Appalling or Appropriate? An Analysis of the Merits of Ray Rice’s Appeal

On September 15, 2014, it was announced that Ray Rice plans to appeal both his indefinite suspension and termination from the Ravens in the wake of domestic violence charges. While Rice is not currently with a club, he is still a member of the NFL Players Association (NFLPA); therefore, the NFLPA will be assisting Rice in his appeal. Previous grievances and suspensions provide a valuable illustration of the potential merits of Rice’s appeal.

The facts are still unclear in the entire situation. But, as we can gather, the timeline of events and evidence are as follows:

  • February 19, 2014: A video emerges of Ray Rice dragging his unconscious fiancé (and now current wife) Janay, out of an elevator in a hotel in February.
  • June 16, 2014: Rice and his fiancé both have a meeting with Roger Goodell to discuss the circumstance of the situation.
  • March 27, 2014: Rice is indicted on third-degree aggravated assault charges. He pleads not guilty May 1, 2014.
  • July 24, 2014: Rice is punished by Goodell and must serve a two game suspension. Rice is not punished by his team.
  • August 28, 2014: The NFL announces a new standardized penalties for domestic violence and sexual assault by any league personnel: a six-game suspension and indefinite suspension for first-time and repeat offenders, respectively. On the topic of the Rice suspension, Goodell announced “he didn’t get it right.”
  • September 8, 2014: A second video emerges, detailing exactly what happened in the elevator, including a full view of Ray striking his fiancé. Roger Goodell increases the suspension from two games to an indefinite suspension. The Baltimore Ravens terminate Rice’s contract.
  • September 10, 2014: The Associated Press reports that, while Goodell levied a new suspension in light of new evidence, and because the video was “starkly different” than Ray’s account of the situation, Goodell or his office had knowledge of the second video tape since April.

Ray Rice’s appeal will likely be centered primarily on two claims. First, he may assert that his suspension constitutes double jeopardy, or stated otherwise, that he being punished twice for the same transgression. Section 4, Article 46 of the NFL Collective Bargaining Agreement (CBA) states that “the Commissioner and Club will not both punish a player twice for the same act or conduct. The Commissioner’s action will preclude or supersede disciplinary action by any Club for the same act or conduct.” The language does not explicitly prohibit double jeopardy by the Commissioner or the Club separately, but there is reason to believe this clause precludes it.

One of the most prominent double jeopardy arbitration decisions was issued by arbitrator John Feerick, a Fordham University School of Law professor and former dean. The case concerned the suspension and contract termination of Golden State Warriors player Latrell Sprewell for choking coach P.J. Carlesimo. Feerick found that the suspension and the termination of the remainder of Sprewell’s three-year contract was “excessive” in combination. While Feerick reinstated Sprewell’s contract, he recognized that the Commissioner’s suspension was necessary, and reduced Sprewell’s suspensions from 82 to 68 games (the remainder of the current season). Beyond the question of double jeopardy, the Sprewell holding creates an interesting discussion about the potential reinstatement of Rice’s contract with the Ravens. NFL and NBA contracts differ in a crucial way: NBA contracts are guaranteed, whereas NFL contracts are not. Therefore, the Warriors did not have the flexibility to part ways with players that the Ravens have right now.

The double jeopardy facet of Rice’s appeal will ultimately turn on whether or not the second video tape is considered “new evidence.” Some lawyers feel this concept is erroneous in this case simply because even if the Commissioner’s office only saw the second video recently, it does not affect what anyone suspects of Rice. Rice was punished for striking his fiancé, which the second video only confirms.

The second argument that Rice will likely assert in his appeal is that the NFL failed to follow its own precedent for instances of domestic abuse. As sports law scholar Marc Edelman points out, Rice’s suspension is clearly in line with other instances of domestic disputes under former commissioner, Paul Tagliabue.

Rice could draw support for his precedent argument from the case of Steve Howe. The arbitrator in that case stated, “[d]eterrence, however laudable an objective, should not be achieved at the expense of fairness.”Howe challenged a lifetime suspension by Major League Baseball due to failed drug tests. Baseball promised to test Howe a certain way because he suffered from Attention Deficit Hyperactivity Disorder, but the MLB failed to adhere to the agreed-upon testing policy. Like the Sprewell case, arbitrator George Nicolau found the lifetime suspension to be an excessive punishment, holding that Howe’s 119 day already-served suspension was sufficient. Rice may argue that his increased suspension is, like Howe’s, excessive and merely a result of public criticism, as opposed to past precedent and the terms of the CBA.

In dealing with Ray Rice, the NFLPA has been very quiet. In any statements made publically, Demaurice Smith (NFLPA Executive Director) and the union have stayed neutral. However, like it or not, the NFLPA cannot remain neutral in this scenario. No matter how abhorrent the NFLPA considers Rice’s actions, they are a union and bargaining representative of the players, and are therefore charged with a duty of fair representation. This duty does not, however, mean that the NFLPA must file a grievance on Rice’s behalf if Rice requests it (generally, this duty is unenforceable for independent workers). Rather, it only means that the NFLPA cannot act arbitrarily, discriminatorily, or in bad faith. Courts have generally given deference to union decisions because the bargaining process necessarily involves compromises, including some that come at the expense of some workers over others. In this instance, the NFLPA cannot simply decide not to file a grievance on Rice’s behalf without any reason at all; but, the union must only assert a reasoned decision to omit filing.

Bad precedent is what truly renders the NFLPA’s reaction a moot point. The NFLPA exists precisely to prevent due process violations, something Rice risks experiencing during his appeal. There is, as the union contends, a distinction between supporting a player’s right to due process under the CBA and supporting the action underlying the league’s concern. The greater problem would arise if the union failed to respond to an actual due process violation committed by the NFL. The league may be free to intensify suspensions because of public outcry, or where different information comes to light during a player’s suspension. If Rice and the union fail to persuade the arbitrator that Rice should not be suspended or should receive a lesser punishment, they will likely appeal to federal court to challenge the decision.

Speculation regarding Rice’s suspension and appeal has already caught the eye of both teams and the Commissioner. After a second allegation of child abuse surfaced, Minnesota Vikings running back Adrian Peterson was very recently placed on the “Exempt List/Commissioner’s Permission List.” The Commissioner has the authority to place a player on this list under particular circumstances. Placement allows that the player not count against the 53-man active roster, and it also allows the player to get paid, which distinguishes it from a suspension. Peterson is not the first player to be added to this list; Michael Vick was placed on it 2009, and the Carolina Panthers will most likely add defensive lineman Greg Hardy to the list prior to his appeal of a domestic violence conviction.

Regardless of the result of Rice’s appeal, it is abundantly clear that public sentiment is driving the NFL to make policy changes. These changes will, at the very least, start with a panel on domestic violence and sexual assault established by Goodell. This panel is currently comprised of three experts (out of what is expected to be four experts in total). The experts, Lisa Friel, Jane Randel and Rita Smith, will “help lead and shape the NFL’s policies and programs relating to domestic violence and sexual assault.” Although it risks committing due process violations, the NFL may finally be responding to the problem of domestic disputes in a proactive and meaningful manner.

Reshaping the NCAA Market Power Discussion Post-O’Bannon

Ed O’Bannon was a member of the 1995 UCLA Championship Basketball Team, and the Tournament’s Most Outstanding Player. O’Bannon, now a car salesman, noticed something one day while watching a child play “NCAA Basketball” produced by Electronic Arts. What he noticed was a player, wearing the same number as he did, same height, and near identical attributes as himself, playing for UCLA. While his name wasn’t used, Ed wondered why he isn’t, or hasn’t been, compensated for someone else using his image and likeness in the video game.

O’Bannon, along with 20 other plaintiffs (including Hall of Famers Oscar Robinson and Bill Russell), brought suit in Northern District of California alleging the NCAA violated antitrust law by fixing player compensation, for usage of their image and likeness rights (“ILR”), at $0. At the time of the suit, players were barred from receiving any money generated from their ILR. This includes endorsements, merchandise sales, video games, or television exposure. The NCAA argued that in order to maintain a model of amateurism, these “student-athletes” are barred from profiting of their ILR.

Judge Claudia Wilken delivered a favorable holding for the players in early August. She ruled that the NCAA regulations prohibiting players from profiteering off of their ILR’s is an unreasonable restraint on trade violating Section 1 of the Sherman Act. Judge Wilken did not extend the holding to allow players from collecting their share of profits during their tenure as a player or in school. However, Wilken found delayed payment, held in trust, for the players and disbursed upon graduation or withdrawal, to be a reasonable restraint on trade, due to the a pro-competitive justification by the NCAA.

The NCAA has been characterized as a classic “cartel.” A cartel, in the eyes of antitrust law, is defined as a combination of producers of any product joined together to control its production, sale, and price, as to obtain a monopoly and restrict competition in any particular industry or commodity. The NCAA itself functions as a trade association that prescribes rules for its membership, comprised of over 1000 schools.

In bringing a Section 1 claim, the claimant must hurdle the threshold issues of 1) showing an agreement between two or more parties; and 2) that the alleged restraint affects interstate commerce. Both threshold issues are easily satisfied when analyzing rules prescribed by the NCAA. It has been clearly established, by the Supreme Court, due to the nature of sporting leagues, that the appropriate rule for viewing restraints of trade is the Rule of Reason, and not the Per Se rule. In a very basic explanation, the Rule of Reason, first looks to “Market Power” (Geographic and Product), and affords the ability to justify the restraint as a “reasonable” restraint because it is pro-competitive and is as least restrictive as possible.

Most significantly, in these instances, the NCAA holds complete market power in the services for Division 1 Basketball and FBS group licensing ILR. This is so simply because there is no reasonable alternative available. All member schools must assent to NCAA rules or face sanctions, and even expulsion from membership. Both measures demonstrate classic cartel behavior.

The NCAA has very recently dropped the rules prohibiting compensation beyond the stipends offered by teams. To counter the impending ramifications of being enjoined from enforcing these restraints, the “Big Five” Conferences, comprised of the ACC, Big 12, Big Ten, Pacific-12, and the Southeast Conference (SEC) have been given the autonomy to make their own rules regarding ILR compensation. While a loosening of the rules by the NCAA may seem on its face a big win for the players, it isn’t exactly the “no-strings attached” kind of a gift by the NCAA.

Going back to the Rule of Reason, the claimant must show that the alleged competitors have market power. Courts have generally held that in order to fall within the scope of Section 1, market power must near or above a 33% market share. Again, established in the NCAA O’Bannon case, the NCAA as 100% market power. However, by delegating the rulemaking to the Big Five, without further analysis, would appear that when each conference enacts a rule that it’s member schools agree on, they will fall below the a 33% market power share because each conference will, absent further analysis, account for only 20% market power.

What is most interesting is that not all conferences are created equal. Merely allowing 5 separate actors to make rules autonomously doesn’t necessitate equal market shares. Firstly, Conferences don’t all have the same amount of teams (ACC, Big Ten, and SEC each have fourteen; Pac-12 has twelve teams; Big 12 has ten teams). On its face, based solely on the amount of teams in each conference, the ACC, Big Ten, SEC would each have approximately 21.8%. The Pac-12, and Big 12 would have 18.7% and 15.6%, respectively. Further, the past 8 FBS Championship games have all featured teams from the SEC, with the SEC team winning all those contests except 2013. This seems to show more than just mere coincidence; it tends to show that in the market for elite player services, the SEC may control more of the market. A more detailed inquiry into the allocation of top recruiting classes may shed even more light onto actual market power, as opposed to the assumption of 20% per conference.

The market power determination will play an integral role in the rulemaking of the Conferences. In the past, some courts have tended to struggle with the economic analysis of antirust cases. It will be interesting to see how courts may come to grapple with this determination and also what new rules the Big Five will enact.