March 12 (Bloomberg) -- National Football League players filed an antitrust suit against team owners after talks on a new labor agreement failed and the NFL Players Association dropped its status as a union.
The suit, which seeks to block the NFL from locking out players, lists quarterbacks Tom Brady of the New England Patriots, Peyton Manning of the Indianapolis Colts, Drew Brees of the New Orleans Saints and defensive end Osi Umenyiora of the New York Giants among the plaintiffs. It was filed yesterday in federal court in Minneapolis.
The move came after the NFLPA announced in a statement that it will become a professional trade association. That allowed players to sue the NFL as individuals and pursue a solution to the contract impasse in court.
“The NFL has a long history of violating federal antitrust law in an effort to minimize its labor costs,” according to the complaint. “The owners’ collective purpose in imposing the ‘lockout’ is to force the non-unionized NFL players to agree to the massive wage reductions and anticompetitive restrictions, which the NFL defendants are seeking from the players.”
Owners had not yet decided whether to lock out players after the contract expired at midnight, Jeff Pash, the NFL’s chief negotiator, told reporters in Washington yesterday as he left talks with the mediator.
The lawsuit was filed after negotiations overseen by the Federal Mediation and Conciliation Service in Washington failed to yield an agreement on how to divide $9 billion in annual revenue. The union said owners refused to show financial records to support their position; owners said players always planned to go to court.
“The union’s position has been take it or leave it, and has had the same position since last September,” New York Giants co-owner John Mara said. “We made an offer today to split the difference between the two sides. They came back and said it was insufficient. Their objective was to go the litigation route.”
NFL owners voted in 2008 to end the league’s collective bargaining agreement with players on March 3, saying it didn’t account for costs such as building stadiums. That deadline was extended until yesterday as owners and players met with the mediator. Areas of dispute also include expansion of the season to 18 games from 16, a rookie salary cap and health care for players.
Owners want to double the amount set aside from the league’s $9 billion in revenue for expenses before paying players, according to the players association. Under the old agreement, about $1 billion was deducted before player payrolls are calculated, for costs related to stadiums, marketing, NFL.com and the NFL Network, according to DeMaurice Smith, the association’s executive director.
Smith said yesterday before the association announced its action that any further extension of talks would have to be accompanied by the owners turning over 10 years of audited financial records.
George H. Cohen, head of the federal mediation service, said in a prepared statement that the players and management retained “strongly held, competing views that separated them on core issues.”
“No useful purpose would be served by requesting the parties to continue the mediation process at this time,” he said. Cohen said his office was ready to step back into the talks at any time.
NFL Commissioner Roger Goodell said the quickest way to a resolution is through discussions, not litigation.
“We do believe that mediation is the fairest and fastest way to reach an agreement,” Goodell said in Washington. “We believe that ultimately this is going to be negotiated at the negotiation table. We will be prepared to negotiate again.”
The NFL said in a statement that its offer split the difference between the sides’ stands on financial issues and would have no adverse monetary impact on veteran players in the early years and meet their demands for the latter years.
Jim Quinn, outside counsel for the players’ association, said the owners offered a proposal that effectively would have rolled back salaries to 2007 levels.
“They wanted the players over the course of the next few years to give them a $5 billion gift,” Quinn told reporters at union headquarters in Washington. “They have forced us into a situation where we could not agree to a $5 billion giveback.”
The union decertified two years after a 1987 strike that was broken by replacement players. The move triggered about 20 lawsuits, including one that helped create free agency in 1993.
The players association will continue to assist members in financing, litigation and other activities, without participating in collective bargaining, according to a fact sheet on the union’s website.
The case is Brady v. NFL, 0:11-639, U.S. District Court, District of Minnesota (Minneapolis).
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