Supreme Court Ruling Could Consolidate NBA Power: Bad for the Kings, Bad for Fans
by Ziller on Jul 20, 2009 12:31 PM PDT
in Commentary
46 comments
My dalliance in law matters has been mostly limited to the recurring Supreme Court of the NBA posts, in which I assign the SCOTUS judges to their NBA coach doppelganger. (Now accepting nominations for presumptive justice Sonia Sotomayor. Mark Jackson wins by acclamation if Minnesota hires him.) But there's now a Supreme Court issue which actually hits to the heart of the NBA: the case of American Needle vs. the NFL.
I wrote about the issue as it pertains to the NBA at length Sunday for FanHouse. In short, the NFL is attempting to get the Supreme Court to rule that the NFL is a single entity instead of a collection of 32 separate and competitive businesses, that the interests of the NFL teams are completely connected and as such the NFL should not be liable to antitrust litigation. ESPN legal analyst Lester Munson raised huge red flags with a long, exhaustive and alarming piece published Friday, noting that the NBA has filed an amicus brief in support of the NFL's position and will likely reap the spoils of a ruling in the NFL's favor.
Those spoils: complete power over labor.
Collective bargaining could be completely removed from the table if the NFL gets its way. Munson says the leagues could institute whatever salary restrictions they wanted, which would surely mean that whatever the NBA will push for in the 2011 CBA negotiations it will get. A harder cap, a higher age minimum, shorter contracts, a smaller portion of revenue earmarked for player salaries and benefits ... you name it, the NBA will take it.
The only recourse for the players? To strike, or to threaten strike. Sounds like fun, right?
But wait! Shorter contracts, a more solvent league, more solvent team revenue ... that would actually help the Kings, right? We can do better if the Supreme Court rules that the NFL and other leagues constitute single entities, right?
Wrong. Two power bases in the NBA defend small market teams: small market owners, and labor interests. As we note constantly, the NBA's system favors the major market teams. The lack of serious revenue sharing in the NBA creates situations like the one in which we find ourselves today, where the Kings were on track to lose $25 million this season before spinning out gobs of salary for little return ... all while the equally atrocious Clippers probably made money, just because of location -- corporate sponsors, TV contracts, a better arena arrangement. There's almost nothing meritocratic about revenue in the NBA. The size of your market almost completely explains your revenue, especially in comparison to the NFL.
But labor -- the players, the players union and the agents -- supports small markets. It's about money: if more teams have it, players have a better chance of landing a good contract. If Sacramento, Memphis and Milwaukee had better revenue streams right now, David Lee wouldn't be cursing his forebearers and crossing names off his Christmas card list. In fact, Billy Hunter, head of the players union, has said one of the concessions the NBPA will be fighting for in the 2011 CBA negotiations is better revenue sharing. And better revenue sharing is the single biggest change that could help the Kings financially compete with the Clippers, Lakers, Suns and Warriors.
The NBA, again, favors the major markets ... and it's easy to see why. When the Knicks and Lakers and Celtics and Bulls are better, the ratings are better. When Staples Center and Madison Square Garden are full, they are the most lucrative buildings in the league. You can market the Celtics in Bangladesh a helluva lot better than you can market the Kings there. Sure, the league likes some parity (17-win teams are bad for business) and the fortunes of the teams in the smallest markets do matter to David Stern and Co. But it's a secondary interest, and it will always fall behind No. 1.
In talking about revenue sharing, it is very simple to discern the combatants: it is Big Market Teams vs. Small Market Teams. Perhaps the greatest profit comes in allowing the larger markets to keep all their revenue and investing it in improving their product. A 5% revenue boost for the Knicks might add more future revenue than a 5% revenue boost for the Kings. But the players would rather have as many teams as possible hitting the luxury tax, as many teams as possible able to dole out mid-levels every year and max contracts on a wink. So, in this, the most important of financial factors which could work for or against our team's solvency, we're on the side of the players.
And the players could get destroyed by the Supreme Court decision.
Munson argued that the NFL already has four votes in the bag, with the others all up in the air. The case will be heard before the Supreme Court next spring or summer. It has spooked me a great deal.
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I hate Natting Politics
especially when it gets in the way of our favorite pastimes like basketball. Thanks for sharing this, and it is worrisome.
Father of the "Natt this!" movement and Grandmaster of the "Never let AnotherStupidSN forget what a Sham-Wow is" Order.
The NFL has tried this a few times before
But now for the first time they have a legit chance of winning, Some of the professors I’ve talked to have stated that this could be 6-3 or even 7-2 in favor of the NFL. It’s my feeling that if the NFL wins this major sports as we know it would cease to be.
Great Stuff TZ
I wish I wasn’t so backed up in school, or feeling blocked mentally, or this is definitely something I’m going to try and write about eventually. Argh. Thanks for the updates on it though.
No mistakes in the tango, darling. Not like life. Simple. That's what makes the tango so great. If you make a mistake, and get all tangled up, you just tango on.....
Endless rebuilding, strikes, Stern with unchecked power...
Man, it’s all just sunshine and daisies over here today ain’t it?
Dip til I rip
http://reclaimingthetitle.wordpress.com
by Muff209 on Jul 20, 2009 12:56 PM PDT via mobile reply actions
From Munson's article
Although handicapping a decision in the high court can be perilous, Supreme Court scholars agree that [John] Roberts, Samuel Alito, Clarence Thomas and Antonin Scalia are likely supporters of the NFL’s position.
Why does this not surprise me? All four of these guys have a long, proud record of defending monied interests at the expense of the little guy. That’s how they got to where they are. And frankly it sickens me.
Hummus anyone?
From the people who brought you Reggie Musselnatt.
by My Losing Season on Jul 20, 2009 12:59 PM PDT reply actions 1 recs
If Omri isn't good enough for our Hummus
I’m not good enough for it either.
No mistakes in the tango, darling. Not like life. Simple. That's what makes the tango so great. If you make a mistake, and get all tangled up, you just tango on.....
greed will backfire
if the nfl wins, there will be strikes in every major sport. the owners and players will both suffer and at some point other, competive leagues will gain prominence (because there would be too much incentive for the players to form their own leagues).
it’ll prove to be a gain for the leagues in the short term, but it’ll destroy them in the long term. it’s stupid but interesting. time wil tell.
"When talent is roughly equal," said Westphal, "the competitive guys win. You have to have that in this league. Here's a perfect example: We (the Phoenix Suns) drafted Tim Perry and Dan Majerle the same year (1988). Now, if you get a stopwatch for down and back (baseline to baseline sprint), Tim Perry was faster than Dan Majerle. That's a fact. But if you had them race, Dan Majerle won. I can't explain it. Somehow, he had that drive, that fire, something inside him. If you have enough guys like that, your team starts winning again."
Perhaps I'm naive, but would this really change the balance of power significantly?
It seems that across the board all of the major sports have had strikes, or the threat of, during all of their major contract negotiations. Really, that’s the only power the players have and will continue to have as there is no legitimate outside threat to any of the leagues.
Not quite
The league are afraid of antitrust suits — a dozen or so NBA players, led by David Falk MJ and Ewing filed such a suit in 1995 — and as such participate in collective bargaining. Without the prospect of antitrust action, the league would not need to enter into collective bargaining. That means the league could change salary rules at a moment’s notice, and all the players could do would be strike.
This is my understanding of the situation, at least.
Yes, And to reinforce this from the article:
If the NFL succeeds in its single-entity gambit in the Supreme Court, the words “decertification” and “class action” will disappear from the vocabulary of sports. Unions will be left to the uncertainties of bargaining a contract with strikes as their only significant leverage. Instead of resolving bargaining impasses with court cases, the deadlocks will be resolved in strikes and lockouts — the baseball way.
The Munson, I think is, suggesting that strikes and lockouts throughout the major sports, would have the potency say of the 94 baseball strike. Additionally, I think resolving those possible strikes would be even more difficult.
by EvilKaramazov on Jul 20, 2009 1:43 PM PDT up reply actions
Fair enough, but I still get the feeling the significance is overstated here.
I can remember talk in the media of the potential for a strike in next round of contract negotiations for both basketball and football going back at least a year, if not more. Whether a contract is negotiated by ‘collective bargaining’ or some other means of bargaining/negotiation, it is my understanding that unions have to be recognized and negotiated with openly and “in good faith”. I don’t see how that changes with this ruling.
Perhaps I just don’t have all of the facts, but has there ever been a successful legal challenge against the major sports leagues on grounds that this ruling would now block?
From the article
It sounds like the rights of free agency were won not by threats of strike, but rather those of litigation. Also, my impression is that the term “collective bargaining” would resemble something totally different:
Leagues could easily establish a similar salary schedule for coaches and managers, who are considered a part of management and cannot legally form a union.
I think without legal ramifications negotiating in good faith might just be a turn of phrase—Justice would reside as the advantage of the strong.
by EvilKaramazov on Jul 20, 2009 2:16 PM PDT up reply actions
Good stuff TZ
If you haven’t already, click that link to TZ’s Fanhouse article. I read it this weekend and it is an excellent article.
This whole thing abosolutely terrifies me.
Never forget: I am a complete idiot
I doubt it's Armageddon
The collective bargaining agreement isn’t voided. It would put more future emphasis on the collective bargaining agreement and would probably grant owners less freedom to pursue outside sources of revenue without player inquisitions.
Also, the NFL suit is not aimed or about labor. It’s about obtaining absolute power over vendor contracts without being sued for anti-trust for awarding Reebok a contract for all licensed apparel for the league.
The NFL
asked the Supreme Court to take the case in order to expand single entity status — won by the NFL only for vendor contracts at the circuit level. It’s not about hats anymore.
if the nfl is granted single entity status...
the xfl and usfl would return faster than we’d all know it. the nfl is opening a pandora’s box with this. it’s not like it’s the freaking early 80s or even 90s anymore. with the proper motivation, enough resources (rich athletes, partnerships with nike, under armour, etc.), creativity and use of technology (online streaming, etc.), 2.0 versions of the previous leagues would be much more viable than the nfl believes. this move will come back to haunt the league in the long term.
"When talent is roughly equal," said Westphal, "the competitive guys win. You have to have that in this league. Here's a perfect example: We (the Phoenix Suns) drafted Tim Perry and Dan Majerle the same year (1988). Now, if you get a stopwatch for down and back (baseline to baseline sprint), Tim Perry was faster than Dan Majerle. That's a fact. But if you had them race, Dan Majerle won. I can't explain it. Somehow, he had that drive, that fire, something inside him. If you have enough guys like that, your team starts winning again."
by kingsbruins02 on Jul 20, 2009 4:25 PM PDT up reply actions 1 recs
Agree
Unless by “long term” he means decades and decades from now. The NFL is too big and too popular in this country right now for any rival league to be anything more than a niche sport.
long term as in within 10 years.
would the nfl be as popular if more than half of its best players migrated to another league?
i love college football. hell, if a professional league started today, one that is an extension of college football (say a professional team made up of former bruins, notre dame, etc.), i’d sign up to watch it. never undervalue motivation and creativity.
"When talent is roughly equal," said Westphal, "the competitive guys win. You have to have that in this league. Here's a perfect example: We (the Phoenix Suns) drafted Tim Perry and Dan Majerle the same year (1988). Now, if you get a stopwatch for down and back (baseline to baseline sprint), Tim Perry was faster than Dan Majerle. That's a fact. But if you had them race, Dan Majerle won. I can't explain it. Somehow, he had that drive, that fire, something inside him. If you have enough guys like that, your team starts winning again."
by kingsbruins02 on Jul 21, 2009 10:11 AM PDT up reply actions
creative destruction.
the catch word of all economist. in the early 90s, people believed companies such as mci and worldcom would rule telecommunications for the next 20 years, because they had the long distance phone market cornered (long distance cards, etc.). cell phones and the internet destroyed them. although the nfl is sitting pretty these days, it doesn’t mean it’s position is set in stone forever.
look at the music industry. 20 years ago, guys like jay z and 50 cent did not exist. most emcees were essentially artist, who were the employees of the record companies. today, these artist have simply bypassed the record companies to produce and market their own sh*t. they did their way because they had to (the record companies did not like their sh*t) and they’ve been able to because the times have changed—why do you need a large company to push your sh*t if you can do it on you tube or myspace… why do you need a large company to produce the cds, when you can simply sell it online with absolutely no overhead…etc.
"When talent is roughly equal," said Westphal, "the competitive guys win. You have to have that in this league. Here's a perfect example: We (the Phoenix Suns) drafted Tim Perry and Dan Majerle the same year (1988). Now, if you get a stopwatch for down and back (baseline to baseline sprint), Tim Perry was faster than Dan Majerle. That's a fact. But if you had them race, Dan Majerle won. I can't explain it. Somehow, he had that drive, that fire, something inside him. If you have enough guys like that, your team starts winning again."
by kingsbruins02 on Jul 21, 2009 10:21 AM PDT up reply actions
There's a huge difference
Between these individual industries.
The ability to harness modern technology to create viable alternatives to telecommunications companies is available to anyone with brains and a work ethic. Football has a finite resource of talent to draw from – and the NFL will always get the best of that resource. Meaning any league that tries to compete will have a weaker product on the field – and is gonna get squashed and squashed hard.
You might build it up to a niche sport, like the Arena Football League, or the WNBA, but there won’t be a serious competitor to the NFL for some time. Can a startup league financially survive long enough to eventually take down the NFL? I just don’t see it.
but what happens if/when the league wins its case and...
it starts throwing down impossible salary and contract length demands and half of the players leave because the difference between the alternative leagues pay and the nfl is not all that great?
you’re assuming the players will never leave because the nfl is just that great. i’m assuming the nfl will eventually become greedy with its new found powers and impose crazy demands on the players—enough crazy demands to get them to bounce.
without any restraints, who’s to say the nfl will act justily. i just don’t believe they will. per colin powell, of all the powers, the power of restraint is the most valued and most hard to achieve.
and for the record, i don’t thnk the nfl will win the case. ziller and other cite the supreme court head count and assume that because many of the judges are pro business, they’ll vote in favor the nfl. pro business to me also means pro free enteriprise. granting the nfl single entity status would go against the notion of free enterprise so i doubt the nfl will win.
"When talent is roughly equal," said Westphal, "the competitive guys win. You have to have that in this league. Here's a perfect example: We (the Phoenix Suns) drafted Tim Perry and Dan Majerle the same year (1988). Now, if you get a stopwatch for down and back (baseline to baseline sprint), Tim Perry was faster than Dan Majerle. That's a fact. But if you had them race, Dan Majerle won. I can't explain it. Somehow, he had that drive, that fire, something inside him. If you have enough guys like that, your team starts winning again."
by kingsbruins02 on Jul 21, 2009 10:44 AM PDT up reply actions
Well
I assume the NFL aren’t complete morons. They do realize that some of their profits are reliant on the product and personalities they put on the field.
I think you are just seeing the worst case scenario here.
worse case indeed. :)
"When talent is roughly equal," said Westphal, "the competitive guys win. You have to have that in this league. Here's a perfect example: We (the Phoenix Suns) drafted Tim Perry and Dan Majerle the same year (1988). Now, if you get a stopwatch for down and back (baseline to baseline sprint), Tim Perry was faster than Dan Majerle. That's a fact. But if you had them race, Dan Majerle won. I can't explain it. Somehow, he had that drive, that fire, something inside him. If you have enough guys like that, your team starts winning again."
by kingsbruins02 on Jul 21, 2009 11:20 AM PDT up reply actions
That's a big if IMO
If a new league could get 2% of the existing NFL talent, I’d be shocked. 50% would never happen.
The USFL may have been the most successful attempt to challenge the NFL. They had owners with money, they stole some top flight talent, and they lasted for three seasons. I’d venture that the NFL is considerably more popular now (understatement), meaning any venture that attempts to go head to head with them will meet a fairly quick demise.
Your idea re: a professional league would appeal to the hardcore college and professional football fan (maybe), but it wouldn’t draw the casual fan IMO.
carving out a market to start would be ideal...
look, i’m not saying the nfl will all of a sudden become obsolete, but in the long term, it’ll hurt them. it wouldn’t surprise me at all if in 50 years, the talent gets broken up between numerous leagues—where essentially free agency becomes something like soccer (transfer money, etc.).
"When talent is roughly equal," said Westphal, "the competitive guys win. You have to have that in this league. Here's a perfect example: We (the Phoenix Suns) drafted Tim Perry and Dan Majerle the same year (1988). Now, if you get a stopwatch for down and back (baseline to baseline sprint), Tim Perry was faster than Dan Majerle. That's a fact. But if you had them race, Dan Majerle won. I can't explain it. Somehow, he had that drive, that fire, something inside him. If you have enough guys like that, your team starts winning again."
by kingsbruins02 on Jul 21, 2009 10:33 AM PDT up reply actions
Sotomayor Suggestions:
Stan Van Gundy — Simply because if you were to put a mustache on Soto, I’d seriously have trouble distinguishing who is who. Also, you’d have to get in a “Kinkos” joke.
Muss — Like Muss, Soto has apparent knowledge of the game. She goes on and on (unnecessarily so) in her speeches and opinions, so you assume she knows what she’s doing and that you know what you’re getting. But in the end (especially because she is replacing Souter), you just get the feeling that the experiment will fail and we’ll get screwed in the end.
And my favorite doppelganger nomination, NELLY — They both are known for their liberal offense, and do not favor the defense. A solid history of stats, but you’d still expect more results given their position of power. And finally, they are united in their battle against Type-1 diabetes.
"It would be my honor to be your new stepfather."
A depressingly brilliant read
I think I could watch “Marley and Me” right now and it would actually cheer me up.
Sigh.
SACTOWN ROYALTY - Try our thick creamy shakes!
But that's a sad movie
Oh wait, I see what you did there….touché
Never forget: I am a complete idiot
Good...
…Unions suck. They’re terrible for businesses and dilute the product. I hope the NFL wins and as such, the NBA as well. What’s good for business is good for the consumer.
I'm confused
What reason do we have to believe that NBAPA would be able to get revenue sharing written into the new CBA even if this ruling wasn’t an issue? If labor couldn’t (or wasn’t willing to make the concessions necessary to) earn it in the ’90s, it seems out of the question that the players would have the bargaining power necessary to make it happen in 2011.
And why wouldn’t things like “shorter contracts, a more solvent league, more solvent team revenue” help the Kings? I can understand why they might not help as much as serious revenue sharing, but I can’t see any reason why they would be bad for small-market teams, nor can I see how the enactment of one would preclude the possibility of the other.
Shorter contracts, a more solvent league, more solvent team revenue and revenue sharing...
need to be put into place in the next CBA and work harmoniously in order solve this leagues problems. When expiring contracts are worth more than talented players, then the system has flaws. The rookie pay scale was on of the league best ideas, now they just need to add revenue sharing (at least to some extent) and fix the guaranteed portions of the contracts.
Kusian: Dude, I completely disagree with almost every single one of your political statements, but I don’t want to argue politics here, I came to read about basketball and all things Kings. I just wanted to say that your rant against Furious made you look anything but thoughtful, it made you seem childish and, well…like an ass. Maybe your intended tone didn’t translate from your thoughts to the post, I don’t really know so I won’t hold it against you. I don’t see the logic in your politics, but hey, you prob don’t see it in mine either. I can live with that, I hope you can too. If you want to post about subjects that truly matter to us though, be ready for people to disagree with you and to call you out on something you may say.
by NorCal BillsFan on Jul 21, 2009 10:32 AM PDT up reply actions
rant?
With respect, I chose not to respond to a “pissing in the wind” comment. And I hardly repsonded with a rant. I like thoughtful debate devoid of profanity and ad hominem attacks. I simply chose not to respond to that particular post. I don’t mind people disagreeing with me at all. Otis does every time we enter into the political realm. Frankly, I love the back and forth when it is polite and thoughtful. So, if you can find fault with my logic in this or any other debate, feel free to respond with your views. I’d be happy to engage and, perhaps, learn something new. Or if you just want to talk hoops, I’m always up for that as well.
I'm sorry
If that specific word offended you. I don’t consider it to be profane, but I won’t hold it against you if you do. I wasn’t trying to hurt your feelings, but I did take exception to your generalizations about the value of unionized and public-sector work.
I’m sure you can think of someone you know and respect who currently works (or has in the past) in a unionized or government job, and who wouldn’t appreciate you saying that his/her work was inferior. Even if you can’t think of anyone who fits that description, I suggest expressing your opinions more tactfully. I know that there are some civil servants who frequent this website, and I doubt that they come around to hear themselves bashed.
I found your original comment off-topic, reductive, and belligerent. As a result, it wasn’t the arguments that I cared to respond to, but their presentation. An impertinent argument will often attract an impertinent response.
Fair enough.
I can appreciate your opinion. I do absolutely agree that there are dedicated and driven people working in both public and private unions. It is the system that breeds the problems and the inefficiencies. Obviously, though, we are not going to convince the other. You are also correct that this has gotten way off topic and for that I also apologize.
It's good to see that you're keeping politics out of your profile image too
You don’t work for FOX News by any chance, do you?
From the people who brought you Reggie Musselnatt.
by My Losing Season on Jul 21, 2009 5:12 PM PDT up reply actions
OK for you
But do you have to remind us every time you post a comment? It’s not like you’re going to persuade anyone, and you may just irritate the reader, thereby distracting them from what otherwise might be valid basketball-related points (basketball being, after all, the point of this blog). It would be like me putting "Abolish the Federal Reserve" in my sig line. I may feel strongly about it, but what does it have to do with the Kings? It’s just an invitation for a non-basketball-related debate. See my point?
If you so insist though, I recommend modifying your profile image to show the blue guy as "American Taxpayer" and the red guy as "Wall Street Corporatists", except with about 50 money bags already in his possession. You see, I do truly hate predatory parasitic corporate Wall Street interests.
But again, nothing to do with basketball. An occasional political zinger? I’m all for it. Political grandstanding? Not so much. And I suspect that that view more or less reflects the philosophy of the StR management. You can even ask them yourself.
Good night and good luck to you.
From the people who brought you Reggie Musselnatt.
by My Losing Season on Jul 21, 2009 10:28 PM PDT up reply actions
Gee -
So every time I post I remind everyone of Joe Kleine? I’m not sure which is worse.
SACTOWN ROYALTY - Try our thick creamy shakes!
So THAT'S who that is
Obviously I’m showing my ignorance of all things Kings pre-1999.
I never saw the guy, but a coworker of mine once told me “That guy couldn’t catch the ball if you handed it to him.”
From the people who brought you Reggie Musselnatt.
by My Losing Season on Jul 22, 2009 10:46 AM PDT up reply actions
Joe Kleine
His legacy is kind of victimized by his being drafted so high. He never turned out to be a top-flight talent, but he was a pretty solid player…he was the Jon Brockman of the ’80’s and ’90’s. You look at his stats, and you’d wonder how he stayed in the league so long, but not if you watched him.
He’s still one of my all-time favorite Kings.
Maybe the Kings ought to retire his number
If for no other reason than that the guy has become iconic of the years in the wilderness. Has to count for something.
From the people who brought you Reggie Musselnatt.
by My Losing Season on Jul 22, 2009 12:36 PM PDT up reply actions
Take it easy on the K-Man
Kusian’s been around these parts a long, long time. And I think if you spend some time talking hoops with him, you’ll find out that he brings a lot of knowledge to the table – despite the fact that he’s a corporatist, warmongering douche. ;)
My man Otis---spoken like a true diplomat :D
I don’t hate the man, not at all. I’d just prefer not to have his politics shoved in my face every time. Somehow I got this idea that a profile image ought to be basketball-related, funny, or both, not political posturing. If we all trumpeted our political views every time we commented, this blog would probably be a lot less fun. IMO.
From the people who brought you Reggie Musselnatt.
by My Losing Season on Jul 22, 2009 11:02 AM PDT up reply actions
I like Kusian.
He smells like cherries.
And tastes like chicken.
Wait....Why is everybody clapping? Everyone around me is clapping.... I guess I should be clapping too... GO LAKERS!!! I hate living in So Cal
by 27freethrows on Jul 22, 2009 5:35 PM PDT up reply actions
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