The NFLPA appealing an arbitrator’s decision from January, which found NFL owners didn’t collude over restricting guaranteed money in players’ contracts, isn’t just about collusion, or the lack thereof.
It’s also about the boundaries and responsibilities of the NFL’s Management Council (NFLMC) to share economic information with owners and high-ranking team officials. This latter dynamic could make the pending appeal a game-changer for the business and law of pro sports leagues.
The appeal is before a three-person panel, with a decision expected by the end of the year. Details about the appeal are confidential per arbitration standards and collectively bargained terms. The decision won’t necessarily be the final word—the loser could petition a federal court to vacate the decision. The odds of a court petition would be long, however, as federal law requires judges to show deference towards arbitrators.
The appeal challenges a decision in January by NFL systems arbitrator Christopher F. Droney. A retired judge from the U.S. Court of Appeals Second Circuit and a former U.S. attorney, Droney denied the NFLPA’s claim of collusion. Under Article 17 of the CBA, collusion means two or more teams, or the league and at least one team, conspired to deprive players of collectively bargained rights.
The NFLPA’s theory of collusion mainly stemmed from a presentation in 2022 by the NFLMC, which is the collective bargaining representative of the 32 teams’ owners. The presentation included a slide show on topics related to signing bonuses, player compensation trends and the salary cap, and it mentioned data movements, including that guaranteed salaries and salary-bonus commitments in player contracts were escalating in ways that would be “difficult to walk back.”
The NFLMC also suggested that players might gain a higher percentage of revenue than required by the CBA.
As the NFLPA sees it, the NFLMC informing teams that they were guaranteeing more money to players made teams more mindful of that phenomenon and, perhaps, less inclined thereafter to guarantee money. The NFLPA also asserts that New England Patriots owner Robert Kraft told then-NFLPA executive director DeMaurice Smith in 2022 that Goodell encouraged owners to avoid large, fully guaranteed deals. Both Kraft and Goodell have refuted the claim.
Droney found there was no collusion, saying league officials presenting economic information to owners is not indicative of collusion. Collusion, he says, would require at least a couple of teams or the league and at least one team conspiring to deprive players of guaranteed money or some other benefit, and an information presentation is not collusion.
Even if a team became less willing to guarantee money, that, by itself, would not constitute collusion, since the team would be acting on its own. Collusion stems from the Latin word “colludere,” which means to “have a secret agreement” with another—if there is no other, there is no collusion.
Droney also found the claim against Kraft unlikely to be true, and he stressed how owners testified they want to win and wouldn’t spend less on players as part of a plot, since they want to defeat other teams.
While Droney didn’t find collusion, he was still critical of the NFLMC’s presentation. “There is little question that the NFL Management Council, with the blessing of the commissioner, encouraged the 32 NFL clubs to reduce guarantees in veterans’ contracts at the March 2022 annual owners’ meeting,” he wrote. To be clear, that critique was dicta, or commentary that is not essential to the holding. It still stung, though, and that element became the focus of debate in the media, most notably the podcast, Pablo Torre Finds Out.
Expect the NFL to push back on Droney’s disapproving depiction in the appeal.
To that point, the NFLMC is a multiemployer bargaining association that is legally obligated to share information with its members. In labor law, such an association negotiates on behalf of multiple employers (in this case, NFL teams), and it negotiates as one unit with a union. It is a concept long recognized by courts, including in cases involving the NFL. This is true of the U.S. Supreme Court’s decision in Brown v. Pro Football (1996), where Justice Stephen Breyer wrote “multiemployer bargaining itself is a well-established, important, pervasive method of collective bargaining, offering advantages to both management and labor. “
The setup is necessary for a pro sports league with independently owned teams. Collective bargaining with a union enables the NFL and its teams to negotiate economic restraints that become exempt from antitrust scrutiny, including a rookie wage scale and a salary cap. It wouldn’t make sense for the New York Giants, for example, to negotiate a CBA with Giants players, and the Los Angeles Rams to negotiate a different CBA with Rams players. Teams in a league need to play by the same set of rules for wages, hours, pensions, health care and other working elements.
Team-by-team bargaining could also lead to disruptive labor disputes involving one team and their players; a strike or lockout of players on the Chicago Bears would impact not only the Bears but teams the Bears play against.
Multiemployer bargaining is not unique to sports. It arises in the trucking industry, with numerous truck companies bargaining with unionized truckers, as well as in telecommunications, railroads and other industries. The bargaining association has legal obligations to its members, including pertinent disclosures of information.
To that end, expect the NFLMC to assert that, as the bargaining agent for independently owned teams, it has a duty to be transparent with those teams and inform them of data trends and other topics related to bargaining. Stated differently, if NFLMC doesn’t tell teams about guaranteed salary amounts, it could fail to meet its underlying purpose.
Imagine owners discovering that the entity representing their interests in collective bargaining concealed materials from them. At a minimum, expect owners to demand personnel changes in how their interests are bargained.
This is why a dispute about alleged collusion could turn out to be much more influential on the parameters in which management representatives share information with owners and teams.
