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NFL Lockout Ruling: Not Necessarily The End Of The World

In a surprise move today, the Eighth Circuit Court of Appeals issued its ruling in Brady v. NFL (PDF). The timing of the ruling is surprising given the fact that the two sides have apparently been making solid progress in their negotiations and a ruling for one side or the other might be construed as creating leverage for one over the other. The court ruled the lockout was legal, but the courts analysis and subsequent remand to the district court are not quite so black and white.

While the ruling allows the lockout to continue, the court has put the two sides in a position where either one could face significant trouble if they don't come to a settlement. First, the court only ruled that the lockout was legal according to the Norris-LaGuardia Act. The court did not address all of the league's defenses because the first one was enough. Accordingly, the court did not rule against the underlying antitrust lawsuit. The league claims the nonstatutory labor exemption immunizes them against antitrust suits.

The court would not rule on the antitrust issue and the decision from American Needle leaves the league somewhat susceptible to future antitrust suits. It doesn't meant the NFL would definitely lose such a suit, but it puts them in a precarious position. If the league lost such a suit and the lockout was ruled illegal, treble damages for antitrust suits could see the league paying the players upwards $12 billion or more.

The second issue surrounds the short term lockout itself. The court ruled the lockout legal as to current players, but they also ruled that the lockout might not necessarily apply to veteran free agents and rookies. The free agents and rookies are not under contract to any team and accordingly the court views them as "non-employees." The court stated that the lockout could conceivably be lifted in terms of signing these "non-employees" to contracts. That would mean the league could continue its lockout but would have to handle contract negotiations with free agents and rookies. That would also mean as soon as those players are signed, they're officially locked back out.

This is not something that will happen immediately. The appellate court remanded the case to Judge Nelson because they said she needs to hold a proper evidentiary hearing to decide whether the free agents and rookies would suffer a certain degree of undue harm. To impose a temporary injunction there must be irreparable harm. The hearing would be used to determine whether such harm exists. Of course, if Judge Nelson ruled for the players on this, the league would simply appeal it right back up to the Court of Appeals and we'd be back at square one.

Given all that, this decision seems to provide enough problems for both sides that it really is in both their best interests to settle this thing and get a CBA done. One of the judges said during the oral arguments that the court would hand down an opinion that would not please either side. This would seem to be such an opinion.

The players and owners have proclaimed they remain committed to the current negotiations. The next few days will give us a better idea of how committed they are to getting a deal done. Talks are done for today although this doesn't say whether negotiators are finished for the weekend or will be back at it tomorrow. Even if the negotiations cease for the weekend, the attorneys will be working to get more language figured out before negotiations pick back up on Monday.

On a somewhat related note, this past week I have taken on some additional responsibilities with SB Nation. The work includes some legal analysis across the network and also some general NFL coverage. I won't be leaving NN, but I will be doing a bit more work in addition to 49ers coverage. Thus far I've written that post about the lockout, I've begun providing coverage of the Roger Clemens perjury trial, and even some coverage of Gilbert Arenas' lawsuit against the reality show Basketball Wives. So thankfully my law degree won't be completely wasted.

Since my work will be spread around SB Nation, you can follow my activity across the network on my profile page. It gives me a chance to expand and write about other areas of interest. So basically, I'll be writing here, SB Nation Bay AreaSB Nation NFL, and across SB Nation on legal issues. But don't worry, I won't let it impact the coverage here at NN. Considering this was what got me in at SB Nation, it will always be at the forefront for me.