Category Archives: Agents

The Effectiveness of the NFL’s Three-Day Unrestricted Free Agent Negotiating Window

At 4:00 p.m. ET today, the 2013 NFL free agency signing period kicks off.  For NFL fans, general managers and players alike, the signing period marks one of the most exciting times of the NFL year.  It is a time where teams can rebuild rosters to further Super Bowl hopes and players can seek out new opportunities to build a lasting legacy in the league.

This year, the possibility exists that there will be a flurry of activity shortly after the start of the signing period.  This is due to the fact that this year marks the first time that a three-day negotiating window was opened before the start of the signing period.  During this time, NFL teams were allowed to contact and negotiate with agents for this year’s unrestricted free agents.  This period served only as a negotiation window, and teams and agents were not allowed to execute contracts until 4:00 p.m. ET on March 12.  In fact, the NFL even sent out a memorandum warning teams of “tampering” and reminding them that agreements between players and teams could not be reached during the three-day window.

Due to the fact that teams and agents had a chance to possibly hash out many of the details surrounding a player’s contract, chances are that some players will be ready to sign shortly after 4:00 p.m. ET.  However, signing an unrestricted free agent quickly after the start of the signing period may lead the NFL and other clubs to believe that tampering occurred.  As such, it is to be seen which team announces that it has signed the first unrestricted free agent of the 2013 free agent class.  Then, it will be seen whether the NFL and other clubs are satisfied that the respective agreement was made outside of the course of the three-day negotiating window and within the signing period.

Another reason why the three-day negotiation window may preclude a flurry of activity today, is during the window, unrestricted free agents were not allowed to visit other teams and could not have direct contact with team employees.  Thus, chances are that this negotiation window only represented a chance for agents to better test the market for their clients.  Due to the fact that many players are hands-on when it comes to selecting where they play, chances are most players want to get on the ground at a potential team’s site and visit with personnel from the team to learn how their presence on the team will be utilized.

Given these factors, the question exists as to whether this three-day negotiation window was necessary.  If teams and players were unable to reach agreements on various terms of a prospective contract, what is the point of negotiating?  If anything, the purpose the three-day negotiation window serves for both sides is an information grab.  By negotiating with a variety of teams during the window, unrestricted free agents can get a jump on getting an idea of where their best offer may lie.  Similarly, by negotiating with a variety of players, teams can get a sense of who best fills their team’s position needs and at what price tag.

Most agents and team executives would tell you that too much information is never a bad thing.  As such, it’s likely that the NFL will continue allowing the three-day negotiation window.  However, expect teams and agents to press forward for the right to reach agreements during the course of the window.  The NFL is unlikely to allow this, as it will argue that in doing so, the negotiation window essentially becomes a signing period.  Nonetheless, the three-day negotiation window has presented one more story line for NFL fans to watch this season, as they can now wait to see which unrestricted free agent is scooped up by a team the fastest.

 

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Why Do 8 Top-Rookie NFL Prospects Still Not Have Signed Contracts?

By:  Danielle Blanchard, Ruling Sports Intern (Twitter:  Elle087)

Under the new collective bargaining agreement (CBA), NFL rookies and their agents may not negotiate things such as escalators like they could in the past. The new face of the NFL rookie contract is very standard; the financial terms are virtually locked in, and there is very little left to negotiation.   All that remains to negotiate is whether first-round picks will get three or four years guaranteed and the extent of that guarantee.  Ultimately, this means that the rookie will have a minimum of three to four years at a certain salary, the salary amount usually varying depending on the players draft round and number, which is guaranteed.  If these new rookie contracts are so standard why do the top eight draft picks still have unsigned contracts?

The deal breaker for these eight rookies right now is something called offset language.  Offset language is a contract term which states that if a team releases a player (per a number of potential reasons, including poor performance), the unpaid money they guaranteed him in the contract is offset by money he will potentially receive from another team when they pick him up.  An offset language clause is something that teams optimistically want included in a contract for any player, but especially for rookies who have yet to show their true NFL potential (or lack thereof).  To explain in more detail, under a standard contract, since the salary is fully guaranteed for the duration of the contract term, even if a player is not performing at the expected level and is released by the team, the player will still get paid their original guaranteed salary.  Additionally, with an absence of offset language in the contract, if a new team picks up the player upon release, the old team will still have to honor the player’s guaranteed salary.  This leads to a “double dipping” of sorts, because the player will now receive his original guaranteed salary in addition to the salary offered by the new team.   For example, assume a team guarantees a rookie $40 million over three years and they pay the player $30 million of it before the player is released and subsequently picked up by another team who offers the player $50 million over the next 3 years (including a year of the original contract).  With the absence of offset language in the contract, the rookie could potentially make $90 million over a five year span.  However, with offset language present, the rookie would receive $80 million, $50 million from the new team and $30 million ($40 million – $10 million offset) from the old team.

Teams are eager to get this language into their rookie contracts to avoid paying out large sums of salary money for players who don’t live up to their potential.  Vernon Gholston is a prime example of why teams are fighting for offset language in rookie contracts.  Gholston was picked sixth in the 2008 draft by the New York Jets and later released for poor performance.  Soon after, he was acquired by the Chicago Bears and was being paid by both teams until his original contract with the Jets expired (Gholston has since been released from the Bears also).

An interesting fact that’s key in this year’s top players’ negotiations with their respective teams is that Luke Kuechly, the ninth overall pick by the Carolina Panthers, is the only rookie drafted in the top ten that has a signed contract- his contract has no offset language.  This is important primarily because it has now set a precedent for the first eight overall picks in their negotiations with their respective teams. Luke Kuechly has given picks one through eight more leverage in the bargaining process, which will allow them to enter negotiations with the confidence that if the ninth pick didn’t have offset language in his contract, clearly more sought after, top draft picks should not either.

The entire conflict is about setting a precedent, agents want big name athletes as future clients, and these clients want to hear that their agent can get them the best contract –meaning no offset language.  On the other hand, the teams want to establish that the players they release cannot double dip, and that if a player does live up to the expectation that landed them their respective (frequently giant) contracts, they should not benefit as a result, especially when another team has acquired the player and is paying them a new salary.  Herein lays the dilemma.

Precedent seems to be on the side of the players’ and their respective agents, however.  In 2011, there was no offset language in the contracts of the top ten picks.  I spoke with Tom Mills of Ascent Sports, who is an agent for various professional football and baseball players, and his sources suggest that the tenth, twelfth, and thirteenth picks do not have offset language in their signed contracts, but that the eleventh pick as well as picks twenty through twenty-five are still unsigned.   This means that, even in the contracts for rookies from this year’s draft, the earliest pick who has been subject to offset language in a contract is Michael Brocker, the fourteenth pick.   Mills is of the opinion that the players’ and their agents will get their way and the teams will forfeit the use of offset language primarily banking on the leverage of Luke Kuechly’s (ninth pick) contract.

With most training camps just a week away, the contracts need to be signed, both sides are motivated to close the deals, and each have valid reasons regarding the presence of offset language in the contracts.  It should be an interesting week.

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An Agent’s Preparation for the NFL Draft: Kelli Masters’ Story

This evening at Radio City Music Hall, 32 young men’s dreams will come true, when they are drafted in the first round of the 2012 NFL Draft.  When a player walks across the Radio City Music Hall stage to be donned with his new team’s jersey and hat, it is the culmination of hard work not only on his end, but also by his agent.

Kelli Masters is the founder of Kelli Masters Management, a sports agency based in Oklahoma, that represents NFL players, baseball players and Olympians.  Her NFL clients include the Tampa Bay Buccaneers’ 2010 first round draft pick (3rd overall pick) Gerald McCoy and the Dallas Cowboys’ 2008 first round draft pick Roy Williams, along with eleven other high-profile NFL players.

Masters’ experience in working with and representing first round draft picks makes her knowledgeable of the intense preparation that an agent must complete going into the NFL Draft.  Masters explains the preparedness required of an agent when going into the NFL Draft as follows,

“There are a lot of different seasons and facets in being an agent.  Preparing for each season and knowing what’s coming going into it, along with having your wits about you and being prepared and organized,  is so important.” 

The first season in an agent’s preparation for the NFL Draft, is finding clients to represent.  Masters takes a very hands-on approach when it comes to finding talent to sign.

“When I’m recruiting players, I go to their games.  Not because I’m there for any improper purpose, but because I want to see them in their environment–how they interact with people–and see them play live.  It is really important to me, to be on that journey with them,” Masters said.

Kelli Masters is an NFL agent and the founder of Kelli Masters Management.

While Masters’ hands-on approach and commitment to the players she signs are reasons for any player to sign with her, the fact of the matter is, Masters is one of only a handful of female agents representing NFL players.  As such, when she started her agency, she faced some difficulties when it came to recruiting talent.  However, using the keystones of her agency, she was able to quickly overcome these obstacles.

“The recruiting process in the beginning was very difficult, because young men have always dealt with men in football.  It changes in the NFL, because suddenly it becomes a business.  You have to have the right people around you to manage your career.  While I have seen players open their minds and say that they want the best person to manage them, it took a little bit of time to open their minds to have a female.   I don’t see myself as a woman agent; I see myself as an agent–and a good one,” Masters explained.  

There is not a cookie-cutter model for agents to abide by when it comes to preparing for the Draft.  Rather, agents must familiarize themselves with the players they represent and those players’ individual needs.  What a first round draft pick needs from an agent is different from what a player who will be drafted in later rounds needs. 

“How you prepare for the Draft really depends upon the type of players you represent.  In the first few years of my agency practice, I mostly worked with guys who were under the radar, they weren’t necessarily combine invites.  We had to look for opportunities and pro days to showcase their qualities.  I spent more time preparing film and getting it into people’s hands during those years.  Every year, I still take on a couple of guys in that scenario; they are more of the free agent and priority free agent players, who need someone to represent their interests,” Masters explained.
 
As for the role an agent takes in representing players expected to be drafted in the higher rounds, Masters noted,

“You are not necessarily begging for workouts, but it is a different approach.  You’re identifying teams specifically that have a need for the position the player plays and looking to see whether he fits their scheme and whether they like his style of play or his size.  You spend a lot of time communicating with the teams where that player fits best and making sure that all of their questions about the player get answered, so the player gets drafted as high as possible.  An agent can’t move a player up higher than his talent will dictate, but you can certainly make sure questions don’t go unanswered about your player, because that’s what makes your player drop lower than his talent dictates.  If there are questions about injuries from a college career that need to be dealt with or character questions, my job is to make sure those quest are answered.”

Given Masters’ unique position as one of the few women who actively represent NFL players, one has to be curious as to her ability to develop relationships with college and NFL coaches as well as front offices.  However, Masters has been able to use her unique position to her benefit when it comes to developing relationships.

“It has been challenging.  I don’t think it’s been as bad as I prepared myself for.  Surprisingly, having doors open and being able to make connections as far as networking and developing relationships with front offices, coaches and owners, has not been as difficult as I anticipated.  At the beginning, maybe they thought it was interesting that this woman was passionate and determined enough to make it in this business.  That may have opened doors in the beginning, but to establish rapport and relationships, is more.  I decided I’d use my uniqueness as an advantage, and a positive as opposed to a negative.  Now, I would say it definitely worked out well,” Masters said. 

After developing relationships and answering questions to ensure that teams are aware of her players’ talents and potential, Masters notes that “the rest is logistics.”  According to Masters, this includes organizing the logistics of her clients’ on-campus workouts and team visits.  “As an agent, I do things like make sure the guys get to their flights, know their itinerary, prepare them for the questions they may get and do a lot of media coverage for them,” said Masters.

The payoff for all of Masters’ hard work, is having each of the players that she represents drafted or signed by a team when the NFL Draft is complete.  Masters’ players can rest assured that her support of them does not end once they sign a contract.  Rather, Masters’ hands-on approach to representing talent continues.  “Every weekend im at one college game and one pro game,” Masters noted. 

Up until January of this year, Masters was a parter of the Oklahoma City law firm Fellers, Snider, Blankenship, Bailey & Tippens, P.C., while also working as an NFL agent.  These days, she is of counsel of the firm.  Masters notes that she made this choice because, “It got to the point where I wanted to do all of my clients justice, and I knew for my sanity and the quality of work I wanted to do, I needed to focus on a lighter caseload with the firm.”  When asked how she balances representing a sizable stable of NFL talent while also working as an attorney, she answered,

“I don’t sleep.  To be honest with you, when it comes to draft work, it’s just me.  I have another attorney with a different firm who has worked with me on the client services side for three years now.  His role during the Draft, is tending to our current clients, while my focus is on the Draft, because I’m the only one with our agency that speaks to teams.  When it really comes to dealing with all of the Draft work and Draft issues, that’s all on my shoulders.”

While sleep could come for Masters after the NFL Draft, it most likely won’t.  Rather, Masters will most likely be calling NFL front offices ensuring that her players get the best deals, scouting new talent, or hopping on an airplane to the new cities her players are headed to.

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The Structure of NFL Rookie Contracts

As a result of last year’s NFL lockout, which resulted in a new collective bargaining agreement between the NFL and NFLPA, changes have been made to the structure of rookie NFL contracts.  With the first round of the 2012 NFL Draft set to kick-off on Thursday, April 26, RulingSports.com reached out to NFL agent Mark Slough of Ascent Sports to learn more about how NFL rookie contracts are structured.  This year, Ascent Sports has 22 clients in the NFL Draft.

The first thing Slough noted about rookie contracts under the new CBA, is that “They’re all very similar.”  Under the new CBA, changes were made to the structure of NFL rookie contracts.  These changes largely favor the NFL clubs, as one of the big factors during negotiation of the new CBA, was suppressing rookie salaries.  Under the new CBA, rookies that are drafted receive four-year contracts.  If a rookie is drafted in the first round, clubs can exercise a fifth-year option for the player’s rights.  According to Slough, “In all likelihood, unless [the player] flames out, it will be a five-year deal for first rounders.”  If a rookie is undrafted, he will receive a three-year contract.

As for the type of salary NFL rookies can expect to earn under their contracts, Slough noted that rookies receive “minimum salaries under the CBA.”  This season, the minimum salary is $390,000.00.  In 2013, 2012’s rookies can expect to earn $480,000.00 in salary, as they will have one-year of credited seasons in the NFL, if they make a squad as an active player.  In 2014, the 2012 rookies will earn $570,000.00 in salary, if they make a squad as an active player.

As for first round draft picks, the amount of salary they’ll receive in their fifth year of play if their option is picked up by their respective team, depends upon where they were selected in the first round.  According to Slough, “If a player is picked 1-10, then the 5th year option is going to be the average of the top-10 players at the respective player’s position.  So, if you’re quarterback and go number-two in the Draft, then your fifth year option salary will be the average of the top-ten quarterbacks.  The option is exercised after the third season, so it would be based upon the top-ten quarterback salaries at that time.  If you’re picked 11-32, then the 5th year club option is the average salary of the top 3rd through 25th player in that position.”

While salaries for rookies are standard in NFL contracts, certain items present in a rookie’s contract can make his earnings higher than other rookies’ earnings.  According to Slough, “The general rule, is that the majority of these contracts are going to look pretty identical, except for the amount of a signing bonus a player receives.”  The size of a rookie’s signing bonus depends upon where he is drafted and this is one area in which an agent can successfully negotiate higher earnings for his client.  “The amount of the signing bonus is negotiable.  We operate under an unofficial sliding scale system,” Slough said.  Thus, the number-one NFL Draft pick will receive a higher bonus than the second pick, and so on.

One area in which agents no longer can negotiate higher earnings for their clients under the new CBA, is escalators.  Under previous CBAs, “agents used to be able to negotiate all kinds of escalators into the contracts,” according to Slough.  For instance, if the player played a certain percentage of the time, his agent could negotiate contract terms so that he would be paid more for his playing time.  However, under the new CBA, escalators are standardized.  According to Slough, players drafted in rounds three through seven receive a “proven performance” escalator, that goes into effect during their fourth season of play.  The escalator these players receive, is based upon them playing 35 percent of the time during two of their first three seasons, or an average of 35 percent of the time during their first three years.  If a player hits either of these benchmarks, then in their fourth season of play, their salary will escalate to the right of first refusal amount.

The role of an agent in terms of negotiating rookie contracts has greatly changed as a result of the new NFL CBA.  “Truthfully, there’s not a lot of negotiation in rookie contracts anymore for agents.  Your job really becomes focusing on the time leading up to the draft and getting through the draft process. Then, your job becomes everything that comes post-draft.  There’s a lot of other things that agents can do and be an asset to our clients beyond contract negotiation,” noted Slough.

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Peyton Manning’s Contract

Today the Denver Broncos are set to make a move which has been called the “biggest move” since free agency began in the NFL.  In signing quarterback Peyton Manning to a five-year, $96 million contract, the Broncos have signaled their willingness to spend to win, and also their belief in Manning’s continuing capability as a quarterback, even in the shadows of age and injuries.

Last season, Manning did not take a single snap nor make a single pass for the Indianapolis Colts, after enduring a number of neck surgeries.  Recently, however, numerous teams’ physicians, including those of the Denver Broncos, cleared Manning to play.  Yet, given that injuries caused him to miss action all last season, along with his age, questions linger as to whether Manning will reemerge in Denver with the playing capability that has made him one of the most successful quarterbacks in NFL history.

The apparent concerns over Manning’s playing ability likely factored into contract negotiations between Manning’s camp and the Broncos.  Arguably, each side negotiated provisions of the five-year contract to ensure that its interests were protected should Manning not be able to play due to injury.

Fourteen-year NFL agent Mark Slough of Ascent Sports provided insight into what safety protections may be present in Manning’s contract with the Broncos.  Slough does  not represent Manning and was not present during the course of the negotiations between Manning and the Broncos.  However, his experience in representing NFL players over the course of the past two decades makes him a qualified source on the topic, as his negotiation of player contracts has granted him significant insight into what provisions may be present in Manning’s contract with the Broncos.

According to Slough, from the outset, players and teams begin negotiating from a standard contract.  However, most contracts entered into between players and teams stray from the terms of the standard contract.  For instance, provisions dealing with bonuses, escalators, incentives and injuries are negotiated outside of the terms of the standard contract.  As for the issues surrounding Manning, Slough noted that, “There will not be anything that is standard in this contract, with regard to how the Broncos are going to address the concerns that they probably have.”

One way in which players secure their rights in contracts with teams, is to negotiate guaranteed contracts.   In the NFL, three types of guaranteed contracts exist:

1.  Skill guarantees:  Contracts guaranteed for skill guarantee that a player will be paid even if he is cut because his skill is no longer up to NFL-par.

2.  Injury guarantees:  Contracts guaranteed for injury guarantee that a player will be paid even if he is cut due to injury.

3.  Salary cap guarantees:  Contracts guaranteed under a salary cap guarantee ensure that a player will be paid even if he is cut for salary cap purposes.

Given Manning’s talent and experience in the NFL, Slough believes that this is a fully guaranteed contract, meaning that Manning would be guaranteed to be paid under each of the theories above.

However, teams are protected in contract negotiations through the form of waivers.  Thus, while a contract may make certain guarantees, the existence of particular factors waives that guaranteed payment.

One such waiver is an injury waiver.  Generally, according to Slough, teams are “obligated to pay for medical care and to rehabilitate a player back to his full health, even if he sustains an injury while playing.”  However, by having players sign injury waivers in their contracts, teams can waive that obligation.

Given Manning’s recent medical issues surrounding his neck, Slough supposes that there is an injury waiver in Manning’s contract with the Broncos.  The waiver likely waives the Broncos’ obligations to Manning should he sustain additional neck injuries and be unable to play.  However, Slough points out that Manning’s agents likely narrowly defined what was being waived.  Thus, it is unlikely that the contract simply waives, “neck injuries.”  Rather, it would more than likely waive specific types of neck injuries causing certain types of outcomes.

Outside of the injury waiver, Slough believes that the Broncos further negotiated to protect their interest by requiring Manning to pass a future physical.  Reports indicate that Manning will be paid $18 million this season.  Yet, Slough believes that a physical examination is to take place in March 2013, and if Manning does not pass this physical, he will have no future guarantees under the contract.  However, if he passes the future physical, Manning will likely be fully guaranteed, save for the injury waiver.

Although both the Broncos and Manning’s camp indicated that contract negotiations ran smoothly in this instance, it is clear that significant negotiation was required to bring Manning $96 million and the Broncos one of the most decorated quarterbacks in history.

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Rushing the Passer: Did Terrelle Pryor’s Agent and Lawyer Rush to Accept the NFL’s Sanction?

The good news for Terrelle Pryor?

He’s been declared eligible for the NFL’s supplemental draft set to take place on Monday, August 22, 2011.

The bad news for Terrelle Pryor?

His declaration for the supplemental draft coincided with NFL Commissioner Roger Goodell’s ruling that Pryor cannot participate in the first five games of the NFL’s regular season or practice with a team between the end of the preseason and week six of the NFL season.

The league rationalized this sanction by explaining, “… Pryor made decisions that undermine the integrity of the eligibility rules for the NFL draft.  Those actions included failing to cooperate with the NCAA and hiring an agent in violation of NCAA rules, which resulted in Ohio State declaring him ineligible to continue playing college football.”

As noted by the league, the NCAA suspended Pryor for the first five games of the 2011 football season.  The suspension stemmed from the NCAA’s investigation of the Ohio State University football program, where Pryor played quarterback for three seasons and racked up an impressive 31-4 record and Rose and Sugar Bowl victories.  The NCAA investigation centered upon allegations that Pryor and other Ohio State football players sold memorabilia in exchange for cash and discounts on tattoos. 

In further support of its decision to not allow Pryor to play the first five games of the NFL season, if drafted by a team during the NFL’s supplemental draft, the league noted, “Pryor had accepted at the end of the 2010 college football season a suspension for the first five games of the 2011 season for violating NCAA rules.”

Thus far, the league’s decision to institute a five-game moratorium against Pryor has not been challenged by Pryor; his agent, Drew Rosenhaus; or his attorney, David Cornwell.  A source indicated that the NFLPA believed Pryor should challenge the sanction, but that his agent and attorney “. . . believed it was a losing battle and that Pryor should accept the NFL’s punishment and move on.”

Did Pryor lose his battle against the NFL on the day that he was declared eligible for the NFL supplemental draft? 

Or is his battle just beginning?

In 1977, the NFL created its supplemental draft as a way “. . . accommodate players who did not enter the regular draft.”  The most common  reasons why players enter the supplemental draft are that they missed the filing deadline for the NFL Draft or had a change in their collegiate playing status due to eligibility issues.  Teams obtaining players through the supplemental draft must forfeit their pick in the round equivalent to which the player selected in the supplemental draft would have been selected in the actual NFL Draft.   

Pryor’s agent and attorney are likely reasonable for encouraging Pryor to accept the punishment set forth by the NFL so that he can participate in the supplemental draft and presumptively be selected by a team and begin earning a salary as a NFL player. 

However, the supplemental draft’s forfeiture rules provide a basis for Pryor to obtain relief against this sanction in the future, if need be.

Common law recognizes a cause of action for tortious interference with business relationships.  This cause of action arises when a “tortfeasor acts to prevent [a] plaintiff from successfully establishing [a] business relationship.”  A plaintiff can assert a cause of action for tortious interference with business relationships “. . . when a first party’s conduct intentionally causes a second party not to enter into a business relationship with a third-party that otherwise would probably have occurred.”

In this instance, the first party is the NFL.  The second party is any NFL team who, prior to the institution of a five-game suspension against Pryor, was interested in drafting Pryor in the supplemental draft.  The third party is Pryor.

Drew Rosenhaus, who as an agent set to earn at least ten percent of his client’s salary, has as much of an interest in Pryor’s draft placement as Pryor himself, pegs his client to be drafted in the first round of the supplemental draft.  Thus, given the rules of the NFL’s supplemental draft, a team drafting Pryor next week will have to give up their 2012 first round draft pick.

For those who dispute Rosenhaus’ assertion that his client is a first round draft pick as mere puffery, Pryor’s collegiate stats and victories solidify him as at the least, a second round pick.

There is little argument to be made against the notion that rookie quarterbacks face difficulty when learning a new team’s playbook.  Given that Goodell has forced Pryor to sit out over one-third of his rookie and the NFL’s sixteen game season, will NFL teams bite on drafting Pryor early and face losing a top-round pick in the 2012 NFL Draft?  Or, will Pryor fall to later rounds of the supplemental draft and risk losing the monetary benefits associated with signing with a NFL team as a high-round draft pick?

Pryor and the world will find out on Monday.

But should Monday come, and Rosenhaus’ client isn’t drafted in the early rounds of the supplemental draft, I’d suggest that he get on the phone with Pryor’s attorney, David Cornwell. 

At that time, the two should decide whether it’s a losing battle to assert a cause of action for tortious interference with business relationships against the NFL.  Pryor’s legal posse will have to decide whether the NFL’s implementation of a five-game suspension arising from actions allegedly taken by Pryor when he was neither a NFL player or potential draftee, was made to intentionally cause NFL teams to either not draft Pryor or draft Pryor as high as they would have.

Rosenhaus and Cornwell were correct in asserting that challenging the NFL’s sanction against Pryor at this stage would be a losing battle. 

But what they didn’t point out, is that their patience in this situation creates a winning situation for Pryor–albeit while potentially extending the battle. 

Pryor will either be drafted in the early rounds of the supplemental draft and reap the associated economic benefits. 

Or, he will fall to the later rounds of the supplemental draft as a result of the NFL Commissioner’s institution of a landmark enforcement strategy and subsequently invoke his own landmark litigation in response.

The battle has just begun.

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The Carson Palmer Lesson

It is a well-documented fact that sports fans in Cleveland have had their hearts ripped out at least once or twice by the teams and players they support.

However, Cleveland fans may soon be consoling their cohorts in southern Ohio, whilst commiserating over the loss of a franchise player who wanted to take his talents elsewhere.

Earlier this year, Cincinnati Bengals quarterback Carson Palmer asked that the team trade him.  The team denied this request.  Since then, rumors have circulated that Palmer will stop at no lengths–including retirement– to get out of Cincinnati.

Palmer was the first pick in the 2003 NFL Draft, when the Bengals selected him as their first-round choice.  Thereafter, Palmer originally signed a seven-year contract with the Bengals, which included $14 million in bonuses with the potential to earn up to $49 million.  When Palmer originally signed with the Bengals, the team had been the NFL’s worst team for twelve years.  Yet, in his second season, Palmer was able to lead the Bengals to the NFL Playoffs.

In 2005, Palmer signed a six-year contract extension, which granted Palmer the opportunity to earn $118.75 million in salary and bonuses throughout its course.  After signing the extension–and only two years into his playing career–Palmer commented, “Hopefully this is the last place I’ll end up playing.”

The NFL Lockout ended on July 25, 2011.  Teams were allowed to begin trading players on July 26, 2011.  On the first day of the NFL trade period, Bengals owner Mike Brown reiterated that the Bengals will not trade Palmer.

If this were a first year law student’s midterm, Brown would have scored close to the top of the curve with his explanation as to why the Bengals will not trade Palmer.

Brown explained, “Carson signed a contract.  He made a commitment.  He gave his word.  We relied on his word.  We relied on his commitment.  We expected him to perform here.  He’s going to walk away from his commitment. We aren’t going to reward him for doing it.”

It is possible that Brown, who is acting as the Bengals’ interim General Manager, will break with his stance and trade Palmer.  However, for the time being, it looks like the Heisman Trophy winning, first pick of the 2003 NFL Draft will retire after just seven seasons of play.

This retirement wouldn’t be the result of injuries incurred from playing one of the most physically demanding sports, but rather, because of a contract.

It is not entirely clear why Palmer is adamant about exiting Cincinnati.  However, it is possible that only achieving two playoff berths and enduring three losing seasons over the course of seven seasons has something to do with it.

Given this, how could this contractual issue have been avoided?

The clearest solution is the avoidance of lengthy contracts.

Two years into the league and at the ripe age of 26, Palmer essentially agreed to retire a Bengal.  With that level of experience and maturity, Palmer arguably did not have the wherewithal to consider factors such as the team’s ability to continue to perform and his ability to exit the team if it failed to do so, when signing a nine-year contract.

For the common American, it is hard to sympathize with the predicament that Palmer got himself into by signing a nine-year $119,750,000.00 employment contract.

However, consider this:

You are fresh college graduate.  Not only that, you have graduated at the top of your class from Harvard.  You have countless companies seeking out your skills.  However, this is an alternate universe and you don’t select your first employer.  Rather, they select you.  And furthermore, it being an alternate universe, the employer which selects you is the employer which consistently performs at the bottom of the market for your given profession.

However, two years later, you have learned from your new employer and have enjoyed your position.  You’ve even achieved some success in your position and helped your company achieve some of its goals.  You are young and not jaded.

In the coming years, however, things begin to change at your company.   You are no longer succeeding at the level you used to and changes aren’t being made to help you do so.  Your company hasn’t achieved any of its goals in several years.  You’re wondering if what you heard when you were being recruited is true–that this is an organization that can never “win” the market.  Your career has reached a place of stagnation.  You feel like you’re going nowhere.

What would you do?

You’d likely realize that your skills and talents aren’t being properly utilized.  You’d come to understand that the environment you’re in isn’t allowing you to succeed at the level you know you’re capable of.  So, you’d get on LinkedIn, surf over to Indeed.com and network with other similarly-minded professionals, in an effort to find a new position matching your career goals.  In a normal economy, shortly thereafter you’d be walking through the doors of a new employer’s office.

However, by signing a nine-year contract, Palmer essentially rid himself of the ability to seek a new employer.  In fact, his nine-year contract paradoxically granted his employer the right to prevent other employers from seeking out Palmer’s talents.

Palmer’s current conundrum should be a lesson to agents when advising their young clients during contract negotiations.  Agents must advise their clients of the pros and cons involved in signing lengthy contracts.  Issues to take into consideration when weighing the pros and cons, include the front office’s philosophies and the team’s ability to cultivate and develop talent.

In advising young clients facing offers of lengthy contracts from teams, Palmer’s story should serve as a key example and guide.  Palmer’s $119,750,000.00 contract, which ranks as the 35th largest sports contract of all time, was likely a beacon of promise to the then-young player.  However, that same nine-year contract is the reason why the now 31 year-old, healthy, former number 1 Draft Pick might be forced to hang it up.

And that, my friends, is how a contract can force a player to retire.

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