ContractsProf Blog

Editor: Jeremy Telman
Oklahoma City University
School of Law

Thursday, November 14, 2024

Marc Edelman Discusses College Athletes as Employees on the Taboo Trades Podcast

Krawiec-22-2Kim Krawiec (right), joined by guest hosts UVA Law 3Ls Olivia King and Alyssa Marshall, interviewed Marc Edelman (below left) about his recent publication (with Michael A. McCann and John T. Holden), The Collegiate Employee Athlete in the Illinois Law Review. Professor Krawiec's podcast operates like a live seminar, with well-prepared students, who have read the guest's work, posing well-crafted questions to which the guest responds.

Professor Edelman began the discussion by identifying three movements coalescing in the college athletes' rights movement. The first is the name, image, and likeness movement that is now permitting college athletes to promote products for money. Second, there are various strategies involving antitrust litigation to lift restraints that the NCAA and member schools impose to prevent college athletes from being compensated. Finally, there is the subject matter that Professor Edelman and his co-authors address in their work, which is labor law.

Professor Edelman starts with the simple proposition that college athletes meet the legal definition of employees. That means that they should be entitled to the protections afforded to other workers, including a minimum wage and workman's comp, but also that they should get the benefits of unionization, including collective bargaining.  The students, many of whom were themselves collegiate athletes, seem to have drunk the cool-aid on the employee argument, but they press Professor Edelman on the status of college athletes who are not revenu- generating. 

This podcast episode was a revelation for me. I was prepared to hate it. My posts on the subject of college athletics generally take the position that college athletics are a bizarre accident of history, unique to the United States, which undercuts the already rotting foundations of U.S. support for higher education. Professor Edelman comes at the topic from a different direction. And yet, o my surprise, Professor Edelman and I have very similar views up to a point. If he were writing on a blank slate, he says towards the end of the interview, he would de-couple the development sports leagues from higher education, as they do in other countries. That's my solution.

Marc_EdelmanHowever, given that the cake has already been baked, Professor Edelman doesn't think we can separate the eggs from the flour. College athletics are already thoroughly commercialized, and students are exploited to benefit the universities. He thinks they ought to be treated as employees and have their right to organize recognized. Let the market for their services dictate the ways in which they are compensated for their labor and for the contributions they make to their colleges and universities. I have to admit that his approach is far more realistic than mine.

That said, while I am under no illusion that we will see college athletics dismantled in the near future, I do think we should nonetheless resist exacerbating the commercialization of college sports as well as the disconnect between the educational purpose of the universities and elite athletics programs. Professor Edelman is most eloquent on the ways in which educational institutions shamefully prioritize revenue from college sports over the overall welfare of college athletes. Universities switch conferences, forcing athletes to travel across the country. Everything is done with football in mind. Those games are at least played on the weekends. Basketball games can be played during the week, not to mention all of the non-revenue sports teams whose massive carbon footprints generate expenses well in excess of revenues. Universities give lip service to their educational missions but forget their purposes entirely when pursuing the broadcast revenues associated with the favored conferences. Based on the experience of friends who teach at the University of Oklahoma, I see no evidence that the immense revenues generated from joining the SEC have not benefitted university faculty and staff not affiliated with athletics.

I think Professor Edelman downplays the possibility for negative externalities associated with the gestalt switch for which he advocates from student-athlete to athlete-employee. I do not share his optimism that making college athletes employees will have a dramatic impact on the economic well-being of the typical college athlete. His focus is on "revenue-generating athletes," and I do not think it will be as easy to determine which athletes are revenue-generating as Professor Edelman assumes.  Very few individual athletes generate net revenue. Although they may play a key role, nobody other than family and close friends come to a college football game to see the offensive linemen or the long snapper. What will it do to team morale if some players are employees and some are students. More likely, the decision would be made on the team level. Treating athletes differently based on what sports they play will change behaviors in myriad ways. Professor Edelman has written elsewhere that Title IX is a red herring, and the subject did not come up in the podcast. I'm pretty sure it would come up from day one if a school has some male employee athletes and no female employee athletes. 

I also think Professor Edelman downplays the benefits that students athletes enjoy. He grudgingly grants tuition as a benefit. One of the students raises the idea that for some sports, college athletics is the only path towards professional sports. Well, when I played in a recreational softball league, I paid for the privilege of playing. My team had no coaching staff, and certainly not a professional-level coaching staff. We had no trainers, nutritionists, fitness experts, physical therapists, or tutors. We did not have a bespoke sports facility to which only we had access, nor was there a stadium or training facility built to meet our needs. The team did not pay for my travel. All these factors should be counted as benefits that students receive in exchange for performance. This is why the math becomes challenging on the question of which athletes are "revenue-generating."

Overall, only a handful of university athletics programs generate income over expenses. Those that do tend to reinvest the surplus into athletics programs. That's why I would unbake the cake as much as possible. The finances of college athletics are already decoupled from those of higher education. There would be a lot of psychic boundaries to overcome, but universities are not dependent on income from sports. Their fuel is tuition and, for some, endowments. The sports programs are financially siloed off. 

Taboo TradesA note on terminology: Professor Edelman treats the term "student athlete" as an ideologically tainted neologism created by the NCAA to facilitate its exploitation of students. His preferred term is "collegiate employee-athlete." I have referred to "college athletes" in this post because it makes sense in the context of his scholarship. However, notwithstanding the origins of the term, I think it has lasting value to think of college athletes as "student-athletes." Most college athletes are not revenue-generating athletes. Most of them think of themselves as students first. They enjoy athletics, and it might help pay for school, but they are in school for the education. Students first; athletes second, hence student-athletes. Very few collegiate athletes become professional athletes, and so most athletes, including most in revenue-generating sports, would be better off thinking of themselves as student-athletes. As a result, I do not think it promotes the best interests of student athletes to get them to think of their main purpose as athletics.

Notwithstanding that disagreement on the level of student-athlete consciousness, Professor Edelman has persuaded me that at least some collegiate athletes are entitled to be considered employees and thus are entitled to unionize and to enjoy the benefits of collective bargaining. I regard this as a second-best solution. It is certainly an improvement over the current state of affairs, which benefits mostly adults -- university administrators and coaches -- exploits collegiate athletes, and massively detracts from the purpose of universities.

November 14, 2024 in Commentary, Contract Profs, Current Affairs, Recent Cases, Recent Scholarship, Sports, Web/Tech | Permalink | Comments (0)

Wednesday, November 13, 2024

Fourth Circuit Upholds Summary Judgment in Favor of Zion Williamson

Zion_Williamson_2020
By Erik Drost - Zion Williamson and Brandon Ingram, CC BY 2.0 

Zion Williamson (right) played one season as a student-athlete at Duke before announcing his intention to enter the NBA draft. After his last game at Duke, he entered into a five-year agreement with Prime Sports Marketing LLC., through its president, Gina Ford (collectively Prime). Prime was to act as Mr. Williamson's agent, and the parties worked together for a few weeks. Mr. Williamson's parents then notified Prime that he was terminating the agreement, and he signed a contract with a rival agency with whom he had shared the details of his arrangement with Prime.

Mr. Williamson sought a declaratory judgment that his contract with Prime was unenforceable. Prime counterclaimed alleging a variety of claims against Mr. Williamson. Mr. Williamson pointed out that his contract with Prime was illegal under two provisions of the North Carolina Uniform Athlete Agents Act (the Act). Prime did not dispute the substance of Mr. Williamson's argument. The contract was not in conformity with the Act. However, Prime contended that the Act did not apply because Mr. Williamson was no longer a student-athlete at the time the parties entered into their agreement.

The District Court denied Prime's motion to dismiss and then, after discovery, granted Mr. Williamson's motion for summary judgment. Prime appealed, and on May 6, 2024, the Fourth Circuit affirmed the judgment in Mr. Williamson's favor in Williamson v. Prime Sports Marketing, LLC

Much like Judge Friendly's opinion that started with "What is a chicken?", the Fourth Circuit's analysis begins with the question, "Who is a student-athlete?" No North Carolina court had construed it. The Court's task was to figure out how a hypothetical North Carolina court would define the term.  The Act defines the term as follows:

An individual who engages in, is eligible to engage in, or may be eligible to engage in any intercollegiate sport. If an individual is permanently ineligible to participate in a particular intercollegiate sport, the individual is not a student-athlete for the purposes of that sport.

Prime's main argument turned on the second sentence of the definition, but the court, deploying the canon of construction against superfluity, found that the second sentence applies to multiple-sport student-athletes, which Mr. Williamson was not. In discussing this argument, the Court does not explain with respect to what particular intercollegiate sport Mr. Williamson was permanently ineligible. That factual predicate is provided in the Court's discussion of Prime's next argument.

Prime argued that Mr. Williamson's violations of NCAA rules rendered him "permanently ineligible" to engage in intercollegiate sport. Mr. Williamson has violated the NCAA's amateurism rules by accepting money to play basketball. However, the Court found that the NCAA and its member schools exercise discretion. Violations of NCAA rules may render a student permanently ineligible, but they do not do so automatically. The schools and the NCAA have discretion. Prime had a bunch of other arguments but the Court found that none of the prior caselaw on which it relied was applicable to these facts.

Having determined that Mr. Williamson was a student-athlete at the time he signed with prime, the Court found that the contract was void. The District Court correctly granted Mr. Williamson's motion on the pleadings and correctly granted Mr. Williamson summary judgment on Prime's breach of contract, fraud, and misappropriation of trade secret claims. Because the underlying contract between Prime and Mr. Williamson was illegal, he violated no duty by sharing Prime's documents with a rival agency. Finally, Prime's marketing materials were not trade secrets.

Adam SilverThe case has an ick factor for me all around. Prime's conduct may have been icky in swooping in on a nineteen-year-old college student, apparently cutting his parents out of negotiations. In the alternative, if the parents were involved, it was icky for them to use Prime as a stalking horse so that another agency could swoop in with the aid of Prime's confidential communications with Mr. Williamson. The complicated interpretive dance that the Court had to go through to determine that Mr. Williamson  was not "permanently ineligible" is also a bit icky. Student athletes are an especially vulnerable population. They have the potential to earn millions of dollars in contractual compensation, but they are too young and inexperienced to know how best to protect their own interests. Agents may have the athletes' interests at heart, but they are also competing to profit off other people's talents.

I'm not sure what the solution is. Here's an idea from someone with very limited knowledge of the industry. Professional sports associations are rolling in money. NBA Commissioner Adam Silver (left) earns an estimated $10 million a year. The average NBA team is valued at $4.4 billion. Surely there is enough money floating around to set up an independent non-profit to advise and even represent college athletes. If there is concern about the leagues capturing the non-profit, have the NBA players' association kick in support and leadership. Set up an independent governing board to insulate the non-profit from influences that might be adverse to those of the young, aspiring athletes. The same model could be adopted in other professional sports associations.

November 13, 2024 in Celebrity Contracts, Commentary, Recent Cases, Sports | Permalink | Comments (0)

Tuesday, October 1, 2024

Matthew Sluka: More NILs; More TroubILs

Screenshot 2024-09-30 at 4.36.36 PMI expect that college athletics contracts are going to be the single most popular topic for student notes for the next five years at least. Two students came to me with the same story.  They are Nathan Vann (below left) and Ryan Collins (right). Both have allowed me to use their names and images in exchange for the glory of having their enthusiasm for contracts evidenced on this blog.

It's a refreshing story about how providing support for young athletes enable them to pursue their dreams of university education.

No, it's not that.

It's a refreshing story about how the NCAA's rules allowing student athletes to benefit from  Name, Image, and Likeness (NIL) deals is facilitating support for the students who make college athletics so fun and exciting.

No, it's not that either.

According to Pete Thamel and Adam Rittenberg, writing on ESPN.com, UNLV quarterback Matthew Sluka has left his team after three games because the athletics supporters, also known as the "UNLV's collective," who made oral pledges of an NIL deal did not deliver. Mr. Sluka was allegedly promised $100,000, but the team's head coach refused to honor the promise, which was oral and did not come from him but from an assistant coach.

The news coverage of this story makes much of the fact that that promise was oral, but that is only relevant for evidentiary reasons. Contracts only have to be in writing if they are within the statute of frauds, and this contract was not. It would have to be in writing the parties were contemplating that Mr. Sluka would be UNLV's quarterback for many years, but he only has one year of eligibility remaining. And the team's head coach seems to have acknowledged that the promise was made by the offensive coordinator, so we don't really have an evidentiary problem.

UNLV_Rebels_wordmark.svg
We do have an agency problem. Likely the assistant coach would not have actual authority to bind the university, but he might have apparent authority. However, because players are paid by collectives rather than by universities, it may be that he lacked even that. I suppose it depends on what a college athlete in Mr. Sluka's position would be expected to know about the way these deals are structured. I suspect that they know a hell of lot more about this world than I do, and Mr. Sluka was represented by an agent. Would a reasonable agent know that an assistant coach can't promise $100,000 on behalf of the collective?

The collective paid Mr. Sluka $3000.  UNLV paid Mr. Sluka $3000 for moving expenses. Mr. Sluka's agent for some reason acknowledges that the only "formal offer" from UNLV was $3000/month for four months. Believing he was entitled to more, Mr. Sluka threatened to quit if UNLV and its collective did not make good on their alleged promises. UNLV does not respond kindly to threats. According to ESPN, it "interpreted these demands as a violation of the NCAA pay-for-play rules, as well as Nevada state law."

Under NCAA rules, Mr. Sluka, having played only three games, can "redshirt" and thus preserve his eligibility for another season. According to an earlier ESPN.com report, he had already been at Holy Cross for four years before coming to UNLV. I guess it doesn't matter if it takes a quarterback six years to graduate college. [Update: an alert reader pointed out that Mr. Sluka already got his undergraduate degree from Holy Cross; he is now pursuing a graduate degree.] None of the reporting mentions Mr. Sluka's course of studies, his major, or what he would like to do with his college degree, assuming he does not become a professional athlete. He does not seem to be attending college with the primary aim of getting an education.

It's all very confusing. Where was Mr. Sluka's agent when it came time to formalize the promise? To make matters more confusing still, the NCAA, in an attempt to head off an antitrust suit, seems poised to allow colleges to pay their students directly, eliminating the need for "collectives." That's probably a good thing, because it seems very likely that the NIL agreements are really just means for allowing local boosters to pay student-athletes, disproportionately football players, it seems, to attend particular schools. That model, one can imagine, creates a complicated relationship among coaching staffs, players, and boosters, with the latter suddenly assuming a position similar to that of equity investors. For example, Kalan Hooks reports for ESPN that car dealerships are frequent sponsors of NIL deals. But at the University of Utah, eighty-five football players on scholarship received leases for pickup trucks.

Screenshot 2024-09-28 at 6.44.33 AMOKCU 1L Nathan Vann shared with me the additional news that, as Mike McDaniel reports in Sports Illustrated, the CEO of a local resort and sportsbook offered to pay $100,000 to Sluka to keep him at UNLV. Consistent with its previous position that paying Mr. Sluka would violate NCAA rules and Nevada law, UNLV declined the offer, also noting that Mr. Sluka had already left the team. If a sportsbook is what I think it is, I can certainly imagine no negative externalities if such entities were placing bets in the form of NIL contracts on the players on whose performance they were also taking bets.

In its first game without its star quarterback, UNLV won by a score of 59-14. The backup quarterback completed 13 of 16 passes for 182 yards and three touchdowns.  He also rushed for 119 yards and a touchdown. Rebel fans will have to hope that he doesn't start looking around for an NIL deal.

We wouldn't have this problem if we in the United States were just normal about sports and did not think of universities as bloated justifications for semi-pro leagues funded by boosters' donations. No other country in the world does sports this way, people! We want young athletes to have access to higher education, but if we had real development leagues, such young athletes could pursue their professional dreams and get paid sufficiently to also attend universities if that's what they wanted to do. They could do so either as part-time students or, after their careers, when they were older and better able to get the most out of the educational experience.

Universities could still adopt local teams as though they were their own. After all, many big-time college sports programs are based in small towns that would not be able to attract a sports team if they were not college towns. Here, in Oklahoma, the most popular teams are located in Norman and Stillwater. They could continue to be there, even if those teams were part of the "SEC Development League" or whatever. Just for starters, that would save Oklahoma taxpayers $15 million because they would no longer have to pay the salaries of the head coaches at those schools. Or perhaps that money could be put to some use at those universities in the form of scholarships for deserving students or resources to serve their educational needs.

I just had to say it. As you were.

October 1, 2024 in Commentary, Current Affairs, In the News, Sports | Permalink | Comments (3)

Tuesday, September 17, 2024

Beating Cubs' Arbitration Clause Is Easier in Illinois than Tennessee

Yesterday, we covered a journalist's defeat of the Chicago Cubs' attempt to compel arbitration of his negligence claims. The Illinois court found, as it had found in the 2021 case, Zuniga v. Major League Baseball, that the Cubs did not put people on notice of arbitration terms by referencing their website, which links to an arbitration agreement, on the back of tickets or press credentials.

Tennessee SmokiesA Tennessee court reached the opposite conclusion based on very similar facts involving the Cubs' Double-A affiliate, the Tennessee Smokies. Deborah Roberts attended a Smokies game on April 22, 2022 and sat in the front row near the third-base dugout. She was hit by a foul ball and injured, requiring a three-day hospitalization and further treatment. Her husband immediately met with team representatives, but the Robertses claim that they only learned of the Smokies' arbitration clause when the team filed a motion to compel arbitration. As in Zuniga, the motion to compel was based on notice on the back of Ms. Roberts' ticket. The court provides the added particulars that the notice was in part in bold and in part in ALLCAPS, and it referenced arbitration, as well as a class-action waiver to be found on the team website.  To me, the most relevant fact is that all of the print on the back of the ticket was in 4-point font [this is eight-point because our platform knows that going small than that is absurd], which would make it completely illegible to me and likely to any potential reader over the age of forty. Moreover, the court does not seem to read this blog, because if it did it would know Yonathan Arbel and Andrew Toler's work showing that people are actually less likely to read and understand ALLCAPS text than they are to read and understand ordinary text. 

Applying Tennessee law, the District Court in Roberts v. Boyd Sports, LLC found that the parties had formed an arbitration agreement.  It's reasoning is summarized as follows:

. . . [A] reasonable onlooker or objective observer would conclude that the parties mutually intended to assent to the terms on the tickets by Plaintiffs' acceptance of the tickets and subsequent entry into the stadium. Plaintiffs were provided with ample opportunity to read, investigate, and understand the provisions on their tickets, both when received, and certainly in the 7 days afterward when they were investigating their options to resolve the injury that occurred. According to the undisputed facts here, they never inquired as to the terms or indicated confusion or lack of understanding. Simply failing to read the terms does not present a party with the ability plead ignorance to or reject the terms after the fact. 

The seven-day period is relevant because, had plaintiffs during that time found the arbitration agreement on the team website and worked through its terms, they would have seen that ticketholders have an option to opt-out of the arbitration provision within seven days.  To do so, plaintiffs would have had to know their account number, which they did not have.  While

Arbitration
Image by DALL-E

the Zuniga court found the seven-day period substantively unconscionable because it is so short, the Tennessee court declined to follow non-binding precedent.  As to the account number, given that the Roberts claim that they did not even know of the arbitration clause, their lack of an account number was irrelevant.  The team represented that it would have honored the opt-out even without such a number.

I find the opinion infuriating, in part because it treats four-point font as notice and in part because unconscionability relates to formation.  A contract that provides for an opt-out but requires an account number that the team does not actually provide is unconscionable at the time of formation.  It is of no matter that the team later proffers self-serving assurances that it would not stand by the terms of its unconscionable arbitration provision.  

In the case discussed in yesterday's post, Arbogast v. Chicago Cubs Baseball Club, LLC, the court held a summary hearing into arbitrability.  Such a hearing could have been useful in this case.  A judge ought to want to hear from the parties about what was going on during those seven days.  Were the plaintiffs not actively exploring their legal options based on conversations or assurances that the team had given in discussions with Mr. Roberts about Ms. Roberts' injury? If I were not a contracts professor and my spouse were hospitalized for three days with facial injuries, my first instinct would not be to try to decipher the four-point font on the back of her ticket stub.  But perhaps I am not the "reasonable and objective observer" that the court is looking for.

As usual, I say all this without quite grasping why plaintiffs prefer litigation over arbitration.  In Arbogast, the arbitration was to take place in New York.  If the same is true in this case, that might be a reason to opt out. But I would think such a remote venue would also be a basis for a claim of substantive unconscionability, so perhaps this arbitration clause allowed for arbitration in Tennessee.

September 17, 2024 in Commentary, Recent Cases, Sports | Permalink | Comments (0)

Monday, September 16, 2024

Journalist Challenges Enforceability of Chicago Cubs' Arbitration Agreement

CubsBack in 2021, we covered a surprising case, Zuniga v. Major League Baseball, in which a woman attending a Chicago Cubs game was injured by a foul ball.  She did not read the back of her ticket (shocking!), nor did she visit the Cubs' website referenced on the back of the ticket (more shocking!) and familiarize herself with the Cubs' mandatory arbitration provision (the most shocking of all!).  The court in that case held that the woman was not on notice of the arbitration provision, and the court denied the Cubs' motion to compel arbitration.

As they say in baseball, "It's that old deja vu all over again!" Charles Arbogast was awarded journalist credentials and granted entry to storied Wrigley Field on July 26, 2018.  While there, he “fell and sustained injuries,” allegedly due to the Cubs' negligent decision to stack pallets in the photo well near first base.  The pallets were intended for photographers to stand on, but Arbogast claims that they created a hazard.

Once again, on the back of Mr. Arbogast's press credential were terms and conditions, including the words "Bearer acknowledges receipt and review of, and agrees to be bound by, the further terms and conditions contained on the website of the Office of the Commissioner of Baseball at MLBPressbox.com."  If Mr. Arbogast had visited that website and found the appropriate link, he would have found a twenty-five paragraph, six page document containing an arbitration clause.

When Mr. Arbogast sued for negligence, the Cubs moved to compel arbitration.  The trial court, citing Zuniga, denied the motion without prejudice, and the appellate court affirmed.  The case was a bit more complicated than Zuniga, because Mr. Arbogast had been awarded media credentials on numerous occasions and had been granted access to Major League Baseball (MLB) stadiums during every season since 2018.  The Cubs' renewed their motion and demanded a summary proceeding to determine the existence of an arbitration agreement between the parties.  In a supplemental affidavit submitted by a Cubs' employee, the Cubs identified an Associated Press (AP) employee who requested the credential on behalf of Mr. Arbogast and other journalists.  In order to receive the credential this AP employee had checked a box agreeing to the Cubs' and MLB's terms.

Wrigley1950compositeHaving conducted the summary proceeding, the trial court now granted the Cubs' motion to compel arbitration, rejecting Mr. Arbogast's claims that he had no reasonable notice of the arbitration provision and that the provision was unconscionable.  In Arbogast v. Chicago Cubs Baseball, LLC, the appellate court reversed and remanded.

The appellate court agreed with the trial court that an agreement had been formed but reversed on unconscionability.  Here, even more than in Zuniga, there was procedural unconscionability because Mr. Arbogast's press credential did not even mention arbitration.  Like in Zuniga, the provision was substantively unconscionable because, although the holder of a press credential has seven days to opt out of the arbitration provision, Mr. Arbogast had no ability to do so, as he was hospitalized during the relevant period and in any case had not been furnished with an account number which he would have needed in order to opt out.

September 16, 2024 in Recent Cases, Sports | Permalink | Comments (0)

Friday, September 13, 2024

"We'll Take Care of You" Does Not Equal $2.5 Million for Johnny Wilkes

Sopranos logoWhen I teach vagueness, I use Baer v. ChaseThe case is about an aspiring screenwriter who pitches a script for a show about the New Jersey mob to David Chase, the creator of The Sopranos.  Mr. Chase did not use the script, but he is alleged to have borrowed some ideas and, at the very least, the colorful names of two characters.  Mr. Baer alleged an expectation of payment, but the best evidence he had of an agreement was an allegation that Mr. Chase repeatedly promised, "We'll take care of you."  In the mob context, I found this statement not just vague but delightfully ambiguous.  See the conversation in Pulp Fiction between Jules (Samuel Jackson) and Vincent (John Travolta) in the elevator about "taking care" of Mia Wallace ("Uma Thurman").

Kawhi_Leonard_presents_ball_to_President_Obama_2_2015-01-12_croppedWell, it turns out "We'll take care of you" is just what people say in these situations.  Johnny Wilkes, the best friend of an uncle of Kawhi Leonard (right, with fan), claims that Jerry West said those words to Mr. Wilkes in connection with the latter's efforts to help the Los Angeles Clippers persuade Mr. Leonard to join the team.  Mr. Wilkes claims that he demanded and was assured that he would be taken care of to the tune of $2.5 million, which was his estimate of a sports agent's take on such a contract. 

It appears that the Mr. Wilkes's best friend, Dennis Robertson, is an important advisor to Mr. Leonard, but Mr. Wilkes does not allege that either he or Mr. Robertson was Mr. Leonard's sports agent. After Mr. Leonard did join the team, Mr. Wilkes sued Mr. West and the Clippers, alleging, inter alia, breach of contract, promissory estoppel, and fraud.  The trial court dismissed the claims, and in January, 2024, a California appellate court affirmed in Wilkes v. LA Clippers, LLC.

This case adds an agency wrinkle to the vagueness problem in Baer v. Chase.  The court provides an extended excerpt from Mr. Wilkes's testimony, and he is less than convincing about the specific promise to pay $2.5 million.  Nor is it clear what services, if any, he provided, given that Mr. Leonard appears to have been unaware fo Mr. Wilkes's role.  Another impediment is that the alleged promise came from Mr. West, but the alleged payor was Steve Ballmer, the owner of the Clippers, and Mr. Ballmer never made a promise.  The parties dispute whether Mr. West had authority to bind either Mr. Ballmer or the Clippers in this matter, but the case really turned on the court's finding that the alleged contract was fatally vague as to the services Mr. Wilkes was to perform in order to be entitled to payment.

September 13, 2024 in Celebrity Contracts, Recent Cases, Sports, Teaching | Permalink | Comments (0)

Thursday, May 16, 2024

Chicago Bears Rookie Sought to Avoid Contract with Big League Advance

We missed this one when the case was filed last September, and there hasn't been much news since then.  Plaintiff took a voluntary dismissal in November, but nobody has covered the story, so I don't quite know what to make of it.  The best sources I could find on this story were on law blogs written by law students.  I have noticed that a lot of law students are very interested in writing their Notes about name, image, and likeness agreements (NILs), so it makes sense that students will be all over this case. Here's what I've pieced together.

Florida_Gators_football_logo.svgStuart Moore, writing for Villanova Law's Sports Law Blog, reports that Chicago Bears Rookie Gervon Dexter sued Big League Advance (BLA), seeking to avoid a contract he entered into as junior at the University of Florida.  According to Mr. Moore, Mr. Dexter agreed to pay BLA fifteen percent of his pre-tax NFL earnings for twenty-five years in exchange for an up-front payment of $436,485, a peculiarly precise number.  Matthew Bereche, writing for the Brooklyn Sports & Entertainment Law Blog, adds that, once Mr. Dexter entered into a four-year, $6.72 million contract with the Chicago Bears, BLA would be entitled to over $1 million under that contract alone.

BLA was started in 2016 by Michael Schwimer, who had a brief career as a major league pitcher and then started BLA, with the idea of investing in undervalued major-league prospects early in their careers in exchange for large pay-outs over time.  Enjoying success with baseball players, BLA then started to court college football players, and Mr. Dexter was among the first.  Many have denounced BLA's deals as "predatory" and "usurious," and there have been cases filed before, but none have proceeded to judgment, as far as I can tell.  

Chicago_bearsMr. Dexter's case is the first against BLA involving an NIL or at least a contract that purports to be an NIL.  According to Mr. Moore's reading of the contract, the up-front payment was in exchange for BLA's ability to use Mr. Dexter's name, image and likeness during his eligibility to play NCAA football.  But BLA also was entitled to its fifteen percent payment for twenty-five years after that eligibility ended.  Mr. Dexter claimed that the contract violated Florida's NIL statute, which, Mr. Bereche notes, provides that NIL agreements "may not extend beyond [a student's] participation in an athletic program at a postsecondary educational institution.” 

BLA would thus have to characterize its agreement with Mr. Dexter as really consisting of two contracts: an NIL that applies while he is in college, and a more typical BLA agreement, which is just a speculative investment vehicle and kicks in after the NIL lapses.  BLA would thus argue that the second half of the contract was not an NIL agreement at all and thus that Florida's statute does not apply.

The  contract apparently had an arbitration clause, which means, among other things, that we will have a very hard time learning about how these cases are resolved.  Mr. Moore notes that BLA's response to the lawsuit was to file a motion to compel arbitration.

Mr. Bereche notes that, after Mr. Dexter entered into his deal with BLA, Florida amended its NIL statute to remove the restriction on the duration of such agreements.  Mr. Bereche argues, quite plausibly, that the amendment was motivated by Florida's desire to better position itself to recruit students.  Other states had no such restriction, and student athletes attending college in other states could thus get more lucrative NIL deals than student athletes attending Florida schools. 

Perhaps.  However, Mr. Dexter's contract suggests that Florida just joined the race to the bottom, removing one provision that protected student athletes from potentially predatory practices to which they are uniquely susceptible.

May 16, 2024 in Commentary, Current Affairs, Recent Cases, Sports, True Contracts | Permalink | Comments (0)

Wednesday, May 1, 2024

David Beckham Sued Fitness Brand F45 in 2023, and It's Suddenly News

BeckhamAh, the frustrations of being a contracts law blogger.  According to Zachary Folk who covers "breaking news" for Forbes, David Beckham (right) first tried to sue F45, a company in which Mark Wahlberg owns a large stake, in 2022.  A judge dismissed that suit, in which Mr. Beckham joined forces with golfer Greg Norman, advising the plaintiffs to file separately. 

Mr. Beckham refiled his suit in March, 2023, but as such things go, everybody is covering the case now, although nobody is linking to any filings from the case, so I neither really know what is going on nor why the media are suddenly interested in the "breaking news" of a case that is already one-year into its existence.  I wonder if some publicist for one of the parties decided that some media attention might speed up the settlement process.

The essence of the case seems to be that Mr. Beckham did promotional work for the brand beginning in 2020 in exchange for "tradable shares" of the company when it went public, which was supposed to happen in July 2021.  The share price quickly tanked after the company's initial public offering in January 2022, and Mr. Beckham alleges that the company delayed delivery of his shares.  During the delay, Mr. Beckham alleges, the value of his shares dropped by $9.3 million.  He also alleges entitlement to another $5 million in shares that were supposed to be transferred to him in July 2022.  

The current valuation of the company appears to be about the same as what Mr. Beckham claims he is owed.  But he is not the only party suing the company, so there may not be much left for Mr. Beckham at the end of the day.

Mr. Beckham is no stranger to the world of contracts disputes.  In December 2022, we blogged about his agreement to help promote the World Cup in Qatar.  Apparently, that deal worked out pretty well, although Mr. Beckham was paid bucketloads of money and did relatively little to promote the World Cup, unless being vilified by his LGBTQ+ fans counts as fulfillment of contractual obligations.

May 1, 2024 in Celebrity Contracts, Sports | Permalink | Comments (0)

Thursday, April 11, 2024

Sportsball: Clemson Sues the ACC over $140 Million Exit Fee

Clemson_Tigers_logo.svgThe nerve! Clemson University (Clemson) has filed a complaint against the Atlantic Coast Conference (the ACC) because the ACC claims ownership of media rights over home games at member institutions and because the ACC claims entitlement to a $140 million payment should members leave the conference. The audacity! And all this just because Clemson arguably agreed to those terms when it joined the ACC. The impudence!

How can a public educational institution fulfill its mission if saddled with this onerous financial burden?  Or, as Clemson puts it, "Each of these erroneous assertions separately hinders Clemson's ability to meaningfully explore its options regarding conference membership, to negotiate alternative revenue-sharing proposals among ACC members, and to obtain full value for its future media rights." Yeah! Basic science, medical research, training future educators, social workers, professionals, and others who can serve South Carolina and the region. You can do a lot of worthwhile things with $140 million.

And this really is all about money. The complaint details an alleged "revenue gap." The SEC and the Big Ten entered into more lucrative contracts with media companies than did the ACC.  As a result, universities in those leagues get a media share that can be as much as $20 million higher than what Clemson gets through the ACC.

ACC
As to the media rights, that is a matter of differing interpretations of this contractual language.  Clemson points out that it granted the ACC only those media rights "necessary for the Conference to perform the contractual obligations of the Conference expressly set forth" in separate agreements between the ACC and ESPN.  Those obligations apply only to members, Clemson alleges, not to former members. I think we'd need to see the language of those other agreements to know whether this is a plausible construction of Clemson's obligations. Alas, the parts of the complaint relating to ESPN have been redacted, apparently into response to ESPN's hissy fit when the details of the ACC's arrangement with ESPN were disclosed in a similar case involving Florida State University, as Chapel Fowler and Ted Clifford explain in The State.

As to the $140 million, the ACC characterizes the amount as "liquidated damages," while Clemson says it is -- you guessed it! -- an unenforceable penalty, and an unconscionable one at that. Much of the complaint is dedicated to showing that the withdrawal fee is too high. It is pegged at three times the ACC's annual operating budget, and that operating budget has grown tremendously in the last decade. But if Clemson's media rights are valued at somewhere north of $40 million/year and the ACC is claiming entitlement to those rights through 2036, $140 million hardly seems disproportionate.  Clemson has an argument for why the ACC is not harmed, but much of it is redacted.

Clemson says the that withdrawal fee arose through a "purported" 2012 Amendment to its rules. The complaint does not clarify in what sense this amendment was merely "purported." Seems hard to imagine that Clemson did not somehow agree to this amendment, and it may even have profited from it when other universities withdrew. Clemson's complaint seeks declaratory judgment under a South Carolina statute. Is that an equitable remedy despite being codified? Unclean Tiger paws?

Contracts are risk-allocation devices. Is there anything more to say here?

April 11, 2024 in Current Affairs, In the News, Recent Cases, Sports | Permalink | Comments (0)

Wednesday, January 3, 2024

Finally, a Sensible MLB Contact!

Shohei_Ohtani_(16735312258)_(cropped)I am often baffled by sports contracts.  Recently, there was the story of a public university paying a man $75 million not to coach its football team, but my interest in bad contracts (or contracts that seem bad to the outside observer) goes back to Bobby Bonilla In this case, Fabian Ardaya and Evan Drellich explain the Los Angeles Dodger's contract with  Shohei Ohtani (right) on The Athletic, and it seems pretty sensible.

The contract has been variously described as a ten-year deal for $700 million, a twenty-year deal for $700 million, and a $46 million/year contract.  The wrinkle is that, although Mr. Ohtani has contracted to pay for the Dodgers for the next ten years, 97% of his pay is deferred until after than time.  He will have to economize and live on $2 million/year for the next decade.   Thereafter, he will be paid $68 million/year for ten years.  All he had to do was sign.

Shohei SignagureGiven the discount rate, the $700 million deal is worth about $46 million/year in 2023 dollars.  Both parties seem to benefit from the arrangement.  Mr. Ohtani might derive certain tax benefits, especially if he leaves California before 2034.  The team gets to dodge (get it?) luxury taxes and have payroll flexibility to surround Mr. Ohtani with talented teammates.  One would think that the obligation to pay Mr. Ohtani buckets of money starting in 2034 would weigh on the team's prospects during that decade.  But perhaps in 2034 $68 million/year won't buy a chicken dinner.  Or a tsunami might wash Los Angeles into the sea. Or the rapture. . . . Optimism fuels baseball.

January 3, 2024 in Commentary, Current Affairs, In the News, Sports, True Contracts | Permalink | Comments (0)

Wednesday, November 29, 2023

Take the Money and Run, Pass, or Kick

Recently, Sid DeLong wowed us with an interesting perspective on the case of Danish performance artist Jens Haaning.  As readers of the blog well know, Haaning was commissioned to produce artwork incorporating $70,000 in Danish currency that the commissioning museum advanced to him for incorporation into the work.  Hanning never provided the work; instead, he delivered two blank canvases entitled Take the Money and Run.  

No biggy, Sid pointed out.  People get paid for doing nothing all the time.  Farmers get paid not to plant crops when the government is trying to control against overproduction.  Young William Story was entitled to collect from his Uncle William for successfully abstaining from certain corrupt behaviors before turning twenty-one.

Jimbo_A&M_Press_Conference
Image by Ethridgem, via Wikimedia Commons

But if you really want to get paid the big bucks for doing nothing, I recommend coaching.  As I learned from Bobby Chesney and Steve Vladeck on their excellent, most recent, edition of the National Security Law Podcast, Texas A & M University is paying Jimbo Fisher (right) $75 million for not coaching its football team between now and 2031.  

Doug Lederman provides some details in Inside Higher EducationAccording to the story, Mr. Fisher's contract was renewed in 2021 for ten years, and the contract was guaranteed, which meant that he would be paid whether or not he continued as coach.  You might be wondering how the taxpayers of Texas feel about having their money being used in a Bobby Bonilla style boondoggle.  The answer is probably that they are fine with it.  What's government for if not for building college football programs?  But just in case Texas taxpayers have other priorities, the university stresses that the $75 million will not come out of the university's regular budget but from "donor funds."

This strikes me as a relatively transparent shell game.  That $75 million in donor funds that will be going into Mr. Fisher's pocket are $75 million that the university might use for other, presumably sports-related, purposes.  And if the university cannot raise more private donor funds to attract its next football coach, or football stadium, or training facility, or whatever else it needs, the money to cover these new costs will indeed come from university funds that might have been used for, I don't know, educational purposes?

Burge_mark1 Snyder_franklin_gLast I checked, the Texas A &M football team is not ranked in either the AP nor the Coaches poll, nor did they have any votes in either poll, meaning that nobody polled thought that they were a top 25 team.  CBS Sports ranks them at 37.  Meanwhile, Texas A & M's law school is ranked 29th.  By my math, that ranking should entitle the law school's Dean to a guaranteed ten-year contract worth at least $85 million, and some portion of that money ought to go to the Blog, given that the Blog was founded by Texas A & M law faculty member Frank Snyder (left), and Texas A & M faculty member Mark Edwin Burge (right) continues to serve as a contributing editor.  Even a million or two would go a long way towards meeting the Blog's pressing fiscal needs.  I'm not asking for much.

One might think that Mr. Fisher will not in the end actually collect his $75 million from Texas A & M or its donors, because of the duty to mitigate.    But we've been down this path before on the blog, and I think we discovered that coaches who depart with guaranteed contracts do not have a duty to mitigate.  Mr. Fisher is perfectly free to move on to his next gig, command another Brobdingnagian salary, and continue to collect his spoils from Texas A & M.  In our world of the parable of his talents, this is righteousness.  Not compounding his windfall with greater lucre would be regarded as a wasteful, and Mr. Fisher would be consigned to that outer darkness, complete with ambient weeping and gnashing of teeth.

November 29, 2023 in Celebrity Contracts, Commentary, Current Affairs, Government Contracting, Law Schools, Sports | Permalink | Comments (0)

Thursday, September 28, 2023

Baltimore Orioles Strike Out in Appeal of Arbitral Decision in the New York Court of Appeals

The playoffs are on their way.  In the context of this case, I have only one thought.  Go Cubs!

CubsIn 2001, the Baltimore Orioles and  TCR Sports Broadcasting, LLC (TCR) established the Orioles’ Television Network, which had the exclusive right to broadcast Orioles games in the region, covering seven states and the District of Columbia.  When Major League Baseball (MLB) decided to move the Montreal Expos to Washington D.C., where they became the Nationals, the Orioles chirped a bit, but the Orioles, MLB, and TCR entered into a settlement agreement, converting the Orioles' Television Network into the MidAtlantic Sports Network (MASN), a two-team regional sports network. 

OriolesThis was a sweet deal for the Orioles, because they got to keep the majority of the revenues from the network.  That was intentional and intended to compensate the Orioles for the revenues they would lose, having to share the market with the upstart Nationals.  The structure is also a bit unwieldy.  MASN was to pay both teams equally for the right to broadcast their games, but given that the Orioles got the lions share of MASN's profits, it was incentivized to sell its rights rather cheaply in order to reap benefits from the Nationals' television revenues.  

Washington NationalsThe first time the parties tried to negotiate telecast rights fee, they failed to reach agreement.  The parties chose not to avail themselves of the mediation process provided for in their agreement, and so they opted for arbitration through a body provided for in the agreement consisting of the three members of the MLB revenue-sharing committee.  There were complications, but the arbitral body eventually determined that each teams' revenues should be set at $53 million for 2012, rising to $67 million for 2016.  MASN and the Orioles objected and, despite MLB's insistence that the parties avoid litigation, the Orioles filed suit in New York.  They claimed that MLB was biased in favor of the Nationals.  

The New York court vacated the arbitral award on the ground that the Nationals' attorneys, Proskauer, also represented MLB in various matters.  This ruling was affirmed on appeal, and so the case was sent back for a new arbitration, this time with a different panel and without Proskauer.  The result of the second arbitration was pretty similar to the first, and the Nationals moved in a New York state court to have the second decision enforced.  The Orioles still called foul, but the New York trial court affirmed the arbitral award, entering a judgment of $105 million, including pre-judgment interest.  New York's Appellate Division affirmed, and the Orioles appealed both the 2017 and the 2020 decisions.

Still think arbitration is a fastball?  Seems more like a knuckler.

In Matter of TCR Sports Broadcasting Holding, LLP v WN Partner, LLC , New York's highest court affirmed the arbitral award and yet still condemned the parties to "extra innings."  Baseball puns?  So unprofessional!

The Court of Appeals found no impropriety in the trial court's decision to return the matter to the original arbitral body, and it agreed with the lower courts that the second proceeding was free from the taint of partiality.  While the lower courts thus properly affirmed the second arbitral award, they erred in awarding the Nationals prejudgment interest and rendering a money judgment in the Nationals’ favor.  As the Court of Appeals explains:

The settlement agreement grants the RSDC the power only to determine “the fair market value” of the telecast rights fees. The parties did not agree that the RSDC could resolve disputes over nonpayment of such fees. Instead, remedies for MASN’s nonpayment of those fees are governed by a different provision of the settlement agreement, which sets forth certain requirements, including a cure period. Only after that cure period expires do the Nationals “have a right to seek money damages.” Further, disputes over nonpayment of the fees appear to be governed by the settlement agreement’s more general dispute resolution provisions. Now that our courts have confirmed the RSDC’s determination of the fair market value of the telecast rights, the parties must resolve any disputes over nonpayment of those fees in accordance with their agreement. 

Cubs WinOne hopes that these court-ordered "extra innings" will be quickly completed.  After all, with so many legal matters sorted out after over ten years of adjudication, it's almost like having a runner on second base at the start of an inning.  

Go, Cubs, Go.

September 28, 2023 in Recent Cases, Sports | Permalink | Comments (0)

Tuesday, September 12, 2023

Contracts Hypothetical Come to Life!

Screenshot 2023-09-11 at 4.13.54 PMI have been using Brian Blum's Examples and Explanations book as a supplement to my first-year contracts course for years.  This week, we are covering offers.  Professor Blum (right) provides Example 13 of chapter 4, which involves the acceptance of an offer to enter into a unilateral contract by hitting a hole-in-one at a charity golf tournament.  Professor Blum's hypo is based on a case out of Utah, and he cites another case out of South Dakota.

But they just keep coming.  As Teny Sahakian reports for Fox News, Linda Chen hit a hole-in-one at a charity golf tournament in Florida.  She claimed entitlement to a new Mercedes Benz, valued at $90,000.  The tournament organizers denied her the prize on the ground that the offer was only made available to amateurs, and Ms. Chen had been a professional golfer from 1994-96.  She claims that she is now "officially registered" as an amateur.  Gosh.  I'm not registered.  What does that make me?

According to her complaint, as reported on Fox News, Ms. Chen claims that "By showing up, entering the Fins on the Fairway golf tournament, her host paying the entry fees, and hitting a hole in one," Chen "accepted the Defendants’ offer, formed a contract, paid consideration, and fulfilled her obligations under the contract."  The tournament organizers claim that only amateurs were qualified to claim the prize.  And no, this is not a Lefkowitz  situation, because the limitation to amateurs was not some unspoken "house rule"; it was a stipulation of the tournament rules, a copy of which Ms. Chen signed.   

HunterBut is someone who has not been a professional golfer since 1996 a professional for the purposes of the contest?  Did Ms. Chen have duty to disclose her status as a former professional.  The tournament organizers insist that other professionals had registered in the tournament as such.  If Ms. Chen had only done that, they say . . .   Well, if she had only done that, what exactly?  Are they suggesting that they would have told her, imitating a Seinfeld character, "No Mercedes for you!"?  In any case, we can now layer interpretive issues on top of the unilateral contract issues to make one lovely fact pattern!  I hope you are paying attention, Professor Blum.

Thanks to OCU 1L Hunter Lovell (left) for sharing the story with me.

September 12, 2023 in Contract Profs, Recent Cases, Sports | Permalink | Comments (1)

Tuesday, September 5, 2023

College Football Coach Fired for Failure to Comply with the Clery Act

WSSUKienus Perez Boulware (Boulware) was employed by the Winston-Salem State University (WSSU) since 2010.  In 2016, he entered into a four-year contract as head coach.  Among his "other duties . . . as may be assigned," Boulware served as a Campus Security Authority, tasked with assisting WSSU in complying with its duties under the Clery Act, which requires universities to track and report crimes. 

In April 2019, two football players got into a fight on the field.  They then fought in the locker room.  They were sent home to their dorms, where they continued to fight.  The father of one of the football players told Mr. Boulware that there might have been a gun involved.  Mr. Boulware went to the dorm room, discovered what was likely marijuana, but did not search for a gun after the players denied that there was one.  

A few weeks later, the school began proceedings to terminate Mr. Boulware for cause.  He had not notified campus police or any other authorities, despite a situation that clearly posed a potential threat to security on campus.  He thus violated his duties as a Campus Security Authority.  Mr. Boulware exhausted his on-campus avenues of review and then appealed his termination in state court.

In July, in Boulware v. University of North Carolina Board of Governors, the North Carolina Court of Appeals sided with WSSU and ruled that his termination was valid.  WSSU had correctly interpreted the Clery Act and had stated multiple grounds for terminating Mr. Boulware and had been asserting those grounds consistently throughout the proceedings.  

September 5, 2023 in Government Contracting, Recent Cases, Sports | Permalink | Comments (0)

Monday, August 21, 2023

Blind Sided

On the first day of class each year, I tell my contracts students about the blog.  They may or may not think that they are interested in contracts law, but I think it is good to introduce them to the idea that the whole of existence can be considered through the lens of contracts law, which is what we do here.

Screenshot 2023-08-21 at 8.44.33 AMAnd then, without warning, on the second day of class, I was blindsided when OCU 1L Sydney Freshwater (left) asked me to blog about suit brought by Michael Oher (below right) challenging the conservatorship set up purportedly on his behalf in 2004.

I protested that I sat out the whole Britney Spears thing, and as a result, I know nothing about conservatorships.  Sydney was unfazed and insistent.  The world needs to read the contracts angle on all of this, she scolded.  Well here goes.

According to writing in Vulture, Mr. Oher was not adopted by the Tuohy  family as he and millions of movie-goers believed.  Rather the Tuohy's set up a conservatorship that provided, among other things, that Mr. Oher could not enter into any contracts without their direct approval. 

Michael_Oher_2016_(cropped)
Jeffrey Beall, CC BY 4.0, via Wikimedia Commons

Mr. Oher claims that he was told that the conservatorship was the legal equivalent to an adoption.  Adoption itself was not an option, he was told (falsely, according to the article), as Mr. Oher was over 18 at the time the conservatorship was established.  No conservatorship was necessary, he now claims, as he suffered from no disability, and he claims that the conservatorship cost him millions of dollars.  He wants the conservatorship to be ended, and he seeks an accounting.  The Tuohys were paid $225,000 each (it's not clear if that is for husband and wife alone or also for their two children) plus 2.25% of profits on the movie The Blind Side, which grossed over $300 million.  

They respond to this suit by a man they "love as a son" by calling it "hurtful and absurd."  They are absurdly rich.  So rich, apparently, that their attorney thinks that hundreds of thousands in up-front payments from a movie studio plus perhaps millions in post-production profits amount to "a few thousand dollars in profit participation payments."  It's easy to lose track of one's spare millions when you are just throwing them on the pile.  They characterize his lawsuit as "ludicrous" and dismiss it as an attempt to drum up interest in his new book.  Gosh, they are so loving!  Imagine what they would say about him if they had actually adopted him.

Mind you, there is a lot going on here that doesn't add up.  It seems odd that Mr. Oher has gotten this far in life without noticing that the Tuohys were necessary parties to his multiple contracts over the years.  At no point did his agent tell advise him that he didn't need the Tuohys around?  Does he need to check with them before he signed with multiple NFL teams? Closed on a house?  Agreed through clickwrap to a website's Terms of Service? Bought a car?

With both parties here are well-resourced, one hopes that this case will be quickly resolved through mediation.  Otherwise both sides might be blindsided and made worse off by attorneys fees.

August 21, 2023 in Current Affairs, In the News, Recent Cases, Sports, Teaching | Permalink | Comments (1)

Thursday, August 10, 2023

Locker Room Rap Breaching Licensing Agreements Leads to Suspension of Football Activities at FAMU

I have been writing for the last two years or so about the interaction between contracts rights and First Amendment rights.  There are links to lots of posts starting with this one.  I have an article forthcoming on the case from 2021 in which SCOTUS found that a middle school could not discipline a cheerleader who posted a Snap that read "fuck school fuck softball fuck cheer fuck everything."  

FAMU_RattlerSo, I was intrigued when I read 's article on CBS's Sports' website, that Florida A & M University's (FAMU) football coach, Willie Simmons, acknowledge free speech issues in announcing on July 21st that he was suspending "all football activities" due to an unauthorized rap video posted on YouTube.  

The artist in question is Real Boston Richey.  He appears in the video, among other places, in the FAMU football team's locker room.  He is shown wearing FAMU gear, including football helmets, and he is surrounded by team members, also wearing FAMU gear.  The Rapper performed at FAMU's homecoming game last season, so there seems to be a genuine bond there.  It is unknown how he and his crew gained access to FAMU's facilities for the purpose of recording the video.  FAMU notes that the unauthorized use of apparel and logos violates licensing agreements.

In suspending all football activities, Coach Simmons expressed his support for free speech but said that the language in the video "is not consistent with FAMU's core values, principles and beliefs."   That's a bit hard to square with FAMU's invitation to Richey to perform at homecoming.  Coach Simmons said of his athletes, "They will all learn from this mishap and we will continue to work hard every day to become the best version of ourselves and continue to make Rattler Nation proud."  Sure.

The video is no longer viewable, as far as I can tell, but you can listen to the song here.  You can find the lyrics to the song here.  I don't have the expertise to comment on the their qualities, but it seems understandable that FAMU would not want to be associated with the rap's message, at least if one associates the message of the song with the words as written.

I assume that the students who join college football teams enter into agreements that include limitations on their rights of free expression.  FAMU is a state university, so there ought to be First Amendment protections that the athletes cannot bargain away.  That said, the cheerleader in the SCOTUS case signed an agreement in which she promised not to make disparaging comments about her school or cheerleading on social media, and then she proceeded to do that very thing.  SCOTUS said that the school could not discipline her in any way consistent with the First Amendment.

In this case, it seems like there was non-expressive conduct that could be punished consistent with the First Amendment.  There was unauthorized access to FAMU's facilities.  There were the licensing violations.  But some of those pertain only to Real Boston Richey and his crew, and some of those pertain to the individual students who presumably allowed him into the locker room and joined him in the music video.  Suspending all football activities seems to punish student athletes who had no involvement. Perhaps for that reason, among others, the suspension was lifted on July 24th.  According to Jim Henry, reporting in the Tallahassee Democrat, no information regarding player discipline has been made public, but the investigation is ongoing.

August 10, 2023 in Commentary, Current Affairs, In the News, Sports | Permalink | Comments (1)

Monday, July 31, 2023

Guest Post from Michael Blasie on Plain Language Waivers

Which Contract is Better?
By Michael A. Blasie

BlasieIf presented with two contracts with wildly different language about the same transaction, how would you tell which is better? To work towards an answer, let’s consider the waiver for the Paine to Pain Trail Half-Marathon, which is a trail running race in southern New York.

  1. Waiver Language
  2. The Introduction

The waiver begins “We bet you’ve never seen a waiver and disclaimer like ours” and has an image of the word “legalese” circled in red.

  1. Kind of Hazards

In a few paragraphs comprised of short, plain, humorously-worded sentences, the waiver explains how natural and human-made, known and unknown hazards can injure racers.

First, it describes a category of natural tripping hazards: “The trail has plenty of rocks, roots, stumps and other tripping hazards.” Then it describes a category of human-made tripping hazards: “A faster runner might, therefore, knock you to the side, causing you to slam headfirst into a tree or be impaled on a jagged root.”

It warns of general health hazards caused by nature, “like poison ivy, ticks, bugs, wasps and other woodsy things you find in the great outdoors.” When pointing out how weather can affect racers, the waiver notes “[w]ind and rain may create mud holes, fell trees and limbs and create hazards that race officials don’t even know about. Even if we detect a hazard, don’t expect us to warn you. You’re on your own.”

Thomas Paine Cottage Sign
Image by Anthony22, CC BY-SA 3.0 
via Wikimedia Commons

Almost in a chuckling tone, the waiver warns about directions: “Vandals may swipe trail markings. You could veer off course and run straight into a horse’s ass for all we know. . . .  race officials may deliberately create extra hazards. Just for fun. (Don’t worry, this gets better.)”

When discussing the importance of hydration and nutrition, it warns “[t]here are only three water stops, so it’s important to carry a water bottle and any food that you want. If you get dehydrated, it could be months before we find your pile of vulture-picked bones. (Ever had so much fun reading a disclaimer?)”

Last, it points out road crossing dangers: “There are some road crossings. They might have police coverage. Or they might not.”

  1. Release Language
Thomas-paine-cottage
Thomas Paine Cottage, image by Dmadeo 
via Wikimedia Commons

Then comes the release language: “But even though you might get hurt or lost, you’re agreeing to all this crap because you want to run this race.”  

To describe who the racer is releasing, the waiver states: “You are therefore releasing and discharging all race officials, volunteers, sponsors,  municipalities, and school districts, as well as releasing the rocks, roots, bugs, tree limbs, and other stuff, dead or alive, gnarly or not, that might poke an eye out or otherwise hurt you.  Because you know that trail running is a high-risk activity.” In case the bottom line was unclear, the waiver states “[i]n other words, you won’t sue any of the people or groups responsible for this race if you get hurt or suffer illness (such as COVID).”

  1. Known and Unknown Risks

“We’re almost done. This is the important part. This trail has known knowns; there are things we know that we know. There are also known unknowns; that is to say, we know there are some things we do not know. But there are also unknown unknowns – there are things we do not know that we do not know. You are accepting all these risks; known and unknown.”

  1. Concluding Swipe at Typical Waiver Language

“And you are agreeing to all of this even though it’s written in plain English instead of stupid legalese.”

  1. Is This Waiver Better?

By the way, you might like to know a plaintiffs’ personal injury lawyer created the race. The fact that a lawyer who likely has extensive experience attacking waivers would choose to use one with very different language likely untested in court piqued my interest.

The waiver’s language is unique. It certainly looks nothing like the kind of language usually found in waivers for high-risk activities. Indeed, it openly mocks typical waiver language, while also invoking humor and using plain language. All that makes it different. But different is not necessarily better.  

Is this waiver better than the traditionally worded waiver? I am less interested in the answer and more interested in the process of getting to an answer because I am not convinced lawyers or scholars have a way of evaluating contract language.

Of course, most would say the waiver must be enforceable. Ok, so it has to have all the requirements for contract formation and nothing that would render it unenforceable. But that is a fairly low bar, and many differently-worded waivers would meet this threshold.

And you would want the waiver to contain the right substance. This analysis prompts an interesting question: does this waiver offer more, less, or the same substance as a traditionally worded waiver? For the moment, let’s assume both options are coextensive.

Next, you would probably say it should be enforceable the way the client wants it to be. In other words, we want to be able to predict a court will interpret language to our client’s advantage. Fair enough, but without case law interpreting the language, it seems hard for a lawyer to claim one set of language is more predictable of how a court would rule than another.

Here is where deciding between the two gets murky. I do not think there is widespread agreement on what else a lawyer or a client would consider when evaluating a contract. Here are other potential considerations:

  • Should the waiver be understandable to the participant?
  • Should the waiver be understandable to race administrators?
  • Should the waiver’s writing style be consistent with or supportive of the company’s brand?
  • Should the waiver decrease the chance a racer will be harmed, which in turn decreases the chance of a lawsuit?
  • Should the waiver decrease the chance an injured racer would sue (even if you believe you would win at trial)?

What else would you consider?

  • Conclusion

A contract may serve a client in ways beyond being enforceable in court the way the client intended. Looking at unconventionally-worded contracts like this one may provide some insights as to what additional purposes contractual language might serve.

July 31, 2023 in Commentary, Contract Profs, Sports, True Contracts | Permalink | Comments (1)

Monday, July 3, 2023

On Hiatus

Dear Readers,

I am taking the month off to move house and try to get some scholarship done before the new semester begins.  There may be guest posts and Top Tens, but I do not anticipate putting up fresh content until August.

If you need diversion, I recommend the Tour de France!

 

LAFAY!!!

July 3, 2023 in About this Blog, Sports | Permalink | Comments (0)

Tuesday, June 6, 2023

PGA Tour and LIV Golf Merge

The New York Times has detailed coverage here for some reason. 

There are undoubtedly contracts issues, but I think I will let The Sopranos Furio handle this one.

Furio

June 6, 2023 in Sports | Permalink | Comments (0)

Thursday, May 18, 2023

DP World Tour Wins Arbitral Decision Allowing It to Punish Golfers Who Defected to LIV

GolfUnfortunately, I have not been able to locate a digital copy of the arbitral decision.  I will make do with reporting from in The Guardian.  A dozen professional golfers (none of whom are included in the painting at left) played in a tournament sponsored by the LIV Golf Circuit.  The DP World Golf Tour sanctioned the players with fines of up to £100,000.  The players denied that they had violated their agreement with the DP World Tour by playing for the rival organization.

Last month, an arbitral panel ruled that DP World Tour had acted within its rights in fining the players and had in fact reacted reasonably in the circumstances.  DP World Tour issued a statement, noting that 26 players are now subject to sanctions for playing in LIV Golf events, with fines ranging from £12,500 to £100,000 as well as suspensions.  The statement notes that players who have resigned from the DP World Tour will not be reinstated until they pay their fines.  According to SkySports, as of December 2022, Henrik Stenson, Lee Westwood, Ian Poulter, Sergio Garcia and Richard Bland had resigned their memberships.

As of three days ago, it seems that all fined golfers other than Sergio Garcia had paid their fines. Ankita Yadav, writing in Sportskeedasuggests that LIV Golf paid the fines for seven golfers and provides the following list of golfers who have paid.

  • Ian Poulter
    Lee Westwood
  • Richard Bland
  • Laurie Canter
  • Branden Grace
  • Justin Harding
  • Sam Horsfield
  • Martin Kaymer
  • Pablo Larrazabal
  • Graeme McDowell
  • Shaun Norris
  • Wade Ormsby
  • Adrian Otaegui
  • Patrick Reed
  • Charl Schwartzel
  • Bernd Wiesberger

Interesting international developments as the U.S. tightens rules on non-compete clauses.

May 18, 2023 in Current Affairs, In the News, Sports | Permalink | Comments (0)