The Battle for Free Agency
Though free agency is a now a staple in the world of professional sports, many old school fans feel that professional football lost it’s way once its adopted the free agency model has because it placed a higher value on the individual than the team. Players, they argue, have no sense of loyalty to the organization that provided them the opportunity to make a living by playing the game they love. To them, dynasties today aren’t built, but rather bought, and that rivalries mean nothing if a player will take more money to play in his opponent’s uniform.
The game back then was played for pride. Today, it’s played for profit.
To others, however, free agency means giving players the same free market opportunities that other American workers enjoy. It means that players can take control of their career paths without having to plea or even beg the owners to allow them to play elsewhere for greater financial security. Free agency is a symbol of empowerment, reminding the owners and the public that this national obsession and multi-billion dollar industry wouldn’t be possible without the players. In addition to offering players free market rights, free agency has supplied an endless amount off season content for football fanatics while they wait for next season to kick off, and has opened up an entire sector of business opportunities in salary cap management, player representation and player scouting.
Regardless of where a person may stand on this issue, many can agree that the battle for free agency is the classic American tale of the battle between management and labor.
The early days
The groundwork for the battle stems back to 1920, when the American Professional Football Association, comprised of corporate funded teams from small and mid sized towns in Ohio, New York, and Illinois, was in it’s inaugural season. Legendary All-American athlete Jim Thorpe served as the league’s first president, but wasn’t at all interested in fulfilling the administrative and managerial duties in addition to his role as a player-coach with the Canton Bulldogs, so the APFA commenced the season without a written constitution or bylaws to regulate the game, the rosters or the league standings. The APFA owners sought out to legitimize and develop the image of professional football, and determined that in order to do so, they needed a man with a sharp mind for business. That’s when Columbus Panhandles owner Joseph F. Carr delivered a passionate speech about the potential of professional football’s future and how to achieve success. His fellow owners were inspired, and elected him as the new president of the League.
Carr’s first order of business as the president was to author a constitution and set of by-laws to establish stability within the APFA. In it’s first year of play, it was common to see ineligible college players on the field. Furthermore, the League’s most talented players would sometimes finish playing a game for one team and then drive to the next town to play for another team that same week, drawing in paychecks from whichever owner would pay them. These practices spawned an unequal competitive balance and painted a dysfunctional image of pro football in the newspapers.
When Carr took over the reigns, he presented the constitution at his first meeting as the President of the Association on June 18 in Cleveland. The first rule implemented was “that all players of last year’s team are not to be approached by any other managers of any other teams until the manager notifies the President of the Association that a player is a free agent.” To enforce this, Carr introduced player contracts to limit player movement. Carr also adopted the Reserve Clause from professional baseball, which gave the team the first right to offer a player a new contract once his previous one expired. If the team had no interest in making a new offer, they would render the player a free agent and he could pursue opportunities elsewhere, but only once the team sacrificed his rights.
Much would change in the coming decades after Carr’s first season as President; the American Professional Football Association rebranded as the National Football League in 1922, the title of President would become Commissioner, and professional football had largely migrated from small factory and coal mining towns into metropolitan cities like Chicago, Philadelphia and New York City. Furthermore, the NFL was facing competition from an upstart football league, the All-America Football Conference.
The AAFC was the creation of Arch Ward, the sports editor of the Chicago Tribune who was also the originator of the College All Star Game, a preseason match between the reigning NFL Champions and a team of All-Star college seniors in the NCAA. Though the NFL had never faced a competing league for longer than a couple seasons, the AAFC was able to garner significant media coverage through Ward’s press connections. Just as significant, the AAFC not only drew top end talent from the college ranks, but also attracted former NFL players. The AAFC originally stated that it had no interest in pursuing a bidding war for talent, rather hoping to work with the NFL over matter of player contracts, salaries and even establishing a “World Series of Football.”
NFL Commissioner Elmer Layden had no interest in acknowledging the AAFC, and many NFL owners publicly ridiculed the rival league in the newspapers. The AAFC, in a fight or flight response, proceeded to recruit top flight NFL talent at the conclusion of the 1945 NFL season, offering salaries that far exceeded what top veterans in the NFL were making. By the time the AAFC was about to kick off the league’s history, 95 players on AAFC rosters had NFL experience.
To dissuade players from changing leagues, the NFL began the practice of “blacklisting” players from returning to the NFL, for a duration that could last up to five years. This practice would lead the NFL into the courtrooms, where the entire business model of the NFL would be challenged forever.
radovich V NFL
William Radovich was an All-Pro guard for the Detroit Lions in 1938. Having left his position on the team to serve in the Navy during World War II, Radovich resumed his role for the Lions in 1945, but complications to his father’s health in Los Angeles became a great concern to him. He approached Lions owner Fred Mandel to request a trade to the Los Angeles Rams, which had just relocated from Cleveland. Mandel refused his request, however, so Radovich decided to pursue an opportunity with the Los Angeles Dons of the AAFC. After playing with the Los Angeles Dons in 1946 and 1947, Radovich was the offered another opportunity as a player-coach with the San Fransisco Clippers, a minor league team in the Pacific Coast Football League.
Though a minor league, the PCFL held interesting place in the realm of professional football as a “divisional affiliate” of the NFL. Prior to the Rams relocation to LA, the NFL had no franchises on the West coast, and the AAFC had two (the LA Dons and the San Fransisco 49ers). To ensure that the AAFC wouldn’t get a firm grasp on the California market, the NFL signed an agreement with the PCFL. Essentially, the PCFL teams would schedule their games to directly compete with the AAFC teams when the NFL wasn't playing games in California. In return, the NFL would essentially provide financial assistance to underwrite any losses that these designated scheduling conflicts would create.
Given this relationship, Radovich’s offer as a player coach was quickly revoked when the newly appointed NFL Commissioner Bert Bell informed PCFL Commissioner J. Rufus Klawans of Radovich’s previous history with the NFL and the AAFC. Radovich, now waiting tables to pay the bills, was enraged by the events that had unfolded. In 1957, after receiving legal advice, Radovich decided to file antitrust lawsuit against the NFL on the grounds that it violated the Sherman Antitrust Act of 1890. The Sherman Act, a federal statute which prohibits activities that restrict interstate commerce and competition in the marketplace, was enacted to combat monopolies that conspired to eliminate competition.
Coming into the litigation, Commissioner Bell was confident that the NFL would emerge from the trail in the court’s favor. His confidence was rooted a 1922 Supreme Court ruling that professional baseball was exempt from the antitrust laws since the Supreme Court at the time did not view professional baseball as a form of interstate commerce (the ruling would be upheld in a separate antitrust case in 1953). Bell believed that the ruling applied to baseball would cover professional football as well.
At the time of Radovich v. NFL, however, professional sports had drastically changed with the rise of broadcast media, which by definition, crossed state lines from where the contest was being played. The court claimed that while it may be inconsistent to exclude professional baseball and not professional football, Justice Tom C. Clarke, speaking for the majority, explained,
We, therefore, conclude that the orderly way to eliminate error or discrimination, if any there be, is by legislation and not by court decision. Congressional processes are more accommodative, affording the whole industry hearings and an opportunity to assist in the formulation of new legislation.
The judge ultimately ruled that the NFL was subject to the Sherman Act, and Radovich would settle out of court for $42,500. Bert Bell, believing that this case could complicate the NFL’s legal and business dealings moving forward, set out to receive an antitrust exemption from Congress. The House Judiciary Anti-Trust Subcommittee would hold hearings to all major team sports organizations to determine if all sports should be exempt, or if baseball’s exemption should be removed.
While negotiating with Congress, Bell had another labor issue on the horizon. By now, the NFL had merged with the AAFC and absorbed three of it’s franchises (the Cleveland Browns, Baltimore Colts, and San Francisco 49ers), which resulted in drastic pay cuts for some of the former AAFC players that were now restricted to their team under the reserve clause of the NFL.
Furthermore, the NFL’s limited yet nonetheless profitable exposure on television provided a whole new revenue stream for the owners. Wanting to get a share of profits, Abe Gibron and Dante Lavelli of Cleveland Browns, with the aid of attorney Creighton Miller, successfully organized the National Football League Player’s Association in 1956, demanding a league minimum salary payment of $5,000, for training camp and exhibition games, as well as a pension plan. Though Bert Bell and the owners met with representatives from the NFLPA in early 1957, they did not publicly acknowledge NFLPA, believing that they could simply add a few more amenities to the players here and there without having to formally negotiate with a union.
Their attitude would change once the court ruled that the NFL is not exempt from antitrust laws in Radovich v. NFL. Fearing that this ruling would give the NFLPA leverage to file antitrust suits in the future, the owners began to accommodate the player’s proposals in varying capacities.
Bell’s congressional and union battles would be cut short, however, when Bell suffered a heart attack at a Philadelphia Eagles game and died later that day. His successor, Alvin Ray “Pete” Rozelle, was voted into the role at the age of thirty-three after serving as the general manager for the Los Angeles Rams. Rozelle, believing that the NFL would prosper only if all of it’s teams strived for competitive balance, implemented numerous bylaws to see that each team would be on an equal playing field. One of these bylaws would be dubbed the “Rozelle Rule,” and would strengthen the conflict between the players and the powers of the NFL office.
the rozelle rule
Under the Rozelle Rule, any franchise who’s contract with a player had expired had the right to compensation from the player’s new employer if he were to sign another contract with another franchise. The compensation would be in the form of draft picks or trading a player of equal caliber. If the two teams were unable to reach a mutually satisfactory agreement on compensation, then Rozelle had the right, in his sole discretion, to fix the rate of compensation. The Rozelle Rule, implemented to maintain competition between small and big market franchises, in effect deterred teams from pursuing free agents and ultimately stagnated player’s salaries.
The “all for one, one for all” economics of the Rozelle Rule would be challenged in 1972, however, when former Baltimore Colts tight end and NFLPA President John Mackey, among others, filed a lawsuit against the NFL claiming that the Rozelle Rule was in violation of the Sherman Act. Mackey, voted in as the union president in the aftermath of the well documented AFL-NFL merger, felt the first hand the effects of the Rozelle Rule when he was traded to the San Diego Chargers in 1971. Even prior to this transaction, Mackey felt the Rozelle Rule stripped the freedom of the players away.
The union’s legal representation, Ed Garvey, a Minneapolis labor lawyer who was first hired by Mackey in 1970 to negotiate a new CBA agreement on behalf of the NFLPA, was equally as vigilant in fighting for player rights. In 1970, Garvey and Mackey had successfully organized the first strike in pro football’s history that lasted two days and resulted in a new four year CBA, as well the appointment of Garvey as the new NFLPA Executive Director. Now, the two were taking the NFL to court.
Garvey was, as Pete Rozelle described, “a prototypical early sixties radical, a militant ideologue who is unable to see any good, any justice, in any action of management.” In a contract negotiation meeting between the owners and the NFLPA, Garvey stated to the League office, “You have perpetuated an unjust system of control over athletes headed by those who have demonstrated disdain for the constitutional rights of athletes,” and proceeded to list a series of demands that would in essence remove the governing laws of the NFL. Clearly, the two parties could not have been further apart from reaching a compromise.
In 1975, the Minneapolis court ruled that the Rozelle Rule, “is so clearly contrary to public policy that it is illegal under the Sherman Act. It is also an unreasonable restraint of trade at common law.” Commissioner Rozelle would tell author David Harris that, “[The Mackey case] attacked the very structure of the game. It attacked the validity of the game.” The owners, understanding the severity of this ruling, agreed to a final session to reach an agreement with the NFLPA in February of 1977. A five year agreement was reached, and a variety of concessions were met, including, but not limited to, a $107 million package of benefits spread over the duration of the five year contract, a $13.65 million settlement paid over ten years for legal fees and no arbitrary dress or hair codes.
In return, however, the NFLPA agreed to accept a revision of the Rozelle Rule, a decision that would cost Ed Garvey credibility with the NFLPA, and momentarily silence any threat of internal labor disputes.
The revision of the Rozelle Rule was known as the Right of Refusal/Compensation system. George Mavris, in an essay for the Loyola of Los Angeles Entertainment Law Review, explains the revision in detail:
Under the Right of First Refusal/Compensation scheme, once a player's contract expired he became a free agent with the right to negotiate with any interested team. If a player signed with a different team, the compensation to be paid to the team losing the player was determined by the player's new contract. According to a fixed scale codified in the 1977 CBA, the more the new contract was worth, the more compensation the new team was required to pay. Before compensation was paid, however, the losing team had the right to match the contract offered to the player. Should a team threatened with losing a player decide to match the offer, the player was denied the right to move but was paid according to the new contract.
Though the revision was meant to limit the powers of the Commissioner in trade/free agent matters, NFL clubs still retained the rights to the players nonetheless, and minimal transactions occurred between the 1977 CBA agreement and the upcoming 1982 strike.
a decade of Disputes
The 1982 strike, lasting fifty seven days, marked the first time in NFL history that a regular season game had ever been canceled due to a labor dispute. Ed Garvey, once again, was at the forefront of the protest, demanding that the NFL allocate a minimum of fifty-five percent of it’s gross to player’s salaries. The NFL owners, however, were not willing to turn control of the business to the players, instead opting to offer a $1.6 billion package over a five year term. The NFLPA refused, with Garvey claiming, “I’m convinced they’re offering $1.6 billion about as much as I’m convinced there is a tooth fairy.”
The strike was bleeding two month into the season. Needing money to supplement lost income, the NFLPA planned to launch a 19 game series of All-Star matches for fundraising and to showcase their independence. Media entrepreneur Ted Turner agreed to broadcast the games on his superstation, WTBS-TV. The union only organized two games, however, before aborting the remaining games due to financial losses. Ted Turner, who paid $500,000 for the rights to the games, lost $800,000 on the first game alone.
As Ed Garvey’s bluff was being called, the union voiced their skepticism on if the strike was really the right maneuver. The strike was still in effect the second week into November when Steeler’s President Dan Rooney reached out to Garvey to try and come to an agreement and salvage what was left of the season. The two sides came to terms on another five year CBA agreement that saw an increase in salaries for veterans, a $60 million “money now” deal for ending the strike and the initial $1.6 billion packaged dispelled over a four year period.
Free agency, however, was not part of the deal, and left many players considering the fifty-seven day strike a failure. One year later, Garvey would resign from his position as Executive Director, and was replaced by former Oakland Raider’s offensive tackle Gene Upshaw. The NFLPA, while locked in to a five year CBA, polled and consulted with all of it’s members as to what the biggest priority was for the upcoming 1987 CBA negotiations. Unsurprisingly, free agency was the highest priority.
By 1987, the NFL’s antitrust battles were becoming more vicious than the product on the field. Al Davis, along with the Los Angeles Memorial Coliseum Commission, filed a lawsuit against Rozelle and the NFL for refusing to allow him to move his franchise from Oakland to Los Angeles, claiming that it was in violation of the Sherman Act. The court ruled in Davis’s favor, and crumbled the collectivist philosophy that Rozelle implemented as the foundation of the NFL’s success. Furthermore, the NFL, having survived yet another bidding war for talent when the United States Football League folded in 1986, was still trying to subside distractions and get the game itself back in the headlines.
The NFLPA, however, had different plans when they decided to go on strike prior to the 1987 season. Unlike the previous strike five years earlier, however, this strike lasted only twenty-four days when players began to cross the picket line and play when the owners decided to use replacement players instead. Understanding that a union wasn’t able to fight a monopoly with signs and protests, they again took the NFL to the courtroom.
Powell v nfl
Powell v. NFL, named after NFLPA President Marvin Powell, was filed that same year to challenge the Right of First Refusal/Compensation, again claiming that it was an antitrust violation. The owners, however, used the defense that the RFR/C system was exempt from the antitrust laws by operation of the non-statutory labor exemption, meaning that although the 1982 Agreement had terminated, basic labor law principles and policies should remain in effect after expiration of the agreement until a new agreement was reached. Meanwhile, the NFLPA sought an injunction against the RFR/C implementation, while ownership filed an unfair practice charge against the NFLPA to the National Labor Relations Board, neither of which would be entertained. The court determined that both sides had reached an impasse.
After the impasse ruling, ownership brought forth a new proposal to the union: Plan B free agency, which offered to reduce player benefits but allowed a select number of players on a roster to have unrestricted free agency. The number of players depended on the teams standing from the prior season, but the numbers would range between as little as three to no more than seven players per team. After the union refused this proposal, management then offered the allowance of ten players per team the right to unrestricted free agency. The NFLPA still wasn’t satisfied with the offer, and fearing that the court was swaying toward the player’s argument, the NFL owners implemented Plan B free agency anyway.
The players continued to play without a CBA for the next two seasons, and Plan B was the only form of free agency. The Judge still indicated that an impasse would be continue to be reached unless a new agreement would drafted and ratified. The NFLPA was now at a crossroads, as explained by Carol T. Rieger and Charles J. Lloyd,
In the aftermath of the Eighth Circuit's Powell decision, the players were faced with a dilemma. They could continue to bargain collectively with the NFL with the hope of reaching a satisfactory agreement, but by doing so they would continue to insulate the NFL from the operation of the antitrust laws. In the alternative, they could abandon their union status and forego their right to collectively bargain with the NFL.
After weighing the benefits and the disadvantages of both courses of action, the players determined that it would be in their best interest to cease collective bargaining and no longer function as a union. The players' union, the NFLPA, immediately disclaimed interest in representing NFL football players in collective bargaining. At team meetings, more than 930 of the 1,500 players signed petitions stating that they did not want the NFLPA or anyone else to represent them in collective bargaining.
Power to the nflpa
Now that the NFLPA was a professional association, it essentially sacrificed the right to collective bargain to represent the players in court. This would be on display when a group of players led by New York Jets running back Freeman McNeil filed suit against the NFL challenging the restrictions under Plan B as violations of the Sherman Act. Furthermore, the NFL could no longer claim the labor exemption defense because the NFLPA was no longer a labor union. Therefore, there was no longer a collective bargaining relationship and the non-statutory labor exemption had expired.
Once McNeil v. NFL was underway, players took to the stand to talk about the unjust enforcement the RFR/C and Plan B restrictions. Though the owners did not take the stand, many other NFL figure heads, including Pittsburgh Steelers head coach Chuck Noll and newly appointed commissioner Paul Tagliabue, argued that free agency could disrupt competitive balance and financially hurt small market clubs. In their defense, the players hired an economist to show how profitable a single NFL club is and that in fact free agency would not damage any franchise financially.
After both sides made their arguments, the jury found that the current restricted free agency model had substantially harmed the players Following the verdict, players now were filing suit to seek damages done from the previous free agency policies and to seek an injunction from having Plan B ever implemented again, most notably White v. NFL, named after Philadelphia Eagle and eventual Green Bay Packer Reggie White.
In order to reach a settlement, compromise would have to be made. According the NFLPA, the compromise went as stated,
Lawyers from both sides, along with Gene Upshaw from the NFLPA and Commissioner Tagliabue, met on dozens of occasions trying to find middle ground for settlement of the court cases. The players wanted meaningful free agency and fair damages for the plaintiffs. The league wanted a salary cap which would keep free agency from financially threatening teams in smaller markets. The players opposed a cap, saying it would unduly restrict the market.
The settlement eventually came, but only after both sides compromised. Owners agreed to free agency, but only if there was a salary cap. Players agreed to the cap, but only if player costs first exceeded 67% of league revenues. Even then, the cap would have to be high—64% of revenues—and the clubs would have to guarantee that at least 58% of revenues would be spent on players… And most importantly, the owners would have to agree that there would be no cap in the last year of the deal—1999. In addition, $195 million in damages would have to be paid to settle the various court actions, including the White v. NFL class action.
With this settlement, the RFR/C and Plan B were now obsolete, and the NFLPA regained it’s union status. After seventy years, the era of free agency was officially underway, and forever changed the fabric of professional football.
conclusion
Undoubtably, the battle for free agency has created more enemies than allies. Today, ownership and players still harbor deep rooted differences that continually threatened the financial success of America’s most identifiable brand with disputes over skyrocketing salaries and a continuing mission for guaranteed salaries because of the injury prone nature of football. But whatever the next labor dispute may bring about, it can determined that in the end, professional football, underneath the shoulder pads, formations and touchdown celebrations, is and forever will be a labor drama, and while the battle for free agency was won by the players, the war with management will continue rage on.
References
Willis, Chris. The Man Who Built the National Football League: Joe F. Carr. Rowman & Littlefield, 2014.
“Radovich v. National Football League, 352 U.S. 445 (1957).” Justia Law, supreme.justia.com/cases/federal/us/352/445/.
Coenen, Craig R. From Sandlots to the Super Bowl: the National Football League, 1920-1967. University of Tennessee Press, 2005.
Crippen, Kenneth R., and Matt Reaser. The All-America Football Conference: Players, Coaches, Records, Games and Awards, 1946-1949. McFarland & Company, Inc., Publishers, 2018.
Harris, David. The League: the Rise and Decline of the NFL. Bantam Books, 1987.
Mavris, George. “White v. National Football League: The Myth of Free Agency in the National Football League.” Digital Commons at Loyola Marymount University and Loyola Law School, 1994, digitalcommons.lmu.edu/elr/vol14/iss2/6/.
Attner, Paul. “Close Friends, Few Others See Mosley Win Game in RFK.” The Washington Post, WP Company, 18 Oct. 1982, www.washingtonpost.com/archive/sports/1982/10/18/close-friends-few-others-see-mosley-win-game-in-rfk/8224ac9e-0e80-4b52-ac48-87fb3cc66939/.
Truelock , Mike. “Free Agency in the NFL: Evolution or Revolution.” Https://Scholar.smu.edu/Cgi/Viewcontent.cgi?Referer=Https://Www.google.com/&Httpsredir=1&Article=2389&Context=Smulr, SMU Law Review, 1994.
Rieger, Carol T, and Charles J Lloyd. “The Effect of McNeil v. NFL on Contract Negotiation in the NFL- That Was Then, This Is Now.” Https://Scholarship.law.marquette.edu/Cgi/Viewcontent.cgi?Referer=Https://Www.google.com/&Httpsredir=1&Article=1068&Context=Sportslaw, Marque e Sports Law Review, 1992, scholarship.law.marquette.edu/cgi/viewcontent.cgi?referer=www.google.com/&httpsredir=1&article=1068&context=sportslaw.
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