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Think the owners are being the stubborn ones? Think again

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If you are truly a partner you are at risk. If the company is sued, loses money, etc, you share liability. If the 'partner' you describe does not share that risk, the partner is only euphamistically used. Using a term improperly would not be proof its definition is wrong.

They're not law partners but they are in the same class of employees who have a financial stake legalized contractually in the success of the business. I named several examples of this earlier. Not all of them are liable to losses. There are plenty who aren't. In fact, there are some on Wall Street who are paid solely according to the business's profits, and yes they often sue when they are not recompensed according to the language of their contract. They are in essence "locked out." In fact, this is very common, it has even happened to some of my family members.
 
A couple of things I was thinking about today.

1. The owners should again tell the union that they'd take $300 million but that this time, the giveback would replace the Supplemental Revenue Plan (i.e. revenue distribution to small market teams) and that there would be new language involved which established a soft salary floor. Teams would have to average a certain amount in yearly salary for players.

As you look at the cap and how it's slated to rise, we can envision the $170 million Patriots taking on the $120 million Bills twice a year, and that helps no one. If you could insure that salary balance is maintained league wide by forcing Ralph Wilson to max revs and pay his players, then this would benefit the players. The truth is the small market teams are close to their revenue maximums. They still make profits and they still spend practically to the cap, but they have no margins left. As the salary cap rises, that Supplemental Revenue Plan will need more juice to maintain parity. It will benefit the players and the fans. So, the players giveback, but only if they receive assurances that the money won't automatically find its way into the NFL bank accounts. This will also make the big market clubs happy since they will no longer have to subsidize the small markets beyond the sharing of TV revenues.

2. The rookie salary cap changes were interesting since the players were asking for smaller draft allowances versus strict slotting. I think this makes great sense and may be good for owners too since some college players are indeed deserving of more money. It's going to create mayhem in signing these players as--similar to baseball--you'll have players holding out, and it may change the shape of the draft if teams start foregoing late round picks in order to make nice with highly talented players. But, it also keeps the NFL's flank from being exposed too much. After all, think if Andrew Luck next year is relegated to earning only $4 million a year rather than say the $9 million Bradford is getting. A league like the UFL may get the idea that it's worth it to fork $7 million over to Luck. This way, whoever drafts Luck can satisfy him.

Can you say holdouts galore?
 
If you are truly a partner you are at risk. If the company is sued, loses money, etc, you share liability. If the 'partner' you describe does not share that risk, the partner is only euphamistically used. Using a term improperly would not be proof its definition is wrong.

Andy is more or less technically "right" in this debate, assuming that the definition of partner is "General Partner" and not "Limited Partner."

The whole point of partnership is "shared risk for shared gain." The most common and important coin of partnership Risk is financial capital. In the NFL, the owners take risks in many ways, but most notably by committing to contractual payrolls, by taking on debt for facilities and operations, by trying to build a Brand and by putting either startup or purchase equity into the franchise. So, for taking that risk they are entitled to the rewards of the upside in a disproportionate way. I really don't hear the players arguing that (obvious) point.

So, yeah, he's right on all of that.

However, a more contemporary and enlightened view of partnership would accept the above but acknowledge that there are industries in which the workers are, to a large degree, essentially irreplaceable as individuals and where the core business of the enterprise cannot reasonably be outsourced to alternative sources of technology or labor without a serious impairment of an enterprise's ability to conduct its business in a value-added manner. The NFL is clearly defined in terms of such an industry.

In addition, the identification of a franchise with some players is indeed part of the branding of that franchise, creating economic value for owners for many years, not only when such players are active but long after their retirement. Joe Montana still embodies his franchise's brand as do Bart Starr, the "Steel Curtain" and many other individuals, as, no doubt, will Tom Brady and Peyton Manning for decades to come.

In that sense, a player who puts his body, skills and future earning power on the line everyday he crosses onto a practice or playing field is indeed contributing human capital to the enterprise in a way that, to varying degrees, directly and uniquely impacts the enterprise's potential for success.

So, it's not unreasonable or out of the question for these players to see themselves as quasi Limited Partners in the enterprise of the NFL. They are, indeed, not risking financial capital but they are risking their human capital in a way that not only makes them essential and to a material degree irreplaceable to the success of the enterprise but which entitles them to considerations by those who are risking financial capital that go beyond the considerations that might normally be given.

Given the above and that, under the law, the salary paid to its players is the entirety of what a franchise owes to them, I think that wanting full and complete documentation of the, supposedly changed, financial status of the owners before ceding back to them billions of dollars of revenue generated by their play on the field is perfectly reasonable.
 
No, that is not correct. The players would have their pay reduced if revenues went down. That is not the same as a business operating at a loss. A business operating at a loss, loses the owners personal assets in operation.
In other words.
100 mill in revenue 90 mill in expense. Players at 60% are paid 60 mill, owners make 10 mill.
90 mill in revenue 100 mill in expense. Players paid 54 mill, owners loses 10 mill of thier own money that they had to use to pay the expenses, out of their bank account. Players had 54 mill income, owners had negative 10 mill.

Many business pay employees based on revenue, its called commission. In essense the players are commission employees.

The anti-trust law issue isnt something the owners want to violate. It is something that is necessary to have a competitive sports league.
And they do not VIOLATE it they have an EXEMPTION. That is because without it the NFL would be like Walmart competing against Target. You would end up with one rich owner buying all the players. The main component that the anti-trust law makes possible is the draft. The purpose of the antitrust exemption isnt for the owners to do harm to the union or anyone else, it is to allow them to exist as a league. Without it there is no league just independent 'football companies' which would end competitive sports as we know it.
At least thats how I understand it.

Actually, Whether they want to or not, the owners have violated Anti-trust laws and I think it was the judge currently presiding over the case who found them in violation. And I think you've described part of the dispute but missed the point. Yes, the owners have said we are losing money on our 40 percent (and the owners have other revenue sources that are not shared at all with some owners better at maximizing the than others) the players have said prove it by opening your books.
 
Actually, Whether they want to or not, the owners have violated Anti-trust laws and I think it was the judge currently presiding over the case who found them in violation. And I think you've described part of the dispute but missed the point. Yes, the owners have said we are losing money on our 40 percent (and the owners have other revenue sources that are not shared at all with some owners better at maximizing the than others) the players have said prove it by opening your books.

I don't think anyone is actually losing money. I think what's actually happened - and I'm far from an authority on this - is that the owners are claiming their profits are becoming smaller. The players have said "prove it" and the owners showed them some high-level aggregate numbers. Now, the players are saying "we want to see the details behind these numbers to make sure that you are losing profits for the reasons you say, and not because you are mismanaging your business".
 
I jumped in on this argument and I don't think anyone was arguing they are partners in a legal sense. They're not, but they are partners in the sense they share revenues. Part of the recent ruling was that the owners had a fiduciary obligation to maximize revenues for not just themselves, but also the NFLPA. To get to the current league structure, both side have given up several rights they would otherwise have. The players for example gave up certain free agency rights and accepted a salary cap. They would probable make even more money if teams like Washington could pay whatever it wanted or teams could have unlimited rosters. Yes, the owners have a greater financial risk, but players risk their careers every time they step on the field. What owners also have in the current environment is a great deal of cost certainty which is a very valuable thing.
 
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In many businesses, you are made partner. They only ask that you continue to bring in business as you share the firm's wealth. You have risked nothing--other than losing your job. Think of a lawfirm. Lawyers don't pay into the profit structure, they simply agree to a cut of revs (often predetermined).

As a partner in a law firm, you are given a bonus, typically a large one. And if the partners don't like it, they don't go storming into the managing partners' office claiming they have the right to see the books because their bonus is smaller than last year's. Of course what the partners are able to do is find a job with another law firm and take their customers along. So it's not such a good comparison.

Bottom line is this - both parties have valid points, both parties are being greedy, both parties need each other, both parties have something to lose. They need to get the deal done.
 
As a partner in a law firm, you are given a bonus, typically a large one. And if the partners don't like it, they don't go storming into the managing partners' office claiming they have the right to see the books because their bonus is smaller than last year's. Of course what the partners are able to do is find a job with another law firm and take their customers along. So it's not such a good comparison.

Bottom line is this - both parties have valid points, both parties are being greedy, both parties need each other, both parties have something to lose. They need to get the deal done.

What's that bonus based on?

On Wall Street, that bonus is predetermined, much as the players know what % of revenues defines the salary cap. It's the same on Wall Street. They have a preestablished contractual basis for their bonuses. Sometimes they get gypped and either sue or find another job. They sue for bonuses a lot these days.
 
Actually, Whether they want to or not, the owners have violated Anti-trust laws and I think it was the judge currently presiding over the case who found them in violation. And I think you've described part of the dispute but missed the point. Yes, the owners have said we are losing money on our 40 percent (and the owners have other revenue sources that are not shared at all with some owners better at maximizing the than others) the players have said prove it by opening your books.
I'm pretty sure you can't be in violation of a law you have an exemption from.
Opening the books to your adversary in a contentious negotiation would be idiotic.
 
I'm pretty sure you can't be in violation of a law you have an exemption from.
Opening the books to your adversary in a contentious negotiation would be idiotic.


The point of decertifcation is to challenge that exemption, and accepting a percentage of a revenue that can't be verified would be idiotic. If the owners don't want open books then they should offer the players a yearly lump sum independent of revenues. Someone on salary has no right to ask for transparency, someone on revenue sharing does.
 
Damn them for wanting the truth.
I think that is a shortsighted outlook.
I think there were many ulterior reasons the union wanted the financials. Frankly I see no way in the world that the result would be NFLPA looks at the books, says see you arent losing money, and he NFL says yup, caught me, I'll accept your offer.
In the real world they would now fight, disagree and battle over what the books really say. (Just as statistics and their meaning, usage and context are argued here) To say both sides would interpret those complex financials identically is silly.
With those financials, the union now gains bargaining power by isolating whatever issue they see fit and ignoring what they do not. Additionally, at that moment they were on the brink of a lawsuit.
Consider this:

I will consider your answer if you show me all of your financials, allow me to assess the strength of your commitment to hlding your bargaining position, be able to mathematically apply my proposal, in my terms to your actual numbers, and pick and choose which of the numbers best support my case, and if you don't do it, we will decertify and sue your @ss.

Do you really think anyone in their right mind would fall for that?

It seems to me that the union planned to decertify all along expecting that its best result would come in the court room, and the negotiating that has been going on was posturing for the lawsuit, including trying to grab those financials.
I'm certainly no expert on this matter, but I know a few things about negotiation.
 
What's that bonus based on?

On Wall Street, that bonus is predetermined, much as the players know what % of revenues defines the salary cap. It's the same on Wall Street. They have a preestablished contractual basis for their bonuses. Sometimes they get gypped and either sue or find another job. They sue for bonuses a lot these days.

I don't think you and I are talking about the same thing. But regardless of that, I shudder to think that we're going to start using Wall Street as the ideal business model that the NFL should strive to become.
 
The point of decertifcation is to challenge that exemption, and accepting a percentage of a revenue that can't be verified would be idiotic. If the owners don't want open books then they should offer the players a yearly lump sum independent of revenues. Someone on salary has no right to ask for transparency, someone on revenue sharing does.
I think you are mixed up here. I have never seen one single accusation that revenues were not being reported properly, and I believe since the cap is tied to revenues, the NFLPA has access to that information.
They are asking for 10 years of full financials for all teams.
They have transparency on revenue, and have ever since the cap has been in place. No union would ever agree to a system where they got a percentage of revenues and those revenues did not need to be verified.
The request for the books, is to use the profit margins, of SOME teams as a bargaining chip.
Essentially, the NFL has stated that expenses have risen, and the NFLPA says we will not agree to any deal until we are allow to look at your books and define them however we choose.
As has been stated many times, the NFL has no obligation to tie their proposal to increasing costs, or anything. The could simply say, we negotiated a bad deal last time so you need to take less or we will not sign a new CBA.
 
The point of decertifcation is to challenge that exemption, and accepting a percentage of a revenue that can't be verified would be idiotic. If the owners don't want open books then they should offer the players a yearly lump sum independent of revenues. Someone on salary has no right to ask for transparency, someone on revenue sharing does.
By the way, they are not asking for verificaiton of revenues during the new CBA they are asking for financials for the last 10 years. If they were objecting to the way revenues are being calculated or negotiating a more transparent or reliable method (my understanding is that it already is both) then they would have a 100% valid point.
10 years worth of old financials is a fishing expedition.
 
I think that is a shortsighted outlook.
I think there were many ulterior reasons the union wanted the financials. Frankly I see no way in the world that the result would be NFLPA looks at the books, says see you arent losing money, and he NFL says yup, caught me, I'll accept your offer.
In the real world they would now fight, disagree and battle over what the books really say. (Just as statistics and their meaning, usage and context are argued here) To say both sides would interpret those complex financials identically is silly.
With those financials, the union now gains bargaining power by isolating whatever issue they see fit and ignoring what they do not. Additionally, at that moment they were on the brink of a lawsuit.
Consider this:

I will consider your answer if you show me all of your financials, allow me to assess the strength of your commitment to hlding your bargaining position, be able to mathematically apply my proposal, in my terms to your actual numbers, and pick and choose which of the numbers best support my case, and if you don't do it, we will decertify and sue your @ss.

Do you really think anyone in their right mind would fall for that?

It seems to me that the union planned to decertify all along expecting that its best result would come in the court room, and the negotiating that has been going on was posturing for the lawsuit, including trying to grab those financials.
I'm certainly no expert on this matter, but I know a few things about negotiation.



Then the owners should abandon revenue sharing and offer the players a lump sum. I would be much more sympathetic to the owners case if they weren't trying to have it both ways, they want the players to share in the risk related to yearly revenues, but don't want to let them see what those revenues are. If they offered the players a yearly sum not related to revenue the players would have no right to ask for transparency they cvould simply take it or leave it, but when they offer percentages then the players have a right to know what the whole pie is.

I don't see how anyone advising the players could in good conscience tell them to simply trust the owners given that the owners have already violated the current deal by their dealings with Direct TV.
 
the owners are the ones who had this planned for 2 years, so this media spin of thier so called offer is a sham... the players are playing this so right, the leauge is at a all time high, the owners are the ones crying poverty open your books snyder, kraft and jones... lets see who is losing money... the players will win this in court , there will be football this year, but the offseason will be delayd.. nuf said...

Seems to me that the union has been planning litigation for over two years from the time Smith (a lawyer) was hired. Maybe I missed it, but I haven't heard any counter offers from the union during this period. Their chief negotiator is the person who will litigate the lawsuit (and thus be overly compensated). As stated, I haven't heard of any concession at all on the union's part. And I have to laugh at the unions statement of a "partnership". Who in the union has any of their money at risk?
 
By the way, they are not asking for verificaiton of revenues during the new CBA they are asking for financials for the last 10 years. If they were objecting to the way revenues are being calculated or negotiating a more transparent or reliable method (my understanding is that it already is both) then they would have a 100% valid point.
10 years worth of old financials is a fishing expedition.


Andy, in your previous post you said that you haven't seen anyone suggest revenues weren't being reported properly yet in this post you are saying that the players are trying to find out if the revenues were being reported properly. Which is it?

BTW-The Direct TV deal is a clear violation of the CBA and evidence revenues were being screwed with. Given that deal the players are absolutely right to want to know what else has been going on.
 
Seems to me that the union has been planning litigation for over two years from the time Smith (a lawyer) was hired. Maybe I missed it, but I haven't heard any counter offers from the union during this period. Their chief negotiator is the person who will litigate the lawsuit (and thus be overly compensated). As stated, I haven't heard of any concession at all on the union's part. And I have to laugh at the unions statement of a "partnership". Who in the union has any of their money at risk?

The players have said they will rework the deal and take less if the books show that is needed, the owners refuse to back up their own case with the proof of their claim
 
My point is easy to understand. "Show us (the NFLPA) where your expenses have increased dramatically, if you want us to take a dramatic pay cut" doesn't really take a lot of explanation.

I'm confused about the "dramatic pay cut". The salary cap was to increase to $161 MM which is substantially higher than the current cap. Where is the pay cut?
 
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