Greedy NFL Owners and Players
The poor NFL owners and players can’t agree on how to divide $9 billion a year. Last Friday, the owners and players broke off labor negotiations hours before their contract expired. The union was decertified and the league imposed a lockout signaling the NFL's first work stoppage since 1987. Ten players, including MVP quarterbacks Tom Brady and Peyton Manning, sued the owners in federal court in Minneapolis.
It seems as though the sides whittled down the disagreement to “just” $185 million on how much owners should get up front each season for certain operating expenses before splitting the rest of the revenues with players — a far cry from the $1 billion that separated the sides for so long. But the NFL Players Association refused to budge any further without getting detailed financial information from each team.
By dissolving and announcing it no longer represents the players in collective bargaining, the union cleared the way for class-action lawsuits against the NFL, which opted out of the collective bargaining agreement in 2008. The antitrust suit — forever to be known as Brady et al vs. National Football League et al — attacked the league's policies on the draft, salary cap and free-agent restrictions such as franchise-player tags.
Invoking the Sherman Act, a federal antitrust statute from 1890 that limits monopolies and restrictions on commerce, the players are seeking triple the amount of damages they've incurred. That means the stakes here could be in the hundreds of millions. It could take a month for there to be a ruling on the union's injunction request, and antitrust judgments should take longer.
The court fights eventually could threaten the 16 game 2011-12 season for a league whose past two Super Bowls rank as the two most-watched programs in U.S. television history. The last time NFL games were lost to a work stoppage came when the players struck 24 years ago, leading to games with replacement players.
I don’t know for whom to feel more scorn in this dispute. The average player salary in 2009 was about $1.8 million. The highest paid is reported to be Tom Brady with an average of $18 million over four years. The league minimum is $295,000 just for being on the roster for three games. I don’t know about you, but I’ll hold Tom Brady’s clipboard for that amount – even all 16 games.
It’s virtually impossible to know how much money the owners make or what they do on their income statements to hide/mask earnings. These enterprises are not publicly owned, except for the Green Bay Packers, so the release of financial data is optional, and there’s the rub for the players. Why should they trust the owners who claim poverty?
Some criticize the current league “revenue sharing agreement” that calls for only television revenues to be shared among the 32 teams but not team revenues. At the same time the operating expenses have to be shared equally across all teams. This is a great deal for Jerry Jones who spent $1.2 billion to build the Palace in Dallas, a stadium with a maximum capacity including standing room of 110,000. The stadium is the largest domed stadium in the world, has the world's largest column-free interior and the largest high definition video screen which hangs from 20 yard line to 20 yard line. It must cost a small fortune in annual operating expenses and I’m sure the other 31 teams are just thrilled to be paying for Jerry’s excesses.
So, what will happen on September 8 when the season is scheduled to begin? My guess is an agreement will be reached well before then so there is ample time for the exhibition season. Otherwise, regularly scheduled games may have to be replaced by exhibition games and there will be a lot of angry fans. But don’t fret because a new reality TV show is in the works called the Real Players of the NFL. Bravo will sponsor the show for 16 segments plus 4 all-star segments in Andy Cohen’s Clubhouse.