If the Eighth Circuit, as is now expected, rules that the lockout will continue beyond the middle of June, the only other short-term source of litigation leverage for the players comes from the damages award from Judge David Doty in the so-called lockout insurance case.
To summarize, Doty found on March 1 that the NFL had breached the CBA (and, in turn, the settlement agreement in the Reggie White antitrust case) by obtaining in the latest TV deals a promise that money will be paid to the owners during a lockout, instead of maxing out the total money to be shared by the teams and the players. We’ve agreed with the concept of the players’ argument since the case was first filed (actually, the moment of realization came while watching the second act of Jersey Boys, seriously), and we’ve been very intrigued by the manner in which Doty will require the NFL to make things right.
Though it wouldn’t be fair to give the players 59.6 percent of the $4 billion to be paid during a full-season lockout in 2011, since most of that money represents only a loan, the players fairly should recover 59.6 percent of the money that the NFL left on the table for 2009 and 2010. The challenge will be to determine the right number.
The players’ effort to obtain punitive damages via a trebling (fancy lawyer term for tripling) of the damages seems to be a bit on the aggressive side, since the violation essentially flowed from a breach of contract. That said, we wouldn’t be shocked by the imposition of a penalty, given that the action also could be characterized as a tort-style breach of fiduciary (fancy term for non-douchery) duty.
Either way, to the extent that the players assume that a large award will be entered by Judge Doty and that the money will help the players get through a full-season lockout without having to take out $500,000 loans at 23-percent interest, they need to realize that they quite possibly won’t see the money until after the 2011 season ends.
And that they may not see it at all.
The decision will be subject to appeal by the Eighth Circuit, and the judges assigned to the case could disagree with Judge Doty on the issue of damages, or even on the issue of liability. The Special Master, for example, viewed the case much differently that Doty did, and the appeal of Judge Nelson’s order lifting the lockout already has demonstrated the reality that what is clearly right to one federal judge may be clearly wrong to another.
Also, the Eighth Circuit’s decision to expedite the appeal of the lockout-lifting order doesn’t mean that it will expedite the appeal of the lockout insurance ruling. Typically, awards of money damages are considered in the normal course of court business, with interest accruing while the plaintiff waits for justice to be dispensed.
Thus, even though the chances of getting this entire mess resolved could be enhanced by an order forcing the league to finance the lockout for the players, there’s a good chance the players won’t see a penny of the money until after the 2011 season has come and gone, even if Judge Doty’s ruling is upheld on appeal.