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Opening the books could be the key to closing a deal

Roger Goodell

Peter King of Sports Illustrated and NBC explained in this week’s Monday Morning Quarterback column that the NFL may be prepared to partially open the books in the hopes of getting a new labor deal done this week, with the urging of Commissioner Roger Goodell.

In a visit to ProFootballTalk Live, King elaborated on the possibility, strongly suggesting that his prediction is rooted in things he knows but can’t yet officially report.

King’s best point?  If the NFLPA disbands and sues, the owners eventually would have to give up financial information.  So why not give it up now?

He’s right on the money.  Some employers flatly refuse to give a disgruntled employee a copy of his or her personnel file.  (In some states, access to the file is required by law.)  But since the employee can simply file a lawsuit and ask for the file as part of the discovery process, giving the employee the file before pulling the cord on legal action, legal action could still be avoided.  Once the proverbial litigation lawnmower has been engaged, the employer could quickly learn that its ass is indeed the grass.

Today, Liz Mullen of SportsBusiness Journal reports that, with the gap between the players and owners now at $750 million, the players believe that the gap won’t be closed until the owners open the books.  “The players really think that the NFL opening their financials has become the key to getting a deal done,” an unnamed source tells Mullen.

So while the owners have consistently refused to give the players financial information and people like Goodell have pointed out that the books have been opened to no avail in labor disputes involving other sports leagues, the NFLPA needs something tangible on which to make further financial concessions, especially after last week’s “lockout insurance” ruling.  Even without a judicial finding that the NFL failed to try to max out the revenues in lieu of lining up ongoing TV payments during a work stoppage, the union shouldn’t accept the league’s claim of unacceptable profit margins at face value.

Trust and verify is the proper approach in matters of this nature, and without verification the players should not be willing to trust what the owners are saying about profitability.

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31 Responses to “Opening the books could be the key to closing a deal”
  1. Kave Krew says: Mar 8, 2011 9:49 AM

    Isn’t it ironic that a group of guys who never had to open up a book in their lives now want to open books…..

  2. clintonportisheadd says: Mar 8, 2011 9:53 AM

    I don’t understand this.

    The owners are claiming they need major concessions to make ends meet and for the life of me I can’t figure out why the NFLPA doesn’t take Dan Snyder and Jerry Jones at their word on this. What is all this “prove it to me” nonsense?

    I mean if you can’t trust those 2 guys what is this world coming to?

  3. wryly1 says: Mar 8, 2011 9:54 AM

    It hasn’t been written about or discussed much publicly, but one of the major sticking points on the division of revenues is this:

    Owners are saying they want another billion of the revenue for marketing, expansion and upgrade of stadiums.

    Fine, but then the questions becomes – why should the players pay for that out of their end?

    Yes, complete and full disclosure of what the numbers truly are is key to resoltion.

  4. bluepike says: Mar 8, 2011 10:07 AM

    It seems to me that an accounting firm enlisted by the mediator, and agreed to by both principals, should be brought in to scrutinize the owners’ books. What they find should be given to the NFLPA – but in the form of “bottom line” info only. Any particulars would not be disclosed and would be kept in the strictest confidentiality. Hopefully, this would seem very fair to everyone and trigger an equitable settlement.

  5. ipeefreelyagain says: Mar 8, 2011 10:10 AM

    I think you’re missing the point. Regardless of what the books say, that doesn’t mean the players are entitled to a bigger piece of the pie.

    Theres this whole disconnect between players & owners, and that is the players THINK they’re owners too…WRONG!

    As an NFL fan, I have no problem watching players play a game for the love of it. So bring on the replacements.

    Greedy players flapping their gums with their 100 M$ ear rings, mansions, exotic cars, and woe-is-me attitude is sickening. I hope they get to face the real world and have to get a real job.

    Where else could they make tens of millions, much less a certain percentage without a degree!

  6. anarchopurplism says: Mar 8, 2011 10:13 AM

    I’m going into my bosses office to demand that I see the company’s profitability numbers in order to demand to know why I have a sliding scale on my commissions and how they decided on their salary-wage/quota scale.

    Those greedy bastards……….I deserve more!

    Open the books! Open the books!

  7. smchristensen says: Mar 8, 2011 10:17 AM

    Is that unnamed source Brees?

  8. bravin4evr says: Mar 8, 2011 10:18 AM

    the owners a$$ may be grass and the nflpa may be the lawnmower; but the owner’s still need $ to improve stadiums and the fan experience! I only get to go to 1 or 2 games a yr, but I want to enjoy the experience and feel safe.

  9. bleedgreen says: Mar 8, 2011 10:19 AM

    Goodell have pointed out that the books have been opened to no avail in labor disputes involving other sports leagues
    ——————

    What? In the NBA the league said ‘we need more money, we’re failing financially’ and the players said ‘show us the books’. The NBA did and the players said ‘OK we can work with you and divy it up differently’.

  10. chapnastier says: Mar 8, 2011 10:20 AM

    I’ve got something tangible, the Packers made a $9 million profit last year. Next season A.J. Hawk will earn $11 million. Someone please explain to me how it is fair for an EMPLOYEE to earn more than the company?

  11. ipeefreelyagain says: Mar 8, 2011 10:25 AM

    Also, are the players willing to share a portion of their endorsements? huh!?!?!?

    Exactly.

    Owners FTW.

  12. clintonportisheadd says: Mar 8, 2011 10:27 AM

    anarchopurplism says: Mar 8, 2011 10:13 AM

    I’m going into my bosses office to demand that I see the company’s profitability numbers in order to demand to know why I have a sliding scale on my commissions and how they decided on their salary-wage/quota scale…..

    —————-

    Sigh.

    When will some people learn that making comparisons between entertainers (football players) working in a monopoly (the NFL) and their humdrum everyday 9-5 lifer existence is hopelessly impossible.

  13. wryly1 says: Mar 8, 2011 10:28 AM

    ipeefreely

    Players are NOT asking for more – or even anything! It’s the owners who want a bigger cut of the revenues. Players are fine with the existing deal. The billionaires are asking for concessions from the revenue producers we pay to see.

  14. wtfru2 says: Mar 8, 2011 10:28 AM

    So let it be written…..So let it be done!

  15. jeff061 says: Mar 8, 2011 10:31 AM

    Lets hope it’s on a very limited basis and/or only on NFL Corp level. Otherwise You have 32 teams, 32 ownership structures, 32 different team atyys, 8 different cpa firms, 16 different configurations of the books

    If it’s a deep dive this will take 2 months and will provide more questions than answers

  16. dryzzt23 says: Mar 8, 2011 10:32 AM

    Players should disclose all of their drug and alcohol use so that the owners know what they’re paying for.

    Clearly the liberals are winning this war b/c the press is making sure that the inmates run the asylum….but they will blame the owners for anything that goes wrong

  17. dryzzt23 says: Mar 8, 2011 10:38 AM

    So what the title of this thread is saying is that if a corporation just gives in to the demands of the union, all will be good but if not then all hell will break loose

  18. macgee10 says: Mar 8, 2011 10:40 AM

    My employer would laugh at me if I asked them to open any kind of books haha. The players may be greedy big time in this situation but if it gets a deal done I don’t care what they have to do.

  19. wryly1 says: Mar 8, 2011 10:41 AM

    bluepike

    The bottom line is THE issue. If owners say they need another billion from the pool of players revenue they’ve already agreed to, you have to know where that money is really going and what it’s being spent on. If it’s going to come out of what is now the players share – you better have a darn good justification of why and what for!

  20. jfluke65 says: Mar 8, 2011 11:01 AM

    If the Union sues, you’ve already stated that the whole decerification process would be opposed by the league as a sham. So why would the owners have to open their books until that litigation is solved? And wouldn’t Smith have to completely step aside as union chief, I mean after they reform the union, to sell their position that it isn’t a sham? I can’t see that happening. Too much personal loss for him.

  21. toe4 says: Mar 8, 2011 11:06 AM

    It makes me laugh how blue collar workers who are a dime a dozen can equate their jobs to an NFL player who are one in a million at their jobs.

  22. ghost072 says: Mar 8, 2011 11:09 AM

    The difference between one of us going into our boss’s office and demanding to see the books is that we are (presumably) not in a labor agreement for a certain guaranteed percentage of the profits. If we were, we would have every right to see the actual profits being generated.

    The owners want the players to take a smaller percentage of the profit pie because they say that operating costs are higher and profits are lower, but then refuse to show exactly what profits are being generated. With such high stakes, and knowing that they will be the ones physically handicapped in the twilight years, why would the players take the owners at their word on these numbers?

  23. sbakernc says: Mar 8, 2011 11:25 AM

    Some of the owners are probably too embarassed to provide full disclosure because then everyone can see the results of some of the brilliant moves that these highly intelligent and savvy free marketeers have made and how they are trying to offset those losses with their football revenue.

  24. kmart0319 says: Mar 8, 2011 11:47 AM

    I saw a sign in a protest recently “Profits = unpaid wages.” The reason for starting a business is to make money, not to “break even”. If that were the case, nobody would start a business and we would all work for the government. They could then slice up all the money equally among everyone so it would all be equal. Sound familiar comrades?

    Player salaries have been increasing annually and as long as they are getting a fair wage for their performance, why do they “deserve” a larger slice of the pie? They didn’t buy the ingredients or even bake it, they just show up to eat it and we get to pay to watch.

  25. peanutbutter&jelly says: Mar 8, 2011 11:50 AM

    i get it that both sides want to proffitt and that is only natural but i don’t get why the players feel that they should get a share of the proffitt from everything the owners lay their hands on when i dont see the players sharing any of the endorsment deals with the owners.in the past i have sided with the players but with all this greed going on i really am leaning more with the owners on this issue, i know they are already rich but if the players keep going this way they will become the billionairs and the owners will become the millionairs except the players will still expect the owners to keep shelling out the big bucks and no business can survive like that .and i think the owners will be well served to open the books and show whats going on and yes i would expect the books to show a decent proffitt but not as much as many may think all you need to look at is what many players are already getting and the worst of that is there are to many players getting to much guarenteed money that they haven’t earned or dont think they need to earn because they already have it. i feel thet system needs to be set up to award those players that earn it and allow all teams to take minimal hits for those that dont. now that in the long run will make for a better product on the field and good pay for good players and keep losses to a minimum for all teams

  26. robf2010 says: Mar 8, 2011 12:11 PM

    Comparing the NFL to other business models is ridiculous.

    What other business can dictate to employees where they work? They do this with all draft picks. The draft would be abolished if any draft pick had 5 years or so of his prime to sue. Why can’t college players offer their services to anyone who is interested in them and anyone they’re interested in? Anyone care to see how that question would fare in court?

    What other business would even dream of asking employees to contribute to operating expenses? And then proceeded to lock them out if they said no?

    I find it difficult to side with the players but I find it impossible to side with the owners. Free, unsolicited, unwanted advice to the owners: Take the best deal offered. You will lose in the court of public opinion and you will lose big time in any other court.

  27. FoozieGrooler says: Mar 8, 2011 12:29 PM

    The owner’s need to open their books.

    Up till now they’ve been claiming “lost revenues”, and while that may be true, until they prove it, it remains just a “claim”.

    I guess the “because we said so” angle didn’t pan out like they had hoped.

  28. bleedgreen says: Mar 8, 2011 12:31 PM

    kmart0319 says:
    Mar 8, 2011 11:47 AM
    Player salaries have been increasing annually and as long as they are getting a fair wage for their performance, why do they “deserve” a larger slice of the pie? They didn’t buy the ingredients or even bake it, they just show up to eat it and we get to pay to watch.

    ———————-

    You’re missing the part where the players are NOT ASKING FOR MORE MONEY. The owners are asking them to take a paycut essentially.

    Also, all the tools saying your boss would laugh at you. If the business you work for was, by all indications, booming. You know of all kinds of revenue coming in from clients, advertising, and whatever else, but your boss said to you ‘We’re not doing so well. We’re going to need you to take a pay cut, and also your benefits are going to decrease.’, would you go ‘Oh, OK. You’re the boss, I guess I should just take you at your word that you’re not making enough money.’

  29. clintonportisheadd says: Mar 8, 2011 12:47 PM

    dryzzt23 says: Mar 8, 2011 10:32 AM

    Players should disclose all of their drug use so that the owners know what they’re paying for.

    ———————–

    Jim Irsay does NOT want to go down that road…..

  30. southpaw2k says: Mar 8, 2011 1:00 PM

    I’m no economics whiz, but it strikes me as very odd given the NFL is a $9 billion-a year business, and yet the Green Bay Packers made a $ 9 *million* dollar profit. How does ANY franchise – especially one that has a nationwide draw like the Packers – make a 1% profit off numbers like that? Where is their money going? I don’t know exactly what the Packers spent in salaries last year, but let’s say it was around $120 million since that was about the cap in 2010. What in hell else did they spend on to turn in a mere $9 million in profit? I realize they have to spend money on maintaining the stadium and its facilities, pay its staff members, etc, but this is also a team who sells a boatload in jerseys, memorabilia, and other items. And that’s before any TV revenue comes in. Oh yeah, and they won the SUPER BOWL. Is it just me, or does strike anyone as bad business? I’d really appreciate enlightenment by some economists because I really have to be missing a major part of the puzzle here, and that’s not meant to be taken as sarcasm.

  31. chris1982 says: Mar 8, 2011 1:19 PM

    Of course this is the only way the players will concede, its what they have always wanted. If i was getting a percentage of revenue as my compensation from my employer id be in there demanding to see the books if i was asked to take a pay cut when its clear the business is doing better than ever.

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