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NFL Lockout Ruling Explained: Brady Antitrust Lawsuit Still In Play

Friday morning saw the Eighth Circuit somewhat unexpectedly release their opinion in Tom Brady v. NFL even as the players and owners slog through negotiations. The court vacated Judge Nelson's ruling that the lockout was illegal and remanded the case to her for additional proceedings. The Eighth Circuit was expected to rule in favor of the owners if a decision came down but many people felt a decision would continue to be delayed while the two parties continued negotiations on a collective bargaining agreement.

The owners and players issued a joint statement declaring that the court ruling would not change the state of negotiations. Prior to this decision both sides were feverishly working towards a deal in part because neither side knew who would get the most leverage in a decision. Following the release of the decision (PDF), the court's reasoning and actions should leave neither side comfortable with the long term implications of a continued lockout.

The court ruled for the owners by stating that the Norris-LaGuardia Act prevents federal courts from issuing injunctions during labor disputes to end work stoppages. The owners were successful in part because the court agreed that the players could not simply turn the key with decertification and end the lawsuit. The court's ruling does not address whether the decertification is legitimate because that is a labor law issue that would be ruled on by the National Labor Relations Board.

The district court decision focused in part on the need for unionization among employees for Section 13(a) of the Act to apply. The Court of Appeals disagreed because employees may engage in activities for the purpose of mutual aid and protection even without the existence of a union. While the NFLPA decertified, the labor dispute did not simply end at the drop of a dime.

While the court would not enjoin the lockout against current NFL players, the same did not hold true for current veteran free agents and rookies. The court ruled that the court could enjoin the NFL when it comes to veteran free agents and rookies because they are considered non-employees at this time. However, in order to enjoin the NFL with regards to these particular players, the district court has to conduct an evidentiary hearing to determine harm to the parties. The court remanded the case to the district court to conduct such a hearing.

The implication of this is that if the court finds sufficient harm to veteran free agents and rookies, the league could be required to negotiate with free agents and rookies even as the lockout continues. This could lead to players signing contracts and then immediately being locked out because they have joined the ranks of the employees. The problem at this point is the amount of time that would be involved in getting the hearing scheduled and conducted, and then dealing with an inevitable appeal on the results of the hearing.

There was also a long term implication of the ruling. Since the court ruled the lockout legal based on the Norris-LaGuardia Act, it did not address whether the nonstatutory labor exemption provided the NFL with immunity from the underlying Brady v. NFL antitrust lawsuit. This means that without a settlement and new CBA, down the road the lockout could be ruled illegal and the league could find itself staring down the barrel of a multi-billion verdict for the players.

These two separate issues should hopefully keep the players and owners on the straight and narrow and working as hard as they can to get a CBA and settlement of Brady v. NFL. There are still significant problems facing both sides if a deal is not reached, which should be the necessary motivation to get it done.