Eighth Circuit Court extends stay; NFL owners gaining traction in Brady case

On May 16, more than two weeks after the U.S. Court of Appeals for the Eighth Circuit issued a temporary stay of Judge Susan Nelson’s decision to lift the NFL lockout, the Eighth Circuit has decided it will extend the stay.

“[W]e have serious doubts that the district court had jurisdiction to enjoin the League’s lockout, and accordingly conclude that the League has made a strong showing that it is likely to succeed on the merits” the Court stated in its written decision.

While many would, and rightfully so, take this as an indication of the court’s opinion on the player’s ability to succeed on their claim that they will suffer irreparable harm if the lockout continues, the decision will necessarily extend the lockout at least until the June 3 hearing to determine the legality of Judge Nelson’s ruling.

While the NFL owners seem to have built a good deal of leverage and momentum in the Eighth Circuit, the players are working another angle that could ensure that if the owner’s were to succeed in the Eighth Circuit, they would have a tough time collecting the money owed to them by the television networks who agreed to make payments in case of a work stoppage. By agreeing to this “lockout insurance” with the television networks, the league breached its fiduciary duty to the players by not maximizing the deals’ overall value. Because of this action, viewed by the court as the league not acting “in good faith,” the players will be awarded damages by Judge David Doty, a judge whom the NFL has tried to remove from litigation in a number of instances, due to what they feel is a bias toward the players. While the players are hoping to use the “lockout insurance” damages that will presumably be issued as a bit of insurance themselves, it’s important to remember that all decisions will be subject to an appeal in the Eighth Circuit, where the players have taken a beating over the last few weeks.

And while all the legal wrangling is still in progress, many players who depended on the relatively small per diems and workout stipends granted over the offseason are looking for alternative ways to maintain their lifestyle. One player recently took a $500K loan, at 23% interest, that amounts to a whopping $115,000 in interest per year.

The real question, in this writer’s mind, isn’t if the players and owners can get a reasonable deal done. With over $9 billion in annual revenues, and teams of highly qualified (and highly-compensated) lawyers representing each side, an agreement should be made shortly before the proverbial ‘clock strikes midnight.’ But, in all reality, if players are taking on such lopsided financial stipulations with short-term turmoil, can anyone really expect that they have enough cash stored away to make it through a full season without football? That fact may force them to step back to the bargaining table a bit earlier than they would like, and take a deal that they wouldn’t necessarily take if they were flushed with cash. While that may be advantageous to football fans in the near future, it certainly doesn’t bode well for enduring labor peace.

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