Brady et al v. National Football League et al
COMPLAINT (originally filed in 11-cv-748 SRN/JJG on 3/28/11) against Arizona Cardinals, Inc., Atlanta Falcons Football Club LLC, Baltimore Ravens Limited Partnership, Buccaneers Limited Partnership, Buffalo Bills, Inc., Chicago Bears Football Club, Inc., Cinncinnati Bengals, Inc., Cleveland Browns LLC, Dallas Cowboys Football Club, Ltd., Denver Broncos Football Club, Detroit Lions, Inc., Football Northwest LLC, Green Bay Packers, Inc., Houston NFL Holdings LP, Indianapolis Colts, Inc., Jacksonville Jaguars Ltd., Kansas City Chiefs Football Club, Inc., Miami Dolphins, Ltd., Minnesota Vikings Football Club LLC, National Football League, New England Patriots, LP, New Orleans Louisiana Saints, LLC, New York Football Giants, Inc., New York Jets Football Club, Inc., Oakland Raiders LP, Panthers Football LLC, Philadelphia Eagles Football Club, Inc., Pittsburgh Steelers Sports, Inc., Rams Football Co, LLC, The, San Diego Chargers Football Co., San Francisco Forty Niners Ltd., Tennessee Football, Inc., Washington Football Inc., filed by Priest Holmes, Ryan Collins, Carl Eller, Obafemi Ayanbadejo. (Attachments: # 1 Exhibit A, # 2 Exhibit B, # 3 Exhibit C, # 4 Exhibit D, # 5 Exhibit E, # 6 Exhibit F, # 7 Exhibit G, # 8 Exhibit H, # 9 Exhibit I, # 10 Exhibit J, # 11 Exhibit K, # 12 Exhibit L, # 13 Exhibit M, # 14 Exhibit N, # 15 Exhibit O, # 16 Civil Cover Sheet) (akl)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MINNESOTA
Carl Eller, Priest Holmes, Obafemi
Ayanbadejo, and Ryan Collins,
individually, and on behalf of all others
Civil Action No:
National Football League, Arizona
Cardinals, Inc., Atlanta Falcons Football
Club LLC, Baltimore Ravens Limited
Partnership, Buffalo Bills, Inc., Panthers
Football LLC, Chicago Bears Football
Club, Inc., Cincinnati Bengals, Inc.,
Cleveland Browns LLC, Dallas Cowboys
Football Club, Ltd., Denver Broncos
Football Club, Detroit Lions, Inc., Green
Bay Packers, Inc., Houston NFL Holdings
LP, Indianapolis Colts, Inc., Jacksonville
Jaguars Ltd., Kansas City Chiefs Football
Club, Inc., Miami Dolphins, Ltd.,
Minnesota Vikings Football Club LLC,
New England Patriots, LP, New Orleans
Louisiana Saints, LLC, New York Football
Giants, Inc., New York Jets Football Club,
Inc., Oakland Raiders LP, Philadelphia
Eagles Football Club, Inc., Pittsburgh
Steelers Sports, Inc., San Diego Chargers
Football Co., San Francisco Forty Niners
Ltd., Football Northwest LLC, The Rams
Football Co. LLC, Buccaneers Limited
Partnership, Tennessee Football, Inc.,
Washington Football Inc.
CLASS ACTION COMPLAINT
This class action is brought to enjoin violations by each defendant of
the federal antitrust laws and for declaratory relief as described below. Plaintiffs are
former professional football players who played with the National Football League
The Defendants are the NFL and its 32 member teams. Although the
NFL might be viewed as a type of joint venture, The United States Supreme Court held
last year in American Needle, Inc. v. NFL, 130 S.Ct. 2201, 2212-13 (2010) that each
member team is legally capable of conspiring with other member teams in violation of
the antitrust laws:
The NFL teams do not possess either the unitary
decisionmaking quality or the single aggregation of economic
power characteristic of independent action. Each of the teams
is a substantial, independently owned, and independently
managed business. “[T]heir general corporate actions are
guided or determined” by “separate corporate
consciousnesses,” and “[t]heir objectives are” not “common.”
... The teams compete with one another, not only on the
playing field, but to attract fans, for gate receipts and for
contracts with managerial and playing personnel.
The NFL is also an adjudicated monopolist that acquired its
monopoly power in the market for professional football in violation of Section 2 of the
Sherman Act (15 U.S.C. §2). Thus, in United States Football League v. NFL, 644 F.
Supp. 1040, 1057-58 (S.D.N.Y. 1986), aff’d, 842 F.2d 1335 (2d Cir. 1988) (“USFL”), the
court upheld jury determinations that (a) the NFL held monopoly power in the
professional football market, receiving 95% of the revenues from major league
professional football and (b) it had acquired that power through “predatory conduct.”
These findings have been given collateral estoppel effect in subsequent antitrust cases
against the NFL. E.g., McNeil v. NFL, 790 F.Supp. 871, 889-96 (D. Minn. 1992)
(“McNeil II”). Those findings are entitled to similar effect in this case.
The NFL has also been determined to have abused its dominant
position in the market for professional football services, which is the relevant market at
issue in this case. For example, in Mackey v. NFL, 543 F.2d 606 (8th Cir. 1976), cert.
dismissed, 434 U.S. 801 (1977) (“Mackey”), the issue was the validity of the “Rozelle
Rule,” which decreed that when a football player’s contract with an NFL club expired
and he moved to a different club, his present employer had to provide compensation to
his former employer, with the NFL Commissioner resolving any dispute. The United
States Court of Appeals for the Eighth Circuit upheld the district court’s determination of
liability after a 55-day trial. The appellate court found that the relevant market was one
for professional football services (id. at 617-18) and that the “Rozelle Rule, as enforced,
unreasonably restrains trade in violation of §1 of the Sherman Act” (id. at 622).
Likewise, it has been determined that the NFL’s College Draft
“cannot be regarded as ‘reasonable’ under the antitrust laws.” Smith v. Pro-Football, 420
F. Supp. 738, 747 (D.D.C. 1976), aff’d in part and rev’d in part on other grounds, 593
F.2d 1173 (D.C. Cir. 1978) (“Smith”). This determination as well is entitled to collateral
estoppels effect here.
Similarly, after a ten-week trial, a jury in another case held that the
NFL’s conspiratorial Right of First Refusal/Compensation rules (known as “Plan B”
Rules) that limited the mobility of professional football players after their contracts
expired and they became “free agents” had a “a substantially harmful effect on
competition in the relevant market for the services of professional football players.”
McNeil v. NFL, No. 4-90-476, 1992 WL 315292 at *1 (D. Minn. Sept. 10, 1992)
In 1992, a group of players brought suit seeking relief for injuries
they suffered as a result of the very same anticompetitive restraints that the jury in
McNeil III found violated Section 1 of the Sherman Act. In Jackson v. NFL, 802 F.Supp.
226 (D. Minn. 1992) (“Jackson”), the district court gave collateral estoppel effect to the
jury’s findings. Id. at 229-30. It then issued a temporary restraining order against the
enforcement of the Plan B Rules, stating that “the four players who remain restricted by
the Plan B rules make a sufficient showing of irreparable harm because they suffer
irreparable injury each week they are restricted under an illegal system of player
restraints.” Id. at 230-31.
In this case, the Defendants--the NFL and its separately-owned and
independently-operated member teams--have jointly agreed and conspired to deny class
members the ability to provide and/or market their services in the major league market
for professional football players through an unlawful group boycott and price-fixing
arrangement and through anticompetitive restraints on the market freedom of prospective
players. This boycott has included a lockout of rookie players seeking an NFL contract
for the first time. The lockout has also injured retired or former NFL players who depend
upon the NFL for pension and health benefits and who were denied the benefit levels that
would have existed in a competitive market. The admitted purpose of this group boycott
is to coerce Plaintiffs and the other players to agree to a new anticompetitive system of
players restraints that will, inter alia, drastically reduce prospective player compensation
levels and benefit levels for retired or former players.
The group boycotts, concerted refusals to deal and price-fixing that
Defendants are carrying out are per se illegal acts under Section 1 of the Sherman Act (15
U.S.C. § 1). They also constitute an unreasonable restraint of trade under the rule of
reason. As a result of Defendants’ anticompetitive agreements, former professional
football players who depend on the NFL for health and retirement benefits are injured, as
are existing NFL players and future professional football players who are seeking
employment by an NFL club who will be prevented from offering or providing their
services in a competitive market and from receiving a competitive market value for their
services, and will be denied the freedom of movement available to employees in virtually
every other industry in the United States.
JURISDICTION AND VENUE
These claims arise and are brought under Section 16 of the Clayton
Act, (15 U.S.C. § 26), and Section 1 of the Sherman Antitrust Act (15 U.S.C. § 1).
This Court has jurisdiction pursuant to 28 U.S.C. §§ 1331, 1337.
Venue in this action is proper pursuant to 15 U.S.C. § 22. Each of
the Defendants can be found, resides, has an agent, or transacts business in the District of
Minnesota, and the unlawful activities were or will be carried on in part by one or more
of the Defendants within this district.
Plaintiff Carl Eller (“Eller”) was a premier defensive end in the
NFL who played for the Minnesota Vikings from 1964-78 and for the Seattle Seahawks
in 1979. He was selected to the Pro Bowl six times (1968-71, 1973-74), was selected as
First-team All Pro five times (1968-71, 1973), First-team All Conference seven times
(1968-73, 1975), the Newspaper Enterprise Association’s NFL Defensive Player of the
Year in 1971, and the 1970s All Decade Team. In 2004, he was elected to the Pro
Football Hall of Fame. Eller retired after the 1979 season. Eller is the President of the
Retired Players Association (“RPA”), a non-profit organization dedicated to providing
powerful national advocacy and collegial support for retired professional football players,
their families and the community at large.
Plaintiff Priest Holmes was a running back in the NFL who played
for the Baltimore Ravens (1997-2001) and the Kansas City Chiefs (2001-07). He was
selected to the Pro Bowl three times (2001-03), was an All-Pro selection in 2001-03, was
NFL Offensive Player of the Year in 2002, and received the Ed Block Courage Award in
2004. He earned a Super Bowl ring with the Baltimore Ravens in Super Bowl XXXV. He
retired in 2007.
Plaintiff Obafemi Ayanbadejo (“Ayanbadejo”) was a fullback in the
NFL who played for the Minnesota Vikings (1997-98), Baltimore Ravens (1999-2001),
Miami Dolphins (2002-03), Arizona Cardinals (2004-06), and Chicago Bears (2007).
Ayanbadejo earned a Super Bowl ring with the Baltimore Ravens in Super Bowl XXXV.
Ayanbadejo was released by the Chicago Bears in 2007 and joined the California
Redwoods of the United Football League in 2009.
Plaintiff Ryan Collins was a tight end in the NFL who played for the
Baltimore Ravens and Cleveland Browns.
Defendant NFL, which maintains its offices at 280 Park Avenue,
New York, New York, is an unincorporated association consisting of the 32 separatelyowned and independently-operated professional football teams that are listed below. The
NFL is engaged in interstate commerce in the business of, among other things, operating
the sole major professional football league in the United States.
The other Defendants are the 32 NFL member teams, each of which,
upon information and belief, is a corporation, except where noted below. The NFL and its
member teams are referred to collectively herein as the “NFL Defendants.” Upon
information and belief, each of the Defendant teams is a separately-owned and
independent entity which operates a professional football franchise for profit under the
team name and in the cities set forth below:
NFL Defendant Team Owner
Team Name (City)
Arizona Cardinals, Inc.
Atlanta Falcons Football Club LLC
Baltimore Ravens Limited Partnership
Buffalo Bills, Inc.
Panthers Football LLC
Chicago Bears Football Club, Inc.
Cincinnati Bengals, Inc.
Cleveland Browns LLC
Dallas Cowboys Football Club, Ltd.
Denver Broncos Football Club
Detroit Lions, Inc.
Green Bay Packers, Inc.
Green Bay Packers
Houston NFL Holdings LP
Indianapolis Colts, Inc.
Jacksonville Jaguars Ltd.
Kansas City Chiefs Football Club, Inc.
Kansas City Chiefs
Miami Dolphins, Ltd.
Minnesota Vikings Football Club LLC
New England Patriots, LP
New England Patriots
New Orleans Louisiana Saints LLC
New Orleans Saints
New York Football Giants, Inc.
New York Giants
New York Jets Football Club, Inc.
New York Jets
Oakland Raiders LP
Philadelphia Eagles Football Club, Inc.
Pittsburgh Steelers Sports, Inc.
San Diego Chargers Football Co.
San Diego Chargers
San Francisco Forty Niners Ltd.
San Francisco 49ers
Football Northwest LLC
The Rams Football Company LLC
St. Louis Rams
Buccaneers Limited Partnership
Tennessee Football, Inc.
Washington Football Inc.
Plaintiffs are representatives of a class, as defined by Rule 23(b)(1)
and/or Rule 23(b)(2) of the Federal Rules of Civil Procedure, and bring this action on
behalf of themselves and a class with respect to which the NFL has acted or refused to act
on grounds that apply generally to the class.
The class is composed of: (a) all retired or former professional
football players who were employed by any NFL member club but are not now employed
by the NFL or any member club and who receive health, retirement or other benefits from
the NFL pursuant to the “Bert Bell/Pete Rozelle NFL Player Retirement Plan” (the
“Plan”) or other benefit plans subsidized by the NFL, as described below, and (b)
potential rookie professional football players who, as of March 11, 2011 to the date of
final judgment in this action and the determination of any appeal therefrom, have not
previously commenced negotiation with any NFL club concerning employment and have
not been selected in any NFL College Draft.
The class consists of persons who do not fall within the definition of
the Collective Bargaining Unit (“CBU”) contained in the 2006-12 Collective Bargaining
Agreement (“CBA”) between the NFL Management Council and the NFL Players
Association (“NFLPA”). The “Preamble” to that CBA describes the CBU as follows:
This Agreement, which is the product of bona fide, arm’s
length collective bargaining, is made and entered into as of
the 8th day of March, 2006, in accordance with the provisions
of the National Labor Relations Act, as amended, by and
between the National Football League Management Council
(“Management Council” or “NFLMC”), which is recognized
as the sole and exclusive bargaining representative of present
and future employer member Clubs of the National Football
League (“NFL” or “League”), and the National Football
League Players Association (“NFLPA”), which is recognized
as the sole and exclusive bargaining representative of present
and future employee players in the NFL in a bargaining unit
described as follows:
1. All professional football players employed by a member
club of the National Football League;
2. All professional football players who have been previously
employed by a member club of the National Football League
who are seeking employment with an NFL Club;
3. All rookie players once they are selected in the current
year’s NFL College Draft; and
4. All undrafted rookie players once they commence
negotiation with an NFL Club concerning employment as a
The class is so numerous and geographically so widely dispersed
that joinder of all members is impracticable. There are questions of law and fact common
to the class. Plaintiffs' claims are typical of the claims of the class that they represent, and
the Plaintiffs will fairly and adequately protect the interests of the proposed class.
Each person in the class is, has been, and/or will be subject to
uniform agreements, rules and practices among the Defendants that restrain competition
for player services, including, but not limited to, those described herein as the "lockout"
and all restraints of trade that the lockout seeks to further.
The prosecution of separate actions by individual members of the
class would create the risk of:
inconsistent or varying adjudications with respect
to individual class members that would establish incompatible
standards of conduct for the party opposing the class; or
adjudications with respect to individual class
members that, as a practical matter, would be dispositive of the
interests of the other members not parties to the individual
adjudications or would substantially impair or impede their
ability to protect their interests;
In construing and enforcing their uniform agreements, rules and
practices, and in taking and planning to take the actions described in this complaint, the
Defendants have acted or refused to act on grounds that apply generally to the class, so
that final injunctive relief or corresponding declaratory relief would be appropriate for the
class as a whole.
A class action may be maintained under Rule 23(b)(2) when the
exclusive relief sought is injunctive relief.
NATURE OF INTERSTATE TRADE AND COMMERCE
The primary business in which Defendants are engaged is the
operation of major league professional football teams and the sale of tickets and telecast
rights to the public for the exhibition of the individual and collective football talents of
players such as Plaintiffs. To conduct this business, the NFL Defendants must compete
with each other for and retain the professional services of players, such as Plaintiffs, who
were or will be signed to contracts to play football for the various NFL defendant teams.
The business of major league professional football is distinct from
other professional sports businesses, as well as from college and minor league
professional football. Its distinguishing features include: the rules of the sport and the
season during which it is played; the talents of and rates of compensation for the players,
for which playing football is their full-time profession; the nature and amounts of trade
and commerce involved; and the unique demand for the NFL Defendants’ games by the
consuming public, both as ticket purchasers and as home viewers of and listeners to
television and radio.
The NFL Defendants’ operation of and engagement in the business
of major league professional football involves a substantial volume of interstate trade and
commerce, including, inter alia, the following interstate activities: travel;
communications; purchases and movement of equipment; broadcasts and telecasts of
league games; advertisements; promotions; sales of tickets and concession items; sales of
merchandise and apparel; employment of players and referees; and negotiations for all of
The NFL Defendants’ aforementioned interstate transactions involve
collective annual expenditures and receipts in excess of $9.3 billion. But, as Dan Greeley,
CEO of Network Insights, has noted:
The NFL is like Procter & Gamble. There's the holding
company, the core operation, but then each brand has its own
team and world of revenue. Like Tide: That's a P&G product
but within that there are different types of Tide and a number
of people that make money from it. So the $9.3 billion pie
just scratches the surface and doesn't get into how much is
spent around stadiums, merchandise, agents, all the way down
to mom-and-pop shops.
Annually, the NFL redistributes upwards of $4 billion in radio,
television and digital earnings across its 32 teams—$125 million apiece, plus an equal
share for the league—and that number shows no sign of declining. The 19 highest-rated
fall television programs (and 28 of the top 30) were NFL games, and this year’s Super
Bowl was the most-watched program ever. The NFL earns huge amounts annually from
its telecasting deals with, inter alia, ESPN ($1.1 billion), DirecTV ($1 billion), NBC
($650 million), Fox ($712.5 million), and CBS ($622.5 million).
Companies pour money into the league’s coffers for the right to
associate their brands with the NFL. Among those making such contributions are Pepsi
($560 million over eight years, starting in 2004) and Gatorade ($45 million a year, plus
marketing costs and free Gatorade for teams). Verizon is paying $720 million over four
years to be the league’s wireless service provider. Nike paid $1.1 billion to acquire the
NFL's apparel sponsorship. Previous partner Reebok had been selling $350 million
annually in NFL-themed gear. The league has a $1.2 billion, six-year deal with beer
sponsor Anheuser-Busch, but teams still cut their own deals when it comes to pouring
rights at stadiums.
Teams can collect $25-$30 million for stadium naming rights,
usually on 10-year deals. The largest is Reliant Energy's $10 million per year contract
with the Houston Texans. In Los Angeles, Farmers Insurance has promised $700 million
over 30 years to name a stadium for a team that doesn't exist yet.
Many NFL clubs own in whole or in part the stadiums in which they
play, which can be a source of major commercial value, as reflected in the following
New Meadowlands, NY
Cowboys Stadium, DAL
Lucas Oil Field, IND
U. of Phoenix Stadium, ARI
Lincoln Financial, PHI
Ford Field, DET
Gillette Stadium, NE
Reliant Stadium, HOU
Qwest Field, SEA
Invesco Field, DEN
Heinz Field, PIT
In 2010, more than 17 million fans passed through NFL turnstiles,
paying anywhere from $54.51 (Cleveland Browns) to $117.84 (New England Patriots)
for the average game ticket. Though the league won't open its books, numbers for the
publicly-held Green Bay Packers (“Packers”) offer some insight into what teams reap at
the ticket office and concession stands. In 2010, the Packers cleared $60,059,646 from
home and away game tickets plus private boxes. Projected over 32 teams, that's nearly $2
billion annually. The Packers reaped $13 million from concessions, parking and local
media in 2010, which translates to $416 million on a league-wide basis.
The class members have been employed by and/or are seeking new
employment with, or will seek future employment with one or more of the defendant
teams in interstate commerce as professional football players.
The NFL’s Monopoly Power
As noted above, the NFL Defendants possess monopoly power in the
market for major league professional football in the United States, and have willfully
acquired or maintained that monopoly power in violation of Section 2 of the Sherman
Act. The relevant market for assessing the restraint of trade at issue is the market for the
services of major league professional football players in the United States. As noted
above, Defendants have monopoly power within that market and have repeatedly been
found to have abused that power in violation of the federal antitrust laws.
The NFL Defendants comprise the only major professional football
league in the United States. The NFL Defendants are the only United States market
participants for the services of major league professional football players. Together, they
monopolize and/or restrain trade in the United States market for the services of major
league professional football players. The only actual or potential competition that exists
in this market is among the separately-owned and independently-operated NFL teams.
Rather than engaging in competition for the players’ services, however, the NFL
Defendants have combined and conspired to eliminate such competition among
themselves for NFL players through group boycotts, price-fixing arrangements, and
concerted refusals to deal. This is being accomplished by the NFL Defendants jointly
adopting and imposing “rules” and “policies”, including the lockout, that have the
purpose and effect of preventing players from offering their services to NFL teams in a
competitive market and limiting the benefits that retired players would have otherwise
received in a competitive market.
The SSA And Successive CBAs
The NFL is a recidivist violator of the antitrust laws as reflected in
USFL, Mackey, McNeil II and III, Smith and Jackson.
After the jury verdict in McNeil III, the NFL and players entered into
a Stipulation & Settlement Agreement (“SSA”) on February 26, 1993. A month later, the
NFLPA advised the NFL that it had received authorization from a majority of players to
serve as their collective bargaining agent. The district court approved the settlement
agreement in White v. NFL, 822 F.Supp. 1389 (D. Minn. 1993).
Also in 1993, the NFL and NFLPA entered into a CBA that mirrored
the SSA. The parties amended and extended the CBA in 1996, 1998, and 2002. In 2006,
the parties renegotiated the CBA for 2006-2012, creating the CBU described above. On
May 20, 2008, the NFL opted out of the final two years of the then-current versions of
the CBA. As a consequence, the CBA was due to expire as of March 4, 2011. See White
v. NFL, No. 4-92-906 (DSD), 2011 WL 706319 at *1 (D. Minn. March 1, 2011) (“White
II”). The opinion in White II is attached as Exhibit A to this complaint and incorporated
by reference herein.
The NFL has the Plan referred to above, which is a merger of two
prior plans in 1993. This Plan has been revised in accordance with the 1996, 1998, 2002
and 2006 amendments to the CBA. The most recent version was amended and restated on
April 1, 2007. The Plan provides for retirement benefits, total and permanent disability
benefits, line of duty disability benefits and death benefits. The Plan is subsidized by
NFL member clubs. Pursuant to Paragraph 3.1 of the Plan, the NFL clubs make
contributions according to various actuarial assumptions and methods set forth in
Appendix A to the Plan. Pursuant to Paragraph 3.2 of the Plan, the NFL clubs are
obligated to contribute to the Plan to the extent required by Paragraph 3.1, ERISA and the
The Plan is run by a Retirement Board consisting of three persons
selected by the NFLPA, three persons selected by the NFL Management Council and, in
an ex officio capacity, the NFL Commissioner. Pursuant to paragraph 10.1 of the Plan, it
may be terminated if no CBA has been in effect for more than one year.
There also exists a separate health benefit plan for retired or former
NFL players known as the “88 Plan.” The 88 Plan is designed to assist players who are
vested under the Plan and who are determined to have dementia (including Alzheimer’s
Disease), as this condition is defined in the 88 Plan. The 88 Plan will pay the cost of
medical and custodial care for eligible players, including institutional custodial care,
institutional charges, home custodial care provided by an unrelated third party, physician
services, durable medical equipment, and prescription medicine. For eligible players who
are institutionalized as an in-patient, the maximum annual benefit is $88,000. For eligible
players who are not institutionalized as an in-patient, the maximum annual benefit is
$50,000. 88 Plan benefits may be paid on behalf of an eligible player even if that player
is also receiving total and permanent disability benefits from the Plan, but only if he is in
the "Inactive” category.
There also exists an “NFL Player Care Plan” subsidized by the NFL.
The NFL Player Care Plan provides a uniform administrative framework for a range of
programs that benefit eligible former NFL players. Currently, these benefits are: (a) joint
replacement benefits; (b) assisted living benefits; (c) discount prescription drug benefits;
(d) Medicare supplement insurance benefits; (e) spine treatment benefits; (f) neurological
care benefits; and (g) life insurance benefits.
There also exist other miscellaneous benefit plans that provide
benefits to former players and are subsidized by the NFL. These include an annuity
program (a type of deferred compensation program) and, a Joint Replacement Benefit
Plan (assisting retired players who need joint replacement surgery).
The various iterations of the CBA had an Article XVII dealing with
the EPP or Rookie Cap, which was a subset of the overall salary cap for NFL clubs. In
the 1993 CBA, the EPP was originally set at $56 million or $2 million per club and was
increased to 3.5 percent of “Defined Gross Revenues” (“DGR”) for the first capped year
of 1994. After 1994, the EPP was initially allowed to grow at the same annual rate as
DGR until the 1998 CBA, when pool growth was limited to 10 percent. Beginning with
the 2002 iteration of the CBA, the EPP was frozen for 2002-03 and held to five percent
growth thereafter. This system is reflected in the 2006 CBA, where EPP is set at the
previous year’s level (excluding “Formula Allotments” (“FAs”) for compensatory draft
selections increased by the same percentage as the projected “Total Revenue” (“TR”) for
that year over the prior year up to a level of five percent. FAs for draft selections were set
by the NFL and NFLPA “and shall not be disclosed to Clubs, Players, Player Agents or
the public.” 2006 CBA, §XVII(4)(j). Under this system, the rookies’ share of the overall
players’ salary cap was cut from 6.5 percent in 1997 to 3.7 percent by 2009. In 2009,
rookies made up 16.4 percent of NFL rosters but the rookie share was limited to just two
percent of total revenue, leaving 55 percent for veteran players.
A 2007 article that did an economic analysis of the EPP came to the
In summation, rookie contracts are not only constrained by a
franchise Rookie Cap, but in general are further constrained
by an agreed upon valuation of each draft pick's worth. This
valuation is not the result of market forces, the same interplay
of supply and demand that determines veteran contracts, but
rather is the result of a well-protected formula that artificially
depresses rookie contracts.
Major League Baseball (“MLB”) has nothing analogous to the
Rookie Cap. Even some NFL club representatives, such as William Polian, President of
the Indianapolis Colts, have conceded that the Rookie Cap should be substantially
changed or eliminated.
The NFL’s Decision to Terminate the SSA and CBA And Engage In A Lockout
As reported by ESPN, shortly after the NFL and NFLPA entered
into the March 2006 iteration of the CBA, the NFL club owners began to consider the
possibility of a lockout. The word "lockout" became a popular term among owners.
According to witness testimony and documents filed in recent litigation over NFL
television contracts, a lockout was on the agenda of all NFL owners' meetings in 2007
and early 2008.
Internal NFL documents and testimony from NFL Commissioner
Roger Goodell (“Goodell”) in White II indicated that the NFL club owners knew early in
2008 that "in order for them to get a new labor deal that works for them, they need to be
able to sustain a lockout, which requires financing and requires proper planning." Dallas
Cowboys owner Jerry Jones told his fellow owners that they "needed to realistically
assume they were locking out in 2011" to obtain a CBA that "worked for them."
The “financing” aspect of a lockout involved securing, in effect,
“lockout insurance” from broadcasters with whom the NFL had existing contracts. As the
court in White II explained (2011 WL 706319 at *2) (citations omitted):
Soon after opting out of the CBA, the NFL began to negotiate
extensions of its broadcast contracts. Rights fees in the
broadcast contracts generate approximately half of the NFL's
total revenues. Existing broadcast contracts effectively
prevented the NFL from collecting revenue during a lockout
in 2011 because the contracts did not require broadcasters to
pay rights fees during a lockout or required the NFL to repay
lockout fees in 2011. Moreover, some of the NFL's loan
obligations include “average media revenues” covenants
which provide that an “event of default” occurs if average
annual league media revenues fall below a specified value.
The NFL worried that its creditors could argue that a default
event had occurred if the NFL locked out the Players in 2011,
the same year that some broadcast contracts were set to
expire, and that a default would give the Players bargaining
power in labor negotiations. In light of “market conditions
and strategic considerations,” the NFL understood that it was
“prudent to consider [broadcast contract] extension
As of May of 2008, the NFL had television broadcasting contracts
with DirecTV for the 2006-10 seasons, with CBS, FOX and NBC, respectively, for the
2006-11 seasons, and with ESPN for the 2006-13 seasons.
Beginning in July of 2008, the NFL began to negotiate a contract
extension with DirecTV. The resulting extended contract provided that DirecTV would
pay a substantial fee if the 2011 season was not cancelled and up to 9% more, at the
NFL's discretion, if the 2011 season was cancelled. “As a result, the NFL could receive
substantially more from DirecTV in 2011 if it locks out the Players then if it does not.”
White II, 2011 WL 706319 at *2.
In April of 2009, the NFL began negotiating with CBS and Fox.
Under the existing contracts, the broadcasters had to pay rights fees during a work
stoppage, but would be entitled to refunds for the first three cancelled games during the
affected season and for the remaining cancelled games during the following season.
Under the renegotiated contracts, the the requirement that the NFL repay rights fees
attributable to the first three lost games in the affected was eliminated and the NFL could
repay the funds, plus money-market interest, over the term of the contract. If an entire
season was cancelled, the contracts were automatically extended for an additional season.
“Initially, FOX expressed reluctance to pay rights fees during a work stoppage. Goodell
Direct Test. 19. The NFL considered opposition to the work-stoppage provision a ‘deal
breaker[ ].’ ” White II, 2011 WL 706319 at *3. The NBC contract negotiation,
commenced in March of 2009, contained similar concessions.
In the fall of 2009, the NFL negotiated with ESPN that: (a) ESPN
would, at the NFL's discretion, pay up to the full rights fee during a work stoppage; (b) a
credit for the first three cancelled games of the season would be applied the same year;
(c) the NFL could request less than the full rights fee; and (d) the NFL would repay the
funds, with LIBOR interest plus 100 basis points, over the term of the contract. If an
entire season was cancelled, the contract would be extended for an additional season. The
NFL was not liable to repay more than ESPN's yearly rights fee. As part of this deal,
ESPN got certain additional digital rights. “ESPN agreed to pay rights fees for July 2010
through July 2014. ESPN requested that the fee not be payable in the event of a work
stoppage, but the NFL rejected the request. The NFL stated that the digital deal and the
work-stoppage provisions were ‘linked.’ ” White II, 2011 WL 706319 at *4 (citations
The court in White II found (2011 WL 706319 at *8):
However, under the terms of the SSA, the NFL is not entitled
to obtain leverage by renegotiating shared revenue contracts,
during the SSA, to generate post-SSA leverage and revenue
to advance its own interests and harm the interests of the
Players. Here, the NFL renegotiated the broadcast contracts to
benefit its exclusive interest at the expense of, and contrary
to, the joint interests of the NFL and the Players. This conduct
constitutes “a design ... to seek an unconscionable advantage”
and is inconsistent with good faith.
As an example of this bad faith, the court in White II offered the
following (2011 WL 706319 at *12 n.4 (citation omitted)):
The NFL's “Decision Tree” is one glaring example of the
NFL's intent and consideration of its own interests above the
interests of the Players. Moving forward with a deal depended
on the answer to the question: “Does Deal Completion
Advance CBA Negotiating Dynamics?” If yes, the NFL
should “Do Deal Now”; if no, the NFL should “Deal When
A copy of this “Decision Tree” is attached as Exhibit B to this complaint. Similarly, an
internal NFL document entitled “Key Current NFL Media Objectives” (attached as
Exhibit C to this complaint) referred to “secur[ing] access to revenue in 2011 if a work
stoppage occurs”; this would permit “greater leverage in upcoming labor negotiations.”
Other internal NFL documents (attached as Exhibits D and E to this complaint) referred
to “shift[ing] leverage in labor negotiations away from Union…ability to pull money into
a Work Stoppage year” and using revised broadcasting contracts as “leverage in
negotiations…no hold up value for union.” Goodell and NFL CEO Steve Bornstein
conceded in testimony in White II that the lockout insurance was a critical element in
renewing the broadcast deals.
As a result of these broadcasting contract renegotiations, the NFL
obtained a $4 billion war chest to use against the NFLPA in the event of a lockout.
The “planning” aspect of the NFL’s lockout strategy was explained
in an ESPN article:
The owners' planning was equally bold. The league and its
lawyers knew the players had been highly successful in
antitrust litigation against the owners in the past, as a series of
cases led by the late union leader, Gene Upshaw, resulted in
skyrocketing salaries, bonuses for players and free agency
and vastly increased health and disability benefits. If a
lockout was to succeed, the owners reasoned, they must do
something about their exposure to antitrust liabilities. In a
development that stunned lawyers, judges and law professors
across the nation, the league and its attorneys asked the U.S.
Supreme Court to review a case the NFL had already won,
arguing for an expansion of the decision to a total exemption
from antitrust scrutiny. If the league's strategy had been
successful in American Needle Inc. v. NFL, it would have
eliminated the most formidable weapon the players had in
their quest for fair treatment from team owners.
But in a 9-0 decision, the Supreme Court rejected the league's
claim of immunity from antitrust laws. It was a humiliating
end to an owner strategy that could have changed the entire
landscape of sports labor. As a result, the league likely faces
another antitrust lawsuit from the players in Doty's
courtroom, which, based on their track record there, is the last
place the owners want to be.
The NFL’s planning for a lockout took other forms as well.
NFL club owners began imposing lockout clauses in coaches’ and
executives’ contracts that gave clubs the right to reduce compensation in the event of a
lockout. Examples of such clauses included language allowing the clubs to reduce,
terminate, or suspend the contract on 20 days’ notice, reduce salary by 50 percent if a
lockout continued for more than 90 days, terminate the employee without pay on 60
days’ notice, and extend the contract another year at the same terms as 2011 if at least
eight NFL games are canceled due to a lockout.
In February of 2008, the NFL asked the United States Court of
Appeals to end the jurisdiction of District Judge David Doty over the free agency/salary
cap system. The NFL claimed that Judge Doty was biased in favor of the players. The
appellate court rejected this contention. White v. NFL, 585 F.3d 1129, 1138-41 (8th Cir.
In March of 2008, the NFL retained veteran labor-relations attorney,
Bob Batterman (“Batterman”), as outside counsel. Batterman is widely credited for
orchestrating the 2004-05 lockout in the National Hockey League.
In December of 2008, the NFL began a strategic and premeditated
course of action designed to reduce expenses by laying off 15 percent of its staff.
In March of 2009 at the annual NFL owners’ meeting, the NFL club
owners passed a resolution allowing all NFL teams to opt out of a defined benefit pension
plan for NFL coaches and executives. As a result, nine teams have opted out of the
league’s established policy and now provide less beneficial pension plans to coaches and
In December of 2009, the NFL informed the NFLPA of its intent to
terminate the Supplemental Revenue Sharing (“SRS”) program that purportedly promotes
competitive balance and helps the lower-revenue clubs compete. Andrew Brandy, the
former Vice-President of the Green Bay Packers, described the NFL’s decision to pull out
of the SRS plan as “sending a clear message to its players and the union that the teams
that want to go under the floor and cut team payroll to pre-2006 levels, say $85-$90
million…will now have a legitimate reason for doing so.”
In February of 2010, The NFL launched a new website,
www.NFLlabor.com, to exclusively address labor matters and present the league’s
position on negotiations with the NFLPA.
In February of 2010, the NFLPA initiated proceedings against the
league because it discovered that the NFL did not provide its lower-revenue clubs with all
of the SRS that was promised in the CBA for the years 2006-08.
In that same month, the NFL announced the hiring of former
NFLPA President Troy Vincent as Vice-President for Player Development for Active
Players, less than a year after he lost the election to be the NFLPA’s Executive Director
and as the league and union are engaged in contentious negotiations for a new CBA. The
timing of the hiring raised questions about the league’s motives; William Gould, former
Chairman of the National Labor Relations Board (“NLRB”), said it was quite uncommon
for management to hire a former leader of the union it negotiates against during the midst
of collective bargaining.
In that same month, the NFL rejected the NFLPA’s proposal to
continue the salary cap system for an additional year.
In August of 2010, the NFL team executives negotiated contracts of
the 2010 first-round draft picks in a manner that reflected their belief that there would be
a lockout in 2011 by changing the payment date of option bonuses from the first two
weeks of the league year, which begins in March, to around the time the first regularseason game is played in 2011, whenever that might be.
In September of 2010, the NFL informed its employees of its three-
phase plan that will require many of its employees to take unpaid leaves of absences as
well as pay cuts.
In October of 2010, the NFL’s political action committee, “Gridiron
PAC,” made donations to Speaker Nancy Pelosi, both the House Minority and Senate
Majority leaders and the chairmen of the House and Senate judiciary committees, who
oversee the league in numerous capacities, as well as several other influential lawmakers.
An Associated Press report stated: “The union wants Congress to use its leverage to help
prevent a lockout. The NFL, by contrast, wants Congress to butt out,”
In October of 2010, the NFL required banks lending to its teams to
extend the traditional six-month grace period for declaring a default to stretch instead
through to the end of the 2011 season in preparation for a lockout.
In the context of these ongoing developments, the NFL and NFLPA
were negotiating a new CBA for over two years before the efforts failed.
Initially, NFL club owners had three proposals. The first was to
reduce the players’ salary cap revenue base by allowing an 18 percent increase in new
stadium cost credits. This base reduction would cut the players’ share of total revenue
(57.5 percent in 2009) by about 10 percent. The second proposal sought to modify the
existing EPP by imposing a rookie wage scale. In their third proposal, the NFL club
owners wanted to increase the regular season from 16 to 18 games by reducing the
preseason from four to two games.
Throughout these negotiations, the NFLPA sought to obtain
information from the NFL that would back up the latter’s demands. Exhibits F through K
are copies of letters sent by Richard Berthelsen, General Counsel for the NFLPA, to NFL
representatives on August 6, 2009 and on May 18, June 7, July 8, October 27, and
December 15, 2007 asking for information on NFL club costs, television contracts and
insurance and benefits. As several of the letters reflect, the NFL was not all that
forthcoming in providing some of this information. NFL club members declined to attend
negotiation sessions with representatives of the NFLPA. The parties were also discussing
proposals that would have increased benefits to retired NFL players.
Renunciation By The NFLPA And The NFL’s Lockout
On February 10, 2011, the NFL filed a charge against the NFLPA
with the NLRB, accusing the union of failing to negotiate in good faith.
Four days later, federal mediator George Cohen (“Cohen”) was
brought in and numerous days of mediation ensued in which the parties extended the
expiration date of the CBA several times.
The mediation was unsuccessful. On March 11, 2011, Cohen issued
the following statement:
[T]he parties have not achieved an overall agreement , nor
have they been able to resolve the strongly held, competing
positions that separated them on core issues.
In these circumstances, having reviewed all of the events that
have transpired, it is the considered judgment of myself and
Deputy Director Scott Beckinbaugh, who has been engaged
with me throughout this process, that no useful purpose
would be served by requesting the parties to continue the
mediation process at this time.
A copy of Cohen’s statement is attached as Exhibit O.
On March 11, 2011, DeMaurice Smith (“Smith”), Executive
Director of the NFLPA, sent a letter to all NFL Club Presidents and General Managers,
informing them that the NFLPA had “renounced its status as collective bargaining agent
for all NFL players.” As a result, no NFLPA representative “has the authority or
authorization to engage in any collective bargaining discussions, grievance processing or
any other activities associated with collective bargaining on behalf of players at either the
club or the league level.” The letter stated that the NFLPA would also no longer be
overseeing the activities of player agents. A copy of this letter is attached as Exhibit L to
this complaint. On the same day, Smith sent a similar letter to Goodell, which is attached
as Exhibit M to this complaint.
The practical significance of these communications was explained in
Powell v. NFL, 764 F. Supp. 1351, 1358-59 (D. Minn. 1991) (footnote and citations
Based on the foregoing, the court holds that the plaintiffs are
no longer part of an “ongoing collective bargaining
relationship” with the defendants. The NFLPA no longer
engages in collective bargaining and has also refused every
overture by the NFL defendants to bargain since November of
1989. The NFLPA further has abandoned its role in all
grievance arbitrations and has ceased to regulate agents,
leaving them free to represent individual players without
NFLPA approval. The plaintiffs have also paid a price for the
loss of their collective bargaining representative because the
NFL defendants have unilaterally changed insurance benefits
and lengthened the season without notifying the NFLPA.
Because no “ongoing collective bargaining relationship”
exists, the court determines that nonstatutory labor exemption
has ended. In the absence of continued union representation,
the Eighth Circuit's rationale for the exemption no longer
applies because the parties may not invoke any remedy under
the labor laws, whether it be collective bargaining, instituting
an NLRB proceeding for failure to bargain in good faith or
resorting to a strike.
Accord McNeil II, 790 F.Supp. at 883-84.
By March 11, 2011, the NFLPA had amended its bylaws to prohibit
it or its members from engaging in collective bargaining with the NFL, the NFL’s
member clubs or their agents.
The NFLPA is in the process of filing a labor organization
termination notice with the United States Department of Labor.
An application is being filed with the Internal Revenue Service to
reclassify the NFLPA for tax purposes as a professional association rather than a labor
On March 11, 2011, the NFL sent a letter to Smith announcing its
intention to commence a lockout on March 12. A copy of that letter is attached as Exhibit
N to this complaint. The lockout took effect sat the appointed time.
On March 11, 2011, certain NFL players filed a lawsuit against the
NFL in connection with some of the events described herein, alleging various antitrust,
contract and tort theories. Brady v. NFL, No. 0:11-cv-00639 SRN JGG (D. Minn.). A
preliminary injunction hearing in that case is currently scheduled for April 6, 2011.
After the filing of that lawsuit, on March 17, 2011, Goodell wrote
directly to NFL players, presenting the league’s side of the controversy. Certain players
responded on March 19, pointing out the deceptions contained in Goodell’s letter.
The position taken by the NFL in the aforementioned lawsuit is that
the lockout will continue until the NLRB rules on the league’s complaint, which could
take many months, if not years. As explained above, however, members of the class
were, as of March 11, 2011, not members of the collective bargaining unit described in
the 2006 CBA and the pendency of any NLRB ruling would have no effect on them.
Reaction to the NFL’s lockout strategy has been negative, even
before it was effectuated. A New York Times article quoted Fay Vincent, the former
Commissioner of MLB, as saying: “[b]ut it’s hard to look at these circumstances and not
see a case of owners’ wanting their cake and eating it, too.” As he added: “[t]he N.F.L. is
the premier sports business in the country by a large margin….There is only one way to
go, and that is down. It’s pretty dangerous to tamper with fans’ passion and good will.”
Similarly, in the March 21, 2011 issue of New Yorker, economic
analyst James Surowiecki noted:
You might say that .that’s capitalism--those who provide the
capital for an enterprise deserve to reap the profits. But the
N.F.L. isn’t capitalist in any traditional sense. The league is
much more like the trusts that dominated American business
in the late nineteenth century, before they were outlawed. Its
goal is not to embrace competition but to tame it, making the
owners’ business less risky and more profitable. Unions are
often attacked for trying to interfere with the natural workings
of the market, but in the case of football it’s the owners, not
the union, who are the real opponents of the free market.
They have created a socialist paradise for themselves that
happens to bring with it capitalist-size profits. Bully for them.
But in a contest between millionaire athletes and billionaire
socialists it’s the guys on the field who deserve to win.
Jonathan Weiler, Professor of International Studies at the University
of North Carolina Chapel Hill has likewise noted that players (including former players),
not club owners, bear the brunt of any lockout:
But the two sides are not really comparable. Yes, there are
many wealthy players in the NFL, but the vast majority will
not be for most of their lives.
If they stick on NFL rosters for a full season or more, they
make great salaries by normal standards. But the average
NFL player won't last four years in the league and this is, in
itself, a misleading figure, because there are plenty of players
who last 10-15 years. So, if the average player tenure in the
league is 3.6 years..., the median tenure of an NFL player,
which is a much more relevant gauge of the life of a typical
player, is less than that figure implies.
The media (and the owners) spend a lot of time focusing on
the salaries of players like Sam Bradford and Albert
Haynesworth. But for every Haynesworth or Bradford, there
are dozens of players who may make the league minimum for
the short duration in which they play in the league. And given
the significant long-term health problems that many NFL
players face, the impact of those problems on their job
prospects, the bills they owe, those few years of good
earnings can evaporate quickly. No NFL owner is ever going
to be out on the street. By contrast, NFL players do find
themselves there (remember Hall-of-Fame center Mike
In sum, every single owner is insanely wealthy by any
reasonable standard and will remain so for the rest of their
lives. The same cannot be said of many players….
But it's much worse than the simple fact that the majority of
players who put on an NFL uniform at some point will not
last in the league very long nor make a ton of money.
One central justification under capitalism for rewarding some
people with great wealth is the risk they take to achieve that
wealth. That risk, while pursued for the sake of self-interest,
contributes to a greater good in the form of innovation and
wealth creation. No such risk accrues to NFL owners,
however. Once you are granted a franchise, you are granted a
license to print money. Incompetent owners may cost their
team wins on the field, but they will still make a killing off
NFL revenues run to $8 billion a year and, as Forbes
magazine frequently points out, many other benefits redound
to owners of sports franchises, even if those benefits don't
show up on franchise balance sheets. King writes that it's a
burdensome new reality for NFL franchises that they have to
finance new stadiums on their own, rather than have
taxpayers pay for them. Only in the outrageously entitled
world of the super-wealthy would it be burdensome that
rather than being handed a billion dollar asset, they might
actually have to pay for it themselves. And Jerry Jones' new
stadium, for example, was built with an estimated quarter of a
billion dollars in public funds. Furthermore, if building new
stadiums weren't a profitable endeavor in the long run, let me
assure you that teams wouldn't be building them in the first
The stadium financing issue aside, the risk in the NFL is all
on the side of the players. They are the ones who exist in an
intensely competitive market for talent. And they are the ones
who put their bodies on the line everyday. It's the players, not
the owners who, in football especially, but to lesser degrees in
other sports, risk the possibility of a lifetime of pain and
discomfort or, as the evidence about the long-term effects of
brain trauma increasingly shows, depression and suicide (and
those realities the NFL spent many years denying).
Rutgers' Eric LeGrand, paralyzed from the neck down
Saturday night in an on-field collision, is only the latest
reminder of this simple, indisputable fact: the risk is all on the
side of the players. All of it. The owners cannot lose and they
don't lose. Period. The players can lose catastrophically.
Remarkably, while King does discuss the players' concerns
about pensions and health care for retired players, he fails to
mention the long-term health consequences from playing
football, as if that has no relevance to the players' views about
much of the league's revenue they're entitled to.
The owners win when media focus on things like the rookie
wage scale, 60% revenue sharing, and the like. The owners
lose when media point out that only the players are putting
their lives and bodies on the line in a cauldron of intense
competition. The reality is that owners of sports franchises
are, in many cases, spoiled brats who expect to make
impossibly large sums of money by dint of the fact that, since
they are already rich, they are entitled to become richer still.
They assume virtually no risk, earn massive sums of
guaranteed money regardless of the product they put on the
field and still feel a need -- with the indispensable aid of
Commissioner Goodell -- to distort basic facts about the
nature of sports economics and their own profitability.
As I wrote a few years ago, in the context of growing
evidence of the devastating long-term impact of traumatic
brain injury on retired NFL players, this is especially
And remember one more thing -- when there is a work
stoppage in sports, it's almost always blamed on the players.
But the 2011 season, if it isn't played, will be because of an
owners' lockout, not a players' strike. And in keeping with
their true nature, the owners have announced that, if there is a
lockout, they will stop paying for players' health insurance,
though they are still estimated to receive an estimated $1
billion in TV revenue next year, regardless of whether a game
The concerns about brain injuries to former NFL players caused by
concussions during their service in the league have been increasing in recent years as a
result of several studies of former NFL players. An article in the New York Times dated
October 21, 2010 reported the following:
A 2000 study surveyed 1,090 former N.F.L. players and
found more than 60 percent had suffered at least one
concussion in their careers and 26 percent had had three or
more. Those who had had concussions reported more
problems with memory, concentration, speech impediments,
headaches and other neurological problems than those who
had not, the survey found.
A 2007 study conducted by the University of North Carolina's
Center for the Study of Retired Athletes found that of the 595
retired N.F.L. players who recalled sustaining three or more
concussions on the football field, 20.2 percent said they had
been found to have depression. That is three times the rate of
players who have not sustained concussions.
As scrutiny of brain injuries in football players has escalated
in the past few years, with prominent professionals reporting
cognitive problems and academic studies supporting a link
more generally, the N.F.L. and its medical committee on
concussions have steadfastly denied the existence of reliable
data on the issue.
But in September 2009, a study commissioned by the N.F.L.
reported that Alzheimer's disease or similar memory-related
diseases appear to have been diagnosed in the league's former
players vastly more often than in the national population —
including a rate of 19 times the normal rate for men ages 30
The NFL’s Imposition of Anticompetitive Restrictions Upon NFL Players
Upon information and belief, the NFL Defendants have jointly
conspired and agreed to impose the aforementioned lockout prohibiting all competition
for player services, player signings, and employment and/or a system of anticompetitive
restraints on player movement, salaries, contract signings, and payment of compensation
and retirement/health benefits due under existing contracts or plans.
As part of this lockout, all NFL Defendants have conspired and
agreed, inter alia, to prevent NFL teams from negotiating, or even communicating with,
or employing NFL players, thereby completely eliminating a competitive market for
player services. In addition, NFL teams have conspired and agreed not to honor existing
contracts with NFL players, by not paying them and precluding their access to team
facilities and personnel.
The owners’ collective purpose in imposing the lockout is to ensure
the continuance of the league’s illegally obtained monopoly and the profits derived
therefrom by forcing the non-unionized NFL prospective, active and former players to
agree to wage, revenue and benefit reductions and anticompetitive restrictions.
The lockout by the NFL Defendants constitutes an illegal group
boycott, price-fixing agreement, and/or restraint of trade in violation of the Sherman Act,
under both the per se rule and the rule of reason standard.
The NFL and its teams have also announced that they will hold the
2011 College Draft on April 28-30, 2011. The College Draft is one of the longestrunning restraints on competition for player services in the NFL. It has the purpose and
effect of dividing the market for first year or “rookie” player services among the NFL
teams, who would otherwise compete against each other for rookie players, through a
number of anticompetitive restraints, including a limitation on the compensation that can
be paid to those players.
As described above, for College Drafts prior to the 2011 College
Draft, the SSA and CBA provided for a limitation on compensation to drafted players by
what was known as the EEP or Rookie Cap.
There was no agreement in the SSA or 2006 CBA concerning an
EEP or any similar restraint, for the 2011 College Draft or any College Draft thereafter.
The limitation on total compensation embodied by the College Draft
with an EEP or any similar restriction will be enforced by a group boycott among the
NFL Defendants. This group boycott takes the form of a concerted refusal to deal with
potential NFL players except through restrictive anticompetitive practices, including a
price-fixing agreement. The conspiracy with respect to the College Draft with an EEP has
been furthered by the lockout described above.
The Irreparable Injuries of Plaintiffs, the Class And The Public
Upon information and belief, the NFL Defendants intend to continue
imposing their lockout, the College Draft with EEP and/or other restrictions with
anticompetitive effects. Absent such restrictions, the class members would be free to
work in the 2011 off-season and beyond, to offer their services to NFL teams in a
competitive market and to receive retirement and health benefits established through the
operation of a competitive marketplace. Class members and the public will suffer severe
and irreparable harm if they are prevented from working during the 2011 NFL off-season
and season, offering their services to NFL teams in a competitive market, and/or
receiving health and retirement benefits.
The injuries which the class members are incurring and will continue
to incur will not be fully compensable by monetary damages. This is particularly true
due to the short length of NFL careers (the average length of which is 3.6 years), the
virtually constant need for NFL players to demonstrate their skill and value on the
football practice and playing fields, the life-threatening injuries caused to many former
NFL players as a result of their service to the NFL, and the difficulty in estimating and
proving the amount of monetary damages suffered by Plaintiffs as a result of the NFL
Defendants’ unlawful conduct. Contributions to the health and benefit plans described
above are directly jeopardized by the loss of revenue caused by a cancelled season. If no
new CBA is created within a year, the Plan mentioned above can be terminated, pursuant
to its own terms. And the amounts contributed in several of these plans were affected by
the terms in the 2006 CBA that has expired. The threatened injuries to the Plaintiffs and
class members are irreparable, warranting the issuance of preliminary and permanent
injunctive relieve for the class. Moreover, several programs sponsored by the NFL Player
Care Foundation and The Professional Athletes Foundation (“Foundations”) are put in
jeopardy by the lockout because, although the Foundations are independent, a portion of
the funding for the Foundations, and other similar programs, are funded in part by money
received from fines collected from players who commit rules violations and infractions
both off and on the field, and from money received from damages resulting from anticollusion infractions. The lockout, coupled with the extinguishment of the 2006 CBA
means these fines no longer support these programs. This will result in the removal of
vital services for the retirees --which particularly affects those who would otherwise not
be able to afford them, i.e., the high percentage of retired players who live off of less than
$200 per month in pensions. If these programs are not provided in a timely way, it could
result in a player not finding an illness in time, not obtaining vital prescription drugs,
and/or medical treatment, and so on. The affected programs are: (a) the Cardiovascular
Health Program provides extensive cardiovascular screenings and education, health
screenings, obesity screening and nutritional counseling; (b) the Prostate screening
program; (c) the NFL Neurological Care Program which evaluates and treat spine-related
conditions among retired players; (d) the Priority access to eligible retired players for
assisted living; (e) the Discount Prescription Drug Card program; (f) the Medicare
supplement program; (f) the Player Assistance Trust, which provides financial assistance
to former players for financial crises, completion of bachelor degrees, and programs
provided by NFL Care Foundation; (g) access by retires to their medical records which
could prevent a timely diagnosis; (h) testing and treatment for dementia under the 88
Plan; and (h) tuition assistance programs for retired players will be eliminated and a
retired player may be unable to finish his education.
Rookies who are deprived of the ability to play in the 2011 NFL
season also suffer irreparable injury. If they don’t play because of the lockup, their
careers are shortened and they will be in the unenviable position of competing for slots
on NFL clubs against the rookie contingent available during the year that play resumes.
They are also denied honors that may enhance their careers. And they are put at a greater
risk of injury when they do return because of not having played for months or perhaps
The public interest is also affected by the NFL’s lockout. As noted
above, millions of NFL fans watch NFL games in person or on television. They will be
injured irreparably by a continuation of the lockout that would cause cancellation of the
2011 NFL season. Player and league records would not be achieved, existing records
would not be broken and an entire NFL season would be lost.
Violation of Section 1 of The Sherman Act
Plaintiffs repeat and reallege each of the allegations contained in the
There is a relevant market for the services of major league
professional football players in the United States. The lockout orchestrated by the NFL
Defendants will substantially restrain and injure competition in that market and will
continue to do so.
The lockout constitutes an agreement among competitors to
eliminate competition for the services of major league professional football players in the
United States and to refuse to pay contractually-owned compensation to players currently
under contract with the NFL Defendants for the 2011 season and beyond, in violation of
Section 1 of the Sherman Act.
The lockout operates as a perpetual horizontal group boycott and
price-fixing agreement, which is unlawful per se.
The lockout also constitutes an unreasonable restraint of trade under
the rule of reason. The NFL Defendants have monopoly power in the relevant market.
The NFL Defendants’ group boycott and price-fixing agreement is a naked restraint of
trade without any pro-competitive purpose or effect. In fact, its stated objective is to
reduce player wages and benefits for former or retired NFL players that would have
otherwise prevailed in a competitive market. Moreover, the lockout agreement is not in
any way necessary for the production of NFL football or the achievement of any
The lockout is being undertaken in furtherance of other
anticompetitive practices engaged in by the NFL Defendants, including, inter alia, the
College Draft with EEP.
Each of the NFL Defendants is a participant in this unlawful
combination or conspiracy.
The Plaintiffs and class members have suffered and will suffer
antitrust injury to their business or property by reason of the continuation of this unlawful
combination or conspiracy. The lockout has injured and will continue to injure Plaintiffs
and class members by depriving them of the ability to work as, receive contractuallymandated compensation for, and/or offer their services as professional football players in
a free and open market, as well as depriving retirement and health benefits to retired or
former players that they would have received in a competitive market.
Monetary damages are not adequate to compensate Plaintiffs or
other class members for the irreparable harm they have and will continue to suffer,
warranting injunctive relief.
Declaratory Judgment: Interpretation of the SSA
Plaintiffs repeat and reallege each of the allegations contained in the
Article XX, Section 1, of the SSA provides: “[p]ursuant to the Final
Consent Judgment in this Action, the Court shall retain jurisdiction over this Action to
effectuate and enforce the terms of this Agreement and the Final Consent Judgment.”
Thus, this Court has exclusive jurisdiction to enforce and interpret the terms of the SSA.
Article XVIII, Section 5(b) of the SSA provides:
In effectuation of this Agreement, the Parties agree that, after
the expiration of the express term of the CBA, in the event that
at that time or any time thereafter a majority of players indicate
that they wish to end the collective bargaining status of any
Players Union on or after expiration of any such CBA, the
Defendants and their respective heirs, executors,
administrators, representatives, agents, successors and assigns
waive any legal rights they may have to assert any antitrust
labor exemption defense based upon any claim that the
termination by the players or any Players Union of its status as
a collective bargaining representative is or would be a sham,
pretexts, ineffective, requires additional steps, or has not in fact
Pursuant to the foregoing article, the NFLPA on March 11, 2011
renounced its representative status “on” the date of the expiration of the 2006 CBA.
Plaintiffs and class members seek a declaration, pursuant to 28
U.S.C. § 2201, that, under the SSA, the NFL Defendants have waived any right to assert
any labor exemption defense based on any claim that the players’ decision to terminate
the status of the NFLPA as their collective bargaining representative is in any way a
sham, pretext, ineffective, requires additional steps, or has not in fact occurred.
PRAYER FOR RELIEF
WHEREFORE, Plaintiffs pray for judgment with respect to their Complaint
Certifying the class proposed in this Complaint pursuant to Fed. R.
Civ. P. 23(b)(1) and 23(b)(2);
Declaring that the lockout violates Section 1 of the Sherman Act,
and enjoining it;
Declaring that the NFL Defendants’ future imposition of the
anticompetitive Draft with an EPP violates Section 1 of the Sherman Act, and enjoining
any implementation of the 2011 College Draft until the issues related to the antitrust
violations are resolved;
Enjoining the NFL Defendants from agreeing to deprive the players
of the ability to work as professional football players or negotiate the terms of that
employment in a competitive market.
Enjoining the NFL Defendants from agreeing to withhold
contractually-owed amounts to players (including health and retirement benefits)
currently under contract for the 2011 NFL season and beyond.
Declaring that, pursuant to the SSA over which this Court has
exclusive jurisdiction, the NFL Defendants have waived any right to assert any antitrust
labor exemption defense based upon any claim that the termination of the NFLPA’s
status as the players’ collective bargaining representative is a sham, pretext, ineffective,
required additional steps, or has not in fact occurred.
Enjoining NFL Defendants from taking any punitive or
discriminatory actions against the Plaintiffs or class members;
Placing all disputed sums at issue in this litigation in escrow until a
judgment or settlement is reached in this matter;
Enjoining the NFL Defendants or their designees from terminating
Awarding Plaintiffs their costs and disbursements in this action,
including reasonable attorneys’ fees;
Granting Plaintiffs and class members such other and further relief
as may be appropriate.
DEMAND FOR JURY TRIAL
Pursuant to Rule 38 of the Federal Rules of Civil Procedure, Plaintiffs
demand a trial by jury.