June 20 (Bloomberg) -- The National Football League Players Association will get another chance to argue before a judge that the league instituted a secret salary cap in 2010, in violation of a contract with the union.
The U.S. Court of Appeals in St. Louis today reversed a ruling by the lower-court judge who refused to revisit the lawsuit, sending it back to U.S. District Judge David S. Doty in Minneapolis for reconsideration. The case was filed originally under the name of now-deceased Hall of Fame player Reggie White.
The players, seeking in May 2012 to reopen the 1992 case, claimed they sustained at least $1 billion in damages due to a covert cap, which if proven would automatically triple to $3 billion under the collective agreement. The NFL, the biggest U.S. sports league, had record revenue of $10 billion last season.
“They obviously committed fraud. We know it and so do they,” James Quinn, a players association attorney, said in an e-mailed statement. “Once we get discovery, the truth will be obvious. This really isn’t complicated.”
The union sued on behalf of all current and future players, accusing the league of violating antitrust law with its labor practices. The case was closed in 1993 with an agreement that led to a new labor contract. The agreement, amended in 2006, mandated that salaries in the 2010 season wouldn’t be capped.
The White case dismissal order, entered by Doty in 2011, was part of a larger settlement of a labor dispute and litigation that year related to the expiration of a collective bargaining agreement and NFL owners’ decision to impose a lock-out.
Months after Doty entered that order, New York Giants owner John Mara and other team owners publicly revealed they had secretly capped player pay, according to an NFLPA filing with the appeals court. Doty rejected the players’ request to reopen the case after Mara’s disclosure.
The players had voluntarily agreed to release claims both known and unknown and there were no grounds for reopening the White case, the league’s lawyers said in an appeals court filing.
Doty rejected the NFLPA’s arguments for examination of the circumstances underlying the 2011 dismissal in rulings issued in December 2012 and February 2013, setting the field for the players’ appeal.
“The association bears a heavy burden in attempting to convince the district court that the dismissal was fraudulently procured,” a three-judge panel said. “We hold only that the association should be given the opportunity to meet this burden.”
Brian McCarthy, a spokesman for the 32-team New York-based NFL, said in a statement that the appellate ruling is merely procedural and that the league expected the players’ argument to fail again.
“Far from validating the union’s claim, the court specifically highlighted the heavy burden that the NFLPA faces,” McCarthy said.
White died in 2004 and was inducted into the Pro Football Hall of Fame in Canton, Ohio, two years later.
The appellate case is White v. National Football League, 13-1251 and 13-1480, U.S. Court of Appeals for the Eighth Circuit (St. Louis). The trial court case is White v. National Football League, 92-cv-00906, U.S. District Court, District of Minnesota (Minneapolis).
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