Jan. 15 (Bloomberg) -- The National Football League’s $914 million settlement of claims tied to player concussions was denied preliminary approval by a federal judge who said she is concerned that not all players will be paid.
U.S. District Judge Anita Brody in Philadelphia yesterday said that a $675 million compensation fund included in the settlement may be insufficient to cover a class of about 20,000 retired players for a 65-year term. She asked for more documentation including economic analyses conducted by plaintiff lawyers.
“The judge is questioning the numerical or economic basis for coming up with the settlement and asking for more evidence because she can’t find any basis for it,” Mark Conrad, director of the sports business program at Fordham University’s Gabelli School of Business, said in an interview. “Clearly that is something that would be worrying to the plaintiffs.”
More than 5,000 former football players had sued the league seeking damages for head injuries. The complaints, which were consolidated before Brody, accused the NFL of negligence and failing to inform players of the link between repeated traumatic head impacts and long-term brain injuries, including early onset Alzheimer’s and dementia.
The settlement includes $675 million to compensate players for a specified list of injuries, $75 million for medical tests, $10 million for educational programs promoting player safety and injury prevention specifically in youth football and $4 million for administrative expenses related to class notices.
The NFL also agreed to pay an additional $37.5 million if needed for players plus attorneys’ fees of $112.5 million, according to papers filed Jan. 6 in federal court in Philadelphia.
Brody’s ruling is “unusual” at this preliminary stage in a settlement’s approval process, said Carl Tobias, who teaches product-liability law at the University of Richmond in Virginia.
“The bar is low for that approval,” Tobias said in a phone interview. Brody “has some legitimate concerns about the amount of money for the players and may be sending a signal that the league and the plaintiffs’ lawyers may have to go back to the negotiating table.”
The concussion deal is moving forward, Chris Seeger, co-lead attorney for the retired players who helped negotiate the accord, said in an interview.
“I have no doubt that the deal will ultimately be approved,” he said.
Seeger said lawyers will provide Brody with analysis from economists, actuaries and medical experts within the next few weeks. He declined to give an exact timeframe.
Greg Aiello, a spokesman for the NFL, said in an e-mailed statement, “We are confident that the settlement is fair and adequate, and look forward to demonstrating that to the court.”
Under the agreement, compensation will be based on a list of qualified injuries including neurocognitive impairment resulting in memory loss, Alzheimer’s disease, Parkinson’s disease, Lou Gehrig’s disease and death from a progressive disease known as chronic traumatic encephalopathy, or CTE, according to court filings.
Players will be paid based on age and time in the league. A player with one eligible season would get 70 percent less than someone who played more than four seasons in the league, for example, according to the terms of the accord.
Under the settlement, players who contend their mental impairment stems from time in the league don’t have to prove they suffered concussions or that their injuries were caused by head blows, Seeger said Jan. 6. Still, Brody said she was concerned not enough money was set aside for medical monitoring, and that the deal bars players from suing the National Collegiate Athletic Association and any other collegiate, amateur or youth football organizations.
“In the absence of additional supporting evidence, I have concerns about the fairness, reasonableness and adequacy of the settlement,” Brody said in an opinion issued yesterday.
Under the terms of the deal, retired football players with Parkinson’s disease are eligible for as much as $3.5 million in compensation and those with Lou Gehrig’s disease, or amyotrophic lateral sclerosis (ALS), may receive as much as $5 million.
Even if only 10 percent of the retired players eventually receive a qualifying diagnosis it’s difficult to see how the fund can pay all the claimants at the required levels, Brody wrote.
Brody’s decision came a day after attorneys for a group of 177 former players filed their opposition to the settlement.
Philip Thomas, a Mississippi lawyer representing the group, said in court papers that the deal is unfair to former players who sued the league because most would have to give a portion of their recovery to an attorney under contingency fee contracts. Players who sued should be given an incentive award for helping to force the settlement, he said.
The case is In re National Football Players’ Concussion Injury Litigation, 12-md-02323, U.S. District Court, Eastern District of Pennsylvania (Philadelphia).
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