Sports Agencies Representing Both Players and Ownership: Conflict-of-Interest or Common Sense?

Less than a month ago, Rick Karcher wrote an excellent post about the movement of Hollywood talent agency Creative Artists Agency (CAA) into the business of representing sports coaches, and how this new business unit conflicts with CAA's primary line of business -- representing athletes. Professor Karcher's full post is available here.

Keeping with this theme, on October 1, Street & Smith's Sports Business Journal reported that CAA "has signed a long-term deal to represent the Yankees for sales and marketing as the team prepares to move into a new Yankee Stadium in 2009." Signing this new Yankees deal means that while one CAA agent, Casey Close, is representing shortstop Derek Jeter in his negotiations against the Yankees, others will represent the Yankees against third parties.

This newest representation leads me to wonder the following questions:

(1) Is it ever appropriate for a sports agency to represent both owners and players in the same sport?

(2) If so, are there any safeguards that could prevent the exchange of sensitive business information between members of the agency? (For example, are firewalls between player-representation divisions and team-representation divisions a feasible solution?)

(3) Should either federal or state governments regulate the sports-agent business by defining certain relationships as impermissible?

(4) Given that, pursuant to the NLRA, players associations delegate a share of their exclusive bargaining authority on behalf of the players to a list of certified sports agents, should players associations consider decertifying those agents that share profits with agents that represent ownership?

I am not sure if there are easy answers to any of these questions, but I hope this post leads to some debate.

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