Where Optimism Lives

Darius Soriano —  November 15, 2011

Monday’s news that the players had not only rejected the NBA’s latest offer but had disclaimed interest and would disband their union has left nearly everyone sullen, upset, and discouraged. A deal that would save at least part of the NBA season seems further away (much further, in fact) than ever and Billy Hunter is saying that a cancelled season is now “probable” not “possible”.

However, even with all the doom and gloom, there is still reason to hope not all is lost. From a Zach Lowe report:

“It is impossible to predict what is going to happen,” said Gabe Feldman, a sports law expert and professor at Tulane. The NBA could cave immediately under threat of damages and give the union a better deal — a very unlikely outcome given Stern’s defiance. The union could win a short-term court victory — say a judge denying the league’s motion to dismiss the suit — and force the NBA’s hand. The league, in a legal fantasy world, could enact new free-market rules that might pass must in antitrust court — rules that would allow the Lakers or Mavericks to sign Nene, Tyson Chandler, Tayshaun Prince and any other free agents they’d like for as much money as they’d like. The smart money remains on the two sides settling in some form before January, the point at which the season would be lost. “Today is Nov. 14,” Hunter told a small group of reporters after the meeting. “That is ample time for us to save the season.”

Meanwhile, Henry Abbott lists eight reasons the players latest move can help facilitate an agreement. Among them, these two caught my eye:

  • The money-losing hardline owners can complicate things. But their influence would seem to be finite now that the league and players have traded offers at 50 percent of BRI for active players. More revenue sharing is on the way. Barring a vast new effort by owners to get players to knuckle under — an effort by the way, that would undermine the league’s claims of bargaining in good faith — the relief for those owners would seem to be set. In other words, the increased money the owners want is not on the table anyway.
  • Seeing an antitrust matter all the way through to its final resolution could take years, costing players $6 billion or more in salary if it lasts three years. It makes little sense that this would be the players’ plan. On Monday their new attorney, David Boies, seemed to confirm that the players envision a quicker resolution. He said that his clients were not going to seek an injunction because that would take a long time and “what the players are focusing on right now is what is the fastest way to get this resolved.” Similarly, Derek Fisher says “we continue to want to get to work, to get back to work, to negotiate, but that process has broken down.”

Also understand that David Stern himself stated – quite incredulously, I might add – that the players’ disclaimer is simply part of the negotiations (he actually called it a ploy, a charade, and a magic trick, but I digress). So, even the other side sees this as a means to continue to influence the deal. This means the rhetoric being tossed out (even if in harsh language) is still about making a deal and bringing the game back.

These may be minor points and only a faint glimmer of hope in an otherwise dour piece of news but I’m still inclined to believe too many people actually want the NBA back for both sides to simply throw it all away. Yes, there’s still a lot of anger. And, yes, the sticking points are real. But for a deal that was pretty close to being made before this latest breakdown, I’m still looking for both sides to come to their senses.

Tomorrow: The details of the proposed deal the players might want changed.

Darius Soriano

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18 responses to Where Optimism Lives

  1. I’ve long thought desertification would bring an end to the lockout. Although I thought it would be in July. Here is a funny quote to numb the pain…

    “Beckley Mason, HoopSpeak:  Any players who caught Stern’s condescending words were basically told “Look, you guys don’t know what’s best for you. Put your trust in us, and we’ll take care of you by paying you less and artificially restricting your market value.” The NBA: Where awkward and inflammatory approaches to social media happen.”

  2. TrueHoop also has an article indicating that the league requested (in their case they filed this summer) that the player’s contracts be declared null and void if the players decertify.

    Be careful what you ask for: with valid contracts the players could not start a new league (the owners could say the lockout is over and the players would have to honor their contracts, killing a new league). But without contracts, would it be so hard for the agents to get together 15 or 20 really rich guys and start up a new ABA?

    After all, they would have LeBron, Kobe, etc., and an ESPN contract would be forthcoming. Also, the new owners would not be buying franchises for 400 million, so a real partnership could be set up. How long did it take to start the first ABA?

    Fantasy – imagine Dan Gilbert, Robert Sarver and Michael Jordan losing their whole investment!

    Ok, end of fantasy.

  3. inwit – So, do you think Kobe, LeBron, Melo and the rest as part owners – and with a significant portion of their net worth at stake – would feel be more generous than the current owners? Something tells me that we only need to look at MJ to answer that question.

    Also, lets assume there is a new league. I don’t think that guys like Fisher, Walton, Arenas, and any other player not named Kobe, Lebron or Dwight would get paid anything close to what the NBA pays them.

  4. Hey, I didn’t say there wouldn’t be problems to work out …

    But Kobe, LeBron and Dwight appear willing to give up money now.

  5. 3- To be fair, guys like Fisher and Walton get paid what they do largely because guys like Kobe and LeBron have their salaries artificially capped.

  6. I dunno guys. I will say this, if it was even remotely financially feasible, I think LeBron and Kobe would have been up to now and would be leading the charge for a complete decertification – and not the half-ass thing that is going on right now.

    Also, I would not put my hopes on any anti-trust action going the players way. To my knowledge, there isnt a single case where the players have won that argument in court in the last 30 years.

  7. MannyP – I think you are as right re: #6 above as you are wrong about the owners assuming “all” of the risk.

    The owners are assuming “all” the risk that isn’t covered by the rest of us tax payers in one form or another.

  8. I said this in another post, but I think what this thing will come down to is leverage.

    The players are exercising the only leverage they have . The problem is that this strategy is too little to late.

    At best, the the players win and the lockout is lifted. However, you can bet your lunch money that the league will go to court to argue for an injunction because, as there is no NBPA, then the contracts under the old collective bargaining agreement are void and, therefore, owners cannot allow players to play without knowing how they will be compensated. This will buy the owners time and before you know it we are in the middle of January and the league will now have the right to cancel the season “in good faith” and will threaten to do so. At that point do you really think Kobe Bryant, Lebron, Garnett, Bynum, Duncan will walk away quietly from $24m, $16m, $21m, $15m, $21m respectively in salaries solely on principle and for the benefit of players not yet in the league? (Remember that, with the exception of maybe Kobe and Lebron, most of these guys make more in salary than in endorsements) What about older players nearing retirement that do not have the endorsement dollars that these guys command? Do you think they are willing to forgo their last few paychecks on principle too?

    We can argue about what’s fair until we are blue in the face, but at the end of the day, the owners have the most leverage here and will likely prevail.

  9. The owners will come back to the negotiating table with ‘better faith.’ The big market teams had incentive to go along because they had faith in Stern’s negotiating and because they felt it wouldn’t really hurt to have some of the stupid GMs work under an artificial cap. After all, everyone wants to play in the big cities anyway, so if the small market owners can’t drive prices up, it’s a gain for big market owners as well.

    But since that failed, big market owners would want to try salvage what they can and must feel antsy about losing all the lucrative signings they’ve made. They will now exert pressure on the hawks to give in, and that’s where we’ll see some progress.

    Of course this is what I hope would happen, not how things would work out. To take my fantasies further, like I mentioned in a previous post, I hope the big market owners get fed up with their small market counterparts and declare that they’re forming their own 12-16 team league.

  10. My observation that the small market teams convinced the mega teams to go on a lockout because they are losing. Well, in this situation today, everybody losses. I’m sure behind the scenes the moguls of AEG, Fox Sports, ESPN and so many other enterprises are all griping at the owners who initiated this lockout under this economic environment. Fixed costs have to be addressed like maintenance of stadiums, salaries of management and other liabilities. They could have renewed the CBA on a two year extension, at least buying time in transformation during favorable economic times. An old American idiom says: “A Bird in the Hand is Worth Two in the Bush.” If they only accepted that 53-47 split, then they would not have been in this stalemate where nobody wins. How much did the league lose for insisting a 50-50 deal?

    If the players opt for disbanding the union, it is time also for the mega owners to fire David Stern as the commissioner. The league should start on a clean slate and remove those old fashioned dictators running the show. Stern is just a marketing tool who got big money while taming the wild players, coaches with hefty fines as his own version of maintaining harmonious relationship. Well today, nobody is buying those tricks nor afraid of his threats. The league needs a new commissioner, a new idea, a new paradigm that bridges players’ and owners’ interests in this economic times.

  11. Love the title of this post, and am glad to read a few hopeful opinions. I’ve been admittedly pessimistic over the past few months but there’s something about the level of vitriol, yesterday and today, that’s bothered me. So many prominant writers who are piling on players and the (former) union, as well as owners… essentially playing both ends against the middle. Whatever. Hiring David Boies is not an amateur move. And, David Stern is not exactly doing his side any favors by ranting about a nuclear winter.

  12. I’d love to see Stern going alllllllll the way down.

  13. MannyP,
    The star players are not simple employees, as you like to mention. They are more properly compared to movie stars, as they are the reason any of the clubs are able to make a profit. Simply signing Brad Pitt ensures a movie of breaking even and some of the same logic applies here.

    What the owners are trying to do is limit the stars potential payout so they can claim more of the profit for the ‘movie’. Also, like in the movies, there are some directors who just can’t make a profit. However, in the movies these people do not own the studio.

    What the owners may do – if they get their way – is to make the ‘independent movie makers’ (read: the other leagues in the world) more able to sign some of the big stars and bring their movies (read: leagues) on a closer par with the NBA. Now that would be an endgame that the Jerry Buss types don’t want anything to do with, as it will likely reduce the absolute value of their franchises.

  14. Craig W., my thoughts exactly.

    That’s the real threat and real leverage that the players have. Sign and play with overseas leagues. Devalue the NBA tv and sponsorships by giving international audiences a commodity that can replace the NBA for the most part. Help the other leagues grow and in turn create a safety net in case there is another lockout.

    I’m not sure if this generation can do it, but with the worldwide popularity of basketball slowly increasing, this will happen sooner or later. The owners forcing players too much will only make it happen sooner.

  15. Harold,
    Playing overseas is not a realistic option for most of the players. Many leagues have limits on the number of Americans that can be on a team. Salaries are quite a bit lower, and playing/travel/hotel conditions are not nearly as good. They would also need to adjust to playing a different style of basketball.

  16. Perhaps some deep-pocked players should make a sizeable investment and partner with the ABA. It may seem laughable but the ABA is already expanding in order to capitalize on the lockout. Maybe this has already been discussed here – don’t recall.

  17. I agree with Craig W that players are like movie stars. Problem is, that in the movie industry only a handful of guys with the box office cache of Brad Pitt or maybe Tom Curse get the big paychecks AND a cut of the box office (akin to BRI). Most other actors have settle for a fixed paycheck and residuals (which is basically a fixed payment ever time your movie is re-shown in a medium like TV or cable and is not tied to the original first-run box office sales in any way). So, I get the analogy, but the problem is that the way the finances in the movie business work undermines the argument that any player who is a non-star deserves a cut of BRI from “first-run” activities such as every time a game is played on TV. Also, to carry out the movie analogy even further, think of the biggest blockbuster franchises in the history of film: Harry Potter, Star Wars, Avatar. Who made the most money from the movies? I can tell you it was not the actors, it was the studios and the directors (i.e. the owners). Why? Well, because they put up the money (studios) and hired the talent and managed the process (directors) – even if we go to the movies because of the product the actors produce on screen.

    In terms of Europe as “leverage”, I’m sorry folks but that is a pipe dream. No basketball league or team in Europe can sustain American salaries, due in part to the fact that soccer is king and interest for basketball is not as strong there as in the US. While international superstars like Kobe, Lebron and maybe 3-5 others could get comparable cash if they left, Euro teams do not have the resources to pull away all “star” NBA players without them agreeing to take huge pay cuts. Also, since these leagues are arguably less competitive, how much of a challenge would it be for these super competitive players? Add to that the fact that these players will have to live in a foreign country (most US born players not named Kobe Bryant have not done this), likely without their significant other and their kids, and get used to team accommodations and travel arrangements less luxurious than in the US. Not to mention that the most competitive leagues are in non-English speaking countries with cultural differences and attitudes that would be difficult for anyone to adjust to – let alone a pampered superstar. Also, do you think any Euro team will pay guys like Garnett and his creaky knees $21m for one years’ worth of services? He will be lucky if he gets a fraction of that. How about Fisher? Sorry, but the league knows this so I don’t buy the argument that the players have any leverage.