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NFL Lockout: What's "likely?"

How is this labor dispute likely to end?

Isn't that the question NFL fans want answered? When will Free Agency start? Will we have a 2011 season? Who will ultimately win this court battle and when will that court battle be decided?

Ironically, the Judges themselves have been unable to agree on who is likely to win this court case, and that impasse has caused the flip-flop on the starting the 2011 season. Judge Nelson originally ruled that the Players were likely to win their lawsuit and issued an injunction. Now Judges Colloton and Benton of the Eighth Circuit Court of Appeals have decided that the Owners are likely to prevail and issued a stay pending appeal. The third judge of the Eighth Circuit, Judge Bye, dissented--agreeing with Judge Nelson that the Players are likely to win.

Four Federal Judges have forecasted the future and their predictions have come out fifty-fifty.

Is their any reason for us football fans to put on our Monday Morning Court Robes and attempt to foretell what the Judges cannot decide upon: what's "likely?"

The Player's arguments in Brady v. NFL were far reaching, taking aim at the legality of the lockout, the salary cap, and the draft, absent a player's union. But before debate could proceed on the merits of those issues, the Players also filed a motion for a preliminary injunction against the Owner's lockout. Essentially, the injunction would prevent the Owners from stopping the 2011 season while the issues before the court were still being decided.

In order to be granted a preliminary injunction, the Players had to satisfy four criteria independently. First, they had to show that, in the end, they were likely to win their lawsuit( Likelihood of success on the Merits). Second, they had to show how the lockout was causing harm to the Players that could not be later repaid with money( Irreparable harm). Third, the Players had to demonstrate that ending the lockout would not harm the Owners more than it would benefit the Players( Balance of Equities). Finally, the last requirement for a preliminary injunction is that the injunction must serve the public interest.

I think it's safe to say that the Players have satisfied the last three criteria for an injunction. The Players stand to suffer irreparable harm if the lockout continues. We're not talking about the Tom Bradys or the Peyton Mannings, we're talking about the players like Jeremy Beal, who need this offseason to learn a playbook and work with coaches to secure a roster spot. The window of career opportunity for these players is small and the harm they would suffer without the opportunity would be impossible to monetize.

So far, the Owners have yet to put forth a compelling argument on how going forth with the 2011 season will cause the Owners significant harm. Their main contention is that they will lose leverage at the bargaining table because starting a season with free agency and a salary cap will inevitably open the Owners to more antitrust liability. But if the Player's decertification is solid, the Owners can't claim its illegal action as a harm. As Judge Nelson notes in her ruling:

"Insofar as such liability would flow from the League's lockout violating the Sherman Act, the League cannot predicate harm on the results of its illegal conduct."

With concerns for the public good, an injunction would go far in preventing the economic impact on football cities caused by the lockout. Already in the early stages of this lockout, we've seen support staff laid off, salaries slashed, and municipalities bracing for losses in tax revenues if games are not played. But the public good extends beyond just the economic issues. As football fans, we invest our attention and passion into the game that is just as much a part of the public interest. From Nelson's ruling:

"the public ramifications of this dispute exceed the abstract principles of the antitrust laws, as professional football involves many layers of tangible economic impact. . .And of course, the public interest represented by the fans of professional football--who have a strong investment in the 2011 season--is an intangible interest that weighs against the lockout. In short, this particular employment dispute is far from a purely private argument over compensation."

If the Players have satisfied 3 out of the 4 criteria for a preliminary injunction, then our attention should focus on the final piece of the puzzle: whether the Players are likely to succeed on the merits of their lawsuit. It should be no surprise that this is where much of the disagreement exists. In Judge Nelson's 89-page ruling, 50 pages are dedicated to this topic alone.

The discussion focuses on two parts of the Norris-La Guardia Act, a federal law passed in 1932, that limits the courts ability to grant injunctions in labor disputes. The Owners contend that the facts of the case prevent a court from granting an injunction against the lockout.

"Growing Out Of"

First at issue, is if the Norris-La Guardia Act even applies to the current case. The Act states that "No court of the United States. . .shall have jurisdiction to issue any restraining order or temporary or permanent injunction in a case involving or growing out of a labor dispute." Judges Colloton and Benton take this wording at face value in their ruling to say,

"The plain language of the Act states that a case involves or grows out of a labor dispute when it is 'between one or more employers or associations of employers and one or more employees or associations of employees.' 29 U.S.C. 113(a)(1)(emphasis added). The Act does not specify that employees must be members of a union for the case to involve or grow out of a labor dispute."

But for Judge Bye, in his dissenting opinion, the issue becomes whether to take the words "growing out of a labor dispute" tabula rasa, or interpret the phrase within the original intent of the Act. When Congress passed the Sherman Antitrust Act in 1890, to prevent corporations from creating monopolies and creating restraint on free commerce, courts extended the Act to squash the activities of organized labor. When labor unions would strike against their employer, the courts would readily award an injunction to end the strike. The Clayton Antitrust Act of 1914, sought to reject the courts opinions and exempt labor from antitrust liability, stating, "The labor of a human being is not a commodity or article of commerce. Nothing contained in the antitrust laws shall be construed to forbid the existence of and operation of labor."

Even after the Clayton Act, the courts continued to apply a very narrow interpretation of the law. In Duplex v. Deering (1921), the Supreme Court ruled that while the Clayton Act prevented the courts from issuing an injunction during a dispute among the employee and employers, the same protection was not granted when the union ventured outside of the employee/employer relationship. A group of newspaper-press machinists were able to convince those employed with the delivery and installation of the presses to join a union boycott. In Duplex v. Deering, the Supreme Court found that such a "secondary boycott" was illegal.

In turn, the Norris-La Guradia Act in 1932, was advanced to reject the Supreme Courts narrow ruling in Duplex, and as a way to protect a larger circle of actors in an ongoing labor dispute. For Judge Bye, the use of the phrase "growing out of a labor dispute" was a way for Congress to protect individuals on the periphery of a labor dispute and not a way to extend antitrust exemption.  

Taken to the extreme, Judge Cololton and Judge Benton have ventured down a path with no end. If the barrier to remove liability for an injunction for a corporation is to simply show the disagreement started as a labor dispute, the Owners can wait till the end of days. But as Judge Bye points out, the Supreme Court has already considered that there are limits to the NFL's immunity of antitrust law.

In the Supreme Court case Brown v. Pro Football, Inc (1996), the Owners were sued for unilaterally implementing a scheme for practice squads after an impasse of collective bargaining. The Court ultimately found that the Owners enjoyed exemption from the antitrust laws in this specific instance, but they made clear that such exemption was not invincible. The Supreme Court in Brown said,

"Our holding is not intended to insulate from antitrust review every joint imposition of terms by employers, for an agreement among employers could be sufficiently distant in time and in circumstances from the collective bargaining process that a rule permitting antitrust intervention would not significantly interfere with that process."

As an example, the Supreme Court points to a case,

"suggesting that exemption lasts until collapse of the collective bargaining relationship, as evidenced by decertification of the union"

Judge Bye criticizes Colloton and Benton, because "Instead of accepting a simple, clear-cut line of demarcation suggested by Brown--upon dissolution of the union--the majority indulges in the fiction that collective bargaining continues for some undefined period following the disclaimer." I agree with Judge Bye. The failure to consider the impact the union's disclaimer had on the development of the labor dispute makes me question the reasoning behind Colloton's and Benton's ruling.

Relation of Employment

The second part of the Norris-La Guardia Act at issue, is the enumeration of the specific instances that an injunction cannot be used. The difficulty of the Owners position is that the Norris-La Guardia Act was written to protect labor and the words are not easily switched to promote employers preventing employees from working.

The Owners argument that the Norris-La Guardia Act prevents a judge from granting an injunction stems from the Act's statement that

"No court of the United States shall have jurisdiction to issue any restraining order or temporary or permanent injunction in any case involving or growing out of any labor dispute to prohibit any person or persons participating or interested in such dispute from doing. . . (a) Ceasing or refusing to perform any work or remain in any relation of employment."

The Players have made the argument that this phrasing of "ceasing or refusing to perform any work or remain in any relation of employment" applies only to injunctions against workers and not employers. Judges Colloton and Benton seem to gloss over this fact establishing that they think that argument is unlikely to prevail,

"Because the phrase remain in any relation of employment naturally applies to employers as well as employees"

But again, ignoring the intent of the law, to protect the rights of organized labor while protecting against the establishment of monopolies, leaves me questioning the soundness of Judge Colloton's and Judge Benton's conclusion. As Judge Bye notes, while this act was

"done ostensibly to 'stay the hands of courts whose creativity had been employed in the service of management. . .in interpreting these provisions, the majority loses sight of the principal purpose of the Act, and as a result, manages to use 'benefits to organized labor . . . as a cat's-paw to pull employers' chestnuts out of the antitrust fires.'"

The NFL's Harm

If you've followed me this far, you probably can tell that I am very critical of Judge Colloton's and Judge Benton's majority ruling. I admit, as a football fan I may be biased with wanting to see the 2011 season start now. But no matter what angle I read the majority ruling from, I still find it difficult to support. I'm no more puzzled by the Judges' ruling then their inability to show how the Owners would be harmed by removing the lockout.

Since the Eighth Circuit Court of Appeals was debating issuing a stay on Judge Nelson's already granted injunction, the first order of business should have been to establish whether or not the Owners would suffer irreparable harm by the injunction. As Judge Bye notes in his dissent,

this court has recognized that '[r]egardless of the strength of its claim on the merits, a movant for a [stay pending appeal] should show a threat of irreparable harm. . . Failure to show irreparable harm is an independently sufficient ground upon which to deny a [stay].'"

This all means that no matter how convincing the Owners case is in showing they are likely to win, unless they show how they are being harmed by the lockout, the injunction cannot be removed. The Owners sole claim of harm is the loss of leverage at the bargaining table. The problem with this reasoning is that the loss of leverage would only stem from the NFL being unable to continue the illegal, concerted actions of exclusive player tags and salary caps absent a collective bargaining agreement. Judges Colloton and Benton determination on the harms presented, that "both sides raise valid points," is cruelly hilarious. Much more analysis should have gone into the harms being suffered by the Owners before this stay was granted.

What's Next?

So this is the part where I get to write what I think this labor dispute is likely to go. But if Four Federal Judges can't find common ground on where this case will finish, what chances does a lowly fan have to predict the future?

For the record, I still think the Players have the clear advantage in this legal battle. Even if they don't eventually win an injunction, they still have a solid case against the Owners. Before you criticize me of bias, just consider that much of our legal system is built upon the individual's right to contract their services. It's not so much that I'm biased towards labor, rather the law is. But I'd be shocked if this legal battle ever reaches a conclusion. This labor strife will end at the bargaining table, its just a matter of when and why--that's really the only destination.

But between now and then, fans will be subjected to a different season of football. Not a game played on a field, but something more akin to exclusively watching referees, under the hood, reviewing replay challenges. The voices of the commentators' blistering the eardrums as the same replay is shown on screen ad infinitum:

"Ian, it sure looks like from this angle that he got both feet in bounds for the touchdown."

"But did he maintain control of the ball as he went to the ground Dan? That seems to be the question for me."

"He needs to find irrefutable evidence to overturn it!"

And us fans are still where we've always been, alone on the couch, yelling expletives about the ignorance of the refs, waiting for the game to resume, all the while being captivated by the process. 

For questions on the current labor dispute, or if you want to talk anything Broncos, hit me up on my twitter @MHR_Matt