NBA Players File Anti-Trust Lawsuit Against League; Bargaining Tactic or Desire to Clarify the Law?

Clarification of the Law Would Be a Greater Benefit Than Playing the Season

The talks between the player’s union and the National Basketball Association have broken down, and the players have disbanded their union and individual players have sued the NBA for violation of anti-trust laws.  Usually these actions are a prelude to a settlement, and the court cases are dropped but The Dismal Political Economist hopes that in this situation the case does proceed to trial and resolution.

Outside of the world of sports, what the owners are doing would be patently illegal.  Employers cannot get together and decide that an employee or potential employee can only work for one of them, and that the others will not hire that employee.  In the world of sports this is exactly what employers do.  When a potential player comes out of college the owners decide which team that player will play for, and no other team will employ him.

Owners and leagues make two arguments in support of this policy.  The first is that the league itself is a single employer and like any other employer they can assign an employee to the job the league decides the employee should have. The second argument is that the economic viability of a sport league depends upon every team at some time being a viable contender for the title.  Drafting players and prohibiting them from simply going to the higher paid job allows for competition and makes the sport highly profitable for players and owners.

The idea that the league is a single entity is simply not true.  Each team is a separate employer, and to say otherwise is to engage in a denial of reality to such a degree that one could easily confuse the owners with politicians.  So the argument that is left is that in order to operate a successful business the teams needs restrictions on its employees in terms of whom they can work for, and that the provisions for free agency that allows a player to sell his services on the open market after a number of years have passed is sufficient freedom to pass muster under the anti-trust laws.

The suit alleges that the owners ended the collective bargaining process after Commissioner David Stern issued an ultimatum on the owners' proposal last week and that "the express purpose of Defendants' group boycott and price fixing is to reduce the salaries, terms, benefits and conditions of employment available in the market for players."

Sports leagues go through this process every couple of years, and it is only because the law is not settled that they do so.  So let’s all of us hope that this time the stubbornness of the players and the stubbornness of the owners reaches new heights, and allows the issues to go to trial and be settled once and for all.  After all, nobody is going to be harmed financially regardless of the outcome, it is only question of who is going to get millions and millions, and who is going to get more.