Appeals court allows players’ suit involving contract disputes

The federal 8th Circuit Court of Appeals, in a ruling of interest to Minnesota football fans, kept a lawsuit from the NFL players’ union alive in a procedural ruling. The appeals court partially reversed a lower court’s decision rejecting the players’ collusion claim and sent the case back to a federal court judge for further proceedings.

The NFL Players Association alleged that the league colluded to put a cap on players’ salaries during what was to be the 2010 uncapped year. As a result, the NFL secretly treated the 2010 season as if the $123 million per team cap existed. The players claim that the salary cap cost them at least $1 billion in damages.

The union sued the NFL in May 2012, which was nine months after a new collective bargaining agreement was entered. It claimed the existence of a secret agreement because the Dallas and Washington teams obtained $46 million in future cap reductions although they ostensibly complied within the terms of the collective bargaining agreement and league approval of their players’ contracts.

The appeals court reversed a judge’s dismissal of the players’ collusion claim. The judge had ruled that it was too late for the players to make their argument because a new collective bargaining agreement had provisions settling all outstanding legal claims that were made or could be made.

Allowing this suit to proceed may require the NFL to disclose information on whether it actually told teams to keep the salary cap in place during the 2010 season. The league could potentially face significant damages. After the appeals court ruling, it claimed that the ruling was entirely procedural and that the union faces a heavy burden in establishing its claim.

These employment disputes can result in massive financial losses and gains and potentially expose employers to further legal problems as information is disclosed during litigation. Contract disputes may be avoided with proper planning and legal advice.

Source: Los Angeles Times, “NFL Players Assn. collusion case reinstated against NFL,” Sam Farmer, June 20, 2014

FindLaw Network