White v. National Football League

836 F. Supp. 1458

Reggie 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.

Civ. No. 4-92-906.

United States District Court, D. Minnesota, Fourth Division.

August 19, 1993.

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Edward M. Glennon, Carol T. Rieger, Charles J. Lloyd, Lindquist & Vennum, Minneapolis, MN, and James W. Quinn, Jeffrey L. Kessler, Jonathan T. Weiss, Daniel Rubin, David G. Feher, and Cathy E. Shore-Sirotin, Weil, Gotshal & Manges, New York City, for plaintiffs.

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

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

DOTY, District Judge.

This matter is before the court on the following motions:

1. A motion by the named plaintiffs to amend the Stipulation and Settlement Agreement in the present action;

2. A motion by the named plaintiffs and defendants, other than the Philadelphia Eagles¹, for final approval of the Stipulation and Settlement Agreement as modified by the various amendments agreed to by the parties;

3. A motion by the named plaintiffs and defendants, other than the Philadelphia Eagles, for entry of various factual findings concerning the reconstitution and recognition of the National Football League Players Association ("NFLPA") as a labor union and the application of the nonstatutory labor exemption to various terms of a recently executed collective bargaining agreement; and

4. A motion by the named plaintiffs to sanction the Philadelphia Eagles.

Based on a review of the file, record and proceedings herein, the court grants the motion to amend the Stipulation and Settlement Agreement, grants final approval of the amended version of the Stipulation and Settlement Agreement, denies plaintiffs' motion for sanctions, overrules all objections, grants the motion for further factual findings and makes the findings set forth below.

BACKGROUND²

This antitrust action was filed on September 21, 1992, less than two weeks after a jury rendered its verdict in McNeil v. National Football League, 1992-2 Trade Cas. (CCH) ¶ 69,982, 1992 WL 315292 (D.Minn. Sept. 10, 1992) (special verdict).³ The five named plaintiffs⁴ brought the present action on behalf 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 judgment in this action and determination of any appeal therefrom, and (ii) all college and other football players who, as of August 31, 1987, to the date of final judgment in this action and the determination of any appeal therefrom, have been, are now, or will be eligible to play football as a rookie for an NFL team.

(Pls.' Second Am.Compl. at 8.)

The White complaint, which originally sought only injunctive relief, was amended to seek both antitrust damages and injunctive relief 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.⁵ Defendants, the NFL and its twenty-eight member clubs, answered the complaint, denying all of plaintiffs' material allegations and asserting various affirmative defenses and counterclaims.

On January 6, 1993, the parties, with the assistance of this court, reached a tentative agreement to settle the present action. 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).

On February 26, 1993, plaintiffs and defendants entered into a Stipulation and Settlement Agreement ("the original Settlement Agreement") which set forth the terms of the settlement as originally proposed. The Settlement Agreement was designed to bring an end to both the present action and a wide range of related cases.⁶

In an order dated February 26, 1993, this court granted preliminary approval of the original Settlement Agreement. See White v. National Football League, Civ. No. 4-92-906, slip op. at 2-3 (D.Minn. Feb. 26, 1993). Pursuant to Federal Rule of Civil Procedure 23(e), the court ordered plaintiffs, at their own expense, to send written notice by mail to class members.⁷ The court also ordered plaintiffs to publish a summary notice in USA Today. The notices, the contents of 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 id.

In a class of more than 5,000 players, objections to the original Stipulation and Settlement Agreement were filed on behalf of seventy-three active or former NFL players.⁸ In addition, objections to the original settlement were filed on behalf of one NFL member club, the Philadelphia Eagles, sixteen college players,⁹ and one player agent.¹⁰

On April 16, 1993, the court held a final approval hearing on the original Stipulation and Settlement Agreement. The court heard arguments by counsel and class members both in support of and in objection to the proposed settlement. The court also heard testimony of various witnesses concerning the proposed settlement.¹¹ By order dated April 30, 1993, the court certified a mandatory settlement class pursuant to Federal Rule of Civil Procedure 23(b)(1), overruled all objections and granted final approval of the settlement. White v. National Football League, 822 F.Supp. 1389 (D.Minn.1993). In so ruling, the court specifically found that:

(a) The terms of the Stipulation and Settlement Agreement fundamentally modify the NFL's rules, policies and practices regarding veteran player movement and employment. The settlement also fundamentally modifies by agreement the college draft, the NFL Player Contract, and various other terms and conditions of NFL player employment.

(b) The revised player mobility and employment rules represent a successful effort by NFL players to eliminate Plan B, and to bring about substantial modifications in the principles relating to veteran player transfers.

(c) Under Eighth Circuit law, when evaluating the present Settlement Agreement, it is unnecessary for the court to determine whether every provision of the settlement, if adopted outside a settlement context and made subject to a trial on the merits, would be deemed reasonable after a full rule of reason inquiry. In fact, the court should not make such inquiry.

(d) The Settlement Agreement, as a whole, is not per se illegal.

(e) The court overrules all objections for the reasons previously set forth, and concludes that the overall agreement is fair, reasonable and adequate to the class.

Id. ¶ 7.29, at 1431-32. The court further concluded that class members had been properly notified of the proposed class certification and the terms of the original settlement, id. § I, at 1399-1402, and that due process did not require that absent class members be given the right to opt out of the White class. Id. § III, at 1410-12.¹²

In addition to its rulings concerning the settlement itself, the court also made various findings concerning the status of the NFLPA in its order dated April 30, 1993. In August 1987, the last collective bargaining agreement between players and defendants expired ("the 1982 Collective Bargaining Agreement").¹³ In Powell v. National Football League, a class action in which players sought to challenge, inter alia, a predecessor of the Plan B veteran player restraints, the Eighth Circuit determined that the nonstatutory labor exemption¹⁴ would continue to protect NFL veteran player rules from antitrust...