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Old 06-09-2010, 03:15 PM   #1
houghtam
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Default NFLPA files challenge to TV deals

What's everyone else's opinion on this?



The NFL Players' Association is challenging the structure of the NFL's television contracts in a filing Wednesday to special master Stephen Burbank of the University of Pennsylvania.

The NFLPA is arguing that the league essentially set up a 2011 lockout protection fund with the structure of its TV deals.

The union announced its legal filing in a story on its website, NFLPlayers.com.

The union, in its filing, argues that the NFL's guaranteed $4 billion in television revenues combined with the elimination of $4.4 billion in player salaries would make 2011 a profitable season for the owners even if no football is played because of a lockout.

The league's television contracts for the 2011 season provide for the networks to pay the league even though there would be no games during a lockout. The union argues that this agreement was made to the detriment of the players and is, in fact, a weapon to be used against the players in the lockout.

The union is asking Burbank to order the league to put all TV money in an escrow instead of distributing it to the owners during the lockout. This would, obviously, produce significant leverage for the union.

If the television money is put into an escrow account, the owners would be forced to find other funds to make interest payments, stadium payments, and other bills that continue to accrue during a lockout.

"It appears that the owners bought a strategy to lock players and fans out and nonetheless financially protect themselves," Baltimore Ravens cornerback Domonique Foxworth, a member of the NFLPA's executive committee, told NFLPlayers.com. "The players want to leave no stone unturned to make sure that CBA negotiations proceed in good faith and that next season is played in its entirety."

The NFL currently has television contracts with ESPN, NBC, CBS, Fox and DirecTV.

The NFL defended its television contracts in a statement Wednesday, calling the union's challenge "meritless."

"The television contracts that the union attacked [Wednesday] were agreed to during the worst economy in our lifetimes. Far from failing to maximize revenue, the contracts grew league revenue to fund higher player salaries and benefits," league spokesman Greg Aiello said.

"No wonder [NFLPA executive director] DeMaurice Smith said publicly this year, 'My hat's off to [NFL commissioner] Roger Goodell. Television is locked up until 2014 to the tune of about $5 billion a year.' The union's meritless charges, including many inaccuracies, will be addressed in the proper forum, but they are simply a distraction and do nothing to get us any closer to a new CBA," Aiello said.



IMO, I don't see a problem with how the NFL owners structured the deal, they're entitled to protect their profitability, and I would argue even moreso when faced with the looming threat of no NFL season in 2011. If they were to lose this suit and be forced to put the $400 million in escrow, wouldn't the owners be able to come right back and force all the players to put in escrow any money made while marketing themselves as an NFL product (i.e. all of it)? I don't know a ton about law, but it seems like that argument could be made if the other one succeeded.
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Old 06-09-2010, 03:23 PM   #2
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I'm shocked the TV companies didn't protect themselves against a lockout season. They have to pay the NFL even if there aren't games played? That's insane!
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Old 06-09-2010, 03:24 PM   #3
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I'm not sure where they think this will go. What were the owners supposed to do? Is the league supposed to try and make deals that leave them with their pants down during a financial crisis? If there's demand for your product to the point where people agree to pay even in the event of a lockout, that's just good negotiating on your end. You could argue that their insurance policies against lockouts are in the same vein and "unfairly protecting themselves financially."
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Old 06-09-2010, 03:30 PM   #4
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To me, DeMaurice Smith continues to look more like a moron with each passing day.
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Old 06-09-2010, 03:30 PM   #5
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Quote:
Originally Posted by houghtam View Post
What's everyone else's opinion on this?



The NFL Players' Association is challenging the structure of the NFL's television contracts in a filing Wednesday to special master Stephen Burbank of the University of Pennsylvania.

The NFLPA is arguing that the league essentially set up a 2011 lockout protection fund with the structure of its TV deals.

The union announced its legal filing in a story on its website, NFLPlayers.com.

The union, in its filing, argues that the NFL's guaranteed $4 billion in television revenues combined with the elimination of $4.4 billion in player salaries would make 2011 a profitable season for the owners even if no football is played because of a lockout.

The league's television contracts for the 2011 season provide for the networks to pay the league even though there would be no games during a lockout. The union argues that this agreement was made to the detriment of the players and is, in fact, a weapon to be used against the players in the lockout.

The union is asking Burbank to order the league to put all TV money in an escrow instead of distributing it to the owners during the lockout. This would, obviously, produce significant leverage for the union.

If the television money is put into an escrow account, the owners would be forced to find other funds to make interest payments, stadium payments, and other bills that continue to accrue during a lockout.

"It appears that the owners bought a strategy to lock players and fans out and nonetheless financially protect themselves," Baltimore Ravens cornerback Domonique Foxworth, a member of the NFLPA's executive committee, told NFLPlayers.com. "The players want to leave no stone unturned to make sure that CBA negotiations proceed in good faith and that next season is played in its entirety."

The NFL currently has television contracts with ESPN, NBC, CBS, Fox and DirecTV.

The NFL defended its television contracts in a statement Wednesday, calling the union's challenge "meritless."

"The television contracts that the union attacked [Wednesday] were agreed to during the worst economy in our lifetimes. Far from failing to maximize revenue, the contracts grew league revenue to fund higher player salaries and benefits," league spokesman Greg Aiello said.

"No wonder [NFLPA executive director] DeMaurice Smith said publicly this year, 'My hat's off to [NFL commissioner] Roger Goodell. Television is locked up until 2014 to the tune of about $5 billion a year.' The union's meritless charges, including many inaccuracies, will be addressed in the proper forum, but they are simply a distraction and do nothing to get us any closer to a new CBA," Aiello said.



IMO, I don't see a problem with how the NFL owners structured the deal, they're entitled to protect their profitability, and I would argue even moreso when faced with the looming threat of no NFL season in 2011. If they were to lose this suit and be forced to put the $400 million in escrow, wouldn't the owners be able to come right back and force all the players to put in escrow any money made while marketing themselves as an NFL product (i.e. all of it)? I don't know a ton about law, but it seems like that argument could be made if the other one succeeded.
Sorry players. Just because the owners know how to cover their own asses and you all don't, does not mean you are entitled to their money. Hey, here's an idea, don't allow this to happen with the new bargaining agreement...
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Old 06-09-2010, 03:31 PM   #6
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Quote:
Originally Posted by STBumpkin View Post
I'm shocked the TV companies didn't protect themselves against a lockout season. They have to pay the NFL even if there aren't games played? That's insane!
Not when you consider the money they make on the NFL. They got into this deal knowing the possibility existed and that they'd still make money off of it - even if happens on the back side in the next round of negotiations.
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Old 06-09-2010, 03:34 PM   #7
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Quote:

"It appears that the owners bought a strategy to lock players and fans out and nonetheless financially protect themselves," Baltimore Ravens cornerback Domonique Foxworth, a member of the NFLPA's executive committee, told NFLPlayers.com. "The players want to leave no stone unturned to make sure that CBA negotiations proceed in good faith and that next season is played in its entirety."


Hey, don't lump the fans in there Foxworth. I fully appreciate that the owners have bills to pay even if they are doing it with replacement players. They've got a league to protect. The owners bought a strategy to keep the lights on.
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Old 06-09-2010, 03:59 PM   #8
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Seriously, if the players had any kind of decent representation, they would not have allowed things to get this far. Owners can't help it if the NFLPA shot themselves in the foot by allowing the RFA contract structure for 2010 and the possibiltity of an uncapped 2011 season if there is no new CBA.

IF the players had decent representation then that representation would have told them to start re-negotiating the CBA last year. But, they decided to let a sleeping tiger sleep and now they are basically screwed. The owners have absolutely no incentive to start negotiating now. They have their expenses covered by the TV contract and they can hire scabs if need be. The NFLPA is just farting into the wind right now. Most of the players probably aren't smart enough to cover their own asses if there is a strike or a lockout which means they will come to the negotiating table eager to resolve the situation.
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Old 06-09-2010, 04:04 PM   #9
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What do I think?

I think I want a title like "Special Master."
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Old 06-09-2010, 04:14 PM   #10
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Quote:
Originally Posted by Kaylore View Post
I'm not sure where they think this will go. What were the owners supposed to do? Is the league supposed to try and make deals that leave them with their pants down during a financial crisis? If there's demand for your product to the point where people agree to pay even in the event of a lockout, that's just good negotiating on your end. You could argue that their insurance policies against lockouts are in the same vein and "unfairly protecting themselves financially."
Exactly. WTF do they think this multi billion dollar juggernaut is going to do, take a break??


Mmmkay.
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