White v. National Football League

Decision Date30 April 1993
Docket NumberCiv. No. 4-92-906.
CourtU.S. District Court — District of Minnesota
PartiesReggie WHITE, Michael Buck, Hardy Nickerson, Vann McElroy and Dave Duerson, Plaintiffs, v. NATIONAL FOOTBALL LEAGUE; The Five Smiths, Inc.; Buffalo Bills, Inc.; Chicago Bears Football Club, Inc.; Cincinnati Bengals, Inc.; Cleveland Browns, Inc.; The Dallas Cowboys Football Club, Ltd.; PDB Sports, Ltd.; The Detroit Lions, Inc.; The Green Bay Packers, Inc.; Houston Oilers, Inc.; Indianapolis Colts, Inc.; Kansas City Chiefs Football Club, Inc.; The Los Angeles Raiders, Ltd.; Los Angeles Rams Football Company, Inc.; Miami Dolphins, Ltd.; Minnesota Vikings Football Club, Inc.; KMS Patriots Limited Partnership; The New Orleans Saints Limited Partnership; New York Football Giants, Inc.; New York Jets Football Club, Inc.; The Philadelphia Eagles Football Club, Inc.; B & B Holdings, Inc.; Pittsburgh Steelers Sports, Inc.; The Chargers Football Company; The San Francisco Forty-Niners, Ltd.; The Seattle Seahawks, Inc.; Tampa Bay Area NFL Football Club, Inc.; and Pro-Football, Inc., Defendants.

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Edward M. Glennon, Carol T. Rieger, Charles J. Lloyd, and Lindquist & Vennum, Minneapolis, MN, and James W. Quinn, Jeffrey L. Kessler, Jonathan T. Weiss, and Weil, Gotshal & Manges, New York City, for plaintiffs.

James Fitzmaurice, Daniel J. Connolly, Faegre & Benson, Minneapolis, MN, Herbert Dym, Gregg H. Levy, and Covington & Burling, Washington, DC and Frank Rothman, Shepard Goldfein, Douglas B. Adler, and Skadden, Arps, Slate, Meagher & Flom, Los Angeles, CA for defendants.

Peter S. Hendrixson, Dorsey & Whitney, Minneapolis, MN and Maxwell M. Blecher, and Blecher & Collins, Los Angeles, CA, for defendant Philadelphia Eagles Football Club, Inc.

ORDER

DOTY, District Judge.

BACKGROUND

Plaintiffs filed the present antitrust class action on September 21, 1992, less than two weeks after a jury rendered its verdict in McNeil v. National Football League, Civ. No. 4-90-476, 1992 WL 315292 (D.Minn. Sept. 10, 1992) (special verdict).1 The present action, McNeil, and most of the other litigation that the parties seek to resolve by the global settlement referenced herein, challenge various NFL player rules, including the right of first refusal/compensation component of Plan B, the college draft, the NFL Player Contract and the preseason pay rules. For many years, those and other rules have been the source of numerous disputes between players and the NFL.2

The five named plaintiffs3 filed the present case on behalf of themselves and all other past, present, and future NFL players similarly situated during the period specified in the second amended complaint.4 Defendants are the National Football League and its twenty-eight member clubs. The complaint, which originally sought only injunctive relief, was amended to seek both antitrust injunctive relief and damages stemming from the operation of the right of first refusal rules of Plan B, the college draft, the NFL player contract and the preseason pay rules. The second amended complaint also alleges that defendants illegally fixed players' medical insurance benefits and tortiously interfered with players' prospective contracts. Defendants answered the complaint, denying all of plaintiffs' material allegations and asserting various affirmative defenses and counter-claims.

On October 15, 1992, plaintiffs moved for a preliminary injunction that would have barred defendants from enforcing the right of first refusal/compensation rules of Plan B, or imposing any other player reservation system, on veteran NFL players whose contracts were to expire on February 1, 1993. Defendants opposed that motion, which was still pending when the parties, with the assistance of this court, reached a tentative agreement to settle this action on January 6, 1993.5

By order dated January 6, 1993, as amended and reaffirmed on February 17, 1993, the court certified, for the purposes of settlement, a damages and injunctive relief class pursuant to Federal Rule of Civil Procedure 23(b)(1) consisting of:

(i) all players who have been, are now, or will be under contract to play professional football for an NFL club at any time from August 31, 1987 to the date of final approval of the settlement of this action and the determination of any appeal therefrom, and (ii) all college and other football players who, as of August 31, 1987, through the date of final approval of the settlement of this action and the determination of any appeals therefrom, have been, are now, or will be eligible to play football as a rookie for an NFL team.

See White v. National Football League, Civ. No. 4-92-906, slip op. (D.Minn. Jan. 6, 1993) (entered nunc pro tunc); White v. National Football League, Civ. No. 4-92-906, slip op. (D.Minn. Feb. 17, 1993); Pls.' Second Am. Compl. at 8. Those mandatory class certification orders have provided a vehicle for the settlement of, among other things, all player challenges to the Plan B veteran player reservation rules, the college draft and the preseason pay rules. The settlement is the critical step toward the final resolution of the longstanding dispute between the NFL clubs and their player-employees.

On February 26, 1993, plaintiffs and defendants entered into a Stipulation and Settlement Agreement, which encompasses the terms of the proposed settlement and is designed to bring an end to the present action and a wide range of related litigation. In an order dated February 26, 1993, based on its review of the file, record and proceedings to date, this court preliminarily approved the proposed settlement as fair, reasonable and adequate, specifically finding that:

1. The proposed settlement adequately addresses plaintiffs' predominant claim for relief, namely structural, injunctive relief because it will radically alter the NFL's system of player restraints and provide unprecedented free agency to NFL players.
2. The proposed settlement also adequately addresses plaintiffs' claim for monetary recovery, because it will provide for substantial payments to be distributed fairly among the named plaintiffs and class members in settlement of their past claims against the NFL and its teams.
3. There are substantial novel and complex legal and factual issues involved in this case, precluding any guarantee as to certainty of outcome.
4. The establishment of damages would be uncertain, difficult, costly, and extremely time-consuming.
5. The establishment of plaintiffs' claims regarding preseason compensation are uncertain and are subject to counterclaims that may substantially affect the likelihood of any recovery.
6. Given the long history of this dispute, the parties are uniquely positioned to assess the overall reasonableness of the proposed settlement.
7. The proposed settlement was the product of good faith bargaining at arm's length between the parties.
8. Class Counsel is adequately representing the interests of the named plaintiffs and all class members.

See White v. National Football League, Civ. No. 4-92-906, slip op. at 2-3 (D.Minn. Feb. 26, 1993).

In accordance with Federal Rule of Civil Procedure Rule 23(e), the court ordered plaintiffs, at their own expense, to send written notice by mail to class members.6 The court also ordered plaintiffs to publish a summary notice in USA Today. Those notices, which were approved by the court, described the terms of the proposed settlement and informed all class members that a final approval hearing would be held on April 16, 1993, to determine whether the proposed settlement was fair, reasonable and adequate. The notices also informed class members that they had a right to submit written objections and to appear at the final approval hearing, in person or by counsel, to be heard in support of, or in opposition to, the settlement, or make any other statement of their position concerning the settlement. See Notice of Class Action Settlement and Summary Notice.

Following a resolution of the Board of the National Football League Players Association (the "NFLPA") to seek to become the collective bargaining representative of NFL players,7 in mid-January 1993, the NFLPA began to collect authorization cards from NFL players designating it as the exclusive collective bargaining representative of NFL players.

By letter dated March 23, 1993, the NFLPA informed the NFL that:

a majority of the players on 1992 season-ending rosters have now signed cards authorizing the NFLPA to represent them for purposes of collective bargaining.

(Letter from Richard A. Berthelsen to Paul Tagliabue dated March 23, 1993.) After confirmation of the authenticity of the cards by an independent entity, the American Arbitration Association, the NFL voluntarily recognized the NFLPA as the exclusive collective bargaining representative of the NFL players. (Letter from Harold Henderson to Eugene Upshaw dated March 29, 1993.)

Since March 31, 1993, the NFLPA and representatives of the NFL Management Council, the multi-employer bargaining unit of the NFL owners, have been negotiating in an effort to reach a new collective bargaining agreement.8 As of the date of the final approval hearing, April 16, 1993, those negotiations remained ongoing.9

This case is presently before the court on the motion of the parties for final approval of the Stipulation and Settlement Agreement, which fundamentally revises many of the employment practices at issue in this litigation. The five representative plaintiffs (all of whom are active or former NFL players), class counsel, representatives of the NFLPA, and at least twenty-eight of the twenty-nine defendants10 view the proposed settlement as a fair, reasonable and adequate method of resolving this litigation. All of those parties believe that the proposed settlement advances and protects the interests of all class members, and provides the framework for...

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