The NFL received a major leverage shift from the Eighth Circuit Court of Appeals (the Court) on Monday night with a ruling that keeps the NFL-imposed lockout in place through the appeals process, likely until late June or early July, at the earliest.

Labor dispute, not litigation

The NFL has stayed on message since the NFLPA decertified on March 11th, both in their comments and court filings. Their message has been: the battle with the NFLPA is a labor dispute, not litigation; it should not be in court, as the courts do not have jurisdiction in labor disputes. The Eighth Circuit (Court) majority opinion in this stay ruling was receptive.

The 2-1 opinion of the Court featured the following highlights:

Likelihood of Success on the Appeal

ICONThe Court agreed that Judge Nelson could not stop the lockout.

Both in the NFL’s brief and in oral arguments by lead attorney David Boies on April 6th, the NFL argued that Judge Nelson did not have the power to grant an injunction (stop) of the lockout due to a broad reading of the Norris-LaGuardia Act (the Act), a law used primarily by employees, not employers, to ban injunctions arising from labor disputes.

The Eighth Circuit agreed with this broad reading of the Act. The judges focused on the plain language of the Act and emphasized that it evenhandedly applied to lockouts and to strikes.

Moreover, the Court – in a rebuke to Judge Nelson’s interpretation of the case – had serious doubts that Nelson had jurisdiction to stop the lockout.

This is foreboding to the Players on appeal. Essentially, two of the three judges that will hear the appeal are saying that the lockout cannot be prevented by the District Court. It is hard to see this view changing after the appeal hearing.

Balancing harm to the Owners and Players

The Court agreed with the NFL that absent a stay, it is the NFL – not the Players – who would suffer harm, as it would difficult to unscramble the potential mess created by transactions done in the interim.

I thought that when the schedule came out showing this appeal to be on an expedited schedule – the hearing is June 3rd – that the Owners would get the stay. The fast track of the appeal process should minimize the harm to the Players and allow the case to be resolved before the 2011 season.

Lone Dissent

As with the temporary stay, Judge Bye stood alone from his counterparts, emphasizing that the NFL did not satisfy their burden required to grant the stay.

Bye was critical of the majority's "irreparable harm" analysis, asserting that they did not mention specifically what harm confronted the NFL. He rejected the NFL's "scrambled eggs" claim, and was not sympathetic about future antitrust claims lodged against the NFL if they opened for business: following the law does not constitute irreparable harm.

As to the merits, Judge Bye said the Act no longer applies once the NFLPA decertified. By dissolving the union, Bye wrote, the Players made a choice at the expense of foregoing the protections of labor laws.

As before, Judge Bye was emphatic in his opinion and in his belief in the Players’ side of the case. As before, however, he represents the dissenting opinion.

Post-Stay Ruminations

The expedited appeals process is the best news of the lockout: after the appeal ruling, there is plenty of time to resolve things prior to training camp – if, of course, both sides are motivated to do so.

I do not hold much hope for the mediation presently going on under Judge Nelson’s watch, but I do think that the losing party from the appeal hearing – I would favor the Owners in that now – will have great incentive to work out a CBA.

The Players can hope for some leverage from Judge Doty with a large damage award in the television lockout case, but the Owners will appeal that back to the Eighth Circuit, which initially appears to be a friendly venue for them.

The bottom line is still the bottom line: both sides need to make a deal. Courtroom football is and has always been about tilting leverage. The Owners have the leverage now but the Players have some perceived leverage of a pending award from Doty in the next couple of weeks.

Perhaps both sides use this window – prior to both the Doty ruling and the appeal hearing – to work a deal.

We can only hope…

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