NBA files federal lawsuit against players

[killbuckner]

the courts have been eroding that decertification game plan from one ruling to another,

Where are you getting this from? Please give us an example. I still think that you are missing the point- they haven't ever eroded this game plan other than to say that the NLGA prevented the courts from issuing an injunction to stop a lockout even if it turns out the lockout was illegal. That the remedy for an illegal lockout is to collect treble damages when it goes to court.

[NOOOB]

What the 8th said/did that I think is ground-breaking is not the specific ruling, but rather the underlying principle they used. They said that rules (at least some of them) pertaining to an owner-union dispute can still be completely in existence and applicable after a union decertifies. That can be a game-changing principle - and it could easily be extended further.

From my reading of the decision, it seemed pretty clear that a "game-changing principle" was the last thing they wanted to create. They devoted a lot of text to avoiding the implication that other rules, such a the labor exemption, can extend beyond a union's decertification. I touched on this in the last paragraph of my last post but I'll elaborate for further clarification.

Their ruling was that the law in question, Norris-LaGuardia, applies in the case of a labor dispute. In reaching that conclusion, they pointedly demonstrated that a labor dispute is entirely distinct from an "owner-union dispute" to use your language. Take a look at the court's discussion of the Supreme Court's decision in New Negro Alliance v. Sanitary Grocery Co. on pp. 16-17 of the decision. The 8th Circuit pointed out that the D.C. Circuit initially made the same mistake you're making -- drawing a connection between a labor dispute and whether one of the disputants is a union. Since the New Negro Alliance was not a union, the D.C. Circuit erroneously held that Norris-LaGuardia didn't apply. The Supreme Court reversed, saying that even though the New Negro Alliance was not a union, they were an interested party involved in a "labor dispute" and therefore, covered by Norris-LaGuardia. Summing up the Supreme Court's findings in New Negro Alliance, the 8th Circuit concluded in Brady that:

If [section] 13(a) [of Norris-LaGuardia] were limited to controversies involving unions or unionized employees, then the Court could not have reached this conclusion.

http://www.antitrusthall.com/?p=260

Applying the Supreme Court's reasoning to the case before them, they determined that Judge Nelson's reliance on whether the players were "unionized" (emphasis added by the 8th Circuit) was off base, concluding "[w]e see no warrant for adding a requirement of unionization to the text."

I read all this analysis to mean that no underlying principle was intended that could link their analysis of Norris-LaGuardia to the labor exemption.

[NOOOB]

While you have (accurately) noted that they did not specifically apply that to the labor exemption, they took pains to point out that they were NOT ruling out such application either!

That's something we agree on. My comments on Brady were only intended to disprove your prior suggestion that the 8th Circuit somehow extended the labor exemption post-decertification, not to affirmatively prove that they were shutting the door on the possibility. Indeed, they didn't say either way. And they were careful to give rise to no inference either way as well.

I've even previously said that a court might allow the league to unilaterally impose new work rules post-decertification, so long as it is only temporary. I haven't seen a court say that can be done, but I'm still willing to say that it's within the realm of possibility. We both recognize that if the NBPA decertifies, Hunter will probably still be involved in trying to hash out a deal on the players' behalf. In that sense, the decertification is a legal fiction of sort, and a de facto labor-management relationship would continue to exist.

What I've been rejecting is your belief that any court would allow the league to permanently impose unilateral work rules after the union decertifies, without holding them liable for damages under the Sherman Act. And yes, even if the rules are reasonable. And even if they're approved by a judge and his/her special master. Disagree with me? Well then you disagree with the Supreme Court's dicta in Brown v. Pro Football Inc. too. Although the issue we're discussing wasn't before them, here's where they hinted they'd go if it was:

For these reasons, we hold that the implicit ("nonstatutory") antitrust exemption applies to the employer conduct at issue here. . .Our holding is not intended to insulate from antitrust review every joint imposition of terms by employers, for an agreement among employers could be sufficiently distant in time and in circumstances from the collective bargaining process that a rule permitting antitrust intervention would not significantly interfere with that process. See, e.g., 50 F. 3d, at 1057 (suggesting that exemption lasts until collapse of the collective bargaining relationship, as evidenced by decertification of the union); El Cerrito Mill & Lumber Co., 316 N. L. R. B., at 1006-1007 (suggesting that "extremely long" impasse, accompanied by "instability" or "defunctness" of multiemployer unit, might justify union withdrawal from group bargaining).

http://www.law.cornell.edu/supct/html/95-388.ZO.html

It so happens that that quote was included in the 8th Circuit's Brady decision (that's how I lucked into it).

But I'm not just relying on Supreme Court precedent. Here's what could happen after your ruling. Every industry previously required to bargain with a union in order to be sheltered from anti-trust liability could simply wait for their current CBA to expire. Then they'd take a hardline bargaining stance until impasse and resume work under their unilaterally imposed last best offer. Left with no option but decertification,** the workers would then be permanently forced to accept terms of employment dictated to them by management and the court. You've now removed the workers' spot at the table and arbitrarily replaced them with your special master. In so doing, you've effectively undermined 100 plus years of established labor law. And is Section 1 of the Sherman Act left with any teeth?




**In other industries the workers might strike, but management can outlast them with replacement workers.

[NOOOB]

the courts have been eroding that decertification game plan from one ruling to another,

Where are you getting this from? Please give us an example. I still think that you are missing the point- they haven't ever eroded this game plan other than to say that the NLGA prevented the courts from issuing an injunction to stop a lockout even if it turns out the lockout was illegal. That the remedy for an illegal lockout is to collect treble damages when it goes to court.

+1

Yes, the 8th Circuit softened the impact of decertification by extending the ban on injunctions, but no court has done anything to erode the continued application of the Sherman Act. So I don't see the groundswell or evolution in the courts that leads DBoys here:

the NBA right now is asserting based on the evolution of the law - and asking the 2nd to agree preemptively - that decertification should have no teeth (aka, no treble damages!)

Since the 8th Circuit was silent on the impact of decertification on the labor exemption, the current law remains intact and treble damages are in play. Since no court, including the 8th Circuit, has weighed in on it, the burden of proof remains with DBoys.

[killbuckner]

What I've been rejecting is your belief that any court would allow the league to permanently impose unilateral work rules after the union decertifies. And yes, even if the rules are reasonable.

Actually I disagree with this. I think how this would play out is that the players decertify and sue the league on anti-trust violations saying that the lockout is illegal. The lockout is pretty clearly illegal unless it is ruled that there is a sham decertification but the courts very well may say that they can't grant an injunction because of the NLGA so they would let the lockout stand. Once it goes to trial then it would be ruled that the lockout is illegal and the players are entitled to treble damages for any paychecks or damages (endorsements, etc) that they lost because of the lockout. The judge wouldn't set any rules- they would simply tell the NBA owners that they are not allowed to lock out the players. The owners could then set whatever rules they wanted to- but any rules they chose would also expose them to treble damages if they were later found to be an anti-trust violation. So they could pick a salary cap of 20 million dollars and a 2 year max salary, but since those would be pretty clearly anti-trust violations they would be absolutely crazy to do so. Instead they would only put in place the rules they were confident would be upheld (since they would pay TRIPLE for any they were wrong about).

[NOOOB]

^Oops, yeah that's what I meant to get at. I meant that they couldn't impose unilateral rules in the sense that it would expose them to damages. But you're right, technically a judge couldn't stop them, he'd just hit them with treble damages after the fact.

I edited the post to capture that point.

[DBoys]

"[W]e hold that the implicit ("nonstatutory") antitrust exemption applies to the employer conduct at issue here. . .Our holding is not intended to insulate from antitrust review every joint imposition of terms by employers, for an agreement among employers could be sufficiently distant in time and in circumstances from the collective bargaining process that a rule permitting antitrust intervention would not significantly interfere with that process."

This was written in the setting of having a decertified union, agreed? The circumstance we're envisioning now are just such a situation, where the so-called disclaimer is part and parcel of the CBA negotiation, and we'd be left with a "what comes next" mode. We keep hearing Kill say that at that point the union then rushes to court and easily slams the NBA financially via an antitrust action, and using the wording above as a guide, it looks like there's a significant legal hurdle that the union might not get past. No slam dunk.

But just as important to note, we clearly won't see the NBA paying triple damages over their current situation, because they're not leaving it to guesswork - they are getting a ruling in advance before they get to that point. And I can't imagine they'd chase such a declaratory ruling if they didn't think they had ammo to get a win, but that's why they have judges and courts.

NOOOB, you want to draw the distinction that the labor exemption wouldn't last forever. In general I think that may be true, but let's also agree that the phrase "distant in time" seems to imply a somewhat significant time span. It seems to me that the distinction they're making is not one of a specified interval, but rather addressing what happens on down the road with new-different issues that emerge later and were not part of THIS negotiation.

I am not a player or an owner, so I think I've beat this to death on a topic that is merely theoretical to me. I'm ready for a different topic (hopefully a new CBA someday soon?). Let me make clear that I don't discount the idea you guys may be right - but at the same time I think the courts have offered wider latitude than you're saying. And it's intriguing to me that the NBA is making the very same legal points I've theorized and is chasing a court ruling to get a definitive answer: maybe in a few weeks or months we'll get a factual answer to our theorizing and debate.

[NOOOB]

This was written in the setting of having a decertified union, agreed?

Disagree. The CBA had expired and an impasse had been reached. But no decertification in that case from what I read. If it had, the Supreme Court would have been required to address the extreme outer boundary they referred to and draw a definitive line. I can understand that it was fair to assume that they had decertified since they've got such an extensive history of doing so.

[NOOOB]

But just as important to note, we clearly won't see the NBA paying triple damages over their current situation, because they're not leaving it to guesswork - they are getting a ruling in advance before they get to that point. And I can't imagine they'd chase such a declaratory ruling if they didn't think they had ammo to get a win, but that's why they have judges and courts.

They're nipping it in the bud early on, but if the court rules against them on the lockout (although I don't think it will until the union decertifies), they'll still owe triple damages for any salary lost by players thus far. I'd have to look back at the UPCs, but their salaries are pro rated over the course of the year, right?

In addition, the court will not rule on the issue we're discussing -- whether they would be subject to damages post-decertification -- because it is not ripe for consideration yet. In order to avoid getting nailed for issuing an "advisory opinion" (courts generally can't do this), the court will have to wait until the union has decertified. Then the shelter of the labor exemption is presumably gone and the court can rule on it. Side note: I'm not clear on whether the NRLB can issue an advisory opinion before the fact though.

NOOOB, you want to draw the distinction that the labor exemption wouldn't last forever. In general I think that may be true, but let's also agree that the phrase "distant in time" seems to imply a somewhat significant time span.

Agreed. I used the word temporary, but a court might allow that to last for quite some time. Semantics, I suppose. Look at how the "all deliberate speed" timeframe worked out in Brown v. Bd. of Education.

And yeah, we're beating this to death, but why not? If the union decertifies the issues we've been hitting on will become extremely relevant. There'll be plenty else to talk about as soon as the union files its 12(b)(6) motion later this week.

[DBoys]

In addition, the court will not rule on the issue we're discussing -- whether they would be subject to damages post-decertification -- because it is not ripe for consideration yet. In order to avoid getting nailed for issuing an "advisory opinion" (courts generally can't do this), the court will have to wait until the union has decertified.

Maybe I misread, but I think the NBA suit did indeed ask for "relief" that would serve to preclude the later application of antitrust law and damages in the event of decertification. From the NBA's pov, the NBAPA keeps waving a gun at them, and they are asking the court to figure out for them if the gun is loaded or not, since the answer to that makes a significant difference in how they can respond.

But it's not a one-sided suit. It's a significant issue for the union, to know whether they can have any positive impact if they decertify, and also know if they imperil existing contracts by so doing.

[NOOOB]

In addition, the court will not rule on the issue we're discussing -- whether they would be subject to damages post-decertification -- because it is not ripe for consideration yet. In order to avoid getting nailed for issuing an "advisory opinion" (courts generally can't do this), the court will have to wait until the union has decertified.

Maybe I misread, but I think the NBA suit did indeed ask for "relief" that would serve to preclude the later application of antitrust law and damages in the event of decertification. From the NBA's pov, the NBAPA keeps waving a gun at them, and they are asking the court to figure out for them if the gun is loaded or not, since the answer to that makes a significant difference in how they can respond.

But it's not a one-sided suit. It's a significant issue for the union, to know whether they can have any positive impact if they decertify, and also know if they imperil existing contracts by so doing.

Yeah I might have to soften my stance on that a bit. Through the repeated use of "regardless of the validity of any purported disclaimer" it looks like that's what they're asking for. My guess is that the court won't get ahead of the case and controversy at hand, but the team that put that filing together probably has a much better clue than me.

Edit: Or just scrap it altogether. I think it would actually be a declaratory judgment, which is fine. I'm not the first guy to mess that up.

[ranger001]

I would think both sides will decide what to do after the lawsuit is decided. Does anyone know when a judgement on the NBA lawsuit is likely?

[NOOOB]

I would think both sides will decide what to do after the lawsuit is decided. Does anyone know when a judgement on the NBA lawsuit is likely?

That's a tough one that depends on a couple of things. If the court grants the motion to dismiss the NBPA is getting ready to file, then the suit could be effectively kicked out of court hopefully not too long after Stern's labor day deadline. I don't know what the NBPA's going to argue in their motion, so I couldn't guess what their likelihood of prevailing is. However, they're up against a tough standard, so generally speaking, I wouldn't expect the motion to be granted.

What I'm curious to see is whether the court comments on the legal sufficiency of some of the league's arguments. For instance, if the judge hints that that the labor exemption might continue to apply so long as proceedings are pending before the NLRB (one of the league's several arguments), that may send enough of a message to the union that they'd better strike a deal. I kind of think that's what the league is hoping to get out of this suit. Not necessarily an actual "decision", but an idea of what will play out in the case of decertification.

Beyond that, if they both really want to wait out a decision on the merits, who knows? This preliminary motion has to be resolved, then on to several months of discovery, then summary judgment motions, then setting a trial date...

[ranger001]

Beyond that, if they both really want to wait out a decision on the merits, who knows? This preliminary motion has to be resolved, then on to several months of discovery, then summary judgment motions, then setting a trial date...

Interesting, Stern probably knows the court case will drag on for months which is in his favor. Once the players start missing paychecks negotiations are going to start moving again.

[killbuckner]

Once the players start missing paychecks negotiations are going to start moving again.

Its strongly in the players interest to decertify the uinion before they start missing paychecks. At that point the league would be liable for treble damages once it goes to trial.

[DBoys]

Once the players start missing paychecks negotiations are going to start moving again.

Its strongly in the players interest to decertify the uinion before they start missing paychecks. At that point the league would be liable for treble damages once it goes to trial.

In light of the lawsuit over their heads, that's almost certainly what the union will NOT do ... which means the NBA's lawsuit has gained them a huge tactical advantage now, at the relatively cheap risk of being told later that the union can permissibly decertify any time they wish.

[d-train]

The union should decertify. Collective bargaining is not productive for players and time is being wasted.

After decertification, NBA players should sue owners for antitrust violations if they continue the lockout. The players should also seek an injunction to stop the lockout, but they should file separate claims rather than lump all players together. Players without an employment relationship because they have no contract and players that have never been employed by the NBA should have separate claims than players under contract and in an employment relationship. This differs from the injunction NFL players requested by eliminating the potential blanket applicability of the Norris–La Guardia Act.

[ranger001]

Once the players start missing paychecks negotiations are going to start moving again.

Its strongly in the players interest to decertify the uinion before they start missing paychecks. At that point the league would be liable for treble damages once it goes to trial.

We don't know what the chances are of the nba lawsuit succeeding but whatever it is, it would be foolhardy for them to decertify because if the court rules that decertification means all contracts become void then they would have shot themselves in the foot.

If it was abundantly clear that the lawsuit had zero chance of succeeding then yes but that is not so.

[DBoys]

The union should decertify. Collective bargaining is not productive for players and time is being wasted.

After decertification, NBA players should sue owners for antitrust violations if they continue the lockout. The players should also seek an injunction to stop the lockout, but they should file separate claims rather than lump all players together. Players without an employment relationship because they have no contract and players that have never been employed by the NBA should have separate claims than players under contract and in an employment relationship. This differs from the injunction NFL players requested by eliminating the potential blanket applicability of the Norris–La Guardia Act.

Total suicide plan for the players.

[killbuckner]

We don't know what the chances are of the nba lawsuit succeeding but whatever it is, it would be foolhardy for them to decertify because if the court rules that decertification means all contracts become void then they would have shot themselves in the foot.

If it was abundantly clear that the lawsuit had zero chance of succeeding then yes but that is not so.

Its a ridiculous claim that has no basis at all in the entire history of labor law which seems pretty clear to the league since the only "support" that the league gave for their position was some dicta from a league arbitrator who is not at all binding on the court system.