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DeMaurice Smith interview transcript, part two

[DeMaurice Smith, executive director of the NFLPA, joined ProFootballTalk Live on Monday for an extended interview regarding the current labor dispute.  Part two of the transcript of the interview appears below.  Part one of the transcript has been posted separately.]

MF: We’re back with NFLPA Executive Director DeMaurice Smith. Great conversation so far. I wanted to jump right back in to one of the things that you mentioned right before we took our break, and that is the lockout insurance case. A ruling was issued by Judge David Doty in early March. Do you believe, De, that that ruling has made it harder to get a deal done because it seems to have created a significant amount of mistrust between the players and the league.

DS: I don’t know whether it makes it harder or easier to get a deal done. What I do think that it does is, unfortunately or fortunately, depending on what side of the table you’re sitting on, it does give you a very candid and brutal window into the truth. While we were trying to engage in good-faith negotiations, right around the same time, that’s when that decision tree was made for the National Football League owners and for their management counsel of trying to gain the television contracts in order to lock us out.

You’ve seen some of the documents that have been released by the judge that were obtained during the course of discovery. I’ve seen a number of other documents that haven’t been released. Whether it creates mistrust or not, we live in a world where hopefully we make decisions guided by what’s true and what’s not. In a very brutal, candid way, looking at that document gives everybody in America a window, not only into what the National Football League was planning in secret, but now beyond a shadow of a doubt, now everybody knows that that’s where we were heading – not on the last day of mediation, but as early as 2009.

MF: One thing that really hasn’t gotten a lot of play over the last several weeks is the collusion case that was filed with Judge Doty. And I can see the players viewing the collusion case as the flip side of the lockout insurance case. The lockout insurance case lines up revenue. The collusion case, based upon failure to sign restricted free agents in 2010 to offer sheets, that saves money in advance of a lockout. Do the players feel more strongly about the collusion case that’s still pending in light of the lockout insurance case, and what is the status of the collusion case?

DS: The status of the collusion case is it is still pending; discovery is ongoing, and we’ll see. You know Mike, in all honesty, players right now are focused on how do we get back on the field?  They really don’t spend a lot of time thinking about, “Is this a piece of leverage, is that a piece of leverage.”  You know, I’ll tell you what — a number of our senior leaders, and I know that our board of player representatives — a lot of them have grown up over the last two years, being actively involved in these negotiations and learning about how the National Football League works. A lot of guys who probably have never given much thought to how teams operate or how the business of football conducts itself, were probably shocked when they saw the documents from the TV case.

But at the end of the day, Mike, you know these guys. They wanna play football and they wanna get back to the game they love. They know that they have limited careers, they know that every time they get hurt it’s one step closer to retirement. They know that the average career length is 3.4 years. So being in a situation where they are locked out from the owners and prevented from playing the game that they love — they know that that’s not where they want to be.  And that’s why we filed an injunction to stop the lockout, and that’s what we will be arguing I believe in early April.

MF: A big issue that emerged last week, De, relates to whether the NFLPA or players generally will encourage, discourage, recommend, not recommend incoming players who are invited to the draft to actually show up for the event on April 28. What is your own personal position and preference as to whether or not these incoming players show up at Radio City Music Hall for the NFL Draft, if and when invited?

DS: Yeah, and look, we saw the report from someone from another network that I won’t name use the word “boycott” because it was a word that he wanted to come up with. We never told folks to boycott the draft. But, at the same time, it’s important for our young men to recognize early on what the business of football is. And you covered some of the words that I said to the rookie players last year at the rookie symposium, telling them that I expect them to be men and businessmen in the business of football. Inherent in that is for them to make their own and best choice about what they should do and how they should conduct themselves. We had a party last year around draft time. My guess is we’ll probably have a party this time around draft time.

But at the end of the day, what I think every rookie should do is take careful stock about what the business of football is, and to act accordingly. And when they make prudent, wise decisions about coming into this business, recognizing the short career length; if they do that, football can be a tremendous opportunity for them and a platform for them to do something else. At the same time, you know better than I do, football is going to end for our guys a lot sooner than it began. And what I want our guys and our young men to do is recognize where they are, the decisions they make and to really start planning for life after football the minute that they step on the field.

MF: Are you concerned, though, that any of the incoming rookies who are invited to the draft show up, and when football starts again, whenever that may be, that they might face some type of repercussions either in the locker room or out on the field from players who believe that it was an act of betrayal to show up at the draft?

DS: No, I really don’t. Teams are very interesting, incredibly strong constructs. Today, for example, I’m with over 400, 500 former players who are joined together with our current players for the second time in history. What you know from that, when I see a guy like Mike Vrabel sitting down next to Cornelius Bennett, who’s the head of the former players’ association, you know they overlapped obviously on different teams, but they remain members of the same team.  And I’m not worried about repercussions or anything about when a young man joins a team.

What I do hope that our young men do is take careful stock about where they are, understand the business that they’re stepping in, and make sure that they plan not only to have a great career but also start planning for when that career is over. And right now, unfortunately, they are entering a world of professional football that is markedly different than is has been for the last 20 years. And maybe it’s different over the last 20 years, rookies didn’t have to think about owners shutting down the game. And maybe they didn’t have to think about owners conspiring with the networks to provide the league money during the course of a lockout.

But I do know and do hope that the lesson that rookies can take away from this is while this is a great game, it is a business. And whether they show up on draft day is purely their choice, and I expect it always to be their choice. But they also know that unless things change in a real hurry, the steps that they’re taking walking across that stage won’t be matched by steps that they will be taking on the field. And that the person that they shake hands with is the person who made the decision to lock them out. So my hope is that they make their own decision but more often than not, prepare for the business that they’re entering.

MF: Will next month’s draft be the last draft ever? Is that the end result of this anti-trust lawsuit: no rules, 32 companies acting independently and therefore no draft? You think that’s where this is headed?

DS: You know what, I don’t know. And Mike, man, you’re a lawyer, I’m a lawyer. You and I have probably had a lot of confidence in the way in which court cases were going to work out, either ones that you and I were trying or ones that we were watching. You know you can’t predict anything. I don’t know. What we hope to achieve is the game of football for our fans, the game of football for our players. And that’s what I’ve got my eye focused on right now.

MF: Well when Dominique Foxworth says, and he recently said that the union will not be coming back, that means that we’ll be a collection of non-union employees, 32 separate businesses, any decisions they make among themselves potentially constitute antitrust violations. The lawsuit filed, on the 11th of March, contains some allegations suggesting that the draft is an antitrust violation. Is that what the players are, at least on paper, pushing for right now — an end to the draft via this antitrust lawsuit?

DS: The players are pushing together right now as a class to seek protections on the antitrust laws. Why? Because the National Football League is a non-profit monopoly. And that’s as simple as it is. It’s seeking to avail itself of all of the laws and protections that flow to every citizen, every organization, every class of individuals in the United States. And the monopolistic activity is obviously laid out.

The CBA operates as a shield to the antitrust laws on that monopolistic behavior. And when the owners made the decision to let the CBA expire, they also made the decision to not avail themselves of the protections that the CBA provided. So I can’t predict where we’re gonna be with any sense of accuracy, but I do know that we will push forward an injunction. We’ve got players who have stepped up to the plate to represent their class because they believe in the game of football. And they believe that football should be played, and they’ve stepped up, really as leaders, to carry the torch in the same way former players named Reggie White, Dave Duerson, Hardy Nickerson did for us in 1993.

MF: Let’s focus now for a few minutes on the offer that was made by the NFL on March 11. And first of all, I’ve sensed some possible disagreement on this. Did you interpret that offer that was made as something that was negotiable or as a take-it-or-leave-it, this is our offer, if it’s not this then there’s no offer?

DS: You know, Mike, the simple fact is, March 11th was the end of a two-year process when the National Football League didn’t provide any financial justification for their historic roll-back, and we now know, was gaming with the television networks in order to impose a lockout that they then imposed. On March 11th, we had already extended the deadline twice without the financial information that we said we needed in order to get a deadline done. The National Football League walked into the room on March 11th knowing that there was a 5:00 cutoff and that we’d already extended it twice.  The National Football League walked into that room knowing that if there was going to be another extension, we said that you’re going to have to turn over audited financials in order for us to have constructive negotiations.

It’s not really an issue of whether it was negotiable or not. We’re at the end of a 52o-year process where we had more than 50 negotiation sessions. Fifty. We had 15 days at the end where we had decision-makers in the room, from our side every day. But in reality we had 50 negotiation sessions over two years. And part of those negotiations started – and this is critically important – started at a point where the players of the National Football League did not seek any more money, because we said we’d play under the 2006 rules. And then some of those negotiations began with players offering a pegged cap that was lower than what the pegged cap would’ve been had the 2006 deal gone forward. The players know, beyond a shadow of a doubt, that we never asked for more money, we offered concessions to get the deal done, and on the last day, the National Football League offered a deal that would result in us taking the worst deal in the history of sports.

MF: And you’ve used that term a couple of times in different contexts. What is it that makes the offer that was made at the end of the process the worst deal in the history of sports? Because that implies it was worse than any of the offers made previously by the NFL during the two years of discussions.

DS: Well, the answer is “yes” to both questions. But two simple metric points, and not to get too deep into the cap and the spend and what the benefits are, because you did a great article on that and I’d invite your listeners to go back and take a look at that because it does a very good job of breaking down the financial impact of the deal. But let’s look at it in two simple terms right away. [Editor's note:  He's referring to a March 13 item we did explaining the financial divide between the two sides.]  The first year of the deal alone would be a $14 million reduction, per team in the National Football League in year ok. You take that $14 million and multiply it times 32, and I don’t have the numbers in front of me but I think that comes up to about $440, nearly $450 million coming from players to owners in year one. So that’s $450 million in year one. In year two of the NFL’s deal, my recollection is that would’ve been about $512 million in money coming from players to owners in year two. So within two years of the deal, you’re in roughly, what, about $1 billion?

MF: It’s almost $1 billion.

DS: Almost $1 billion. That’s not counting the $320 million that the National Football League and the owners stuffed in their pockets during the uncapped year because of unfunded player benefits. So within the first two years alone, you take the $320 million, add it to the $448 million, add that to the $512 million, and within the first two years alone, the cost to players adds up to I think roughly $1.2, $1.3 billion. Just in the first two years. So that’s the first metric.

MF: But how is that worse than anything they’ve offered previously? If they came from their number of $131 million in salary cap and benefits to $141 million, when the players were at $151 million, I just don’t understand how the offer that was made on March 11 was worse than any offer that was ever made when you consider they were gonna table the 18-game season issue.

They were offering to send the drug and steroids suspensions to arbitration – something that both you and Gene Upshaw have asked for in the past. There was a lot of stuff in there that made the offer – and I’m not saying ["fair"], because I hear “fair” from the owner’s perspective, and my reaction is, well, I don’t care if the owners think it’s fair, of course they think it’s fair. The question is, do the players think it’s fair? But at least [the offer] seemed like something that would allow further meaningful discussions and not something that would be characterized as the worst deal in the history of sports.

DS: Because of the second part of the metric, Mike. The first part of the metric is just the cost in the first two years. By the time you get to the fourth year of the deal – fourth year of a 10-year deal – as someone famously said, once you start talking about billions of dollars it actually adds up to some real money. But that’s the first metric. The second metric of the deal would be that before the ink was dry on the deal, players would drop to 45% of all revenue and then that drop would continue for the course of the deal.

So the reason why it became the worst deal in sports history, you and I can both probably agree that not only is the National Football League been extremely successful over the last 40 or 50 years, but looking at the revenue numbers generated from last year — the Super Bowl viewership, the sponsorship deals, the TV deals — there is every likelihood that the National Football League will continue to grow at significant rates as you go forward. The deal that they put on the table meant that by the end of the term of the deal, players would be getting smaller and smaller and smaller and smaller shares of the revenue that they generate. And in that way, the deal that they put on the table, became the gift that would keep on giving. And by signing that deal, we would be consigning future players to smaller and smaller shares of revenues, even though what they are doing, how they are working, how they are performing continues to go up. The stress on their bodies continues to go up. And what we know are the long-term consequences of playing this games would continue.

MF: And I think you’re touching on what I believe to be the heart of the matter from the player’s perspective. It’s about the percentage of dollars shared and I think it’s not shifting in the owners mind to actual total dollars paid because even though the percentages, De, would be dropping over time, total dollars keep going up as the NFL continues to achieve higher and higher level of success. So, is that a fair characterization of where this stands?  The players believe absent clear justification otherwise it should be 50-500 no matter how high or how low the revenues are, and the owners are wanting to dial back that 50-50. They want to give players less as those numbers get higher and higher. Is that what’s going on?

DS: Absolutely. And the only thing that I would say is think back. The 50-50 split isn’t something that I created. Wasn’t something that Gene Upshaw created. The 50-50 split has been very good for football players and very good for football owners since approximately 1987, but while we know that those things are continuing to result in larger revenues, larger fan bases, more profitable teams according to Forbes, no one can look back on the increase in team values and say that any owner has suffered at all because while our players might play about 3.4 years, owners own teams for decades. And if you look at just the last 15 years, team values have increased over 500 percent. So, I think I understand it when an owner says, “Well you know, I’d like to keep the team in my family and therefore I’m not going to reap the benefits of selling it,” but that’s a choice. That’s a choice and what I’ll leave you with is something that Mike Vrabel said in that mediation room to the owners, he said: “Unlike you, I can’t will my linebacker position to my son in the same way that some of you received a team because of your birthright. I can’t give my son a position on the Kansas City Chiefs. The only thing, I, as a current player, can bequeath is a safer and better game for the players who come after me. That’s why the players of the National Football League made the decision that they made.” And for me as their executive director, that’s good.

MF: One last question and I’ll let you go. This goes to the safety of the game. The 18-game season. There have been different opinions on this. Is that off the table or is this just something where it’s negotiable if the numbers are right. If the safety measures are in place is it something the players would consider?

DS: The only way I know how to answer is this:  The health and safety of our players is non-negotiable. I’m looking at guys right now in this former player meeting who can’t walk down steps. I’ve got guys in the room about 15 steps away from me who can’t afford healthcare and their wives in their 50’s and 60’s have to go back to work because a lot of these guys can’t bend their fingers or stand up. So, to answer your question Mike, at the end of the day, the health and safety or our players is non-negotiable and the players of the National Football League are going to do everything to make sure that the game for the people who come after us is safer than the one they’ve played.

MF: But can it be made safer? Can it be made safer with 18 games and reductions in contact during practice, pre-season games, offseason workouts? Can it be kept at the same safety level or made safer if we add two regular season games?

DS: That’s a long list because you mentioned a couple of things. But you’d also have to raise issues like guaranteed healthcare. You’d have to recognize that healthcare is going to become more expensive in the future than what it is now. You got to recognize the two extra games exponentially increases the amount of head to head trauma. You have to recognize that right now the NFL is suing 600 of our players trying to keep them from getting the healthcare that they were entitled to. So, you know, Mike, that’s a pretty long list of what we’d have to do. Let’s make sure we understand each other. I think there’s a pretty long list of what we need to do in order to make the game safer under a 16-game schedule. It’s got to be an even longer list if you’re talking about adding two regular season games to the end of what’s already a very brutal schedule, alright?

MF: Well, De, thanks for your time. I know you got a lot of things going on. Hopefully we can talk at some point down the road and hopefully we’ll be talking soon celebrating a new deal. How about that?

DS: Well, nothing would make me happier, my friend.  Take care.

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6 Responses to “DeMaurice Smith interview transcript, part two”
  1. MichaelEdits says: Mar 21, 2011 11:14 PM

    Baby got hat

  2. eagleswin says: Mar 22, 2011 9:06 AM

    Here’s an interesting question, seeing that a large percentage of the players make less than $1,000,000 a year.

    This has nothing to do with reducing the cap but rather as to how it’s distributed. What if the maximum annual salary was a percentage of the cap, such as 5%.

    Say Peyton Manning, could only make $6.5 mill/yr on a $130,000,000/yr salary cap. That would free up money ($16.5 mill) from his contract so that other lower paid players could get increases as well. It would still allow him to be the highest paid player on his team but allow the wealth to be redistributed. He would still be paid plenty of money so he couldn’t claim hardship while the majority of the union benefits.

    It would also benefit owners in that there would less “grass is greener on another team” sentiment as there is no other team that could pay them more.

    The majority of the union benefit and the owners benefit and star players still make plenty of profit.

  3. nicksabansanahole says: Mar 22, 2011 9:57 AM

    Great interview. It all comes down to one thing. Greed. It is gonna ruin the NFL just like it has ruined most everything else. The NFL should pay heath care for every NFL player for the rest of their lives. The players and owners should take less to ensure this. Maybe players should think more about their education and financial planning than about gold plated rims and 25000 square foot houses. The owners should not need to build a new stadium every 20 years either. Damnit. Make it affordable for a family to go to the game instead of how much money can we squeeze out of everybody that walks through the damn door.

  4. bunjy96 says: Mar 22, 2011 12:43 PM

    Interesting that he mentions health insurance costs.

    Last I remember, this is paid by the owners 100% and the owners submitted a proposal to drastically increase it. That has to come from the “pie” someplace.

    Can anyone shed light on the “600” that are being sued by the NFL and the general reasons. Thought it would be the other way around. Also, don’t these medical claims go to arbitration if not resolved by the league and the player? So what is he talking about?

    Part2 was just as bad as part 1 for understanding the facts and his rhetoric. Disgusting.

    More convinced than ever, the players are greedier, of the two sides.

  5. 44kyle says: Mar 22, 2011 4:15 PM

    This guy can say less with more words.

  6. jimphin says: Mar 22, 2011 6:40 PM

    Drama queen. I wish he would just answer the question. You chase him around the bush for an answer but all he does is focus on more questions.

    One clear misrepresentation or lie (if you will) is that replacing two preseason games with two regular season games is the equivalent to “exponentially increases the amount of head to head trauma.” Well, it is the same exact amount of plays. It’s just the rookies (whom he represents) get to experience more head trauma.

    I think I’ve just experienced head trauma by reading this guys skirting, smarmy, arogant non answers.

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