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Posted by on Jul 31, 2017 in Blog, Essays, Sports Betting | 3 comments

When is a Contract Worth the Paper It’s Printed On?

 

 

Today, let’s talk about contracts, particularly as they apply to professional sports.

Even if you do not like sports, this discussion should interest you, especially if you like debating the principles of law.

I just read about an NFL player who is holding out of training camp.  He’s under contract to his team.   But he refuses to show up and play. He wants more money.  I won’t mention the identity of the player, nor name his team, because it’s irrelevant.

The player is one of the very best at his position.  No one will deny this.  Prior to last season, he signed a two-year contract and agreed to accept $11 million for this period.  He played last season and was selected as an All-Pro.  This is now the second year of the deal, for which he’s scheduled to make $5.5 million.  However, the player is convinced he should be paid more money, so he is holding out.

Full disclosure — I typically side with labor against management-ownership because the working class is generally entitled to reap more of the benefits which they create (my political and economic view).  However, the terms of a legal contract impress me as a *binding agreement* between two parties.  Both parties must follow the terms.  End of discussion.  What’s there to negotiate?  They already have a deal.

By using this tactic, the NFL player may be able to squeeze more money out of the team.  Yes, I realize that teams and owners screw just about everyone, so I have no mercy for how they usually do business.  Yet, purely as a matter of principle, shouldn’t the player be forced to honor his end of the deal?  If he is able-bodied and refuses to show up for work, why doesn’t the team file a civil lawsuit against him for breach of contract?

Keep in mind the contract is a two-way street.  Had this player performed poorly last season and lost his starting position, or been seriously injured, or fallen off his back porch and broke his leg, the team would STILL be obligated to pay his full salary.  Think of how many disappointing players leave their teams stranded with wasted high-salaries (one of the major problems with pro sports, and a major reason tickets cost $150+ each).  This happens ALL THE TIME.

Hence, if the player was injured, he’d still be getting $5.5 million — regardless.  If the player performed poorly, he’d still be getting $5.5 million for the 2017 season, even if he was sitting on the bench wasting a roster spot.  So, the team is obligated to pay the salary no matter what.  Given these mutual risks, why does the player have any rights to renegotiate the terms of a contract that were agreed to by both parties?

Please explain this to me.  Why would any fan support a player like this, let alone cheer for someone who is hurting his team?  Moreover, it would seem fans should have some rights, too.  Alas, everyone forgets about the fans.

Consider the actual situation years ago when a losing NHL team from a smaller market signed a star player who was likely to improve the team’s chances to make the playoffs.  Season ticket sales increased by 40 percent.  Then, the star player held out on his team and refused to honor the deal during the final year of the contract.  Shouldn’t the fans who bought season tickets based on the prospect he’d show up and play be entitled to damages?  Or, at the very least, a refund?

One more scenario, which is a bit of an outlier, but still deserves mention.  We’ve seen past situations where an inexperienced backup NFL quarterback is playing for a relatively small salary.  Then, the old starter gets injured and the young player comes in and surprises everyone by exceeding expectations and winning the job.  Under this scenario, one could argue the young quarterback might be entitled to a renegotiation during the following offseason since his responsibilities have increased dramatically.  As a purist, I don’t think any contracts should be forced to be re-negotiated.  However, I concede that teams want to keep players happy and will do this as a practical matter.

However, in the case of the player holding out because he doesn’t think $5.5 million is enough money, nothing has changed.  Seems to me he’s in serious breach of contract and should be sued by the team for violating the terms of an agreement.

Of course, this won’t happen.  It never happens.  But it just seems wrong that athletes can hold teams (and fans) over a barrel in these types of negotiations.

What are your thoughts?

 

FOLLOW THE DISCUSSION HERE ON FACEBOOK.

3 Comments

  1. nolan,

    keep in mind if this player’s performance had diminished the team can cut him and owe him nothing. the nfl is unique among the four major sports in that most of the contracts are not guaranteed. there is often guaranteed money in some contracts but most of the money isn’t. this is probably one of the reasons players (like bell) hold out when their value is at its peak.

    • Goose is correct about the nature of NFL contracts. The other thing is that while the contract is guaranteed, nothing compels the player to play at all. It’s fine for the player to say, “You know, for the money you’re paying me, doing this just isn’t worthwhile anymore.” The bottom line is that you can’t sue someone for retiring, so as long as the player in question doesn’t play for another team during the term of his contract, he can’t be sued. However, he can certainly not be paid and can be compelled to not play for another team.

      Think of a player you admired (or even kind of liked) who was still able to play at a high level but retired recently and was still under contract when he retired. Imagine his team had come to him and said, “If you come back next year we’ll do a new contract that pays you $200 million.” Is it unethical for them to rethink their retirement? I’d say no.

      The difference between this hypothetical case and your case is one of degree, not fundamental difference. Sometimes I agree that a player is being selfish. Sometimes I think it’s good business if they’re actually willing to hold out. However, IMHO, it’s not as cut and dried as you make it seem here, and certainly there should be no more legal remedies to the team than those that already exit.

  2. Your points are well made in absolutely make sense. I think the player should honor his contract.

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