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Federal Judge Denies Stay; Will Tonight's Draft Be AntiTrust Violation?

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Federal Judge Nelson keeps the rain pouring on the NFL owners, denying their stay request. What will Jerry Jones' next move be?
Federal Judge Nelson keeps the rain pouring on the NFL owners, denying their stay request. What will Jerry Jones' next move be?

With a resonating 20 page ruling, Federal Judge Susan Nelson further strengthened the case of the players and denied a stay on the lockout injunction she granted on Monday. The original ruling was immediately met with the request for a stay while the NFL filed an appeal on the 86 page ruling laid down by Nelson. Nelson originally gave the players until Wednesday morning to respond to the stay request. The players came back and said that every second mattered, and they were incurring irreparable harm. Close to 10pm eastern, Judge Nelson denied the stay request and said the league is ordered to open for business immediately.

U.S. District Judge Susan Richard Nelson said the NFL had fallen short in proving a stay was warranted and dismissed its argument that it is facing irreparable harm because of her decision to end the 45-day lockout.

"The world of 'chaos' the NFL claims it has been thrust into - essentially the 'free-market' system this nation otherwise willfully operates under - is not compelled by this court's order," Nelson wrote.

And yet chaos there may be, perhaps as early as Thursday, the first day of the NFL draft.

James Quinn, a lawyer for the players, said free agency -- the biggest immediate question for owners and players alike -- should start immediately.

"We are evaluating the district court's decision and will advise our clubs (Thursday) morning on how to proceed," NFL spokesman Greg Aiello said.

-- Associated Press

Much, much more...

 

The NFL is reportedly going to request a stay from the US Circuit Court of Appeals immediately, however, it is speculated that it may take up to a week to be heard. Judge Nelson has made it very clear that activity must commence now. No team can be forced to sign free agents, but teams are going to be forced, possibly by US Marshall, to open facilities to the players.

From Sports Illustrated's Sports Law columnist, Michael McCann:

NFL teams must resume business operations and allow players to work out, practice and conduct other normal activities. While teams are not obligated to conduct organized practices or even provide coaching sessions, players must be allowed the same employment opportunities they would typically enjoy.

Teams will most likely comply with Judge Nelson's order. Team officials who refuse the order would be subject to penalty -- including monetary fines or even imprisonment -- for disregarding a court order. Judge Nelson could also request enforcement assistance from the U.S. Marshal Service, the federal agency entrusted with enforcing court orders. If necessary, marshals could be asked to escort players into team facilities. If players believe that teams are in any way limiting their access to facilities, expect Judge Nelson to take decisive action against teams and their officials.

Judge Nelson's denial seems to have fortified her previous ruling according to most pundits. Reports state that the appellate court can only grant the stay if they find fault with Nelson's ruling legality. The additional 20 pages supposedly makes that a tougher mountain to climb for the owners. She informed the league that there will be consequences to waiting until the appellate court's decision on the stay request, should they lose.

Consequences: Collusion, damages, etc., if league waits on appellate ruling on stay, which has been its position, and is denied there, too.TweetDeck Favorite Retweet Reply

 

It seems that the league will attempt to stand united and not sign any free agents until a resolution is reached. Contingency plans have long been rumored to play under the 2010 rules, no salary cap, no benefits. Is it possible that we could see an owner or two crossing the picket line, so to speak?  That, would be riveting drama.

It is rumored that the league could make an announcement in regards to allowing players under contract to be traded during tonight's draft.

Sources say draft day trades of players is a real possiblilty and will be announced in the AM. via Twitter for iPhone Favorite Retweet Reply

 

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The National Football Post's Andrew Brandt has a nice read up breaking down Judge Nelson's decision. You can find that here. In his article mentioned earlier, Michael McCann goes on to tackle nine additional questions about his interpretation of the potential fallout. Here are some key notes:

-- The NFL is thus faced with the onerous task of figuring out a set of restraints on competition that would ensure that the league can function effectively, but not prove so anticompetitive that the restraints violate federal antitrust law.

-- The compatibility of the NFL salary cap with antitrust law has yet to be determined, as the salary cap did not become part of the NFL until the league had begun collectively-bargaining with the NFLPA. If the NFL imposes a salary cap, a player or group of players could file an antitrust lawsuit that would mimic arguments made in Tom Brady et al. v. NFL: the salary cap is illegal absent collective bargaining.

-- For similar reasons, it is conceivable that the NFL could postpone Thursday night's draft for fear of antitrust exposure. Keep in mind, in 1978, the U.S. Court of Appeals for the District of Columbia held that the NFL draft was illegal under federal antitrust law. A player drafted Thursday night or this weekend could argue that he should be able to negotiate with multiple teams, rather than one. In antitrust verbiage, he would insist that competing NFL teams have joined hands to prevent him from multi-employer bargaining and from selecting the employer he most prefers.

4. So what would you recommend the NFL do? First, NFL teams should re-open business without any physical or other obstructions to players. A court has told the league to resume operations. It should do just that and not pull any gimmicks. It may be an awkward time for teams and players, but only if they let it be.

Second, the NFL should -- for the time being -- not employ a salary cap, meaning teams should be able to sign free agents without restriction. Teams would still be deterred in their spending because a new CBA will eventually be reached and it will contain a salary cap -- no team wants to be way over the cap when the new CBA is put in place.

Third, teams should remove franchise tag designations and other restrictions on players' free agency rights. History should convince the league of this point: the NFL has lost antitrust cases involving unilaterally imposed restrictions on movement of free agents between teams. Judge Nelson notably stipulated that teams are not obligated to sign free agents. In one respect, that stipulation benefits teams since they cannot be alleged to have engaged in a group boycott under federal antitrust law by not signing free agents. But as a matter of practice, the stipulation may not prove meaningful: teams may not be legally obligated to sign free agents, but if they don't, their competitors will.

Fourth, and more controversially, the NFL should think seriously -- and quickly -- about postponing the draft. While no drafted player may end up commencing an antitrust lawsuit, the NFL draft has been deemed illegal under antitrust law when not borne from collective bargaining. Obviously, postponing the draft with 24 hours till its scheduled start would be very unpopular with teams, players, fans and media, but legally it may be worth doing.

Now that last line might be the understatement of the year. Postpone the draft? Anything is possible, we've learned that time and time again, but I'm having a hard time believing that the draft isn't kicking off at 8pm. I do however have interest in the line of thinking though, stay tuned for more on that front.

[UPDATE]: Albert Breer tweeted a series last night. The NFL has filed a 21 page motion to the Circuit Court of Appeals, basically asking for a stay while the stay denial is appealed.

... May 10: NFL to file opening brief; May 24: Brady/Eller class opening brief; May 31: NFL reply brief; ASAP: Oral arguments. via web Favorite Retweet Reply

 

Here's the timeline:

-- Just went through the motion to stay. Main argument: Nelson "brushed aside legal obstacles" by recognizing NFLPA decert, ignoring labor law.

--In motion to stay, league went to lengths to prove NFLPA is still operating as a union, citing comments from Derrick Mason and Mike Vrabel.

-- And NFL said that, w/o a stay, "It will be impossible to to restore the parties to their respective positions of April 25." ...

-- ... And that it'd also be impossible to reset player movement, etc. BTW: Former solicitor general Paul Clement is listed as lead lawyer.

-- NFL asked 8Cir for 3 things: 1) expedited appeal; 2)stay of injunc until appeal: 3) stay of injunc while they rule on #2

-- Asked NFL spokesman Greg Aiello for follow up this morning on last night's statement. Status quo for now ...

-- Aiello: "Clubs notified last night they should continue to follow the current rules and practices until otherwise advised by our office."

-- Brady class lawyers Jeffrey Kessler and Jim Quinn just sent mass email to players and agents, declaring the league year open. I have a copy.

-- Quinn/Kessler on NFL pursuing stay: "Unless and until such a request is granted, however, we believe the 2011 League Year now has to begin."

-- Quinn/Kessler: "The NFL and the Clubs cannot collectively continue to refuse to deal with players. It is our view that the NFL ...

-- "...&the Clubs will be in contempt of court if they do not comply with the order unless & until they hear differently from the 8th Circuit."

-- One more thing from the Quinn/Kessler email to players/agents: "The order ending the lockout is in full, immediate force." More on NFL.com.