Selecting an Agent, Using Personal Counsel and Agent Regulation

I recently had the opportunity to interview Sports Lawyer and Connecticut Sports Law Editor Daniel Fitzgerald concerning the role and responsibilities of sports agents.  In particular, we discussed the athlete’s process of selecting an agent, the role that personal counsel can play for an athlete, and the regulation of agents.

Rob Romano: What advice do you have for athletes when it comes time to choose an agent?

Dan Fitzgerald: Similar to the college recruiting process, I think an athlete needs to assemble a team of people to assist in the process of retaining an agent.  Trusted advisors such as family members, an old coach or athletic director can be helpful.  Beyond the basics of finding agent who is trustworthy and a good fit for the athlete, I’d recommend that athletes look for an agent with their long-term interests in mind, as well as an agent who is open to involving other professionals such as lawyers, accountants, financial planners, etc.  Not only can the use of other professionals help provide the best possible representation, but also can provide the necessary checks and balances.

RR: Do athletes need an attorney if they have an agent?

DF: Typically, yes.  An athlete should have an attorney review any legal document that he or she considers signing, including a contract for representation by an agent.  Also, athletes must consider how agents are paid – by commission, taking a percentage of the athlete’s earnings.  Agents may have a vested interest in a player signing a deal for not only the commission, but to maintain a positive working relationship with a particular team or sponsor for the agent’s other clients.  This doesn’t diminish what agents do, but it may present conflicts of interest.  Attorneys are held to a different ethical standard than agents, especially with respect to such conflicts.  Accordingly, an attorney should be able to provide a different perspective to an athlete than that of his or her agent.

RR: Some states have passed laws, or are considering laws, that criminalize inappropriate agent behavior.  Do you think this is a positive development?

DF: In Alabama, failing to register as an agent and having illegal contact with an athlete can result in a felony. Arkansas is also considering such legislation. Personally, I don’t think that agents should be charged with felonies for contacting a player at the wrong time or even providing improper payments. It goes too far in preservation of the ideal of amateurism, which just isn’t the reality at the highest level of collegiate athletics.  The commercialization doesn’t condone cheating – but it also shouldn’t result in felony charges for agent-specific behavior.  Of course, if an agent commits an act that violates some other state or federal law, the agent should be held accountable.

RR: Who should regulate agents?

DF: The Players’ Associations should regulate agents.  Players’ Associations already regulate agent certification, how much an agent can be paid, and how fee disputes between players and agents should be handled. These entities should be regulating agent activity as well.  I compare it to lawyers being regulated by their state bar associations. These groups have the power to take away an agent, or a lawyer’s, livelihood. I think that is a powerful tool and sufficient to regulate the profession.

ESPN Sues Conference USA

Sports Network powerhouse ESPN filed a lawsuit against Conference USA alleging that they did not fulfill its contractual obligations when the conference sold its television rights to FOX.

ESPN alleges that the parties reached a tentative agreement and planned additional meetings to negotiate the finer points before a deal was to be finalized. Conference USA, however, never met with ESPN, nor did they provided ESPN a final offer before it announced it was signing a $43 million dollar media rights deal with FOX.

ESPN claims their contract with Conference USA mandates that the conference must provide ESPN with a final offer before it would be allowed to negotiate with another network.

“Rights agreements are at the core of our industry,” said ESPN. “ESPN and Conference USA reached an agreement on a new extension after a prolonged negotiation. The conference then changed their position out of the blue and reneged on that agreement. At best, they violated our right to be given an opportunity to consider a final offer.”

 

John Junker Released As Fiesta Bowl’s President & CEO

John Junker, President and CEO, and the face of the Fiesta Bowl for over 2o years, was fired after an internal report revealed numerous improprieties.  (Report (PDF).  Junker, who has guided the Fiesta Bowl from it humble beginnings to an elite Bowl Championship Series (BCS) franchise, was released from his $600,000.00 a year position after a report revealed a plan to reimburse employees for political contributions and a conspiracy to cover it up.  These political reimbursements, estimated to have exceeded $46,000.00, are a violation of Arizona’s campaign finance laws and the charter that allows the Fiesta Bowl to retain its nonprofit status.  In addition, the investigation revealed “excessive compensation, non-business and inappropriate expenditures and inappropriate gifts.”  These inappropriate expenditures included a 50th birthday celebration for Junker costing approximately $33,000.00 paid for by the Fiesta Bowl, a car allowance and paid membership in four elite private golf clubs, and a $1,200 meeting between Junker and two others at a local Phoenix strip club.

“The entire Fiesta Bowl family is angered and disappointed by what we’ve seen in the report and by the actions of Mr. Junker,” said Fiesta Bowl board chairman Duane Woods.  “The Fiesta Bowl is greater than a few individuals, and the lesson here really is that we placed too much trust in a single individual.”

The BCS issued the following statement:  “We are deeply disappointed and troubled to learn of these findings related to the Fiesta Bowl.  Unprofessional, unethical or improper behavior is unacceptable. There is no place for such activities in higher education or in collegiate sports. It is expected that all parties contracted with the BCS will live up to the highest standards. We do not wish to be associated with entities that believe otherwise.”

The Fiesta Bowl has three years left on its BCS contract, but the BCS has appointed a committee to evaluate the findings and have asked the Fiesta Bowl to demonstrate why it should retain its BCS elite bowl status. The task force will evaluate the Fiesta Bowl’s response and determine whether the Fiesta Bowl will be allowed to host the national championship game in the future.

There are plenty of other bowls out there, such as the Cotton Bowl who have never hidden their desire to return to elite bowl status and play at the new Cowboy Stadium, that would like a chance to host the national championship game.

Fordham Sports Law Symposium

The Fordham Sports Law Forum and the New York State Bar Association Entertainment Arts and Sports Section Present:  15th Annual Fordham Sports Law Symposium

  • Date: Friday, April 1,2011
  • Time: 9:00am-4:40pm

Keynote Speaker: Howie Roseman General Manager, Philadelphia Eagles

TOPICS:

  • Damaging Impact: The long term health effects of concussions and where future liability might lie.
  • Agents, Amateurism and Accountability: Legal and ethical questions arising from the relationships between lawyer/agents and the amateur athletes seeking their representation.
  • Collective Bargaining Agreements in Sports: Impending negotiations, potential lockouts, and the main sources of conflict between owners and unions.

Cleveland Browns’ Fan Suing Over PSL Agreement

Ken Lanci, a Cleveland Browns season ticket holder, filed a lawsuit against the Browns and the National Football League claiming the lockout violated his contract to buy tickets through his Personal Seat License (PSL).

The lawsuit seeks damages from the Browns for breach of contract and bad faith and from the NFL for contract interference.  Mr. Lanci claims the lockout denies him the right under his personal seat licenses to attend Browns’ home games and adversely affects the value of the seat-license agreement.  Additionally, he claims the NFL has “conspired with the Browns and one another to lock out the players, without justification, resulting in the Browns’ breach of the PSL agreement.”

After reviewing portions of Mr. Lanci’s PSL agreement, it seems unlikely that he will prevail.  First, his claims are premature – no violation of the agreement can occur until a game is missed.  Therefore, Mr. Lanci should of sought a declaratory judgment regarding the legality of the lockout, together with a preliminary injunction aimed at blocking the lockout while the litigation proceeds and a permanent injunction preventing a lockout.

Furthermore, after the first missed game, it will be difficult for Mr. Lanci to prove that he was “irreparably harmed”, a necessary element to obtain a preliminary injunction.  The Browns simply must refute the “irreparable harm” element by refunding the price of the tickets and compensating Mr. Lanci for a corresponding percentage of the three-year PSL.

There is also language in the seat license agreement that should control this dispute.  Paragraph 10 of the Club Seat License Agreement: Terms and Conditions – Strikes, Damages and Destruction, Etc. states as follows:

in the event of “any strike or other labor disturbance which results on the  cancellation of any Browns Games at the Stadium,” the PSL holder will receive credit for such games against his or her next purchase of the seat license.

A court would most likely deem that this provision represents a fair and appropriate handling of lost games.

Case precedent further weakens Mr. Lanci’s case.  In Estate of Harold Oshinsky v.New York Football Giants, Inc., 2011 WL 383880, February 02, 2011, the court granted the Giant’s Motion for Summary Judgment after finding that a ticket is a revocable license and admission may be refused at the sole discretion of the team.  The court stated, “season-tickets, as renewal rights, are a limited privilege, subject to revocation.”

The court continued finding that no implied contract existed since on the backside of each annual invoice was a clause, which expressly curtailed renewal rights.  The clause read as follows: “[r]enewal privilege is extended at the option of the [Team], and is subject to revocation at any time.”

The court made an additional point about ticket prices that is worth stating. “A license fee is just an add-on to the price, albeit a substantial add-on in this case.” However, the “price is set by the purveyor of the entertainment and is controlled by market forces, not the courts. Here, the Giants as purveyors of the season tickets raised the cost of tickets every year without substantial objection. It is their responsibility to oversee ticket prices and PSL contracts, not the courts, absent a breach of an agreement.”

Therefore, since Mr. Lanci may not have sought he proper relief from court and that case law is against him, it will be difficult for Mr. Lanci to succeed on his lawsuit against the Cleveland Browns and the National Football League.

Former NFL Players Suing the NFL

Former National Football League players, Carl Eller, Priest Holmes, Obafemi Ayanbadejo and Ryan Collins filed a complaint in federal court suing the National Football League seeking to lift the current lockout to ensure their pensions and health benefits remain funded.  Presently, the retired players receive retirement, disability and death benefits, subsidized by the 32 teams.  The retired players content, according to the lawsuit Eller v NFL, that these benefits will end if the collective bargaining agreement is not renewed by March 11, 2012.

It is also the retired players position that their suit should be combined with the antitrust suit filed against the NFL by Tom Brady, Peyton Manning and Drew Brees.

The retired players, through counsel, stated, “We hope that we can be a part of that hearing. For the sake of judicial economy, it would help to streamline things to make sure you get all parties involved at the same table at the same hearing at the same time.”

The former players’ suit also covers draft prospects that are not represented by the NFL Players Association. These plaintiffs seek to avoid one of the league’s chief counterarguments against the Brady lawsuit:  the union illegally decertified.

“The owners say the union has unlawfully decertified and the union should be ordered to reconstitute and forced to sit at the bargaining table,” lead attorney for the retired players stated. “If you look at the last CBA, it represents the rookies that have been drafted and the rookies who have begun negotiating with teams.”

Therefore, college players waiting to be drafted are not represented by the union and cannot be faulted for its decertification, but are being affected by the lockout.

“These players have an antitrust claim,” counsel said. “The owners have shut down their potential employees through a concerted boycott. The suit is going to avoid the main thrust of the owners’ defense and their argument that the matter should be settled by the National Labor Relations Board, not the courts.”

Interest and Refunds for NBA Season Ticket Holders If a Lockout Occurs

The National Basketball League announced today that all NBA franchise season-ticket holders would receive a full refund on all purchased tickets if any of next season’s games are canceled because of a possible labor dispute.  In addition, according NBA Senior VP/Marketing Communications Mike Bass, the NBA will pay interest on any monies already paid by fans and in the control of the NBA franchises.  Mr. Bass stated, that NBA teams will “pay interest on what could amount to loans to franchises from fans.”  The league office will set the interest rate before any games are potentially canceled.

Romano On Quiksilver: Quiksilver Announces $1 Million Prize Purse At ASP Event In New York

The Romano Sports & Entertainment Agency is proud to announce that it will provide an Economic Impact Study to Quiksilver and the Association of Surfing Professionals (ASP) regarding the Quiksilver Pro New York set to take place on Long Island’s Long Beach from September 4-15, 2011.

The Quiksilver Pro New York will be the 6th stop on the 2011 ASP World Tour and the first-ever ASP World Tour stop on the East Coast of the United States. The event will offer a $1 million dollar prize purse to competitors, an amount unprecedented in professional surfing. The Quiksilver Pro New York will expand the Quiksilver Pro Global Series, which also includes the Quiksilver Pro Gold Coast in Australia (February 26-March 9, 2011) and the Quiksilver Pro France (October 4-15, 2011).

Surfline.com, a leading forecaster of wave and surf conditions, conducted a 15-year wave study for western Long Island, New York, summarizing that September 4-15 is one of the most consistent time periods for sizable surf in the region.  In addition, local feedback supports these findings, with September typically averaging 3+ hurricane swells, with at least one 3-4 day swell.

The competition dates will include the Quiksilver Pro Trials in Long Beach on September 3, 2011 the Quiksilver Pro New York WT competition on September 4-15, 2011.  In addition, Quiksilver will bring world-class athletes to New York City during the month of September for a series of demos, films, parties, music concerts and art exhibits that represent the best of surf, skate and snowboarding cultures.

Please look for continued Quiksilver Pro New York updates and announcements on Quiksilver.com and aspworldtour.com.

NFL Labor Dispute Benefiting the CFL/UFL

With the National Football League antitrust suit/lockout in full force, some NFL veteran free agents may consider heading north to play, showcasing their talents in the Canadian Football League.  However, veteran players need to be aware that CFL teams will not sign players who were under contract with NFL teams at the time the Collective Bargaining Agreement expired.  With a minimum two-year contract, players would have to spend the full two seasons in the CFL.  Hamilton Tiger-Cats General Manager Bob O’Billovich confirmed by stating, “Those kind of guys, you wonder if they know the situation. They might think they can come up here, play part of a season and then go back. They can’t.”

However, with the uncertainty around the upcoming NFL season, the CFL could benefit from unsigned/undrafted rookies looking to play professional football. Toronto Argonauts General Manager and coach Jim Barker: “Where we’ll see a difference is after the NFL draft. Undrafted players won’t be signed and a lot of them normally would try to sign with NFL teams. A borderline player who might have signed with an NFL team might decide to sign here so he can play. There should be a better pool to choose from, no doubt.”

The United Football League can also benefit from a locked-out NFL season.  The UFL feels that they are perfectly positioned to provide alternative pro football programming.  UFL Commissioner Michael Huyghue said that “from an exposure standpoint, replacing the NFL on one or more Sundays would be more valuable” than signing NFL players and former NFL coaches such as new Hartford Colonials coach Jerry Glanville.  Commissioner Huyghue went on to say that “I think one of the (potential) revenue streams has to start hitting or it will be difficult to continue. I’d love for them (NFL) to get back … just not right away”