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Northwestern University Football Players Can Unionize

By [Sunday, March 30th, 2014]

Read the National Labor Relations Board decision here. Read an analysis of the decision, and its impact on the future of college sports here.

New York Law School 5th Annual Sports Law Symposium

By [Monday, January 27th, 2014]

NCAA Athletes Continue the Battle to Reclaim and Profit from their Publicity Rights

By [Monday, December 16th, 2013]

ncaa_money_mgnBY KIERSTEN MCKOY, NYLS ’14

Imagine if there was a billion dollar industry in which consumers bought products based off of characters that were designed to look and move like you. Imagine that these characters were built like you–same height, weight, skin tone, hairstyles, hair color– wore your clothes, and had your mannerisms. Imagine people lining up each year to buy the products because they expected to see you or even better, they wanted to pretend to be you. Imagine all of this was created without your permission. A whole empire built on your image worth $1.3 billion. Now imagine you have not received a dime.

E.A. Sports, a division of Electronic Arts, Inc. that develops and sells video games mimicking some of the world’s most popular athletic competitions and their athletes, has settled all of the class action lawsuits brought against the company by former and current athletes over the unauthorized use of the players’ images and likenesses in the video games and other merchandise. The lawsuits include those brought by former UCLA basketball star Ed O’Bannon, former Rutgers quarterback Ryan Hart, former Arizona State quarterback Sam Keller, and former West Virginia running back Shawne Alston. Each suit alleged that current and former players deserved a share in the billion dollar video game industry that profited off of their images without their permission. Both former and current players (estimated to be between 200,000 and 300,000) will get their share of $40 million dollars that E.A. Sports will have to pay as a result of the settlement. While the payoff does not amount to much, this is the first time that current college athletes can be paid for their appearance in the video games (though the effect on their NCAA eligibility will be in question).

However, several issues remain. First, the settlement with E.A. Sports does not create any legal precedent. The athletes may be entitled to a few hundred dollars each, depending upon how many players have chosen to join the class action suit. However, this does not prevent E.A. Sports, the NCAA, or others from continuing to use the players’ images without their permission in the future. Before athletic participation begins each year, college athletes are required to sign a Student-Athlete Statement confirming that they are amateurs and forfeiting any rights, including the right to compensation and to their images and likeness, in perpetuity. While the athletes have alleged that E.A. Sports’ use of their images is unauthorized, the court has not yet ruled on the matter and E.A. Sports has not admitted any wrongdoing as part of the settlement. This leaves a lot of uncertainty about what will happen in the future.

Second, the NCAA was not a part of the settlement, which means that battle over the use of a player’s likeness is far from over. In a November 8th ruling, Unites States District Judge Claudia Wilken certified the class of current and former college athletes solely for injunctive relief. That means if the plaintiffs prevail in the suit, they can prevent the NCAA from using their images (and profiting from them) without their permission in the future, but cannot collect damages.  Correspondingly, now that the NCAA is no longer at risk of a huge damages award, the organization is unlikely to settle and will continue to require college athletes to waive their publicity rights every year, and to enforce those waivers.

Third, if any current player named as a plaintiff in the lawsuit accepts money—whether from a damages judgment or a settlement—the player’s remaining eligibility could come into question under the NCAA’s strict amateurism policy.  Thus, it is unclear if current players will be able to negotiate their own licenses with companies like E.A. Sports, without affecting their amateur status with NCAA.

Last, the consumers and the schools have lost. E.A. Sports has chosen not to manufacture NCAA College Football starting at the beginning of next year after the NCAA and major athletic conferences like the Pacific-12, Big Ten and Southeastern have bailed, refusing to allow E.A. Sports to use its logos for their upcoming video games. Millions of video gamers will not be opening NCAA Football ‘15 under the tree next year, a disappointment for the games avid fans and players. For top tier schools, the NCAA Football game is worth more than $75,000.00 per year—which is almost double the average national salary for U.S. workers in 2012. Schools will no longer receive these checks with the loss of the video game.

Currently, the resolution of these issues remains a question, but it is clear that both current and former athletes are demanding an overhaul of an organization that has strictly governed their lives during their four years on campus and has profited off their backs.

Firing the $20-million man: Lane Kiffin’s Rights Under His USC Coaching Contract

By [Sunday, September 29th, 2013]

Kiffin.USCFired for cause by the Oakland Raiders in 2008, Lane Kiffin forfeited $2.6 million in remaining contract salary for his abysmal coaching judgment and media skills.  He ended his tenure there with a 4-15 record.

In one season with the University of Tennessee in 2009, Kiffin managed to commit 12 NCAA secondary violations and incur personal liability for $800,000 in liquidated damages for bailing on UT with 5 seasons left on his contract.  Under Kiffin, UT went 7-6.

And yet, for some reason, in 2010, Lane Kiffin landed a $20 million, 5-year contract to coach University of Southern California.  Now the question is, how much of that will he be able to keep?

After a tumultuous 3+ seasons, USC unceremoniously fired Kiffin following the Trojans’ 62-41 loss to ASU on September 28, 2013.

kiffin.UTMost likely, USC will have to pay Kiffin for the remaining years on his contract — almost $8 million.  We can’t say for sure because USC is a private school and the contract terms are available only to a few people.  But it’s safe to assume the contract includes the standard provision requiring the school to “buy out” any remaining guaranteed contract salary owed to the coach unless he is fired for cause. See here for Kiffin’s employment contract with the University of Tennessee — Article XVI contains such a provision.

Cause to fire a coach usually includes:

  1. disability or death;
  2. conduct by the coach or someone under his supervision. at the employer institution or elsewhere, amounting to a major violation of NCAA, conference, or university rules;
  3. neglect of duties, including the duty to supervise those on his staff with respect to compliance matters;
  4. fraud, dishonesty, or gross misconduct in performing the job;
  5. failure to cooperate in the school’s promotional and media activities;
  6. words or actions that disparage the institution;
  7. violation of state or institution ethics laws
  8. criminal conviction;
  9. sports gambling;
  10. illegal drug use or impairment due to alcohol or drug abuse;
  11. acts of moral turpitude; or
  12. material breach of some other provision of the contract.

See here for a helpful summary of the key elements of typical multi-year coaching agreements at Division 1 schools.

kiffin.RaidersNow, having said all that, what would you do if you were USC?  What might have USC already done to prepare for this moment?  Has the school been as crafty as Al Davis? Back in 2007, Davis (R.I.P.) started creating a record to fire Kiffin for cause by calling him out on his misrepresentations about and aspersions against his own team.  When he finally pulled the plug on Kiffin, he had sufficiently documented Kiffin’s misconduct that the NFL arbitrator denied Kiffin’s claim for his guaranteed salary.

What could USC have on Kiffin?  Well, there was that minor recruiting violation his first month on the job, when he picked up a recruit from the airport in a limo.  He arguably committed a second recruiting violation by tipping ESPN back in 2012 about a player he was recruiting.  But neither of these probably rise to the level of cause for termination in a well-worded contract.  And given Kiffin’s history, his lawyer probably closed all loopholes on that score.

Among other reported incidents of Kiffin misconduct, or at least bad form, are:

  • lying that he did not vote the USC Trojans No. 1 in the USA Today poll when in fact he did;
  • drawing a $10,000 fine for criticizing game officials after a loss;
  • barring a reporter from practice for writing about a player injury;
  • refusing the common courtesy to opponents of using the Coliseum field for a walk-through before the game; and
  • trying to confuse one opponent by having players switch uniform numbers.

The only problem is that USC Athletic Director Pat Haden has been publicly endorsing Kiffin through all of this, and even issued a video press release announcing his support of Kiffin.  Hard to argue then that you’ve been building a case to fire the coach for cause.  The clincher is Haden’s public statement the day he fired Kiffin, announcing the decision was largely about the team’s pathetic record under Kiffin:   “at the end of the day, you can ask any one of our coaches, we’re all in the winning business here at USC.”  Haden did leave some wiggle room for a behind-the-scenes negotiation with Kiffin over possible for-cause grounds for termination, mentioning how it was also expected of a head coach that “You have to play by the rules, you have to graduate players, you have care about your kids.”  Maybe there’s something there that will allow him to shave a million or two off the expected buy out.  But at the moment it looks like USC will have to pay Kiffin for all the years remaining on his contract.  How many academic scholarships could that have supported?

And what will the lawyers negotiating these long-term, high-value coaching contracts learn from the Kiffin experience?

New NCAA Enforcement Structure Effective August 1, 2013

By [Friday, August 9th, 2013]

untitledAugust 1 marked the inception of the new NCAA Division 1 enforcement structure that introduces a four-tier hierarchy of infractions, replacing the old two-level system; accelerates the investigation process; and realigns and rationalizes penalties, including ratcheting them up for the most egregious violations.

Four levels of violation are now in place:

Level I: Severe Breach of Conduct. Violations that seriously undermine or threaten the integrity of the NCAA collegiate model as set forth in the Constitution and bylaws, including any violation that provides or is intended to provide a substantial or extensive recruiting, competitive or other advantage, or a substantial or extensive impermissible benefit.

Level II: Significant Breach of Conduct. Violations that provide or are intended to provide more than a minimal but less than a substantial or extensive recruiting, competitive or other advantage; includes more than a minimal but less than a substantial or extensive impermissible benefit; or involves conduct that may compromise the integrity of the NCAA collegiate model as set forth in the Constitution and bylaws.

Level III: Breach of Conduct. Violations that are isolated or limited in nature; provide no more than a minimal recruiting, competitive or other advantage; and do not include more than a minimal impermissible benefit. Multiple Level IV violations may collectively be considered a breach of conduct.

Level IV: Incidental Issues. Minor infractions that are inadvertent and isolated, technical in nature and result in a negligible, if any, competitive advantage. Level IV infractions generally will not affect eligibility for intercollegiate athletics. (This level may be revised or even eliminated pending outcomes from the Rules Working Group’s efforts to streamline the Division I Manual.)

The revised penalties are intended to deter the kind of risk-reward calculation that previously led individuals to violate the rules because of the insufficient risk of detection and punishment.  While the new structure imposes familiar consequences (postseason bans, scholarship reductions, financial sanctions, etc.), penalties will be tailored to the severity of the violation. Punishments will be reduced or toughened based on whether there are mitigating or aggravating circumstances. And penalties for coaches will be greatly enhanced as a result of the new head coach “presumption of responsibility.”  If a the head coach can’t disprove his/her responsibility for the violation, charges will be forthcoming.  A head coach can now be suspended for up to a full season if any member of his/her staff commits a Level I infraction, and for a half season for a Level II infraction. To avoid culpability, head coaches will have to provide training and written materials that instruct their assistant coaches how to act and that send a clear message to the entire staff and team.

To ease the transition to the new regime, NCAA enforcement staff are going back to school this month, visiting campuses and shadowing athletic directors, compliance staff members, and coaches, to better understand the realities of running and policing athletic departments. And certainly lawyers who represent college programs and student-athletes should school themselves  on the new enforcement structure. For a case study of how the new policy would be applied to a past case, see this analysis of the University of Oregon case.

The new enforcement model is probably the most important thing the NCAA will do this year, Johnny Manziel aside.  The greater accountability for the grown-ups on the sidelines should improve incentives for regulating player and staff conduct.