The Wright Stuff? A Defense of the Harlem Globetrotters

On the excellent Truth on the Market, Professor Josh Wright (George Mason University School of Law) replies to my comments on CNN Money concerning the Harlem Ambassadors' complaint with the FTC against the Harlem Globetrotters and their exclusivity contracts. I argue that elimination or contraction of the exclusivity contracts would enhance competition in the market of barnstorming basketball, and that would be a good thing for fans. Wright contends:

[T]here is an economic fallacy underlying this logic that I cannot resist pointing out. The claim is that competition is not present where we observe these exclusivity clauses, or at least that there should be more competition, and that therefore antitrust law might improve consumer welfare eliminating the clauses. This is wrong. There is competition for the contract.

While I understand Wright's theoretical point, I find it hard to imagine how there can be actual competition for the exclusivity contracts when only one actor--an apparent monopoly--has the market power to obtain them.

A great post worth checking out.

Update: Professor Wright replies to my post above. This is one of those days when I am especially grateful to be a law professor: I can have a debate about the Harlem Globetrotters, and it still counts as work.

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More on Iverson, Race/Culture, and the Olympic Team Snub (Part II)

More provocative commentary from the sportswriter and good friend who I referenced on Friday. Here are more of his remarks from an e-mail exchange we had:

Coach K and Coangelo are sending the right message, all right, as far as the NBA is concerned. Like everything else, the league is half-assing this. As much as both of us hate the age-restriction, it was a total half-measure. While it was paternalistic enough to appease a certain segment, only going to 19 instead of 20--while also increasing the number of NBDL farm teams--the league sent a pretty clear message that its commitment to the college farm system and its merits are waning quickly. (It's tough to emphasize the development of 18-year-olds if you're totally under the gun to produce a 20-win within three years or else. Meanwhile, the NCAA is taking away every trick in the book you used to employ -- academically ill-prepared kids and long practices, chiefly among them.)

Same thing with the dress code. How can you have one of these and not have any sort of restriction on cornrows, really nappy 'fros or tattoos? Hampton University does not allow 'rows in its business school. Cornrows are the sole basis of my dad's disdain for Donovan McNabb. Cornrows bug a lot of people, but they weren't addressed in the slightest. (Though I know that legislating hairstyles are different than dress, legally.)

Just throw [Coach K and Colangelo] on the pile of dog and pony shows we've seen recently. There will be others. The league and USA Basketball know that competitively, this could very easily blow up in their faces. And maybe soon. But as long as the "right" guys are on the team and the "right guy" is running it, they can say that they tried to make changes. After that, I guess AAU coaches will still be around to play whipping boy on the topic of America's decline in hoops.

As for those two guys being white, I'd smell a rat even if Billy King and John Cheney were running the show. The big thing is that no one respects NBA coaches as much as we should, even though most big-name college guys get sent to the pasture in a flash when they try coaching pros. For a lot of dupes, er, observers, a college coach "represents" the apex of competence (which a lot of us would be doing if we were playing inferior talent on a regular basis) in the same way that Allen Iverson is a mere symbol separate from his actual merits...

Sports and paternalism pretty much go hand and hand when it comes to black athletes, so I'm kinda like, what else is new.

The funny part about the NBA's brand of paternalism is that so much of it comes from outside. Sports talk radio honchos and sports columnists--not the most diverse group of people in the first place--seem to control the discourse where the NBA is concerned. And yes, they tend to be more paternalistic when it comes to NBA players than any other sport. And then, the NBA buckles worse than Frazier versus Foreman, instead of defending itself....

I think there are a lot of seemingly bright people who have an obvious blind spot when it comes to race, unless Bryant Gumbel or the president of NAACP's Philly chapter happens to sound off on it...

What I saw in the 2004 Olympics wasn't so much as a team of individuals as a really inexperienced team new to the FIBA game, overmatched by really experienced teams that had played together for a while and grew up with the FIBA game.

If you compare the ages of the 1992 team and the 2004 team (sans Laettner and Okafor), you see one factor that was pretty much ignored in the noise about what to do with USA Basketball. One team had a roster full of veteran guys in full control of their talents. Another team had a roster full of very talented players who still had some growing to do in terms of harnessing what gifts they had. (Or compare the youths of the 1988 U.S. team--with its mix of "role players" and future NBA stars--against the veterans of the Soviet team that beat them, very few of whom made a real dent in the NBA.) So there's irony in the notion that a 33-year-old Allen Iverson would be an automatic liability on this team. To me, at least.

While I appreciate the concept of building a national team for the 28-month haul--and even changing the nature of the team--one smells a rat when Iverson isn't invited to COMPETE for a spot. (Barkley in 1984: Given a chance. Not the same deal here.) Is the goal to have ABI--Anybody But Iverson? Seems like another style over substance situation to me, no better than the previous seven McDonald's-ready teams sent to the Olympics and World Championships. Or to put it another way--borrowing, then turning a "White Men Can't Jump" quote upside down--we MIGHT be looking at white guys who "would rather look good first and play good second."

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CNN Money on Harlem Ambassadors' FTC Complaint

Chris Isidore, a senior writer at CNN Money, has an excellent column on the Harlem Ambassadors' complaint with the FTC (Isidore, "Small Rival Files FTC Complaint against Globetrotters," CNN Money, Mar. 3, 2006).

As we have discussed previously (12/23/2005; 1/18/2006), the Ambassadors allege that they are being blocked from many public arenas around the country by a clause the Harlem Globetrotters require in their lease agreements which prevents other exhibition basketball team from playing in the same venue around the same time the Globetrotters are scheduled to appear. This type of clause is often called an "exclusivity clause," and it is used commonly used by circuses and other novelty acts. The Ambassadors allege that the Globetrotters are effectively forcing them to play in smaller venues (like high school and college gyms), playing before an average of 1,500 fans, when their product could generate far greater crowds if afforded the opportunity. The Ambassadors also note that unlike circuses and similar entertainment industries, the Globetrotters appear to enjoy a monopoly over barnstorming exhibition basketball.

I was interviewed for this story, and I contend that while the Ambassadors' may face an uphill legal battle, common sense seems to be on their side:

The Globetrotters refused to comment on the FTC complaint. But Michael McCann, a professor with the Mississippi College School of Law and an expert in sports business law, says that the FTC complaint is an uphill battle for the Ambassadors.

"The FTC may look at this and say the exclusivity agreements are used by circuses and other forms of entertainment, so what's the problem," said McCann. He added though that the fact that few have tried to challenge the Globetrotters in the exhibition basketball arena does "lend credence to the Ambassadors' argument."

McCann also believes that the lease clauses are probably not the best idea for the Globetrotters in the first place.

"There's a real risk when you create your own David vs. Goliath story and you're Goliath. I think the clauses are unnecessary and they would continue to do well without them," he said. "It could be the best thing for them to have a little competition."

Sure, it wasn't that long ago that the Globetrotters were anything but a Goliath. As recently as 1993 the team was drawing only 300,000 fans annually and had revenues of $6 million with a net loss of $1 million . . . But a 2005 press release from the team said that [over the last 10 years] sponsorship revenue rose by almost 300 percent while operating profits increased by nearly 400 percent. What's more, the team reported annual attendance of 1.3 million in 2004, a record for the franchise.

Certainly, it is not often when I can incorporate a biblical reference into sports law analysis, but there it is: David v. Goliath. My many years of Catholic education are paying off. And before someone makes a comment, yes, we had a dress code. And I thought it was foolish then too (although the genuinely outstanding education more than made up for it).

But back to the story, it will be interesting to see whether the FTC acts on the complaint. To the extent the agency is animated to act in the Ambassadors' favor, I suspect it will first try to informally "encourage" the Globetrotters to remove the exclusivity window from future contacts. Should that fail, the FTC may issue a formal letter instructing the Globetrotters to do so and eventually bring charges through the Justice Department. Significantly, the Ambassadors' President and founder, Dale Moss, has stated that he is not interested in treble damages or extensive litigation: he just wants his team to have a fair shot. Such commentary seems to lend credibility to his team's complaint with the FTC: let's have a little bit of competition and see how the American consumer responds.

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More on Iverson, Coach K, and the Olympic Team Snub

A prominent sportswriter who covers the NBA for a newspaper with a national audience e-mails me some excellent and provocative comments on Iverson and his Olympic Team snub:

Michael,

I've had a chance to see the pissing match over the A.I. issue on the Sports Law Blog, so I'll pass along a couple of comments.

Yes, it's just plain ignorant not to have Iverson as one of the 25 finalists for the team. If he goes in and it just so happens that he doesn't work out, I can live with that. But the idea that there are 22 players in world, let alone the U.S., more qualified than he for any team is just plain ridiculous, especially when you have two years to tweak the lineup.

However, the main issue to me seems to be that USA Basketball has never been about putting the best possible team on the floor, and probably less so since the NBA players were allowed to participate in international play. During the amateur era, you had coaches using the team to give favors to old friends, or to pump up players in their own programs.

During the professional era, it's been about having the most marketable team. And nothing seems to have changed for the '08 campaign, which is an attempt to distance itself from the 2004 team as much as possible. So many people saw the Athens Games as a referendum on the state of American basketball, that they ignored the fact that the wrong players were sent for the wrong reasons. (Carlos Boozer over bad-boy Rasheed Wallace pretty much sums it up.) And even though I don't necessarily disagree with the move, USA Basketball decision to totally overhaul its methods of preparing for the Olympics had the wrong motivations.

I'd be a little less cynical about their efforts if not for the selection of Diva K as the national team coach. If you're supposedly wanting to prepare for the international game, picking a tyrannical-type coach who spends most of his time in the college game -- a brand no more similar to FIBA than the NBA -- doesn't indicate much seriousness about completing the task at hand.

It's more of a PR move than anything else. If the pro coaches can't keep the players "in line", of course the answer is to introduce a famous "hard-nosed" coach used to lording his power over kids.

The rest of the moves I've heard of seem to be reactions to radio-show gripes from the 2004. Rebuffing Iverson is a show for the world that they don't want a star-driven team and bringing Bruce Bowen on is some kind of symbol of the "team concept". (As if Diva K is an anonymous figure; even more relevant, he's not above pulling rank on his bosses to get a raise, either, as he did during his dalliance with the Lakers.)

I don't mind Bowen being on the team -- because (after R. Artest) he's one of the best perimeter defenders in the NBA -- but it's an outgrowth of the notion that you need role players on a team such as this. You need that during the season when a team has only a handful of stars. When you don't have to contend with the draft or a salary cap, do you really need to have role players? How is it that the U.S. National women's team doesn't need "role players"?

Just preaching to the choir, I know.

Regards,

[name withheld]

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Negligence and Fan Injuries from Pregame Tosses

Sports Law Blog reader Will Li passes on news from the State of Washington, where a state appellate court in Taylor v. Baseball Club of Seattle (Mariners) upheld a trial court's ruling that a Mariners fan who was struck in the face with a pregame warm-up toss had assumed the risk. The injury happened in 2000. Specifically, about two hours before a Mariners-Rangers game, Delinda Middleton-Taylor was standing in the fourth row down the right-field line. She was trying to locate seats for herself, her two sons, and her boyfriend. At that moment, a throw by Jose Mesa overshot its target--Freddy Garcia--and it directly hit Taylor's eyeglasses, shattering them, and causing pieces of glass to cut into her cornea. To this day, she continues to suffer from blurry vision (for more background, see Peter Lewis, "Appeals Court Rejects Claim of Injured M's Fan," Seattle Times, Mar. 1, 2006).

Taylor asserted that such an injury had never been documented before in a major league baseball game, and thus it was impossible for her to have assumed its risk. She also argued that the Mariners failed to incorporate warm-up methods used by other teams, and that they should have had a formal policy prohibiting pitchers from practicing near the stands.

The Mariners argued that their duty to protect spectators from balls entering the stands was satisfied by providing a protective screen behind home plate and Taylor--who had already been to Safeco field in the past and had watched Mariners game on TV--was familiar with baseball, Safeco Field, and the inherent risk of balls entering the stands, and therefore had assumed the risk of her injury.

The appellate court agreed with trial court's granting of summary judgment for the Mariners. The Mariners showed that Taylor had a "full subjective understanding of the specific risk, both its nature and presence, and that she voluntarily chose to encounter the risk." In making this conclusion, the court noted (and I added the numbering for clarity):

1. [I]t is undisputed that the warm-up is part of the sport, that spectators such as Taylor purposely attend that portion of the event, and that the Mariners permit ticket-holders to view the warm-up. Therefore, we reject Taylor's attempt to delineate between portions of the event and assign varying standards of care to the defendant . . . warm-ups are integral to the game of baseball and a spectator assumes the risk of being struck by a baseball during warm-ups.

2. There is no evidence that the circumstances leading to Taylor's injury constituted an unusual danger. It is undisputed that it is the normal, every-day practice at all levels of baseball for pitchers to warm up in the manner that led to this incident. The risk of injuries such as Taylor's are within the normal comprehension of a spectator who is familiar with the game. Indeed, the possibility of an errant ball entering the stands is part of the game's attraction for many spectators.

3. [As] to whether the risk of injury would be foreseeable to a reasonable person with Taylor's familiarity with baseball, the record contains substantial evidence regarding Taylor's familiarity with the game. She attended many of her sons' baseball games, she witnessed balls entering the stands, she had watched Mariners' games both at the Kingdome and on television, and she knew that there was no screen protecting her seats, which were close to the field. In fact, as she walked to her seat she saw the players warming up and was excited about being in an unscreened area where her party might get autographs from the players and catch balls.

Will Li asks some good follow-up questions:

It's interesting that she was hit when standing in the fourth row of right field - the article says that it's uncertain if Freddy Garcia, the target of Mesa's throw, was able to touch the ball, but you really have to wing a ball to get it up in the fourth row, and at that point, it's unlikely that the target of the throw is going to be able to get anywhere near it.

Would the woman have been better of suing Mesa and not the Mariners, since the action involved wasn't actually part of a game?

So who was in the best position to prevent the harm: Taylor or the Mariners? And what was the significance of the injury being a "fluke" -- couldn't that cut both ways? As to Taylor not suing Mesa (or Garcia), that is an interesting point, and I suspect it is because Mesa would argue that he was reasonably performing his employment functions, and that an accident simply occurred. But I wonder why Taylor didn't sue her eyeglass company -- aren't most eyeglasses supposed to be "shatter proof" or I am wrong about that?

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Trivia Question of the Day

Sports Law Blog reader and Roger Williams law student Thomas Santanello shares a trivia question: Is this the NBA or the NFL?

* 36 have been accused of spousal abuse.
* 7 have been arrested for fraud.
* 19 have been accused of writing bad checks.
* 117 have directly or indirectly bankrupted at least 2 businesses.
* 3 have done time for assault.
* 71 cannot get a credit card due to bad credit.
* 14 have been arrested on drug-related charges.
* 8 have been arrested for shoplifting.
* 21 currently are defendants in lawsuits.
* 84 have been arrested for drunk driving in the last year.

Answer here.

Although these statistics--as the source correctly notes--are mere urban legend, they are based on an underlying truth (i.e., a higher percentage of congresspersons break the law or behave badly than we assume), and they seem to beg the question: Why don't we spend more time worrying about the trouble-making lawmakers we elect than about the trouble-making NBA and NFL players we follow? And shouldn't we expect more of congresspersons than NBA and NFL players? And yet despite frequent scandals and poor behavior, over 90 percent of U.S. Representatives and U.S. senators are somehow re-elected, and many even run unopposed. Quite a democracy we have.

So, to do our part, we at Sports Law Blog should probably write more about stories that matter-- the Jack Abramoff lobbying scandal, Tom Delay's indictment, Duke Cunninghman's bribery plea--than whether Allen Iverson should be able to wear a doo-rag or whether Greg Oden should be able to enter the NBA Draft.

Nah, forget that. Back to Iverson and the Olympic Team snub . . .

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"Bloody Thursday" on the Horizon?

I have been monitoring the NFL's attempts to extend its collective bargaining agreement (CBA) over the past few months. Like most people, I just assumed it would get done. After all, the NFL has been the model of labor peace since the crippling 1987 strike. The league is consistently cited as the pinnacle of the professional sports leagues. But now, it appears that the league and the players cannot reach an agreement and there labor troubles are afoot.

Len Pasquarelli has an excellent summary of the next step, if an agreement cannot be reached by 4pm today.

By Thursday, however, when the real-world ramifications of the failed labor talks become more apparent, fans in a lot of NFL precincts will take notice. With negotiations toward an extension having broken off Tuesday afternoon -- despite earlier optimistic reports that the sides were poised to strike an agreement -- salary cap managers from several franchises are readying themselves for what one general manager suggested late Tuesday will come to be known as "Bloody Thursday."


Translation: Because so many teams are up against the projected cap limit of $95 million to $96 million for 2006, and the lack of a CBA extension means there are few options for relief, some big-name players will be jettisoned by Thursday, when teams must be in compliance with the spending limit.


"In past years, you'd see a lot of guys released who maybe still had some name value but who were really in decline in terms of production," said one AFC team executive who was working late Tuesday, trying to figure out how to pare down a prohibitively bloated cap figure. "This year? People are going to be stunned -- not just by the quantity of players who are cut by Thursday but by the quality, too. It's going to be ugly. There's going to be blood in the streets and, compared to past years, it's going to be from some bluebloods, guys who can still play."

I recommend the entire article.

It appears that both the players and the owners stand to lose a significant amount from the lack of an agreement and playing 2007 as an "uncapped" year. How much this will hurt football remains to be seen, but as with all things at the top, there is nowhere to go but down.

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