Larry Brown Settlement Terms: $18.5 million

Cablevision, the parent company of the New York Knicks, has disclosed the terms of its previously confidential settment with ex-coach Larry Brown. Brown, who had filed a claim for $53 million ($41 million due under the contract and an additional $12 million in damages), accepted an offer of $18.5 million. While this is less than half of what he claimed he was due, it is still a nice chunk of change for doing no work.

You can read the entire 10Q at the SEC's EDGAR database here, although the only relevant paragraph is:

On June 22, 2006, the New York Knicks, a division of Madison Square Garden, L.P., notified the then-head coach of the Knicks, Larry Brown, that his employment had been terminated with cause pursuant to his employment agreement with the Knicks. Mr. Brown disputed the Knicks’ right to terminate his employment with cause and the matter was referred to the Commissioner of the National Basketball Association (“NBA”), who had the authority under the agreement to resolve all disputes. On October 30, 2006, the parties reached a settlement of this matter under which the Knicks agreed to pay Mr. Brown $18,500 of the disputed amount in connection with his employment agreement, which amount has been accrued for in the accompanying financial statements as of September 30, 2006.

All dollar amounts are listed in "thousands of dollars," so you have to add three zeroes to the figure listed. You know that writing this paragraph was the highlight of some securities lawyer's week.

For previous Sports Law Blog writing on this dispute, see:

Letter to Mr. Stern: Larry Brown's Award Should be All or Nothing (September 30)

Larry Brown is Grieving (June 29)

Is There a Disney Case Against Cablevision Over the Larry Brown Contract? (May 16)

HT to UT Law 3L and Sports Law Association Prez Justin Stone for calling this news to my attention.

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Paper Release: Fantasy League Use of Players' Names and Stats

Last August, I discussed the ruling of the Eastern District of Missouri in C.B.C. Distribution and Marketing, Inc. v. Major League Baseball Advanced Media, L.P., which held that fantasy league operators do not violate the players' right of publicity by using their names and performance statistics without consent. I'm pleased to announce that my recently completed article entitled, The Use of Players’ Identities in Fantasy Sports Leagues: Developing Workable Standards for Right of Publicity Claims, will be published in the Winter Issue of Penn State Law Review. An unedited draft of the article can be downloaded here. I encourage you to read it and I welcome your comments.

My article contains an in-depth analysis and application of right of publicity law to fantasy sports leagues, including a discussion about the business and economics of the fantasy sports league industry, the policy considerations involved and the application of the First Amendment. My article explains why the federal district court wrongly decided the case, and attempts to define workable standards in a confusing area of law. The article will be published in February, and the Eighth Circuit Court of Appeals is scheduled to hear the case in late spring.

Michael McCann is currently working on a paper entitled, The Wonderlic Test for the NFL Draft: Linking Stereotype Threat and the Law, which can be downloaded from the link to Michael's articles on SSRN. Michael was a guest at my law school today, and each of us presented our papers. I want to thank Michael on behalf of our student body and faculty, who thoroughly enjoyed his presentation.

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Bidding for Matsuzaka Poses Interesting Legal Issues

Today at 5:00 p.m ET, the bidding rights to Japanese pitcher Daisuke Matsuzaka will end. At that time, MLB will inform the Seibu Lions of the winning bid — without identifying the team — and Seibu has until Nov. 14 to accept or reject the bid. The team with the winning bid will then have 30 days to negotiate a contract with Matsuzaka and his agent Scott Boras. If no deal is reached, Matsuzaka returns to Japan and the major league team will be refunded its posting fee, which is predicted to reach as high as $30 million. See Bob Nightengale, USA Today, Matsuzaka market nears close.

ESPN Magazine writer Buster Olney raises a fascinating issue:

The posting system is deeply flawed. For example, here's one sabotage scenario that might interest a team like Baltimore, which is faced with the possibility that Matsuzaka will land with either of the big market monsters in its division, the Yankees or the Red Sox. The Orioles could post a huge bid -- say $50 million -- and blow everybody else out of the water. With exclusive negotiating rights, they then could offer Matsuzaka a take-it-or-leave-it, strategically structured bid, like a 10-year, $5 million-per-year deal. Matsuzaka and agent Scott Boras, with just 30 days to negotiate and with no ability to generate a competing bid from another major league team, would have the stark choice of taking the Orioles' lowball offer or remaining in Japan. If Matsuzaka came to the U.S. under those circumstances -- and that would seem very unlikely -- the Orioles would have a frontline pitcher for less than the total package that everybody expects it will cost to get Matsuzaka. And if he were to stay in Japan after such a lowball offer, the Orioles would get their posting fee back and would still serve their own purposes, as well, by keeping him out of the hands of the Red Sox and Yankees.

I suppose the one "check" on the bidding system is that the MLB team that gets the winning bid would have an implied obligation to negotiate in good faith with Boras. But "good faith" is one of the most difficult concepts to apply in contract law -- What does it mean and how do you prove a breach? I suppose the winning team could argue that the bid price should be taken into account when negotiating Matsuzaka's salary, and thus the bid price should be included with the player's negotiated salary in determining Matsuzaka's fair value. But the counter to that would be that the bid price is merely consideration paid to the Japanese team for the rights to the player, and that his value, for purposes of good faith negotiation, should be looked at separately. If so, what is the standard for determining his fair value? Is Boras entitled to an amount based upon what the player would get in an open free agent market? If so, that value would be difficult to ascertain when the bid process completely eliminates the ability to determine his value in an open market. Or is a portion of the bid price consideration for the MLB team not having to negotiate with other teams in an open market, and thus the player is not entitled to an amount equal to what Boras could get in an open market?

Now, switch gears, because there is another interesting legal issue arising out of the bid process for Matsuzaka. Boras represents the top pitchers competing in the open free agent market this year: Zito, Maddux and Weaver. It's definitely in Matsuzaka's best interest to sign with an MLB team than to go back and play in Japan, even if the contract is something less than what Boras could get in an open market. But is it in the best interest of each of these three pitchers for Matsuzaka to sign right now? Because if Matsuzaka signs, it would eliminate a team who is in dire need of a premier starter from otherwise bidding in an open market for their services in a few weeks, which would obviously impact the bargaining leverage of each of them in the open market. More to the point, what if the team that gets the winning bid is a free-spending team like the Yankees or Red Sox? How would Boras juggle the best interest of each of the four players in that scenario?

UPDATE (Nov. 14): It was reported yesterday that the Red Sox made the highest bid at $42 million! This bid reportedly far exceeded any other team's offer.

UPDATE (Nov. 15): It has just been reported that the Red Sox actually bid $51.1 million for the negotiation rights, and that the Seibu Lions (obviously) accepted the bid.

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The Origins of the List of Baseball Greats in Flood v. Kuhn

One of the oddest things about the Supreme Court case of Flood v. Kuhn, where the court reaffirmed baseball's antitrust exemption, is the following passage from Justice Blackmun's opinion:

Then there are the many names, celebrated for one reason or another, that have sparked the diamond and its environs and that have provided tinder for recaptured thrills, for reminiscence and comparisons, and for conversation and anticipation in-season and off-season: Ty Cobb, Babe Ruth, Tris Speaker, Walter Johnson, Henry Chadwick, Eddie Collins, Lou Gehrig, Grover Cleveland Alexander, Rogers Hornsby, Harry Hooper, Goose Goslin, Jackie Robinson, Honus Wagner, Joe McCarthy, John McGraw, Deacon Phillippe, Rube Marquard, Christy Mathewson, Tommy Leach, Big Ed Delahanty, Davy Jones, Germany Schaefer, King Kelly, Big Dan Brouthers, Wahoo Sam Crawford, Wee Willie Keeler, Big Ed Walsh, Jimmy Austin, Fred Snodgrass, Satchel Paige, Hugh Jennings, Fred Merkle, Iron Man McGinnity, Three-Finger Brown, Harry and Stan Coveleski, Connie Mack, Al Bridwell, Red Ruffing, Amos Rusie, Cy Young, Smokey Joe Wood, Chief Meyers, Chief Bender, Bill Klem, Hans Lobert, Johnny Evers, Joe Tinker, Roy Campanella, Miller Huggins, Rube Bressler, Dazzy Vance, Edd Roush, Bill Wambsganss, Clark Griffith, Branch Rickey, Frank Chance, Cap Anson, Nap Lajoie, Sad Sam Jones, Bob O'Farrell, Lefty O'Doul, Bobby Veach, Willie Kamm, Heinie Groh, Lloyd and Paul Waner, Stuffy McInnis, Charles Comiskey, Roger Bresnahan, Bill Dickey, Zack Wheat, George Sisler, Charlie Gehringer, Eppa Rixey, Harry Heilmann, Fred Clarke, Dizzy Dean, Hank Greenberg, Pie Traynor, Rube Waddell, Bill Terry, Carl Hubbell, Old Hoss Radbourne, Moe Berg, Rabbit Maranville, Jimmie Foxx, Lefty Grove. The list seems endless.

The list is not only endless, but a classic example of the kind of sickening sentiment that infects so much of American sports jurisprudence. There are a lot of great stories about this list, such as a clerk from another chamber jokingly inquiring as to the omission of a particular player and receiving a detailed memorandum justifying the player's exclusion a few days later, as well as the story that Justice Marshall originally planned to dissent from the opinion given the list's omission of any African American players (some were subsequently added).

Now, via the Volokh Conspiracy, I've learned of an exciting new paper, Blackmun's List, by Northeastern University law professor and former Baseball Hall of Fame scholar-in-residence Roger Abrams. Along with a recent book on the Flood case, this article promises to enhance understanding about a classic opinion from sports law. You can download the paper for free from this link.

In skimming the paper, it's obvious that Professor Abrams is amused by Blackmun's list. He refers to it as a "curious and quite exceptional paean to the appellee in what was a critical sports law decision . . . ." While the paper is still in draft form (i.e., it contains some odd formatting, some blanks to be filled in at a later date, and will likely go through some organizational reworking), it does offer some interesting perspectives from a veteran sports law teacher on this odd passage and some of the names on the list. I look forward to reading the finished version.

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New Sports Law Scholarship

New this week is a collection of articles from last spring's Willamette Law Review symposium on "The Future of Sports Law":

Michael A. McCann, Social psychology, calamities, and sports law, 42 WILLAMETTE LAW REVIEW 585 (2006)

Jeffrey Standen, The beauty of bets: wagers as compen-sation for professional athletes, 42 WILLAMETTE LAW REVIEW 639 (2006)

Jack F. Williams, The coming revenue revolution in sports, 42 WILLAMETTE LAW REVIEW 669 (2006)

Chad Ford, Peace and hoops: basketball as a role player in sustainable peacebuilding, 42 WILLAMETTE LAW REVIEW 709 (2006)

Richard T. Karcher, Solving problems in the player representation business: unions should be the “exclusive” represen-tatives of the players, 42 WILLAMETTE LAW REVIEW 737 (2006)

Timothy Davis, Regulating the athlete-agent industry: intended and unintended consequences, 42 WILLAMETTE LAW REVIEW 781 (2006)

Maureen A. Weston, Internationalization in college sports: is-sues in recruiting, amateurism, and scope, 42 WILLAMETTE LAW REVIEW 829 (2006)

James A.R. Nafzinger, The future of international sports law, 42 WILLAMETTE LAW REVIEW 861-876 (2006)

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CBS Mostly Loses Case Against Former Broadcaster Brent Jones

Yesterday, Judge Chin of the U.S. District Court for the Southern District of New York issued an opinion dismissing the bulk of the CBS network’s claims against former football commentator and one-time 49er tight end Brent Jones. Jones walked away from CBS in the middle of week four of the 2005 NFL season, purportedly to spend more time with his family. The problem, in CBS’s eyes, was that Jones had been paid on a weekly basis between January and October, 2005 (based on an annual salary of $200,000). Yet at the time he quit, Jones had only called three games that season (out of 17). CBS sued to recover 14/17 of the money it had paid Jones.

In his opinion in CBS Broadcasting Inc. v. Jones, 2006 WL 3095916 (S.D.N.Y. Nov. 2, 2006), Judge Chin largely dismissed CBS’s breach of contract and unjust enrichment claims against Jones. The judge explained:

The Agreement does not reference the number of football games Jones was expected to call each year, nor does it contain a provision for the return of any payment to CBS in the event Jones terminated the Agreement prematurely. Rather, paragraph 19 of the Agreement provides in relevant part that: "If Contractor or Artist at any time materially breaches any provision of this Agreement ... CBS may ... reduce Contractor's compensation pro rata, and/or CBS may, by so notifying Contractor during or within a reasonable time after such period, terminate this Agreement." "[P]ro rata" is not defined.

Thus, some ambiguity:

Here, the Agreement is not wholly without ambiguity. It provides that in the event that Contractor or Artist breaches, CBS may "reduce Contractor's compensation pro rata," but it does not define "pro rata." Nonetheless, as between the two competing interpretations before the Court, I conclude that a reasonably intelligent and objective person could give the Agreement only one interpretation--that "pro rata" means a proportion based not on the number of games called out of seventeen, but rather, on the number of weeks out of the year the Agreement was in effect.

First, the express language of the Agreement undermines CBS's argument. . . . Second, the Agreement does not include any language to support CBS's position There is no reference to the number of games that Jones was obligated to call per year. Thus, there is no explanation for CBS's contention that Jones was obligated to call seventeen games, the number of games in the NFL's regular season. Furthermore, there is no provision in the Agreement for reimbursement in the event of a breach by Jones. The remedy set out in the Agreement is reduction and/or termination. CBS, in accordance with the Agreement, terminated the contract at the time of breach. If the parties had contemplated the extraordinary remedy of reimbursement in the case of a breach, they surely would have spelled that out in the Agreement.
Third, CBS's interpretation does not make sense. The number of games was not specified. There could have been more than seventeen games, including exhibition games, playoff games, and the Pro Bowl. Also, Jones's obligations were not limited to calling games. The Agreement references other duties, such as attending seminars, program conferences, and trade shows.

The court also dismissed CBS’s unjust enrichment claims, since under New York law there can be no claim in quasi-contract where a valid contract sets forth the parties’ rights.

The court did, however, preserve one small piece of CBS’s claim:

The amended complaint alleges that Jones improperly charged certain personal expenses to CBS, through his corporate credit card and otherwise. If any personal expenditures charged to CBS remain unpaid, Jones shall reimburse CBS. The Court is hopeful that the parties can resolve this issue themselves.

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Drew Brees Wants No Part in his Mother's Political Campaign

New Orleans Saints quarterback Drew Brees has told Mina Brees, his mother and an Austin attorney, to stop using his picture in TV commercials while she runs as a Democrat for a spot on Texas' 3rd Court of Appeals that reviews civil and criminal cases. The commercial in question includes a picture of Drew Brees in a San Diego Chargers uniform (his former team) and notes Mina Brees' football ties, which includes being the daughter of a successful high school coach and the sister of a former University of Texas quarterback.

Drew says he called his mother and asked her to stop running the ads, and when she did not return his calls or stop using his image, his agent sent her a letter threatening legal action. According to Drew, the commercials were sending a message of, " 'If you don't know much about the election, vote for me because I know Drew' . . . and that is a shame because the political process should be decided on your credentials." But according to Mina, "everything in the ad was true" and she did not anticipate it upsetting her son. She said the connection to football is relevant to her campaign because through sports, her father, Ray Akins, taught her a strong work ethic that she would bring to a career as a judge. Mina says a version of the spot that omits references of Drew was taped last week and sent to TV stations last Friday.

I don't care to play the role of family therapist with this post. Instead, I want to focus in on Drew's agent "threatening legal action." In addition to sports law, I teach torts and this would make a perfect hypothetical exam question for my Torts II class where we discuss one of my favorite areas of the law, the right of privacy and defamation.

Drew would lose on defamation because there is no false statement in the ad (i.e it's a photo of Drew and Drew is actually Mina's son), nor is there anything being said about Drew that would be considered "defamatory" (i.e. that would subject Drew to hatred, ridicule, or contempt).

There are three potential right of privacy claims to analyze here: Right of publicity; misappropriation; and false light. Right of publicity is the "use of the plaintiff's name or likeness, without consent, for the defendant's commercial advantage." The misappropriation tort protects against intrusion upon an individual's private self-esteem and dignity (similar to a public disclosure of private facts claim), while the right of publicity protects against commercial loss caused by appropriation of an individual's name or likeness for commercial exploitation. Here, there is no pecuniary loss to Drew and Mina has not reaped any financial gain from the use of Drew's identity. It would also be difficult for Drew to establish that Mina's use of his identity in trying to get elected as a judge resulted in any "commercial" advantage. Because Drew is a famous NFL quarterback and public figure, misappropriation would not be successful either because Drew would probably have a hard time convincing a judge or jury that the use of his name in the public arena intruded upon his private self-esteem and dignity resulting in emotional harm. A public disclosure of private facts claim fails for the same reason, and in addition because there are no "private" facts being disclosed in the ads.

Drew's best claim against his mother would probably be false light. For this claim, it is not necessary that the statements be defamatory; all that is required is that the defendant placed the plaintiff in a false light that would be "highly offensive to a reasonable person." Although the statements in and of themselves may be true, a cause of action can be established if the statement implies untrue and unfavorable acts taken, or views held, by the plaintiff. Here, for example, Drew could say that the use of his identity in the ads implies that he supports his mother's campaign, when in fact he does not. There is one big problem however....Texas, like some jurisdictions, doesn't recognize a separate cause of action for false light.

Oh well Drew, I tried my best....

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