On the Record

The U.S. Supreme Court tomorrow will hear arguments in American Needle v. NFL, a case ostensibly about who gets to make officially-licensed team hats.

But the underlying issue — whether the NFL and other sports leagues should be considered one business or multiple, privately-owned ones — could have a dramatic effect on professional sports. Only Major League Baseball now has an antitrust exemption.

Sports business and law observers have been weighing in on the case, but the commentary I found most surprising and compelling was by Drew Brees in Sunday’s Washington Post.

Surprising because Brees is the All-Pro quarterback for the New Orleans Saints, and he has a playoff game this weekend. (Granted, Brees was off last week, but most sports fans like to believe the players on our team are concentrating only on the next game; imagine Joe Flacco writing an op-ed about the health care debate as he prepared to play the Patriots.)

Brees, a member of the NFL Players’ Association Executive Committee, argues granting the NFL an antitrust exemption “would enable owners to exert total control over this multibillion-dollar business.” Such a ruling would be particularly onerous for the NFLPA as it negotiates a new collective bargaining agreement, he writes; there is already widespread discussion about a lockout for the 2011 season.

Like any good brief, Brees ends with a zinger, this one directed at two of the most high-profile owners in the league:

I hope that the justices of the Supreme Court recognize and ensure the continuance of the intense competition inherent in this game, and in the business behind the game. As readers of The Washington Post know well, NFL teams such as the Dallas Cowboys and the Washington Redskins are by no means a single entity — just ask Dan Snyder or Jerry Jones.

The NFL released its entire 2009 schedule Tuesday, but it’s eight specific games on the calendar that are the focus of a courtroom hearing in Washington, D.C. this week.

The octet of games will air later this year on NFL Network, which is owned by the league. Comcast has put the network on its premium sports tier, which costs extra on top of the standard digital package, where the league wants its network to be.

Comcast, the nation’s largest cable provider, claims it put the network in the premium tier because of high costs associated with carrying the channel; the NFL says Comcast put the channel there so as not to compete with Comcast’s own sports channels. 

An administrative law judge with the Federal Communications Commission will make a ruling that could have implications beyond sports:

It is the first big test at the FCC of a 1992 federal law that prohibits cable companies, such as Comcast, from favoring their own entertainment content over that of independents, such as the NFL Network. …[A ruling in favor of the NFL] could make it easier for independent programmers to gain access to cable systems, experts say.

This case is one of three that will be heard in the next few months by Judge Richard L. Sippel; another one, interestingly enough, involves MASN, the Orioles’ and Nationals cable network. After settling a separate federal suit against Comcast (over “split feed” advertising in the Baltimore and D.C. region) a little more than a year ago, MASN now wants Comcast to carry the channel in several southern Virginia markets.

As the clock wound down in the countdown to NFL free agency late Thursday afternoon, Ray Lewis’ agent Ira Rainess told a group of law students his client’s ties to Baltimore went deeper than a football contract.

A partner with Rainess in Team 52 Development LLC, Lewis is an equity partner in the city’s Gateway South, a mixed-use sports, retail and office space project that will include an educational and mentoring center named for Lewis.

After Lewis avoided a charge for attempted murder in 2000, Rainess said the linebacker came to him to work on how to get active in the community and teach kids how to not go down the wrong path.

“I meet with the city every one or two weeks to talk about issues in Baltimore where they need his help,” Rainess said at a sports law symposium hosted by the University of Baltimore School of Law, his alma mater. “Ray makes his home here; his commitment to the city is as good as any athlete I’ve ever seen.”

Rainess also told students he believed that public/private development projects such as Gateway South are the wave of the future for athletes Read the rest of this entry »

Back in January, the day before the Baltimore Ravens beat the Tennessee Titans in a playoff game, jurors in the Jacksonville residents’ billion-dollar lawsuit against ExxonMobil Corp. wore Ravens’ paraphernalia. Many of the plaintiffs’ lawyers from Snyder, Weltchek & Snyder wore purple ties or had purple beads around their necks. (Lawyers for Exxon, it should be noted, might not have shown their Ravens’ leanings out of respect for the company’s lead counsel, who are based in Nashville.)

The last person to enter the courtroom that day was the plaintiffs’ lead counsel, Stephen L. Snyder. And when he took off his overcoat, he was wearing a purple suit, much to the delight of everyone in the courtroom.

I mention perhaps my favorite anecdote from the five-month trial to illustrate that most of the light-hearted moments have involved — or were directly caused by — Snyder throughout the proceedings. This Monday was no exception, as Snyder provided a few laughs during the start of his closing argument.

— The always nattily-attired Snyder thanked the jurors for sitting on a trial that has lasted longer than everyone expected. “I almost ran out of suits,” he deadpanned.

— Snyder was in the middle of a point when he was interrupted by his co-counsel, Robert J. Weltchek, who made a correction. Snyder thanked Weltchek and smiled. “One more time and I’ll throw you out of here,” Snyder said.

— A comic strip-like cartoon, part of the plaintiffs’ PowerPoint presentation, illustrated Exxon’s unresponsiveness to an actual leak alarm from a leak detection system because the detector often went off for reasons other than a leak. It featured a boy holding a bucket filled with water. Snyder said the boy’s name was “Peter.”

This touched off murmurs about mixing up children’s stories. The main character in the fable “The Boy Who Cried Wolf”, it was later determined, is not necessarily the same character as in the early 20th century musical composition “Peter and The Wolf.” Snyder held his ground.

“Well, I call him ‘Peter,’” he said.

DANNY JACOBS, Legal Affairs Writer

I’ve written before about how sports are not recession-proof. But the topic was brought home by Ravens owner Steve Bisciotti at a news conference he held last week when he said he is concerned about how the recession may affect the team.

“I’ve said this before: I’m not in this business to make money, but I’m also hoping not to lose money, and we’re running on fairly small margins when it comes to cash flow,” Bisciotti said Wednesday. “So all those companies in Baltimore that buy our suites and everything, I need them to keep on going, and I need the people to keep on buying tickets. So we have to be sensitive with increases and everything else, but it is definitely a factor, and it’s the first time we’re going to go through it.

“But I’ve been through economic downturns in my other business, and so I think that we know how to prepare for those kinds of things. But you can’t prepare for loss of revenues. You just have to try and manage it the best you can and minimize the losses.”

It’s a sticky situation — suites are a big revenue generator for a team, and you don’t want to make the cost prohibitive for a company that is likely scrutinizing its discretionary expenses and may not have many clients left this year to even schmooze at the suite.

But on the plus side, Bisciotti said the team’s performance this season should earn it more primetime appearances for the 2009 season. And national television exposure is good not just for the Ravens but for their relationship with advertisers that pay for the stadium billboards seen on TV.

At what point should fans here start worrying about their team? If finances are an issue, will the Ravens be able to afford a monster contract for Ray Lewis to keep him in Baltimore? And if they can’t, how bad would that be for the city and team’s morale?

LIZ FARMER, Business Writer

Some of the best reactions I got while I was conducting interviews for today’s cover story, “The Tailgate is Now in Session,” were when I asked lawyers the question, “How is tailgating like preparing for a case?”

I received some befuddled looks, but I did receive some great answers. Take Rob Erdman of Webb & Blitz LLC, who said:

Preparation is key. You don’t want to get caught with your pants down and not have enough food at the tailgate. Just like you want to have the right case ready for your arguments.

Below is a video of some other responses from lawyers. Have any better ones?

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Also, I tried to get to as many lawyer-led tailgates as I could, but I know I missed some. Do you feel that there are others that deserve recognition?

RICHARD SIMON, Multimedia Reporter

We all know lawyers are some of the hardest-working folk around. Some carry that energy outside of work–even to M&T Bank Stadium.

Yesterday I spent time with two partners, both from DLA Piper, as they brought in the “Flacco age” with the Ravens and a sold-out crowd.

Before the game, thousands of Ravens fans decorated in purple attire filled the parking lots surrounding the stadium for the first tailgate of the season.

A number of these die-hards are lawyers, who get to the stadium hours before game time to get the festivities started.

Look out for a piece on lawyers who tailgate in an upcoming Maryland Lawyer. For the time being, check out the video below, or click here for a higher quality video.

RICHARD SIMON, Multimedia Reporter

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In a story in today’s Reading (Pa.) Eagle, Edward V. Giannasca II says he will appeal his $33 million loss to former Raven Michael McCrary — and denied he has any intention of fleeing the country with his three children, as alleged by his ex-wife.

“What is she talking about fleeing? I’m right here,” Giannasca told the paper from his office in Reading, where he’s seeking approval for a $2.8 billion mixed-use project on 80 acres along the Schuylkill River.

Giannasca said he “merely got passports for all the children at the same time because one son needed one,” the Eagle reports.

He will have a chance to explain that to visiting Judge Paul E. Alpert, who ordered him to appear in Baltimore City Circuit Court on Monday, June 30, under threat of a body attachment.

But, according to the Eagle, he has other plans.

“Giannasca said he won’t be there because he and his family will be on a weeklong vacation in Hilton Head, S.C.,” the story said.

The Eagle also says Giannasca stayed away from this week’s legal proceedings in Baltimore, despite a court order and his own promise to appear, on advice of counsel.

BARBARA GRZINCIC, Managing Editor/Law

The Baltimore Ravens are looking for a new head coach. The reasons are well, and painfully, documented.

The question now is “Who?”. Reports have the team narrowing the list of potential candidates down to 30 with a further dwindling to eight expected.

Who the next coach will be is extremely important for a team that saw its season spiral out of control, losing 9 of its last 10 games. The lowlight being the loss to New England where, after a heroic performance against the Patriots, the team blamed everyone but themselves for letting a victory slip away and their coach arrogantly defend boneheaded decisions.

Mind you, 40 miles down I-95 in Prince George’s County, the Redskins were dealing with the murder of a teammate and star player and similarly bad play calling and on-field performances. They rallied, though, behind a coach who took responsibility for his team’s lackluster play and brought them closer together.

Read the rest of this entry »

First things first. Baltimore Ravens owner Steve Bisciotti seems to be a great guy. He even returned my phone calls when I covered the sports-business beat at The Sun.

Bisciotti seemed genuinely torn up about firing Coach Brian Billick. But here’s a question: Why haven’t Baltimore’s sports columnists and sports talk show hosts beaten up Bisciotti for “meddling” in the Ravens’ football affairs with the same vengeance that they routinely beat up Peter Angelos with for “meddling” in the Orioles’ baseball affairs?

Is there one iota of difference?

To be clear, I think both Bisciotti and Angelos have every right to “meddle.” They own the teams. You can’t meddle in something that’s your’s.

The reason Bisciotti’s gotten a free pass is that the sports writers also think he’s a great guy. Angelos — well, not so much. (And to be fair, Angelos also always returned my phone calls. We even shared a cab once from Major League Baseball’s New York headquarters to Penn Station.)

But if they think it’s wrong for Angelos to have his hand in baseball decisions, it’s hard for me to imagine why they wouldn’t think it’s wrong for Bisciotti to have his hand in football decisions.

Am I crazy?

ED WALDMAN, Managing Editor/Business

Photo courtesy of scout.com.