Monday, March 30, 2015

The "Daily Fantasy Sports" Marketplace Is Booming, But Is It Legal?

Over the past few weeks I have posted extensively on how gambling laws treat commercial NCAA Tournament pools.  However, March Madness pools are not the only form of online sports gaming proliferating on the Internet.  Indeed, play-for-cash "daily fantasy sports" contests have recently become big business.  Even the National Basketball Association is now a shareholder in one of these ventures (FanDuel).

With the legal status of "daily fantasy sports" still relatively unsettled, it is my pleasure to announce the online publication of sections 1-4 of my newest law review article "Navigating the Legal Risks of Daily Fantasy Sports: A Detailed Primer in Federal and State Gambling Law."   This article explores the legal status of "daily fantasy sports" in light of both federal and state gambling laws, and explains why the legal status of such contests likely varies based on both contest format and states of operation.

The full version of this article will be published in the January 2016 edition of University of Illinois Law Review.  In the interim, I welcome any thoughts or comments.

March 30, 2015 in Law Reviews, Sports, Web/Tech | Permalink | Comments (0)

Thursday, March 26, 2015

NCAA Claims To Put Education Ahead of Profit. Really?

Last week, NCAA lawyers went into court seeking to reverse the U.S. District Court for the Northern District of California’s ruling in O’Bannon v. National Collegiate Athletic Association.  In that case, the district court had held that the NCAA member colleges illegally restrained trade under Section 1 of the Sherman Act when they colluded among other things, to keep college athlete compensation below the full cost of college attendance. 

Among the NCAA’s many legal arguments in seeking reversal was their claim that college athletics is exempt from the Sherman Act because amateurism, according to the NCAA, is driven by economic motives and not commercialism.  Although previous court decisions from the Third and Sixth Circuit seem to side with the NCAA’s argument on that point, other circuits have long rejected this contention and analyzed NCAA conduct in labor markets under the traditional Sherman Act.

Nevertheless, even to the extent there exists a split in the circuits on this important issue, it seems extraordinarily disingenuous for the NCAA lawyers to even make the argument that it prioritizes education over economics when considering the economic realities of the ongoing NCAA men’s basketball tournament.  In the past ten days alone, the NCAA has pocketed upwards $1 Billion from media rights and other revenues related to this single tournament tournament.  And, not only are the athletes unpaid, they are also going uneducated based on the NCAA’s attempt to maximize their own television revenues through midweek tournament games.

Through the first week of the NCAA men’s basketball tournament, athletes on many college basketball teams have already missed upwards of three class days.  While the NCAA elects to schedule midweek games in the early rounds to maximize its television revenues, the NCAA could easily recast the tournament with all teams playing back-t0-back games on Friday night and Saturday night much as all Ivy League teams do during the Ivy League’s regular season.

Making matters worse, the NCAA has once again scheduled its men’s college basketball championship game on a Monday night – requiring athletes on the two finalist teams not only to miss late-week classes, but also to miss Monday and Tuesday classes in that last round.  Indeed, while NCAA member schools make substantial money from the NCAA men’s basketball tournament, the athletes’ main “compensation” -- a minimum of at least six missed class days – places them substantially behind in the classroom on their way home.

March 26, 2015 in Sports | Permalink | Comments (2)

Friday, March 20, 2015

Sports and Business

Last week, I wrote sports and the problems that could arise from a myopic focus on winning.

I promised to attempt to tie that post to business this week, but because I am running to a lunch meeting and then to the Belmont v. Virginia NCAA tournament basketball game viewing party, I am going to keep this short.

(Also, please indulge a little more bragging about my school. Before the game even begins, I am already incredibly proud of our basketball team. Belmont won the academic bracket for the NCAA tournament teams this year, which is based on academic measures like Academic Progress Rate (APR) and Graduation Success Rate (GSR)).

Anyway, I think there are a number of parallels between sports and business. Sports, done the right way, can teach many valuable lessons, such as the importance of teamwork, diligence, unselfishness, strategy, preparation, etc. In fact, team sport participation was one of the things I looked for when interviewing for law students when I was in practice and it is something I look for now when interviewing research assistants. 

As mentioned in last week's post, sports can lead participants off-track if there is a myopic focus on winning that trumps certain overriding principles. Similarly, a myopic focus on profits in business, without adherence to certain legal rules and ethical principles, can lead individuals and companies astray. What the overriding principles should be, and the appropriate level of focus on profits, are two difficult questions that all businesses should attempt to address.   

March 20, 2015 in Business Associations, Haskell Murray, Sports | Permalink | Comments (0)

Friday, March 13, 2015

Competition: Winning and How You Play the Game

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At Belmont, we have been basking in the glow of a dramatic win in the men’s basketball OVC championship game.

While I could not be prouder of all the members of our team, many of whom are majoring in business, I am most proud of the way they played and conducted themselves – with heart, effort, intelligence, humility, confidence, and class. Murray State, holder of a 25-game win-streak and ranked #25 in the country coming into the game, played just as hard and conducted themselves with class as well.

The OVC championship game was the best basketball game I have ever seen and it was a shame that either team had to lose. In the unlikely event that any selection committee members are reading this, I think Murray State deserves a spot in the NCAA tournament as well; how do you justify dropping a team from #25 to outside the top-68 teams after a well-played 1-point loss to another strong team?

Since that basketball game, I have been thinking a lot about “winning” as compared to “how you play the game.” Growing up, I was insanely competitive and was obsessed with winning. I loved the quote attributed to Vince Lombardi: “winning isn’t everything, it is the only thing” and I despised the claim that “it isn’t whether you win or lose, it is how you play the game.” (Interestingly, some argue that Lombardi never said those words, claiming instead that he said “[w]inning is not everything, but making the effort to win is,” which is much closer to the statement I despised.) 

Perhaps, I am getting softer as I age or maybe it is being a father that is changing me, but I now believe that how you play the game is much more important than whether you win or lose. Results of games, like Belmont’s recent one, could turn on a fraction of an inch, but conduct during the entire game (and before and after the game) tells you a great deal more about the character of the competitors. 

I am still not in the “everyone gets a trophy” camp and I still think winning and losing are important parts of competition, but I do think that “winning” should be subordinated to certain overriding principles. When the overriding principles govern, you get things like Bobby Bowden sharing his playbook with the Marshall University team that lost most of its members in a plane crash OR the carrying of an injured opponent around the bases OR the helping of a fallen runner. When winning is seen as “the only thing,” teams and individuals skirt rules to gain an advantage (doping in baseball, cycling, and track; recruiting violations; spygate; deflategate; etc.)

Next week I will apply some of these concepts to business. 

March 13, 2015 in Ethics, Haskell Murray, Sports | Permalink | Comments (0)

Thursday, March 12, 2015

Should Law Professors Abstain From Online NCAA Tournament Pools?

This Sunday, the NCAA will announce the 68 basketball teams that are scheduled to participate in this year's men's basketball tournament.  Then, the true "madness" begins.  

At many schools, one or more professors will likely organize an NCAA Tournament pool.  The pool will likely include entry fees and prize money. The pool's rules and standings will often appear on a public website.

All of this may sound like innocuous fun -- especially during the anxiety-ridden days of waiting for ExpressO and Scholastica acceptances to arrive.  However, law professors playing in online, pay-to-enter NCAA Tournament pools technically are acting in violation of several federal laws -- albeit, laws that are rarely enforced,

One federal law that seems to prohibit online, pay-to-enter NCAA Tournament pools is the Interstate Wire Act of 1961.  This act disallows individuals from “engaging in the business of betting or wagering [through the knowing use of] a wire communication for the transmission in interstate or foreign commerce.”  According to various recent court decisions, the Wire Act applies to contests hosted via the Internet, as well as those hosted over the phone.  And even though the act was originally passed to crack down on organized crime, even "upstanding" individuals such as law professors, at least in theory, are not immune from prosecution.

A second federal law that seems to prohibit online, pay-to-enter NCAA Tournament pools is the Professional and Amateur Sports Protection Act ("PASPA").  Passed in 1992 at the behest of America’s five premier professional sports leagues (including the NCAA), PAPSA makes it illegal for any private person to operate a wagering scheme based on a competitive game in which “professional or amateur athletes participate."  Of course, PASPA includes a grandfather clause that exempts previously authorized government sponsored sports gambling in four states -- Nevada, Delaware, Oregon, and Montana.  But it doesn't include any exception whatsoever for private March Madness pools.

Finally, a third federal law that may disallow online, pay-to-enter NCAA Tournament pools is the Uniform Internet Gambling Enforcement Act.  This act, which was passed most recently in 2006, makes it illegal for those "engaged in the business of betting or wagering" to “knowingly accept” funds in connection with the participation of another person in unlawful Internet gambling.  Although the UIGEA offers a special carve-out provision for “fantasy sports,” this carve-out does not apply to March Madness pools because winning outcomes are based on the final score of actual game results, and not individual player performances

Of course, the likelihood of anyone going to jail for simply participating in an online NCAA Tournament pool may seem next to nil.  But if you are going to play in one of these contests, I have two simple recommendations: (1) let someone else other than you collect the money; and (2) encourage the host to 'grade' the brackets by hand, rather than posting contestant names and picks on an Internet website.

March 12, 2015 in Ethics, Games, Sports, Web/Tech | Permalink | Comments (1)

Friday, March 6, 2015

March Madness Is Coming -- And Legally Speaking, It Is Madness

Ten days from now will mark the start of the 2015 NCAA men's basketball tournament -- one of the most watched sporting events of the year.   Recently, the NCAA sold 14 years worth of television broadcast rights to the NCAA Tournament for $10.8 Billion.  On an annual basis, that comes to an annual sum of  $770 Million per year.  

The athletes who play in these games, by contrast, do not receive any share of the derived revenues, nor are they allowed to endorse products or sign autographs for money.  In addition, the most successful teams in this tournament will have athletes that are required to miss upwards of nine class days based on a tournament schedule that is created to accommodate television broadcasts.

As a guest blogger for the month of March, I will be discussing the legal issues related to NCAA amateurism and the economic realities of the NCAA men's basketball tournament.  Some of the topics I will discuss include why the NCAA is indeed an economic cartel, why the U.S. district court's decision in O'Bannon v. NCAA does not go far enough to protect college athletes, why perhaps the National Labor Relations Board should grant college athletes the right to unionize, and how the NCAA men's basketball tournament could be structured differently if student education, rather than athletic revenues, were truly a top priority.  

Thank you to Haskell Murray for providing me with this wonderful forum to share my ideas and scholarship.  And to all of the Business Law Prof Blog readers, please do not worry: I have no plans to be a Debbie Downer.  I will, however, talk seriously about the economic and legal realities of college sports and how we, as academics, can make a difference.

March 6, 2015 in Current Affairs, Ethics, Games, Sports | Permalink | Comments (0)

Monday, March 2, 2015

Guest Blogger: Marc Edelman

Marc

The Business Law Prof Blog is pleased to announce that Professor Marc Edelman will be joining us as a guest blogger for the month of  March. Quoting from his online bio, "Marc Edelman is an Associate Professor of Law at the Zicklin School of Business, Baruch College, City University of New York. He specializes in sports law, antitrust, intellectual property, and gaming law." During the summers, he also teaches at Fordham University School of Law.

I was previously familiar with Marc Edelman's work through my interest in sports and through a bit of reading in the antitrust area. All of his areas of interest have significant intersections with business law and I look forward to reading his posts. Given that he is one of the most recognized experts in the area of law & sports, we are especially privileged to have him with us right before March Madness. 

March 2, 2015 in Haskell Murray, Sports | Permalink | Comments (0)

Tuesday, February 3, 2015

A Jogger's Story: A Nike+ Marketing Reminder About Loyalty, Transparency, and Expectations

Anyone who has followed me on Twitter knows that I am a pretty regular runner. I try to run at least four times a week, and depending on the time of year, my schedule, and other variables, I have run as much as six times a week.

It was not always this way. I have asthma, which didn’t help much as a kid, but that problem has been controlled by medication for years. And although I was a soccer player, I was not much of a runner. Goalkeepers often aren’t.  In my older years, I was known to say from time to time, “I only run when being chased.”

Sometime in 2011, that changed. I started running three miles, most days.  I got a pair of the Nike Free Run Shoes, which may or may not have helped, but I was less sore then I was with the old, stable, and heavy, running shoes I would previously tried to run.  Not long after that I got the Nike+ running app, which tracked my runs and served as a motivator and something of a personal accountability measure, as I shared my run with friends.   

In a little more than three years, I ran 769 times and logged 2569 miles on the Nike+ running app.  Not bad. 

For me, it was figuring out that I didn't have to commit to a marathon, or even a 10K.  I went for three-mile runs each time, and about a year ago I upped that run to about 3.5 miles each time out, and I never worry about a longer run.  I found what I could stick to, and the Nike+ app helped me see just how much I was accomplishing in relatively short, but regular, outings.  I recommend giving it a try, if you'd like to run, but it always seemed to hard. 

So, this is a long introduction to my breakup with Nike+.  Nike created a thing at the end of 2014 called the “Out Do You Challenge.” It made a nice (kind of goofy) little video that chronicled the year for some of my friends who have accomplished some impressive feats.  Things like marathons. That's great, and a nice, if a bit cheesy reward for a year of effort. 

The site offers a place to click to see if you “made the cut for the challenge.”  I did not.  Okay, so it’s not that I deserve anything or that Nike kept something from me that I had a right to. Their site and app; their rules.  But it still seemed a little odd, given that I am a connected and regular user, who shared all his runs on social media, and had run as much as 200 miles more than others deemed “worthy.” 

Being the connected user that I am, I inquired.  The response from Nike was as follows: “We are sorry to hear that you weren't selected for the Nike+ Outdo You Challenge. We selected our top Nike+ users who met the highest level of engagement and had complete profile information.” 

Again, they get to make the rules, but it’s hard to see how I wouldn’t make the grade based on how often I used the app. For some reason, this irked (and still irks) me, and I couldn’t figure out why.  Then it dawned on me: in my own stupid way, I felt betrayed. I was thinking: We had been in this together for 2,500 miles.  I had stuck with it when the app was not working and the only way to fix it was to email support for help.  I had run with Nike+ in Warsaw and Krakow and London and Spain and all over the United States.  We did it together. And now I was left out.

So, it occurred to me that I was being silly.  It is pretty silly, but it's still how I felt.  And it’s also a lesson in how to keep people connected and engaged.  

If there had been a target or a message – “you need to run at least a half marathon” or “we need your home address” – that made clear what was required, then I can choose if I am in.  Instead, Nike decided to create a post hoc award for certain participants.  Again, their choice, but in doing so they excluded someone who thought they were part of the team.  And that undermines loyalty.

I’m not saying I won’t run in Nike shoes any more or that I’ll never use the Nike+ app.  I might.  But I am also auditioning others.  Currently, I am running with MapMyRun to see how I like that.  In addition to Nike, I will be trying some other options – maybe Brooks, Rebook, or Adidas – in my next trip to the running shop.

This is a good lesson in marketing, I think, but also in teaching.  The best teachers cultivate trust.  They have high expectations, and if they aren’t met, the students usually know.  I try to be transparent with my students about what I expect, and why, so that they know whether they are on track or not.  I am sure, though, that during my career, I have surprised some students who felt betrayed because they thought they were on track, yet their grade did not coincide with what they thought they put in. 

I know I am a lot better today about sharing and explaining those expectations today than I was when I started as a teacher, but it’s good to be reminded of just how critical it can be as transparent as possible with your expectations. So, thanks, Nike+, for the reminder.  Maybe I’ll be back.  Maybe not. 

 

February 3, 2015 in Joshua P. Fershee, Law School, Social Enterprise, Sports | Permalink | Comments (1)

Tuesday, January 20, 2015

A Sports Reminder From Jay Bilas About Human Nature in Law and Regulation

I was watching the Michigan State-Iowa basketball game a couple weeks ago, and commentator Jay Bilas noted his view (which he has stated previously) that the lane violation rule is wrong. I am teaching Sports Law and an Energy Law Seminar this semester, so (naturally) I linked his comments to a broader framework. 

So start, here's the current rule.  Basketball for dummies explains

Lane violation: This rule applies to both offense and defense. When a player attempts a free throw, none of the players lined up along the free throw lane may enter the lane until the ball leaves the shooter's hands. If a defensive player jumps into the lane early, the shooter receives another shot if his shot misses. An offensive player entering the lane too early nullifies the shot if it is made.

Bilas argues that a defensive lane violation should result in the ball being awarded to shooter's team instead of another attempt at the free throw for the shooter.  His rationale is, "The advantage to be gained going in early is on the rebound, not the shot. Give the ball to the non-violating team." This is probably right, though a player might enter the lane early to distract the shooter, too.  I suppose one could award a reshot for a lane violation if the ball is not live (e.g., the violation occurs on the first freethrow of a two-shot foul), and award the ball to the shooter's team on a missed live ball.  

I think there is some merit to Bilas's argument, but I think there's a practical reason the rule remains as it is: the penalty is not too harsh, making it something referees are willing to call.  A favorite quote of mine comes from Ben Franklin, who once warned, "Laws too gentle are seldom obeyed; too severe, seldom executed."   

Here, I think Bilas is probably right on the penalty-incentive link, but the rule he proposes may prove too severe for lane violations to be called as willingly as they are today.  In addition, practically speaking, if the shooter makes the free throw anyway, the shooter's team would still need to get the ball after a lane violation, if the punishment is really about discincentivizing cheating for a rebound.  This could be the rule, and it might be right, too, but that would make the penalty even more severe, making referees even less likely to make the call. (You could, I suppose, give the shooter's team a choice -- the the point or the ball -- but that gets messy.)  

I used the Ben Franklin quote in my article from a few years back, Choosing a Better Path: The Misguided Appeal of Increased Criminal Liability after Deepwater Horizon, which was  published in the William & Mary Environmental Law and Policy Review (available here). In the article, I argued that increased criminal liability for energy company employees was not likely to be any more effective in preventing disasters like the blowout of BP oil well in the Gulf of Mexico because the likelihood of actually sending people to jail is highly unlikely.

I still believe this is true in a many contexts.  It's not to say we should not have harsh penalties for certain behaviors, but we need to be sure the laws or rules are more than justifiable.  We also need to be sure they will be executed in a manner that the laws or rules serve the actual purpose for which they were designed.  

To be clear, we also need to be sure that the penalties are not so gentle that no one will follow the rule.  In the energy and business sector, I am of the mind that we regularly err on both sides -- some rules are too gentle and others too severe.  Sports can be that way, too, though we often don't even know the penalty for certain acts like, say, allegedly deflating a few footballs.  

As for lane violations, though, I think the rule has the balance right, even if there is a justification for a harsher rule.  

January 20, 2015 in Joshua P. Fershee, Securities Regulation, Sports | Permalink | Comments (1)

Monday, December 15, 2014

Conflicts of Interest on the College Football Playoff Committee

Many people have been talking about the four teams chosen for the inaugural college football playoff. I, good business law blogger that I am, have been thinking about conflicts of interest on the selection committee.

If you’re a football fan, you know that this year, for the first time, the national champion in NCAA major college football will be chosen through a four-team playoff. The four teams selected—Alabama, Oregon, Florida State, and Ohio State—will participate in two semifinal games, with the two winners to play for the championship. (Yes, Art Briles, Baylor should be one of the four, but, no, Ohio State is not the team that shouldn’t be there.)

The four participating schools are chosen by a thirteen-person selection committee, although one of the members, Archie Manning, has taken a leave of absence this year for health reasons. The committee includes several people with current relationships to schools that play major college football, including the following athletic directors:  Jeff Long, Arkansas; Barry Alvarez, Wisconsin; Pat Haden, USC; Oliver Luck, West Virginia; and Dan Radakovich, Clemson.

The selection committee adopted a recusal policy that requires committee members to recuse themselves if the committee member or an immediate family member “(a) is compensated by a school, (b) provides professional services for a school, or (c) is on the coaching staff or administrative staff at a school or is a football student-athlete at a school.” A recused committee member may not participate in any votes involving that team or be present during any deliberations involving that team’s selection or seeding.

Under this policy, all of the athletic directors recused themselves from voting involving their schools. Others connected to particular schools also recused themselves: Condoleeza Rice, because she’s a professor at Stanford; Tom Osborne, because he’s still receiving payments as a former coach and athletic director at Nebraska; Mike Gould because he’s the Superintendent at Air Force.

As it turned out, none of the committee members were recused as to the six schools seriously considered for the final four—the four chosen, plus Baylor and TCU. But should they have been?

Consider Barry Alvarez, the athletic director at Wisconsin, a member of the Big Ten. The Big Ten schools share bowl revenues with other members of the conference. Thus, when Ohio State was chosen for the fourth spot over Baylor and TCU, Wisconsin became entitled to part of the $6 million paid to participants in the semifinal game (and additional money if Ohio State wins the semifinal and plays in the championship game). A vote for Ohio State directly benefitted the Wisconsin athletic department Alvarez heads.

The problem is not unique to Coach Alvarez. Other conferences also share bowl revenue, so Pat Haden (PAC-12), Jeff Long (SEC), and Dan Radakovich (ACC) also benefited when the representatives from their respective conferences were chosen. But those choices, unlike the choice of Ohio State over Baylor or TCU, were relatively uncontroversial. (The choice of Florida State over any of those schools should have been controversial, in my opinion, but it wasn’t.) Oliver Luck (Big 12) also had a financial incentive to vote for either Baylor or TCU, but, unfortunately for him and for his athletic department, neither of them was selected.

This conflict of interest may have been intentional. The committee appointments were carefully apportioned among the Power 5 conferences, and the expectation may have been that each of these athletic directors would vote for representatives of their respective conferences. (We don’t know if they actually did.) But no one is even talking about this clear conflict of interest, not even Art Briles, and that’s a little surprising.

December 15, 2014 in C. Steven Bradford, Corporate Governance, Sports | Permalink | Comments (6)

Monday, December 8, 2014

More on Executive Health and Disclosure . . .

Many of you may have seen this already, but this past week's news brought with it an update to JPMorgan Chase CEO Jamie Dimon's health situation--positive news on his cancer treatment results, for which we all can be grateful. I posted here about Dimon's earlier public disclosure that he was undergoing treatment for this cancer.  Based on publicly available information, I give Dimon my (very unofficial) "Power T for Transparency" cheer for 2014.  (The "Power T" is The University of Tennessee's key--and now almost exclusive--branding symbol.  See my earlier posts on UT's related branding decisions regarding the Lady Volunteers here and here.) 

As many of you know, I have written about  securities  law and corporate law disclosure issues relating to private facts about key executives (which include questions relating to the physical health of these important corporate officers).  I do not plan to rehash all that here. But I will note that I think friend and Glom blogger David Zaring gets it just right in his brief report on the recent Dimon announcement (with one small typo corrected and a hyperlink omitted):

Not to pile on, but there's the slightly unsettling trend of CEOs talking, or not, about their health.  Surely material information a real investor would want to know about when deciding whether to buy or sell a stock in these days of the imperial CEO.  But deeply unprivate. . . . The stock is up 2% on the day.  It will be interesting to see whether this email makes its way into a securities filing.

Love that post.  Thanks, David.

Sadly, as I was drafting this post, I learned that Kansas City Chiefs safety and former Tennessee Volunteer football standout Eric Berry has been diagnosed with Hodgkin's lymphoma.  This obviously is not a matter of public company business disclosure regulation (given that the Kansas City Chiefs franchise, while incorporated, apparently is privately held).  But I know I join many in and outside Vol Country in wishing Eric the same success in his cancer treatment that Dimon appears to have had to date with his.

December 8, 2014 in Business Associations, Joan Heminway, Securities Regulation, Sports | Permalink | Comments (0)

Wednesday, September 24, 2014

Thomas and Van Horn on College Football Coaches' Salaries

Randall Thomas (Vanderbilt Law School) and Lawrence Van Horn (Owen Graduate School of Management, Vanderbilt University) have posted a new article entitled Are Football Coaches Overpaid? Evidence from Their Employment Contracts.

This is a rare article that appeals to both my academic interests and my interest in football. Rarely do these two set of interests overlap in my life, and the article has prompted me to think of ways I might incorporate my football knowledge into future academic articles. 

The article's abstract reads:

The commentators and the media pay particular attention to the compensation of high profile individuals. Whether these are corporate CEOs, or college football coaches, many critics question whether their levels of remuneration are appropriate. In contrast, corporate governance scholarship has asserted that as long as the compensation is tied to shareholder interests, it is the employment contract and incentives therein which should be the source of scrutiny, not the absolute level of pay itself. We employ this logic to study the compensation contracts of Division I FBS college football coaches during the period 2005-2013. Our analysis finds many commonalities between the structure and incentives of the employment contracts of CEOs and these football coaches. These contracts’ features are consistent with what economic theory would predict. As such we find no evidence that the structure of college football coach contracts is misaligned, or that they are overpaid.

September 24, 2014 in Corporate Governance, Haskell Murray, Sports | Permalink | Comments (1)

Saturday, September 13, 2014

North Dakota State University - ESPN's College GameDay and Business Law

NDSU

First Joshua Fershee visits North Dakota, now ESPN's College GameDay

North Dakota State University, which is being featured on GameDay this morning, is also one of the schools looking for a business law professor (albeit a "lecturer") on my updated list here.

While most of my co-bloggers teach at much bigger sports schools than I, as I mentioned previously, it is a lot of fun teaching at a school that gets at least occasional national attention for its sports teams.  

September 13, 2014 in Business School, Haskell Murray, Sports | Permalink | Comments (0)

Monday, August 18, 2014

More on Sports, Fashion, and Law

OK.  So, I am stretching a bit here.  But yoga may be considered a sport, athletic clothing is a kind of fashion, and securities fraud prohibitions and corporate director fiduciary duty involve law.  So, I stand by my blog title in the face of any criticism that may follow this post.

I do yoga four times a week when I am not traveling.  I also work out, sometimes on days when I am not doing yoga.  So, I have a fair number of pieces of yoga wear and other athletic clothing.  This means that I get regular mail and email solicitations from the firms that purvey these clothing items.

I recently received a catalog from one of my favorite athletic clothing brands, Sweaty Betty, which I discovered originally when I was teaching in Cambridge, England in one of our study abroad programs a few years ago.  I noticed, with some amusement, that the new catalog harps on the opacity of the firm's yoga bottoms or trousers (as the British like to call them).  The website does the same--"100% opaque" labels abound.  As an astute consumer and securities lawyer, I immediately jumped to the conclusion, whether right or wrong, that this yoga-bottoms advertising campaign is a reaction to the see-through yoga pants debacle of one of Sweaty Betty's competitors, Lululemon (another of my favorite brands).

What does business law have to do with this (apart from the many standard legal angles on the recall of products generally)?  As my securities regulation students from last spring well know (since it was the subject of part of their final exam), stockholders of Lululemon brought a securities fraud class action suit against Lululemon, after the recall of the see-through pants, based on alleged misrepresentations of material fact in public disclosures touting the high quality of its yoga pants.  Predictably (at least imho), the District Court dismissed the action back in April.  The court's opinion and order resulted in a few interesting online law firm commentaries with colorful titles (including posts from, e.g., Orrick and Weil).  The public fallout also includes (as most would guess) allegations of breaches of fiduciary duty and observations about insider trading and Rule 10b5-1 plans because of some well-timed trades by Lululemon's founder and then-CEO. 

As we think about the new semester (ours starts on Wednesday), the Sweaty Betty catalog reminded me to bring the Lululemon matter to the attention of our law faculty readers.  The facts and public reactions make for a nice case study of risk management in the context of securities regulation and fiduciary duty law.  A Stanford "Closer Look" piece, as well as many news reports, make the use of the case reasonably easy.  And for those of you who want to take a peak at my exam question, just ask . . . .

August 18, 2014 in Current Affairs, Joan Heminway, Securities Regulation, Sports, Teaching | Permalink | Comments (8)

Monday, July 28, 2014

American Apparel 1, NFL 0

As many readers (and all of my friends) know, I am a bit of a sports fan.  Having been a college athlete (field hockey, at Brown University, for trivia buffs), I focus most of my attention on college games.  I even served on The University of Tennessee's Athletics Board for a few years.  But my Dad and I used to watch professional football and baseball a lot together when I was a kid (still do, when we are in the same place at the right time), so I also maintain a casual interest in professional sports.

I also have an interest in fashion, especially women's fashion (maybe less well known, except by close friends).  I have friends in the industry and find aspects of it truly fascinating.  I even used to subscribe to Women's Wear Daily, the fashion industry trade rag.  I am the faculty advisor to the College of Law's Fashion and Business (FAB) Law student organization.

This personal background is prelude to my interest in two current events stories that I see as parallels.  I am trying to sort them through on a number of levels. Maybe you can help.  Here are the top lines of each story.

  • Last Thursday, the National Football League (NFL) suspended Baltimore Ravens running back Ray Rice for two games, fined him $58,000 dollars, and asked him to seek counseling after its investigation of an incident relating to a video in which Rice was depicted dragging his then-fiance, now wife, by her hair after punching her in the face (allegedly rendering her unconscious).
  • The very same day, American Apparel (AA) announced a new slate of directors who will assume positions on the AA board in early August as a result of investor intervention and a boardroom blood bath following on lagging profits and continuing investigations of allegations of sexual misconduct (most of it, as I understand it, not new news) against AA's founder and former CEO and director, Dov Charney, whose management roles at the firm were suspended by the board back in June.

Continue reading

July 28, 2014 in Business Associations, Corporate Governance, Corporations, Current Affairs, Joan Heminway, Marcia Narine Weldon, Sports | Permalink | Comments (2)

Friday, March 28, 2014

Northwestern, NCAA, and Negotiation

Now that I am teaching MBA courses in negotiation, I see negotiations everywhere.

For example, in reading about the extremely interesting NLRB ruling in favor of the Northwestern University football players – holding that the players are “employees” and can unionize – I came across this Sports Illustrated article:  Northwestern ruling sends clear message: NCAA, it's time to negotiate.

Former Northwestern quarterback Kain Colter does a nice job articulating some of the interests from the players’ side of things in this video.

Given this ruling, which will be appealed, and the O’Bannon v. NCAA case which is set for trial on June 9, there is likely to be a great deal of negotiation between the NCAA and players outside of the courtroom over the next few months.  As the cases move closer to potential resolutions in favor of the players, the NCAA’s BATNA (best alternative to a negotiation) weakens.   The NCAA, however, may raise doubts about the players’ BATNA, by raising things like the possible tax implications of a court victory.

These will be complex, multi-party, multi-issue negotiations.  The parties with interests at stake include current and former players, coaches and athletic directors, colleges and universities, the NCAA, and the lawyers on either side.  The sports fans also have interests at stake, but while we may be considered, I doubt we will get an actual seat at the negotiation table. 

The interests of all these groups create quite the confusing web.  The NCAA and the players would be wise to ask questions aimed at uncovering all of the underlying interests of the other parties and try to reach a mutually beneficial resolution outside of court.

For more information, from other professors, on the NLRB ruling in favor of the Northwestern football players see below:

March 28, 2014 in Haskell Murray, Negotiation, Sports, Teaching | Permalink | Comments (2)

Wednesday, March 19, 2014

University Sports and Academics

Last night Belmont's men's basketball team beat a very good UW-Green Bay team 80 to 65 in the first round of the NIT.  Both teams were extremely close to making the NCAA tournament this year. Earlier this year, Belmont beat highly ranked UNC and UW-Greenbay beat ACC-Champs UVA.

[Photos courtsey of Belmont University Basketball]

Mann_bradshaw

Why is Belmont basketball relevant to this blog?

Well, actually, I just wanted to brag on my school's team, but I will try to make a connection.

Some extremely interesting studies have been done tying atheletic success to increased applications, increased selectivity, and/or higher (academic) rankings.  See, e.g., Jain (Wharton) and Toma & Cross (UMKC & Michigan).  (While my co-blogger Steve Bradford called the U.S. News rankings of law schools "meaningless" earlier this week, even he admitted that rankings influence some student decisions.) 

In a similar study, a personal friend of mine and University of Georgia doctoral candidate, Michael Trivette, co-authored a paper in 2012 with Dennis Kramer (UVA) about the increases in selectivity and accepted student standardized test scores experienced by schools that switched athletic conferences.

Whether the time and money put into college sports is worthwhile makes for heated debate, and I am sure there are studies challenging some of the findings in the papers I linked to above. 

Personally, I love being at a school with competitive Division-I sports (even though we do not have a football team...).  First, I am convinced our sports teams are helping us recruit better students, Second, I think the teams help create community and school loyalty.  Third, I think our basketball team is one of the handful of things that has given our relatively unknown (but wonderful) school national attention (a few of the other ventures onto the national stage include our school's appearances on the TV show Nashville, the annual airing of Christmas at Belmont on PBS, and the hosting of a 2008 presidential debate...not necessarily in order of importance).

A few of my co-bloggers teach at schools with some of the most successful athletic programs in the country (Duke, Nebraska, West Virginia).  I imagine they may have their own views, and I know that the relationship between university sports and academics is a complex one. 

Update: As noted in the comments, here is an article on Butler University's 40% increase in applications following their NCAA tournament runs.  The article's author also claims that Butler received $1 billion worth of media attention.  (Granted, making the NCAA finals is very different than a first round NIT win, or even a win over UNC, but we have to start somewhere).

March 19, 2014 in Business School, Haskell Murray, Law School, Sports | Permalink | Comments (3)

Thursday, February 27, 2014

Harvard Law School's Petrie-Flom Center: Research Positon for New Project with NFL Players Association

From Michelle Meyer over at the Faculty Lounge.  Sounds like an interesting position:

In connection with our work on a sponsored research project with the National Football League Players Association, the Petrie-Flom Center seeks to hire a Senior Law and Ethics Associate immediately. (Please note that this is a distinct position from the one we recently advertised working with Harvard Catalyst on clinical and translational research.)

 

We are seeking a full-time doctoral-level hire (J.D., M.D., Ph.D., etc. in law, ethics, public health, social science, or other relevant discipline) with extensive knowledge of and interest in legal and ethical issues related to the health and welfare of professional athletes.  The position will be funded for at least two years, with renewal likely for an additional year or more.

 

View the full job description and apply here

 

For questions, contact petrie-flom@law.harvard.edu or 617-496-4662.

February 27, 2014 in Ethics, Haskell Murray, Jobs, Sports | Permalink | Comments (0)