal, and free agency can not be delayed while
waiting for that ruling. Given the steps that need to be taken for the season to
begin, the risk that the 2011 season will be adversely affected is much greater if
the lockout continues than if the lockout remains enjoined.

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10.

The NFL’s assertion that this case raises “novel” issues

regarding this Court’s jurisdiction and the applicability of the nonstatutory labor
exemption is also without merit. These issues have been decided previously by
this Court, and in a manner consistent with the Court’s current decision. See
Powell/McNeil v. NFL, 764 F. Supp. 1351, 1357-58 (D. Minn. 1991) (rejecting the

NFL’s arguments that the Court must defer to the jurisdiction of NLRB and
determining that the nonstatutory labor exemption ended when the players
renounced the NFLPA’s status as their collective bargaining representative);
Jackson v. NFL, 802 F. Supp. 226, 232-34 (D. Minn. 1992) (finding that the
Norris LaGuardia Act did not bar injunctive relief where “the non-statutory labor
exemption terminated after the players abandoned their union”).
11.

Moreover, any purported harm claimed by the NFL is entirely

self-inflicted. The 32 Club owners chose on their own to terminate the CBA early
and lockout the players, and they can not possibly claim any surprise at the
NFLPA’s abandonment of bargaining rights and the present lawsuit. They have
known for months, if not years, that implementing a lockout could put them in the
very situation they are in now. Indeed, the fact that NFL players might choose to
withdraw the NFLPA’s authorization to collectively bargain at the end of the most
recent agreements was expressly contemplated in those agreements.
12.

As the Court found, the NFL players are being irreparably

harmed by the lockout. The NFL has already delayed the beginning of free

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agency for over a month, and is now seeking a stay to further delay NFL players
from having the opportunity to sign contracts and/or get back to work. The NFL
has taken numerous steps to prepare for the resumption of league operations, and
the players should not be prevented from working for even one day longer.
13.

A stay allowing the “lockout” to continue would also cause

severe harm to fans, communities, and a myriad of businesses that rely on the NFL
for their viability. Indeed, the Commissioner of the NFL has acknowledged that
the longer the uncertainty around the 2011 season continues unresolved the worse
it is for everybody: “That’s why we think that the longer it goes, it's bad for
players, the clubs, our partners, and the fans.” See Roger Goodell Exclusive,
attached as Ex. F.
14.

If the Court, however, were inclined to grant a stay, the

Defendants would need to post a significant bond in order to protect the players’
rights, which would need to total at least $1 billion. We simply don’t know how
long any stay would last, and it could cause the cancellation of NFL games. Given
that league-wide payroll for the 2010 season exceeded $3.93 billion in salary
alone, a $1 billion bond would represent only about twenty-five percent of payroll.
Even at this amount, the bond would be significantly less than the treble damages
that the NFL could be liable for at the end of this antitrust suit.
Dated: April 27, 2011
s/Richard A. Berthelsen
Richard A. Berthelsen
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