Before getting into Cornwell’s arguments, it is worth taking a moment to consider who David Cornwell is and how he is so delicately connected to the NFLPA and the players that the association represents.  First of all, Cornwell went up against DeMaurice Smith for the title of Executive Director after the late Gene Upshaw had passed away, leaving an opening at the top position in the NFLPA.  Cornwell has over 20 years of expertise in the professional sports industry, representing professional athletes and sports agents in their legal affairs.  To be clear, Cornwell is not an NFLPA Contract Advisor himself, but he has been retained by NFL players and NFLPA Contract Advisors for various types of legal matters, including representation with regards to grievances through the NFLPA’s mandatory arbitration process.  In the past, Cornwell was Vice President and General Counsel of Upper Deck Company and Assistant General Counsel for the National Football League.  Suffice it to say, Cornwell knows the ins and outs in the world of professional football.

Cornwell’s observations are cleanly broken up into various sections.  The longest section of his memo concerns the new NFL Collective Bargaining Agreement (CBA) that was signed in 2011.  The other sections include a discussion of Terrelle Pryor’s suspension, the new NFL Drug Policy, the NFL’s Conduct Policy, and the NFLPA’s apparent lack of care for enforcing agent regulations.

As stated, the bulk of Cornwell’s memo reveals his dismay about the newly established NFL CBA.  He explains that players were misguided into believing that they would receive 47% of literally all NFL revenues, when in fact, that percentage is based on net revenues, and not gross revenues as was contemplated by the previous agreement.  Cornwell also states that the use of the term “True up” is misleading and that the idea of “Revenue Buckets” is a red herring.  Other issues are discussed at length.

Cornwell was tacitly involved in Terrelle Pryor’s suspension as Pryor’s retained attorney.  Cornwell’s main issue is the way that DeMaurice Smith accepted a five game suspension for Pryor without following up with Pryor and/or Cornwell after Pryor answered some questions posed to him by Smith.  The way that Cornwell explains it, the NFLPA advised the media that the NFLPA urged Pryor and Cornwell to reject the five game suspension (which Cornwell says was false), Cornwell announced that he would appeal the decision, and then DeMaurice Smith demanded Pryor’s agent to provide Smith with a letter promising that the suspension would not be appealed.  Cornwell uses words like “baffling” and “deceptive” in his memo.  The story he paints makes me question what was going on behind closed doors.

I’ll skip the Drug Testing and Conduct Policy issues and jump right to Cornwell’s final section: Agent Regulations.  The following excerpt from Cornwell’s memo will probably not surprise the readers of this website.

In the Conclusion section of Cornwell’s memo, he wrote, “Despite my greatest hopes, my personal experience reveals that De’s vision in 2008 was little more than an inside Washington political campaign — high on style, low on substance. De’s grandiose pronouncments did not translate into meaningful progress in the business of playing football. Rather than  advancing the partnership between players and team owners, the new 10 year CBA relegated NFL players’ status to mere employees.”  Cornwell is “stunned at what the NFLPA has become under De’s leadership.”  Cornwell recognizes that DeMaurice Smith is not required to answer the memo, and in all likelihood, Smith will probably resist making any comment.

David Cornwell Stunned At What NFLPA Has Become Under DeMaurice Smith’s Leadership from Sports Agent Blog - Sports Business, Sports Law, Sports Negotiations, NCAA Rules

When: September 8, 2011 (9 a.m. – 5 p.m.)

Where: Locatelli Center, Santa Clara University (map)

Topics: Concussions (Keynote: DeMaurice Smith, Executive Director, NFLPA), Steroids (Keynote: Mark Fainaru-Wada, ESPN Investigative Reporter), Labor Strife (Keynote: William B. Gould, IV, former Chairman of the National Labor Relations Board), and the Use of Player Images (Keynote: Sonny Vaccaro, Former Director of Basketball Programs at Nike, Adidas and Reebok).

The Reception speaker will be William Neukom, Managing Partner, San Francisco Giants, and Jim Brown will be an honored special guest at the event.

Other speakers include:

• Dan Coonan, Santa Clara University Athletic Director
• Bill Duffy, CEO of BDA Sports Management
• Dan Rascher, University of San Francisco Sports Management Professor
• Retired NFL players Ben Lynch and Shawn Stuckey
• Mike Gilleran, Former WCC Commissioner
• Don Gralnek, General Counsel of San Jose Sharks
• Paul Haagen, Co-Director of the Duke Law School Center for Sports Law and Policy
• Andy Schwarz, Sports Economist
• Professors Kevin Greene, Lateef Mtima and Tyler Ochoa

Cost: Early registration (before July 1, 2011) = $125.  Regular registration = $175.  Deadline to register = August 25, 2011.  Free entry for all college students.  Register here.

2011 Santa Clara Sports Law Symposium from Sports Agent Blog - Sports Business, Sports Law, Sports Negotiations, NCAA Rules

NFLPA Executive Director, DeMaurice Smith, recently sent a memo out to NFLPA Certified Contract Advisors commenting on the terms of the NFL’s counter-proposal.

Agents obviously are not thrilled with the first bullet point in Smith’s memo. No individual negotiations of contracts at all, would again make it very difficult for agents to justify taking any commissions on rookie deals.  Who is going to front the Combine/Pro Day training expenses then?

Smith emphasized that the wage scale would be 5 years for 1st rounders and 4 years for all other drafted players.  These are longer deals than what the NFLPA has proposed, and threatens to prevent many NFL players from ever hitting the free agent market.  Furthermore, minimum salaries would be reduced.  Smith frames this as implementing a veteran scale as opposed to a true rookie scale.

The memo does a good job at distinguishing the NFL’s proposal from the current NBA wage scale.  The NBA scale only applies to first round selections, is fully guaranteed for skill and injury, is still subject to some negotiation (80%-120% of the slot value), and only lasts three years.

Overall, I believe that the memo is extremely effective.  It is not too long or wordy and certainly gets the NFLPA’s point across to anyone who takes the minimal amount of time to read through it.  Job well done by Smith, but nobody truly “wins” until there is some true progress made by each side in coming closer to an agreement.

NFLPA Not Happy With NFL’s Rookie Wage Scale Proposal from Sports Agent Blog - Sports Business, Sports Law, Sports Negotiations, NCAA Rules

The main issue in CBA negotiations has, and will be, the percentage of NFL revenues to player salaries.  Other major concerns include, NFL rookie salaries and the legal inability of franchises to recoup signing bonuses from players who breach contracts or refuse to perform.

The authors of the article take the position that the owners cared so much about labor peace and preventing a potential labor stoppage back in 2006, that they agreed to a CBA that had unfavorable terms.  There is a thought that former NFL Commissioner, Paul Tagliabue, lobbied ownership to accept the deal because he wanted his legacy to be that he presided over almost two decades of uninterrupted labor peace.

Many pages are dedicated to providing a formal history of the NFLPA, its major players, and the numerous legal actions it has been a part of over the years of its existence.  It certainly is not a short read, but I believe that it is important to have a good understanding of the history of negotiations between the NFL and the Players Association in order to have a full grasp on what is going through the minds of the bargaining parties today.

The use of media by both sides of the negotiation table is nothing new.  In fact, it was heavily used in the NHL’s battle with the NHLPA earlier this decade.  It is also being heavily employed by the NFL and the NFLPA during this round of CBA negotiations.  This time, new media in the form of blogs and Tweets are involved, as well.

In such contentious negotiations, it is very difficult, and sometimes impossible, to determine which side has a better case.  And at the end of the day, it does not matter; everyone suffers if a season, or part of a season, is lost due to a labor battle.  Is the NFL bargaining in good faith?  Should there be a rookie salary cap?  Does the union truly have all the financial information it needs to bargain?

Interestingly, when the authors released the piece, they wrote that there is no need to create artificial deadlines, “as  these will obstruct the natural development of negotiations between the parties.”  DeMaurice Smith certainly did not agree, as the NFLPA had an “internal deadline” for agreeing to a new CBA, which apparently has already passed.  Going back to my previous point about new media, check out where the news was posted – on the League’s own blog focused mainly on labor issues.

Skip to the end of the IPLJ article and you will see the authors’ predictions, which includes the belief that Ownership will lockout the players.  And then there is decertification talk, which has been gaining momentum as of late.  Every NFL team has approved of a plan to decertify the NFLPA if there is not a new CBA agreed to by March 3, 2011.  I assume that the date is subject to change.  Decertification would mean that the NFLPA is no longer a union; players could then sue the league under an antitrust claim.

Will There Be A 2011 NFL Season? from Sports Agent Blog - Sports Business, Sports Law, Sports Negotiations, NCAA Rules

HGH Testing

Players strongly oppose HGH testing, while the league has become more and more vocal in the past few months about mandating it.  Although the Players Association insists that there is no room for performance enhancing drugs in the league and that they would be open to fair and accurate testing, NFLPA President Kevin Mawae points out that the current available test “is not completely reliable” because it only has a 48-hour window of detection versus the 14 day test that is being developed.  Seemingly counter-intuitive are claims by the U.S. Doping Agency, which insist that the current blood test is completely reliable.  While a urine-based test has been the preferred method due to its simplicity to administer and deal with, it is believed to be several years away from complete development.  It’s as clear as an empty syringe, that the players will deny the sanctity of the currently available test and just have to figure out a new argument a few years down the road when that urine test is generated.

Winner:  Players

18 Game Season

Players are vehemently opposing the lengthening of an already grueling 16 game regular season, plus the possibility of playoff games, while owners are reveling in the thought of it.  Dropping two preseason games, which fans find just as boring as a 0-0 tie in soccer (football for our international readers) and adding two meaningful ones, equals more money for the NFL from television networks, more money for teams from ticket sales, and additional food and beverage consumption at games…and two more weeks to have something interesting to write about for SportsAgentBlog.com!  What could be better?  On the other hand, players make a good point when they argue the safety side of the issue.  With only one week off for the season, the immense pressure that an NFL athlete’s body goes through is painstaking.   Growing up in South Florida, I’ve heard countless times the horror stories of Miami Dolphins great Zach Thomas, who takes an hour and a half to get out of bed every morning just because his body is that damaged from 13 seasons in the league.  Creating more games is just adding to the future pain.  However, NFL executive vice president Jeff Pash insists that the league has taken this into account and is looking into how to handle “offseason workouts…practice regiments, roster sizes, injured reserve rules, a whole host of things that could be part of an overall restructuring of the football calendar to address the injury concerns.”

Winner:  League (and fans!)

Rookie Wage Scale

This could be the toughest issue argued between players and the league, but interestingly enough, at the 2010 Annual Rookie Symposium in Carlsbad, California, not one player raised his hand when the floor was open for financial questions.  I guess that’s what agents are for.  The league wants to create a competitive balance, instituting lower salaries for rookies and a chance for teams to plan to build for the future, paying the proven veterans more money.  However, players want to score as much cash as quickly as possible, fearing that first or second year career-ending injuries could leave them not only jobless, but poor.  As of last Wednesday, the Players Association said that players would be open to taking $200 million out of the rookie wage pool and redistributing half to established veterans and the other half for retiree benefits.  However, instead of the current four season requirement before players are eligible for unrestricted free agency (and most first round picks usually go for a fifth), the players want to shave one year off.  I think coming to such a compromise is important, and what will eventually happen regarding this issue.  Also, I’d like to point out that this could affect whether or not college players declare early for the NFL, and if they play as hard in college as they do now.  Making money is the most important aspect of getting to the NFL, and preserving your career (especially if there are 18 game seasons) is how you make the most of it.  If there is less money guaranteed when coming in as a rookie, there will be little incentive for guys to stick around in college and endure the wear and tear that they will see in the NFL.  Leave school early and try to make it to the next salary level or stay in school and risk shortening your years as a professional….hmmmm.  Goodell the other executives need to think about how school and education will be affected before making a rookie wage scale decision.

Winner:  Both players and the league when a compromise is reached

The NFL and NFLPA will continue to go back and forth more times than heads in the stands at Wimbeldon.  But Mike Ditka made an excellent point on ESPN radio regarding the possibility of a lockout and the CBA:  “Don’t be greedy.”  Players and owners must realize that one cannot exist without the other, and if they do not come to a compromise, there will be no football in 2011.  Please, for the sake of die-hard fans and fantasy owners worldwide, do not let that happen.

Winner/Loser Predictions Re: NFL CBA Negotiations from Sports Agent Blog - Sports Business, Sports Law, Sports Negotiations, NCAA Rules

What: Santa Clara Law 2010 Sports Law Symposium

When: September 16, 2010 (9 a.m. – 5 p.m.)

Where: Locatelli Center, Santa Clara University (map)

Description: Because sports generate billions of dollars, the law has come to apply more and more to that industry.  This Symposium will look at three issues – concussions, steroids, and the use of athletes’ images – where law and sports intersect in a way that has garnered national attention. Panels of experts consisting of those most closely involved with these issues–athletes, lawyers, journalists, owners, officers of sanctioning organizations, physicians–will present the state of the art to an audience that will be limited to 200 attendees.

Schedule:

• 8:00 a.m.: Registration
• 9:00 a.m.: Welcome – Donald J. Polden, Dean, Santa Clara Law & Dan Coonan, Athletic Director, Santa Clara University
• 9:10 a.m.: Keynote Address – Alan Schwarz, New York Times
• 10:00 a.m.: Concussions: Athletic, Legal, Medical and Moral Issues
  • Jim Brown, National Football League Hall of Famer
  • DeMaurice Smith, Executive Director, National Football Players Association
  • John Hogan, Workers Compensation Attorney
  • Michael Dillingham, former team doctor, San Francisco ‘49ers
  • Craig de Recat, partner, Manatt, Phelps & Phillips, LLC
  • Ben Lynch, retired National Football League player
• 11:00 a.m. Break
• 11:15 a.m.: Concussions Panel (continued):
  • Michael Schulman, CEO, Anaheim Ducks
  • Don Gralnek, General Counsel, San Jose Sharks
• 11:35 a.m.: Performance-enhancing Drugs: Athletic, Legal, and Moral Issues
  • Don Catlin, medical doctor and leading researcher
  • Maurice Suh, Partner, Gibson Dunn & Crutcher
  • Michael Dillingham, former team doctor, San Francisco ‘49ers
  • Jeffrey Benz, former General Counsel, United States Olympic Committee
  • Jim Brown, National Football League Hall of Famer
  • Ron Katz, partner, Manatt, Phelps & Phillips
  • Ben Lynch, retired National Football League player
• 12:35 p.m.: Lunch, Lunchtime speaker: William H. Neukom, Managing Partner, San Francisco Giants
• 1:30 p.m.: Use of Athletes’ Images: An Active Area of Litigation and Licensing
  • Peter Parcher, Partner, Manatt, Phelps & Phillips, LLP
  • Mark Lee, Partner, Manatt, Phelps & Phillips, LLP
  • John Raleigh, Senior Vice President, IMG
  • Bill Duffy, Sports Agent, CEO of BDA Sports
  • Gregory Curtner, Partner, Miller Canfield
  • Michael Hausfeld, Partner, Hausfeld LLP
  • Robert Carey, Partner, Hagens Berman
  • Roger Noll, Professor Emeritus of Economics, Stanford University
  • Kara Yancey, Partner, HDP Law Firm
  • Kenneth Steinthal, Partner, Greenberg Traurig
• 3:00 p.m.: Break
• 3:15 p.m.: Use of Athletes’ Images Panel (continued)
  • Elsa Cole, General Counsel, National Collegiate Athletic Association
  • Professor Emeritus Harry Edwards, University of California, Berkeley
  • Jeffrey Benz, former General Counsel, United States Olympic Committee
  • Michael Gilleran, former Commissioner, West Coast Conference
  • Dan Coonan, Athletic Director, Santa Clara University
  • Daniel Rascher, Professor of Sports Management, University of San Francisco
  • Daniel Mason, Partner, Zelle Larsen
  • Chad Hummel, Partner, Manatt, Phelps & Phillips, LLP
• 5:15 p.m.: Reception

Cost: Early registration: tuition received before August 16, 2010 will be $100, all-inclusive. Tuition received after that date will be $125, all-inclusive. Students registered in an institution of higher education who register for this symposium will be admitted free of charge.

Continuing Legal Education: This program qualifies for 5.5 hours of California CLE credits, 1.5 hours of which will qualify for ethics credit. Upon request, we will apply for CLE credits in other states and other types of credits.

Santa Clara 2010 Sports Law Symposium from Sports Agent Blog - Sports Business, Sports Law, Sports Negotiations, NCAA Rules

Mr. Smith is only one of the many amazing names that will be in Chicago at the conference. Some of the other great names include Jeff Gewirtz, Senior VP and General Counsel of NETS Basketball/ Brooklyn Sports & Entertainment. Stephanie Varvadas, Managing Attorney for Nike Inc. Donald M. Fehr, Executive Director and General Counsel for the MLBPA, Richard J. Berthelsen, General Counsel for the NFLPA,  along with Professors Richard Karcher Director of Law and Professor Florida Coastal School of Law Center for Law and Sports, Vared Yakovee Professor at USC Gould School of Law and Editor-in-chief of Entertainement & Sports Lawyer, Gary R. Roberts from Indiana University School of Law and Gabe Feldman, Director of the Tulane Univesity Sports Law Program to name only a few.

35th Annual SLA Conference In Chicago Coming Soon from Sports Agent Blog - Sports Business, Sports Law, Sports Negotiations, NCAA Rules