Last week, Caron Butler, Ben Gordon, Anthony Tolliver, and Derrick Williams filed a Class Action Complaint against the NBA and its member teams in the U.S. District Court for the District of Minnesota.  At roughly the same time, another class of NBA players filed a similar lawsuit in the Northern District of California.  The California lawsuit has since been dismissed without prejudice, and the Complaint filed in Minnesota has been amended to include the Plaintiffs from the California suit.

The following list displays the current class of Plaintiffs in the Minnesota lawsuit along with their respective agents.

• Carmelo Anthony – Leon Rose (CAA)
• Chauncey Billups – Andy Miller (ASM Sports)
• Caron Butler - Raymond Brothers
• Baron Davis – Bill Duffy (BDA Sports)
• Kevin Durant – Aaron Goodwin (Goodwin Sports Management)
• Ben Gordon - Raymond Brothers
• Kawhi Leonard – Brian Elfus (Impact Sports Management)
• Steve Nash – Bill Duffy (BDA Sports)
• Leon Powe – Aaron Goodwin (Goodwin Sports Management)
• Anthony Randolph - Bill Duffy (BDA Sports)
• Rajon Rondo - Bill Duffy (BDA Sports)
• Sebastian Telfair - Andy Miller (ASM Sports)
• Anthony Tolliver - Larry Fox
• Derrick Williams - Rob Pelinka (Landmark Sports Agency)

With the addition of the new Plaintiffs, there no longer appears to be a claim that all Plaintiffs are somehow tied to the state of Minnesota (other than the fact that they all travel to Minnesota in away games against the Timberwolves).  My friend Marc Edelman, who I consider to be one of the leading experts on Antitrust in Sport, believes that the NBA players smartly dismissed their California Complaint in favor of joining up with the class in Minnesota.  He feels that it will be easier for the class to argue market power in the Minnesota jurisdiction as opposed to the Northern District of California jurisdiction, where precedent may have worked against the players’ arguments.

NBA players will now put up a fight, in unison, in the same court that NFL players were heard within the past year.  The Honorable Patrick J. Schlitz is the judge that has been randomly selected to hear the NBA case.  As Michael McCann has pointed out, Judge Schlitz was a lawyer in the case concerning the Timberwolves’ attempt at relocating to New Orleans and has represented the NFL in several cases.

NBA Amended Complaint in Minnesota

Players Add Plaintiffs, Amend Their Minnesota Complaint v. NBA from Sports Agent Blog - Sports Business, Sports Law, Sports Negotiations, NCAA Rules

Aaron Goodwin of Goodwin Sports Management has represented some of the best players in basketball.  At one point in time, he represented Rodney Stuckey, LeBron James, Al Horford, and Dwight Howard.  They all currently have different agents representing them.  Now add Jamal Crawford to that list.

Jamal Crawford has terminated his relationship with Goodwin Sports Management in an offseason where he is expecting a nice payday (through an extension) once teams resume signing players.  He has performed impressively with the Atlanta Hawks over the past couple of years, and should have quite a few teams as potential suitors, should the Hawks not be interested in providing Crawford’s future request for an extension.

Goodwin Sports Management’s big client is now Kevin Durant.  The company also represents Nate Robinson, Matt Barnes, Demar DeRozan, Terrence Williams, amongst others.  Crawford has not yet announced who his next agent will be.

On To The Next One: Jamal Crawford from Sports Agent Blog - Sports Business, Sports Law, Sports Negotiations, NCAA Rules

The NBA draft is right around the corner and whatever number your player is picked, he’s going to have to pick up not only his game, but also his business skills, unless he wants to end up as one of the 60 percent of NBA players who are broke within five years of retirement.  Some pro athletes have it down, and I have been privileged to provide legal counsel to a number of professional athletes who have their act together.  But no matter who your player is, they each face similar issues, and what separates them is how they handle the pressure.  So before your player signs his first big shoe deal, here’s a list of business moves that he should make.

#1:       Get Extra Insurance and a Will

Your player needs to look into getting life, primary and umbrella coverage, and disability insurance, as well as a will.  While the death of your player is unlikely, it’s not unheard of, as more than 100 NBA, MLB, and NFL athletes have died during their careers.  Without a significant life insurance policy on top of the minimal one that may be provided to all players under the league’s collective bargaining agreement, death would mean financial ruin for those who will soon depend upon his income.  This is especially true if there’s a lockout, when benefits could be rescinded or suspended.  When the NFL’s Darrent Williams was murdered, the life insurance coverage provided under the league’s collective bargaining agreement was insufficient to provide for his two kids, causing the Broncos to establish a fund for fans to help provide for his kids’ futures.

Your player also needs a significant primary and umbrella liability policy, which will provide protection from the lawsuits he may be hit with now that he’s a professional.  If he’s using social media, make sure the policy covers claims like libel, which are not always included.

And since he hasn’t yet built up his bank account, a disability policy should be considered to protect him from a career-ending injury leaving him broke.  Your player may not get the same treatment as the NBA’s Jay Williams, whose contract was voided from a career-ending motorcycle injury, yet the Chicago Bulls were kind enough to pay him out.  This is especially true given the pending NBA lockout, because with no guaranteed contract available during the lockout, an injury during an informal workout or other activity could leave your player with no future income and no health insurance.

Finally, remind your player that a will likely only costs a few thousand dollars, but can prevent disastrous consequences.  For example, when the Redskins’ Sean Taylor died without a will, only his daughter inherited, leaving the rest of his relatives that had previously relied on his income with nothing.  When Steve McNair died without a will, he left his family with no access to his $19 million estate for more than a year.

#2:       Play Defense With Money

Given the high income/short career span of your pro athlete, a conservative investment approach is the way for him to get and stay rich.  Many athletes are enticed into alternative investments either by friends, family, or new acquaintances.  Unfortunately, these investments are unlikely to make 50 Cent money, so any opportunity should be vetted by an advisor who is highly qualified and, most importantly, who has no stake in the outcome.  At the very least, your player should set aside only 10 to 15 percent of his liquid net worth for these higher-risk investments.  Learn from Scottie Pippen, who went broke within six years of retirement, losing $120 million in career earnings, with $27 million lost on bad business deals.

#3:        Limit Risk on Endorsements

If your player decides to have an ownership stake in a corporation he’s endorsing, make sure that the company he’s investing in provides insurance and agrees in writing to defend legal claims on his behalf.  And if the product is high-risk, like a nutritional supplement or new-fangled sports device, make the company provide a legal opinion vetting the legality of the product and its marketing claims, since federal law says your player may be personally liable for his endorsements.  At a minimum, he should be very careful about representations he personally makes, about the product or that the company attributes to him.  Both Shaq and Lamar Odom learned this from the class-action lawsuit they are currently facing for their endorsement of Power Balance bracelets, which alleges that they should have known there was no reasonable basis for the marketing claims they made about the product’s benefits.

#4:       Add Value to an Existing Foundation

It’s likely that your player has no time, isn’t an expert in running a charitable organization, and that his pet cause is probably already being served by a qualified, well-run organization.  If true, he may be better served helping out pre-existing organizations, rather than creating his own.  There are obviously positive exceptions, like Alonzo Mourning Charities and the Steve Nash Foundation, but starting and maintaining a foundation costs hundreds of thousands of dollars and requires navigating complicated law.  In a best-case situation, it will likely be years before your player’s foundation makes a significant difference, and at worst, he’ll end up like ex-Cub Sammy Sosa, who was awarded MLB’s Roberto Clemente Man of the Year award for charity work and only one year later, his foundation faced allegations of misuse of funds.

#5:       Get His Online House in Order

Given that more Americans get their news from the Internet than from newspapers or radio, it’s critical for your player to establish an online brand.  Having a lawyer stop the online imposters and cybersquatters is a great way to start.  Ask Chris Bosh, who sued when he got tired of not being able to use his dot-com and not only won it back, but also offered to return more than 800 other cybersquatted athlete domain names to NBA players like Danny Grainger and Jared Dudley.  Ask the ex-New England Patriot Rodney Harrison, who had an imposter use his Twitter handle to pick a fight with the Jets’ Kerry Rhodes without Rhodes realizing it.  Or the Miami Dolphins’ Davone Bess, whose Twitter imposter hosted a fake chat and even got the Tennessee Titans’ Chris Johnson to agree to a footrace.

Once the brand is under control, your player needs to avoid messages that make him fodder for Deadspin and TMZ.  Every post effectively constitutes a press release, so they should be vetted carefully.  The WNBA’s Cappie Pondexter learned that lesson after her offensive Tweets about the Japan tsunami.  So did the Pittsburgh Steelers’ Rashard Mendenhall, whose four-year Champion endorsement deal was recently terminated after his offensive Bin Laden Tweets.  As did both Gilbert Arenas and Reggie Bush, when Arenas was fined by the NBA for Tweets about sexting and Bush was publicly criticized when he Tweeted how much he was enjoying the NFL lockout. And if your player is too busy to post his own messages, make sure that whoever is posting on his behalf is overly cautious.  Learn from Braylon Edwards of the New York Jets, who was sitting in jail after an arrest while someone embarrassingly tweeted, “Good Morning World!”, under his Twitter account.

#6:         Use A Corporation Properly

There is value to your player in setting up an LLC or corporation, although the true value lies in knowing what benefits the corporation actually provides and in using the corporation properly.  Many set up a corporation mistakenly thinking that it’s some sort of tax shelter, but its main purpose is actually to shield the player’s personal assets from lawsuits.  However, that protection will only be available if the player keeps the corporation in good standing with the state and observes other legal formalities, actually enters into business deals through the corporation, pays his staff via the corporation, has his cars owned by the corporation, and generally doesn’t treat the corporation like a personal piggy-bank.  While that all sounds totally obvious, more often than not, we see players fail to abide by these simple rules.

So good luck to your player on draft day.  But remember, what’s really important is not the deal they make today, but what they do over the coming years that will shape their future.

Brian Heidelberger is a partner and Chair of the Advertising, Marketing, and Entertainment Law Practice at Winston & Strawn LLP, a global law firm, and has provided legal advice to a myriad of professional athletes, including Dwayne Wade, Luol Deng, Donovan McNabb and Kevin Durant, and represented Chris Bosh in his 2009 cybersquatting case (bheidelberger@winston.com & www.winston.com/bheidelberger).

Business Moves Your NBA Player Should Make As Soon As He’s Drafted from Sports Agent Blog - Sports Business, Sports Law, Sports Negotiations, NCAA Rules

Football

• The New England Patriots follow draft prospects on Twitter as part of the scouting process [Quick-hit thoughts around NFL & Pats].
• Particular focus on item 7. Will the players stay unified during the lockout? [Ruling in favor of NFL, lockout extension set up key June decision]
• The Houston Texans have more players on Twitter than any other team [Twitter sense for NFL players].

Baseball

• The Rays have 12 of the first 89 picks in the 2011 Draft and 10 of the first 60 [Rays readying to make most of Draft bounty].
• Agents have a vested interest to fight implementation of a slotting system [Sides dig in for battle over slotting in draft].
• Boras says that Eric Hosmer will have his own market [Boras shoots down idea of Royals locking up Hosmer].

Basketball

• Eric Goodwin makes sure to mention his previous work with LeBron and Dwight [Kevin Durant's Marketability On The Rise].

Sports Business

• PAFI stands for the Professional Athlete Franchise Initiative [Sports agents team with PAFI to prepare clients for career transition].

Shabbat Shalom: Friday Wrap-Up (5/20/2011) from Sports Agent Blog - Sports Business, Sports Law, Sports Negotiations, NCAA Rules

• A.J. Abrams – Keith Glass. Signed with Scaligera Basket Verona in Italy.
• LaMarcus Aldridge – Arn Tellem (Wasserman Media Group)
• D.J. Augustin – Thad Foucher (Wasserman Media Group)
• Kevin Durant – Aaron Goodwin (Goodwin Sports Management)
• T.J. Ford – Arn Tellem (Wasserman Media Group)
• Daniel Gibson – Andy Miller (ASM Sports)
• P.J. Tucker – Andre Buck (ISM)

Wasserman Media Group certainly sticks out amongst the crowd, and I have heard that Texas star Sophomore Jordan Hamilton is leading in their direction.  He is not the only potential first rounder in the 2011 NBA Draft.  If Freshman Tristan Thompson decides to leave, he could also be a fairly early selection.  Texas is a scary team if both players come back, but it is unlikely that either stick around Austin no matter what is being said at this point in time.

Agent Selection Scenarios: Texas Basketball from Sports Agent Blog - Sports Business, Sports Law, Sports Negotiations, NCAA Rules

I learned a lot this weekend.  Perhaps the most important nugget of information was that I should never wait until the last minute to start looking to book a flight.  And even when waiting until the last minute, there is no reason to be stubborn and say, “Screw it, I’m driving.”  Although I was able to take care of plenty of phone calls on the road, driving sixteen hours in three days is not something that is fun or necessary.  Anyway, I am back from Winston-Salem and Chris Paul’s charity bowling tournament, and back to the daily grind.

The weekend was a major success.  I left Friday morning, slightly hungover from the previous night’s festivities.  I made it through all of the Florida speed traps, through Georgia, South Carolina, and eventually into North Carolina.  By the way, the lakes in Davidson (just outside of Charlotte) are beautiful.  I arrived in Winston-Salem at around 7 p.m. and got lost a few times before finding my final destination.  I took a former intern and current Wake Forest student, Justin Herzig, and Dynasty‘s Bowling Division Director, Bruce Falcon, out for some authentic barbecue and before we left the establishment, we all felt that we had been severely hit on by the waitresses, which was not all that gratifying.

The next day, I snuck into a gym to get my daily workout in, caught up on some law school reading, and watched the first half of the Florida vs. Tennessee game before I headed to the Winston-Salem AMF Lanes. At the bowling alley, I met up with Bruce and a couple of gentlemen from Chaney Sports Marketing Group. Besides seeing one of our clients bowl and network with others in the industry, Bruce and I had traveled to North Carolina to witness what goes into creating such an event. Between myself, Bruce, and Chaney Sports, we hope to create a similar bowling event during All-Star weekend. Much more on that to come in the future.

The Dynasty client that participated in CP3 weekend is Tommy Jones. He was partnered up with Dwyane Wade, who I love as a basketball player, but leaves quite a bit to be desired on the lanes. I am not going to give away who won the event, but let’s just say that D-Wade did not stick around for long. Throughout the event, LeBron James was cracking jokes on everyone, and the crowd was eating it up. I hope that ESPN captured some of LeBron’s antics for when the show goes on air in a few weeks. By the way, look out for a spiked hair guy wearing a blue button-down shirt. I am told that I can be seen in the background of many shots.

The event was catered by Texas Roadhouse, and when there is food, I am a happy camper. Five chicken breasts did the job and I was set for the evening. After the bowling tournament, we headed to a club downtown called 411, which was rented out by Chris Paul and contained more free food, an open bar, and some giveaways.

Overall, it was a great event. The drive home on Sunday was less than pleasurable; however, nothing beat hearing that the Dolphins took it to the Patriots in Foxborough. And it seems like Dynasty may be signing some new clients in the near future based on some of my phone conversations in the car. So I guess driving was not so bad after all…

To see some pictures that I took during the event, click here.

Chris Paul’s Winston-Salem Weekend from Sports Agent Blog - Sports Business, Sports Law, Sports Negotiations, NCAA Rules