Final Part 1 Flashcards
(36 cards)
what is a traditional league?
when single owners invest and they’re under the umbrella of the league and each member of the team is liable for the actions of the unincorporated association
what are the pros of a traditional league?
1) easy to raise capital
2) owners can put in as much money as they want
3) individual team owners fund teams, entrepreneurial in nature
what are the cons of a traditional league?
1) subject to Sherman I (significant because a traditional league is always deemed to be a conspiracy, or joint ventured of the member eats)
how does revenue work in a single-entity league?
all revenue expenses are shared equally (NFL shares 99.9% of the revenues because they do not share cost they are NOT a single entity league)
who owns a single-entity team?
each owner owns an interest in the LLC (LLC owns all the teams)
what are the pros of a single-entity league?
NOT subject to Sherman I and NOT a combination, conspiracy or joint venture
what are the cons of a single-entity league?
1) no incentive for owners to invest money in team because it won’t benefit them
2) subject to Sherman II
what is a hybrid league?
a single entity league in which each owner/investor is assigned a team, and a paid bonus based on the success of the team
what is the formation process of a league?
1) first set up as a single-entity
2) once a CBA is established with a duly certified union, the league switches to a traditional league
what is the logic behind a league starting as a single-entity and then a traditional league once there’s a CBA?
when negotiating and implementing a salary cap - you are restraining trade and if a duly certified union brings a suit against the single entity league, they are not subject to Sherman I
what is a CBA?
a written contract between a duly certified union (player association) and an employer (owners)
what does Sherman I need to restrain trade between two or more people?
an act
what does Sherman II need to restrain trade?
power (not necessarily an act)
what can you do with a negative injunction clause?
you can force the team to stay but without the clause you can only sue for damages
what is the only sport with guaranteed contracts?
MLB
what is does the national labor relations act cover?
cover 95% of all labor but does NOT cover public benefit corporations (like Nassau Coliseum)
if 30% request a union vote what happens?
the National Labor Relations board requires a vote
how do you become a duly organized union?
if you have 50% of the class plus one
how do you decertify a union?
more than 30% request on election and more than 50% of those who are members of the union plus one vote to decertify the union
what type organization are leagues?
self-regulated entities (commissioner w/ doctoral power)
what are the pros of a league being a self-regulated entity?
1) gives commissioner power to arbitrate
2) gives commissioner power to regulate equipment
3) in an anti-trust action against the league, a decision is NEVER granted in favor of the plaintiff on a motion (must goto the jury)
4) league deemed a sole employee
5) unilateral regulation of equipment
what are the cons of leagues being a self-regulated entity?
1) must negotiate on a league wide basis (even though the teams are all separate economic entities
2) must negotiate on behalf of the class
what are the 3 types of states?
1) right to work states (work regardless of the union like Virginia)
2) close shop (have to be in a union to get a job which is now illegal)
3) union states (once you have been with a company more than 90 days you must join the union but today this changed, now you just have to pay union dues
what happens when a CBA expires?
every term and condition within that CBA continues until a new one is negotiated, until the union is decertified or until you meet an impasse on all the issues
