The Coming Federalization of Anti-Doping Policy

Just this past week, a Congressional subcommittee held a hearing on the recent Starcaps decision out of the Eighth Circuit. (I wrote about that decision here, and not all that favorably.) To refresh your recollection, the court decision allowed two NFL players, both named Williams and both playing defensive tackle for the Minnesota Vikings, to assert claims for damages against the NFL in state court. The players argued that the NFL's anti-doping policy violates Minnesota state law governing workplace drug testing. The NFL's position was that, even if the NFL policy and state law conflict, state law claims are preempted by federally protected collectively bargained agreements. The "Starcaps" court said they weren't. So we're left with the prospect of two NFL players having violated the NFL anti-doping policy with apparent impunity. We're left with two NFL players (or one team of players) subject to one (more lenient) set of rules, and everyone else subject to the NFL's more punitive policy. One league; different rules.

Pretty clearly, the NFL and interested members of Congress are not pleased. Roger Goodell testified at the hearing, asking the Congress to intervene by reasserting the supremacy of federal law and federally protected collectively bargained agreements over state law. The Players Association's executive director, DeMaurice Smith, along with most of the other witnesses at the hearing, advised the Congress to delay action on the grounds that the Minnesota court could still see things the NFL's way, or that the Minnesota state legislature might amend its law to accommodate the NFL's policy.

I can't speak to the politics in Minnesota's state house. But I can offer an opinion on the legal case: nothing's going to change. No good result for the NFL can possibly come out of the state court proceeding. If the Eighth Circuit's decision stands, the drug-testing policy of the NFL and other sports leagues has been balkanized. It's a done deal; the NFL policy is as good as dead. By waiting, the Congress is only inviting a crisis. And the crisis will not produce the modest intervention prescribed by Goodell and another witness at the hearing; instead it will result in the Congress' sweeping takeover of anti-doping policies for all sports. The union, which should have asked the Congress to protect the collective bargaining process, will instead find its players subject to a set of rules much harsher than ever before.


1. As it relates the the NFL anti-doping policy, the Minnesota state trial that looms in March 2010 is irrelevant. Indeed, it's on that precise ground (that the state case and the NFL CBA are not relevant to each other, thus rendering the state case not preempted) that the federal court allowed the state case to proceed. So how can the state case uphold or reaffirm the NFL policy? The state court will have nothing to say about the NFL policy. I think the suggestion made to the Subcommittee that things can somehow turn out all right in Minnesota is unsupportable. The Minnesota court could, in theory, read Minnesota's law to mirror the current NFL policy, but this suggestion (also made at the hearing) is very dubious. Minnesota's law prohibits any suspension for the first positive test; the NFL policy mandates a four-game suspension without pay. How can those opposites be reconciled? Remember, a Minnesota state trial judge already granted the players a preliminary injunction on the grounds that the players would "likely succeed" on their claims that the NFL's policy violates Minnesota law. These players will win. As far as the NFL policy is concerned, of course, they already have.

2. Regardless of any interpretation of state law by a state court, what's on the books is a decision by a federal appellate court that holds that players may assert state-created rights to avoid being subject to the league's anti-doping policy. Nothing in the opinion limits this principle of law to the NFL; the same reasoning should apply to the policies of other professional sports leagues. Indeed, nothing limits it to the pros; some courts have held that NCAA scholarship athletes comprise "employees" for state law purposes, so perhaps even amateurs will be able to challenge drug suspensions, should they live in a state that has a law in disagreement with the testing protocols of the governing body of the sport.

3. We're not just talking of a few states that have, like Minnesota, workplace drug testing laws more protective of worker rights than the NFL policy. Nearly all states are home to a professional team in some sport. Potentially, the state law of any of these states could form the basis for nullification of a drug suspension. These state laws could also change, as of course they are subject to legislative amendment and judicial interpretation. How effective would a sport league's anti-doping policy be if it were limited by the "most protective" state law? State laws vary a lot on this subject. Some require all tests be based on suspicion; some limit sanctions; some place limits on the means by which urine samples are taken. Writing a policy that complied with all applicable state laws would be difficult.

4. More importantly, the resulting "state-law-proof" policy might not serve the needs of professional sports. State laws on workplace conduct are written with typical workers in mind. In that setting, careful proscription of testing procedures and significant allowances for rehabilitation of the worker make sense, given the typically long employment relationship and given the substantial investments worker and employers make in each other. In the NFL, however, careers are short and pay and public salience is high. Players are well-compensated for their agreement to submit themselves to more rigorous testing procedures; the public attention the league earns makes the teams interested in providing that compensation to present the public a clean image. The short career suggests that swift punishment, not interminable rehabilitation, provides the preferable response to the first positive test. Finally, the need for competitive balance on the playing field requires that players who have helped themselves to an unfair pharmacological advantage need to be removed from the field, not sent to mid-week counseling meetings.

5. Soon enough we'll see other athletes go through the door opened by the Vikings' defensive tackles, challenging drug suspensions in state courts. Indeed, in the wake of the Starcaps case, what competent lawyer for a player would fail to assert a state law claim? Remember, because this claim is not based on the CBA, the players union has no say in the matter, as it would ordinarily in an arbitration claim. The player need only retain a private lawyer for hire to file suit and needs nobody's permission to bring that suit. State courts and state laws will soon define the permissible boundaries for doping policy in major sports. It won't take much of this for the federal Congress to intervene.

6. And when the Congress intervenes, I predict it will do so in a forceful way. Uninterested in the legal complexities of federal law preemption, lacking faith in the collective bargaining process, and perhaps responding to a public outcry, the Congress will proceed to adopt national drug-testing standards for all professional and amateur sports. Most likely these standards will mirror the very strict and most intrusive rules of the World Anti-Doping Association. No one's going to be very happy if this comes to pass.

7. The unions and the Congress could have avoided this path had the unions and the other panelists agreed with the recommendation that Congress intervene currently, but in a modest, surgical way. The Congress was advised at the hearing to adopt a simple measure: amend Section 301 of the Labor Management Relations Act to preempt any state claim that would conflict with any drug-testing policy incorporated as part of a valid collective bargaining agreement. This small measure would have in a stroke of the President's pen taken all the sting out of the Starcaps case and completely insulated sports CBA's from the vagaries of state law. It would also have upheld the significance of the collective bargaining process in sports. It would have maintained the union's relevance by giving the players a voice in establishing doping policy. Instead, they will one day find themselves subject to doping policies set by WADA: a group of unseen people in far away countries, an organization over which American athletes and American sports leagues will have no influence.

The Starcaps Case and the Impending NFL Labor Fight

The recurring drama of the National Football League season is off to a great start, except for the part where my beloved Patriots took it on the chin last week against the hated Jets. Looming over all the optimism of a new season is the much-anticipated labor crisis that threatens a return to the strike-filled era of the late part of the last century, an era in which sports unions flexed their young muscles against entrenched management interests. All football fans are hoping for an interruption-free continuation of America's most popular spectator sport.

For the most part, the job of the courts is to stay on the sidelines during labor negotiations. Their limited role is to police unfair labor practices and keep the parties negotiating. On occasion, in the course of a negotiation or immediately afterwards, courts are also called on to affix the scope of the non-statutory labor exemption. The importance of this exemption cannot be overstated. The non-statutory labor exemption basically means this: it's "non-statutory" (that is, a court made it up); and it's a "labor exemption": not an exemption from federal or state labor laws, but an exemption that exempts "labor" from the federal anti-trust law. That's right. Labor unions and management interests can together reach agreements and otherwise act in concert in ways that violate federal antitrust law, and no one can do anything about it. A private agreement to break the law renders the law invalid.

Which brings to mind the recent decision of the United States Court of Appeals for the Eighth Circuit in the matter of the Minnesota Vikings' defensive tackles, Kevin and Pat Williams, against the NFL in the "Starcaps" dispute. The appellate court upheld the trial judge's decision to subject the NFL's steroid-testing policy to the dictates of Minnesota's drug testing workplace act.

As I said, courts don't often get much involved in labor negotiations. But they can sure mess them up.

1. The issues are a bit too complex to submit to easy summary, but at the nub of the case is whether or not federal law "preempts" state law. Kevin and Pat Williams tested positive for a weight-loss substance, apparently a common masking agent to hide steroid use. It appears the players ingested the substance by taking "Starcaps," an unregulated dietary supplement. The players were suspended by the commissioner's office (acting as arbitrator of the validity of the test) in keeping with the NFL's Steroid Policy, which policy was negotiated between the NFL and the players' union. The NFL's drug testing procedures, however, may not comply with Minnesota's state law that sets the parameters for workplace drug testing schemes in Minnesota. So the issue is this: may the NFL and its players agree to a policy that violates state law, just like they have agreed to many policies (such as the NFL draft) that violate federal law?

2. There's a lot more going on in this case than just who gets to play defensive tackle for the Minnesota Vikings. On the one hand, you might wonder why any two people or parties should ever be at liberty to agree to anything that violates the law. After all, if the State of Minnesota has decided that no Minnesota worker in any context should be drug-tested without the careful adherence to stated procedures and opportunities for appeal, why should NFL workers be treated any differently? The point of Minnesota's law is prevent anyone from agreeing to anything less, no matter what pressures the employer may bring to bear. Aren't those pressures every bit as substantial in the NFL, with its short player careers and the constant threat of contract termination?

3. On the other hand, the NFL is undoubtedly trying to run a business on a national scale. The NFL rightly argues that, if this decision stands, players in each state could theoretically be subject to differing rules insofar as steroid testing goes. The next version of the collective bargaining agreement will have to be written in terms of the "lowest common denominator": the most pro-worker state statute will by necessity form the bottom floor for any national testing plan, assuming the NFL and NFLPA want a single, national standard for all its players. This result requires more than a big legal research project: the supposed effectiveness of the NFL's current policy could be significantly undercut if testing conditions and player sanctions were limited by Minnesota law. (The Minnesota statute, for example, precludes an employee from discharge without first being relegated to treatment; the NFL policy provides for strict liability for all positive tests and requires an immediate four-game suspension for first-time offenders.)

4. The Eighth Circuit court was a little flippant in its dismissal of the NFL's arguments. Quoting from another court's opinion, the Eighth Circuit stated that "[federal labor law] did not give employers and unions the power to displace any state regulatory law they found inconvenient." The federal Congress did not "wish to give the substantive provisions of private agreements the force of federal law, ousting any inconsistent state regulation." (This quote came from a Supreme Court decision.) This is unconvincing. Private agreements override laws all the time. Private agreements determine legal rights. I own my laptop computer: if you borrow it without my agreement, you're a thief; with my agreement, you're a borrower. What is the nonstatutory labor exemption but a private agreement to waive federal law as it applies to the subjects of that agreement? The law is not in place to preclude private agreements; it's there as a "default rule," to supply a fictitious agreement where none was reached explicitly.

5. The better approach for the court would have been to ask whether federal law should empower these particular parties to form an agreement to override contradictory state law provisions. It should. These are well-represented antagonists who are very fully aware of their rights and interests and are both willing to make horse trades on all aspects of employment, including drug-testing protocols and procedures. Agreeing to a relatively intrusive steroid testing program might serve the interests of both the NFL and the NFLPA, given the league's salience in the public mind and its appeal to America's youth.

6. A decision that significantly handicaps the latitude of permissible agreements that the NFL and the NFLPA may strike creates one additional impediment to a successful bargaining resolution. The Eighth Circuit's opinion, remember, in effect prohibits the negotiators from striking any deal on a steroid policy that violates Minnesota law. It will render a successful negotiation more problematic. And any future change in law, in Minnesota or elsewhere, could also render a negotiated resolution immediately obsolete. Courts tend to defer to collectively bargained agreements in resolving labor disputes for good reason. Judicial pronouncements on the terms of labor usually do little good.

Final Word On Delaware Lottery Decision

By the title of this entry I don't mean my final word. I'm referring to the very recent decision of the U.S. Court of Appeals for the Third Circuit, which decision most likely comprises the final word of the federal judiciary on Delaware's planned sports lottery. Here's the link to the court's opinion.

I've complained previously about the unnecessary haste with which this court decided to resolve this important legal issue. If this decision stands, as most likely it will, then it represents the permanent resolution of Delaware's status under the federal PASPA statute. It's an important issue, one of salience to Delaware's ability to take advantage of its unique status under federal law. That Delaware's federal exemption from PASPA should have been conclusively resolved, and resolved in a way apparently contrary to the spirit of the law and to Delaware's expressed sovereign interest in raising state revenue, is problematic. That this resolution was done in the hasty manner normally reserved for cases involving the potential loss of constitutional rights (abortion, free speeech) is even more troubling. No threat to life or liberty necessitated this action.

The court's opinion justified the rush to judgment as follows: "When a party seeks injunctive relief, the stakes are high, time is of the essence, and a straightforward legal question is properly presented to us, prudence dictates that we answer that question with dispatch." This statement may sound convincing, but it seriously misstates the law. It is simply not true that "when a party seeks injunctive relief" that that fact alone means the "stakes are high" and "time is of the essence." The plaintiff (here the professional sports leagues) has to prove that time is of the essence and quick judicial action is needed. The leagues tried to prove that the stakes were high and time was of the essence before the trial judge in this case, and failed to convince that judge to issue the injunction. No new proof of the need for haste was offered (or could be) to the appellate court; indeed, the appellate court specifically refused to address the issue of the potential of "irreparable harm" should the injunction stopping Delaware not be granted.

The fact of the matter was that there was no hurry. The NFL and the NCAA in particular, whose games are already subject to widespread and much-discussed betting action, would likely suffer no harm at all (never mind "irreparable" harm) should Delaware have been allowed to go forward with its lottery scheme. To imply that there would be harm and that Delaware's lottery plan required emergency judicial intervention seems doubtful, if not incorrect.

What we're left with is the claim that, because in the court's view no factual issues remained for resolution and because the legal issue was "straightforward," then the appellate court should proceed to conclusively resolve Delaware's statutory authority. This is not the law that the Supreme Court decision from which this authority is derived, the 1986 Thornburgh decision (about which I've written previously), expressly established. The Thornburgh decision did allow for final appellate resolution of a case on an emergency basis. But in a majority opinion (that collected only four votes) Thornburgh made clear that such an intervention "deviated from the stated norm" and that an appellate court should "ordinarily limit its review to abuse of discretion," and not to a resolution on the merits. The Supreme Court made plain that such intervention was justified in a "constitutional case" where "the unconstitutionality of the particular state action is clear." The Court also noted in Thornburgh that the appellate process in that particular case was benefitted by "an unusually complete factual and legal presentation from which to address the important constitutional issues at stake."

Obviously, no issue of constitutional rights, important or otherwise, was presented by Delaware's plan to expand its state lottery. No "unusually complete factual and legal presentation" was available, particularly considering that the entire case was litigated in a matter of weeks. Prudence did not "dictate" that the appellate court act with dispatch; it dictated the opposite. The claim that the stakes were high militated in favor of holding a trial on the merits, not rushing forward without one.

On the merits of the federal law, the appellate court limited Delaware to offering a lottery game "to the extent" it offered a game in 1976. Thus Delaware may offer parlay bets involving at least three games, and only on NFL games, because that is "the extent" to which Delaware offered bets in 1976. However, the court continued, Delaware's new game may differ from the 1976 game in "certain aspects," such as at what betting locations the game is offered. In short, the court held that Delaware may introduce changes to the game "as long as they do not effectuate a substantive change from the scheme that was conducted" in 1976.

This reasoning begs the question. The whole issue in the case was whether or not shifting from a three-game bet to a single game bet constitutes a "substantive change" from the 1976 game. For the court to tell Delaware that it may make non-substantive changes but not substantive changes tells Delaware nothing new. And when the appellate court holds, as a matter of law, that a change from a three-game bet to a single-game bet is a "substantive change," then the appellate court is resolving a factual issue, and is doing so without the benefit of a trial record.

Here's the factual issue: Is a three-game bet all that different (and different enough to be "substantive") from a single-game bet? The outcome of both bets involves a lot of luck; certainly the three-game bet involves more luck, but most sports gamblers would say that even winning a single-game bet against a point spread involves a lot of luck as well. Is the limited skill involved in a sports bet all that more prevalent in a single-game bet as opposed to a parlay? Is the greater degree of skill in a single-game bet enough of a difference to make the bet "substantively" different than that made in 1976? That's the issue the appeal presented. The issue presented cannot logically supply the rationale for the court's decision. Yet in the Third Circuit it did.

A trial on this point would have been very illuminating. Experts would have testified as to the mathematical differences between parlays and single-game bets; a trial judge would have marshaled and assessed the evidence in creating a record for appeal. Instead, the appellate court resolved the appeal on the merits because the court decided that there were no factual issues left in the case.

Assuming factual issues away doesn't make them go away, not really.

Delaware's Next Step

I have only a few minutes this morning, but with the phone ringing and emails chirping I want to try to offer a few comments on the dark day in Delaware.

1. The decision of the appellate court to convert the preliminary injunction appeal into a decision on the merits is problematic. But it's not unprecedented. Federal courts may do this, as the Supreme Court allowed in the 1986 Thornburgh decision involving a statute limiting abortion. The court can rule on the merits "when the facts are established or of no controlling relevance." It's a controversial decision and should be used only in "unusual cases," as the Court admonished in the Thornburgh opinion.

2. It appears from reports in the popular media that Delaware's counsel conceded that the facts were established, thus obviating the need for a trial. This concession, if true, befuddles me. (Granted, I get confused easily.) Why would Delaware's counsel essentially tee the ball up for the appellate court to rule on the merits? Especially when it appeared, from the (reported) tenor of the hearing, that this particular panel of judges was strongly inclined to rule in favor of the sports leagues? Really, without a trial record (there's never been a trial), how could the appellate court know that the "facts are established" unless the appellate counsel conceded as much?

3. What facts could be developed at a full trial that are relevant to Delaware's statutory exemption from the federal PASPA statute? First, what bet exactly will Delaware offer? I understand that Delaware's plans on this point are incomplete at this time. If they are incomplete, then it is possible that Delaware could devise a game that fit within the PASPA exception. Second, what game exactly did Delaware offer back in the mid-1970's? Delaware offered several games, and changed one in mid-season. All of these games involved NFL bets. Which 1975 bet defines the lottery game that Delaware may now offer? One game involved parley bets requiring picking winners of at least four contests and also picking the point spread for the game. Is that game all that Delaware may offer today? Third, a trial court would take evidence, in the form of expert opinion, as to whether a single-game bet was different in some meaningful, qualitative or quantitative way from a parlay bet. Does the game involve different outcomes, or put the counterparties to the bet in a significantly different position than they were in 1975?

4. The most significant problem with the appellate court's apparent decision on the merits is that the briefing on which it ruled was incomplete. The only element of a preliminary injunction that has anything to do with the legal merits of the case is that the court is to determine if the plaintiff is "likely to prevail" at trial. Lawyers briefing this issue will of course discuss the law as it relates to this element. But they will also spend much of their brief and much of their oral argument discussing the other issues relevant to a preliminary injunction, most notably the possibility of irreparable harm to the plaintiff and the chance of undue hardship on the defendant. In other words, the key legal issue, here the issue about the scope of Delaware's exception under the federal statute, gets only partial consideration in a preliminary, emergency action. The briefing and argument on this legal point are nowhere as substantial as they would be on an appeal devoted to that issue exclusively.

5. The federal statute at issue is a complicated one, and the legislative history that surrounds it is fairly voluminous. Many statements can be found in that history that support Delaware's position; many also can be found that favor the position of the leagues. To resolve this complex legal issue on the basis of incomplete briefs and no factual development, and to rule that Delaware is permanently stopped from enjoying its exception under PASPA in the way that Delaware interprets that exception, strikes me as unnecessary judicial lawmaking. This isn't an abortion case: no salient legal rights or human lives might be affected by the court's ruling. There was no need for the court to take this hasty action, based on a spontaneous and probably ill-advised concession by Delaware's counsel during oral arguments.

I hope Delaware has the wherewithal to fight this decision, either by direct appeal or by a collateral attack on the federal statute.

Not the End in Delaware

Today the U.S. Court of Appeals ruled on a motion for a preliminary injunction brought by the NFL and other sports leagues against the state of Delaware over its plan to offer a sports lottery. The injunction is a preliminary injunction, not a permanent one. It prevents Delaware from offering the sports betting games, for now, until a full trial adjudication can consider the legality of Delaware's plan at a more reasonable pace. So, as a legal matter, Delaware is no worse off today than it was before today; it had no sports bet lottery, and for the near future, it will continue with none. It may take a year to resolve the issue more dispositively, and if Delaware wins, it will be able to offer the games in time for the 2010 NFL season, if not sooner.

Even as a temporary measure, the court's ruling today seems problematic. Like many judges when given a chance to intervene in a legal dispute, the court of appeals failed to give adequate attention to the elements of the process that are designed to limit emergency judicial action to the most severe of cases. For a federal court to intervene so strongly at this stage, and most notably against the wishes of a sovereign state, threatens the presumption of latitude that underlies the delicate federal-state balance. And it's also a bad way to make law.

1. No harm has happened yet. Delaware has not offered a sports bet. At this stage, a court may intervene only if the plaintiff, in this case the professional sports leagues, will suffer a harm from the delay in adjudication that is "irreparable." In other words, the leagues must prove (1) that they will suffer a harm from Delaware's lottery, (2) that that harm will happen between now and (let's say) one year from now (at which time final adjudication would likely be completed), and (3) that that particular harm will be "irreparable," either by the granting of a permanent injunction or by an award of money damages. On all counts the leagues should have lost.

2. First, are the leagues harmed at all by Delaware's plan? Gambling on sports, especially on NFL games, the Super Bowl, and the NCAA's March Madness, is a very common legal and illegal practice that produces an industry that totals billions of dollars in transactions. Sports gambling has been going on for years, apparently without blemish to the leagues' reputations (and at considerable enhancement of their fan interest). How would the leagues be harmed by one more state (joining Nevada) offering a bet? Delaware's plan was to offer the game by contracting with privately owned "racinos" who would create a casino-based sports book: to a bettor, the game would appear indistinguishable from that offered by a sports book in Las Vegas. The fact that the state owned the game means only that Delaware would be the residual claimant on any profits, instead of collecting monies through a tax. How would the leagues be harmed?

3. Look at the leagues' arguments. They claimed they would be harmed in two ways: through fans doubting the integrity of close penalty calls by game officials, and by children being led to gamble by the fact that their sports heroes were playing a game on which gambling was conducted. Again, how would the advent of a comparatively small Delaware game bring about these concerns? Would a fan yelling about a call be more likely to think the officials bribed than the fan thinks already? Remember, millions of dollars rides on game outcomes today, without Delaware's modest entry. As for the children, they know that professional athletes play sports for money. (Indeed, I suspect that's precisely why so many children aspire to be professional athletes.) How would knowing that others also enjoy sports in part along a financial dimension corrupt them, or to be precise, corrupt them more than they might be corrupted already?

4. Second, the leagues must prove they would be harmed not by the fact of sports betting, but by the judicial delay in reaching a more deliberate result. Would one season of NFL sports betting in Delaware harm the leagues? In other words, if Delaware offered its game, and then after the season a federal court rules that Delaware's game violates state or federal law and thus must be stopped, the leagues must prove that this temporary game caused the leagues some harm that they otherwise would have avoided. Most likely Delaware's nascent sports game would likely be small. Delaware and its contracted agents would be unlikely to make large investments in a game that could be subsequently ruled illegal; plus Delaware would have to spend some time ironing out the processes for the game, such as how it should obtain the best point spreads, how to market the game, how to share in profits, and the like. It seems doubtful that a temporary, small game could harm the giant leagues irreparably.

5. Third and finally, the leagues have to prove that the harm from this temporary game would be irreparable by a later injunction or money damages. Assuming Delaware offered the game for one NFL season, then the NFL upon winning permanent relief would be right back where it is now, with widespread betting on its games but with the tiny game in Delaware ruled illegal. Surely a permanent injunction, even coupled with some payment or disgorgement by Delaware of its profits from the game, would fully protect all the NFL's interests. The fact that the NFL is now partnering with (non-sports) lotteries in other states suggests that the NFL's interest is as much monetary as moral anyway.

6. The fact that the law limits judicial intervention to cases where the plaintiff can establish the threat of "irreparable harm" suggests that courts should prevent defendants from planned conduct only in the rare case. So too does another key element in a motion for a preliminary injunction, specifically that the court must determine that the preliminary injunction, if granted, would not cause "undue hardship" on the defendant. Delaware and its contracted parties, I would presume, have already spent some time and money in developing this game. More importantly, if it is later determined that Delaware may legally offer this game, but was prevented from doing so by a wrongfully granted injunction, then Delaware would have lost one year's worth of profits from its lottery game. Estimates of the value of this game vary. But Delaware could recover its lost profits from the NFL and the other plaintiff leagues. Do the leagues realize they could be on the hook for millions of dollars in damages should Delaware turn out to be acting lawfully? The trial judge, in implementing the injunction, should require the leagues to post a substantial bond payable to the state of Delaware should it turn out the leagues, in their haste for a quick judicial victory, have led the courts down the wrong path. Make the leagues put their money where their mouth is.

7. The Circuit Court's decision did not decide the case "on the merits." We don't know any more now than we did before about whether or not Delaware's planned lottery game is legal under federal and state law. In ruling on a motion for a preliminary injunction, the court is only to decide on whether or not the plaintiff is "likely to prevail." This is at best an offhand, brief look at the law. Unfortunately, given the contemporary willingness of courts to issue emergency relief, it is not uncommon that this brief prediction as to the likelihood of success becomes the de facto law of the land. Often once defendants lose at the preliminary stage, they give up trying to pursue their legal rights. If Delaware stops now and does not seek a ruling on the merits after a full trial, then today's appellate ruling on a preliminary injunction will become permanent federal law.

The emergency processes for temporary injunctions were not designed to produce statements of law. That they were used as such today by the NFL and the other leagues only exacerbates a trend of using the threat of legal action, rather than the rule of law itself, to influence others to behave in preferable ways. It is the rule of law, and the rule only, that should limit Delaware's options on raising revenue from its citizens.

The (Un)Importance of American Needle

To most everyone's surprise, the American Needle litigation has found its way to the U.S. Supreme Court. When that court grants cert it's usually to reverse, but because of the strange posture of this petition (both sides sought the grant), the usual rules don't apply.

Plenty of commentators have reviewed the appeal and discussed its prospects before the high court. What has surprised me is the discussion of the decision's potential ramifications. Judging from the weight of expert opinion, if the NFL prevails, the players will suffer complete reversals of the wage and work condition gains from the past several decades. For a particularly notable example, see this article by ESPN's Lester Munson. Under the understated title, "Antitrust Case Could Be Armageddon," Munson paints a picture of owners gone wild: players bound to their teams for life, baseball games barred from cable broadcast, extravagantly expensive game mementos, and players retaliating with widespread strikes. It's a bleak picture; one can only hope Judge Sotomayor comes to the court's rescue, much like her court (thought it) did during the baseball strikes decades ago.

I'm more than a little dubious about these conclusions. I doubt the Supreme Court will use the American Needle litigation to make the pronouncement about the nature of the NFL's business and its relation to antitrust law that the NFL wants it to. Even if the Court obliges the NFL, I doubt that any of the predictions Munson and other commentators make will come true. In short, there will always be an NFL, regardless of what the Court writes.

1. First of all, I thought it was the common consensus that professional athletes are overpaid? Doesn't that mean owners are underpaid? It's a zero-sum game. If we want athletes to make less money, then we have to empower the owners to cut back salaries.

2. But, one might ask, would empowering the owners (should the NFL win the Needle appeal) necessarily come at the expense of the players? In other words, wouldn't the fans also get ripped off, as Munson suggests? I don't see this happening. I assume that every sports franchise is in a competitive market for fans. Each team competes against all the other entertainments and leisure activities which fans might consume in lieu of spectator sports. If the market is competitive, or even approximately competitive, then if the price of spectating is raised the teams will lose profits, no matter if those profits eventually accrue to the owners or the players.

3. Should we, as spectators, care much about who wins the battle between the players and the owners? As long as players command a sufficient salary to keep them from leaving the field, and owners make enough to maintain their investments, why should fans care? Maybe we as fans prefer the current era of comparative player liberty (free agency, arbitration rights, limitations on draft rights), but a lot of anecdotal evidence suggests fans like when players stay on the home team.

4. What may underlie concern about the American Needle case is a preference for the labor side. That's fine, as far as it goes, but really shouldn't be conflated with a concern over the well-being of fans. And even on the labor issue, I doubt that a pro-owner decision in American Needle would do much to alter the balance of power. Undoubtedly the NFL players have had a great deal of historical success attacking the NFL's labor practices under antitrust law. But contemporary courts have adopted a more modern view of business practices. They understand that most significant markets are national in scope, if not international, and that some degree of cooperative behavior among firms is necessary to produce cost-savings and other efficiencies to allow firms to compete. Undoubtedly the NFL today competes in a national market. It will adopt whatever rules on player movement and salary rates that best position it to compete for the nation's attention. In other words . . .

5. Assume the NFL wins and the owners were allowed complete collusion. To put the case more strongly, assume that the NFL were purchased by a single owner and run as a single business. Would the owner prohibit all player movement, despite the attention the league earns from the draft, trades, and free agency? Would the owner eliminate terminable contracts? It strikes me that the NFL already has all the rules in place it wants.

6. Would player salaries diminish? Few employees take salary diminishment lying down. The NFL's salary structure could change, with more wages being devoted to the star and less to the star's complements. Look for quarterbacks to make more; left tackles less. One historic effect of unions is to redistribute salary among themselves. Have the unions also increased the total amount of salary distributed to players? Yes, if we assume that the collective bargain extracts a larger amount of money devoted to labor than would a series of individual negotiations without the constraint of salary slotting and the implicit sharing demanded by unionization. That's a large and very contestable assumption. In any event, it's unlikely the union or the collective bargaining agreement will go away.

7. I'm not saying that the case is insignificant; if the court resolves the case on any but the narrowest grounds, it would give the NFL a significant victory and clear away any antitrust worries for the league when it operates outside of the collective bargaining agreement. But the real balance of power is struck in the CBA; the union is endemically weak because the short-term nature of the NFL player career makes it so. Nothing the court says about antitrust law will change that.

8. As for professional leagues other than the NFL, the newer ones (see Major League Soccer) have from their inception organized in order to appear a "single entity" for antitrust purposes. The older leagues don't have the luxury of starting from scratch. But what would stop the owners in a league from selling their shares to a common company and then "redistributing" owner-like authority back to the former franchisees? It might appear a cynical attempt to avoid antitrust problems, but how would this device be any different from MLS? Recall a few years ago when some wealthy person put in a bid for the entire NHL at a very substantial price? He argued that if he bought the whole thing he could achieve efficiencies that are lost in a league with individual, non-cooperating owners. In other words, along many dimensions it makes business sense for the leagues to act as a single entity. If the courts decide they can't act as a single entity, then they can reorganize to achieve it anyway.

Will Selig Reconsider Rose?

A few months ago I was given a chance to speak at the annual meeting of the Baseball Historical and Sociological Conference, an esteemed group of baseball historians and other researchers. I used my time to argue a favorite point in my agenda, specifically that Major League Baseball should allow Pete Rose to be admitted into the Hall of Fame. I hoped to kindle in these influential baseball scholars a small spark that might set off some reconsideration of Rose's case. I'm sure I failed. Nonetheless, since it appears that Commissioner Selig is about to reconsider the matter, I wanted to disseminate my small contribution to a wider audience. I put the paper on SSRN.

Here's a link to download the paper.

The paper will be published in print form in the periodical, "Nine: A Journal of Baseball History and Culture," in the fall.