Decertification is a gamble that could take years

Months of negotiations have not been enough to settle the differences between the NHL and NHLPA. Last week, federal mediation failed. Tuesday, owners and players meet face-to-face, but without much optimism in the hockey world that anything said will lead to a new collective bargaining agreement or the end of the NHL lockout. What’s left? The one big card that the players have left to play is decertifying the NHLPA—but even taking that theoretical step does not generate a lot of hope for a swift settlement. It's a roll of the dice, and one that could potentially take years to resolve.

Donald Fehr and the players he represent have a crucial decision to make.

 

— Today: Crosby, Toews to join meetings
“I’m not sure I know what they’re going to gain,” said Samuel Estreicher, the Opperman Professor of Law and Director of the Center for Labor and Employment Law at New York University. “They’re trying to do something to change the dynamic. Part of it is getting leverage. The issue is whether the Norris-La Guardia Act would bar an injunction (against the lockout). You’d still have two or three years of lawsuits to determine whether the Brown case applies.”
The Norris-La Guardia Act is a 1932 federal law prohibiting courts from issuing an injunction to force the end of a labor dispute. It came into play last year, when the U.S. Court of Appeals for the Eighth Circuit ruled as improper an injunction against the NFL lockout. The case, Tom Brady et al. v. NFL, overturned a district court’s decision. That sets an unfavorable precedent for the players, but does not preclude the NHLPA from pursuing decertification and an injunction against the lockout.

"You have four federal judges (one on the district court, three at the 8th Circuit) that have basically split on this, so different judges on a different circuit might disagree with Brady, and then there's the open question of whether the players can recover treble damages (for games missed) down the road," said Matt Mitten, a law professor at Marquette University and the director of the National Sports Law Institute. "It would just be presenting a different argument under different circumstances to a different court. It was pretty clear in Brady that that was the strategy of the union, bringing an antitrust suit to prevent the owners from locking them out. This is several months into the season and there has been bargaining for several months. A different court could conceivably reach a different result than the 8th Circuit with Brady."

The other suit Estreicher referred to, Brown v. Pro Football Inc., was a 1996 case in which the Supreme Court ruled in favor of the NFL’s ability to impose salary rules on practice squad players after an impasse with the NFLPA. That precedent—for a league to be able to act unilaterally—presumably would still apply, but with a caveat. “There’s a serious question if there’s no longer a live labor relations relationship,” Estreicher said. “Maybe in a year or two, if there’s no business, you can do something.”

Simply decertifying as a union would not eliminate a labor relations relationship between the NHLPA and NHL. The NFLPA disclaimed interest in collective bargaining in 1989, months before the Brown lawsuit was filed. The union did not reconstitute until 1993, after Jets running back Freeman McNeil led fellow players in an antitrust suit on "Plan B" free agency. After the players won that suit, the NFL reached settlements on other pending lawsuits, and was ready to make a deal after nearly six seasons without a CBA in the wake of the 1987 strike. "What Brady said is that a disclaimer is not enough to take this out of being a labor dispute," Mitten said. "But, if (the NHLPA were to) decide to formally decertify, the union wouldn't be able to collectively bargain on (the players') behalf for a full year. Part of the problem in the Brady case was that there was one foot in collective bargaining and one foot in antitrust, and the court said, 'You can't do that.' You have to make a clearer decision by formally decertifying, and then there could be antitrust remedies. What Brown did was said, 'If there's an active relationship, antitrust law doesn't have a role to play in a labor dispute.' The court suggested that once that collective bargaining relationship ends, and there are steps the players can take to do that, then individual players can bring their antitrust suit. The Brady case is different because what happened there, is there was a lockout and the NFL players wanted to (end it via injunction). ... The strategy would be for NHL players to formally decertify the union and say they've got totally different factors to Brady. Then they perhaps have some leverage and could work out an agreement in the form of a settlement to the antitrust suit. That's what happened in the McNeil case."

The NHLPA has expressed a willingness to do what NFL players did from the end of the 1987 strike through the 1992 season, and play without a CBA, but since a lockout is imposed by owners, would hockey players be able to wait long enough for lawsuits that may not work out in their favor? And are the risks worth that gamble? “Decertifying allows the NHL owners to treat marginal players like hotel workers,” said Stephen F. Ross, the director of the Penn State Institute for Sports Law, Policy and Research. “It also removes the American labor law restriction on employers going over the heads of the union directly to individual players: NHL owners would be free to try to end the lockout and cut deals with individual players. The only reason to decertify is to file an antitrust lawsuit. … The law is not clear whether the antitrust exemption still applies to protect the owners from monetary liability, which eventually could be in the hundreds of millions.”

The Brown lawsuit was initially filed in 1990, with the players receiving $30 million in damages from a jury before the eventual reversal of that verdict by the Supreme Court six years later. Still, that $30 million was just for practice squad players. The specter of a nine-figure lawsuit would make for great headlines, but given that the Supreme Court eventually ruled in favor of the NFL, might not make the NHL worried enough to cave in to the NHLPA’s demands. So, what then?

“(The owners) can withstand this antitrust gambit,” Estreicher said. “I don’t think there’s an endgame. After NFL-Brown, I don’t think there’s an endgame.” If the NHLPA’s best options would be rolling the dice on a different court, or waiting years to see if there is an end-around on Brown, it's hard to see an advantage for the union. That may be because the advantage is not in the United States. “Canadian law is very different than U.S. law,” Ross said. “There is a specific, albeit never litigated, provision of the Canadian Competition Act—their equivalent of our Sherman Act—about unreasonably restricting opportunities for players. There is no case law, and a good argument—disclaimer, I made it in a law review article in 2004—that the American-style labor exemption does not apply. And there is a ‘nuclear’ threat that the Canadian Competition Bureau could file a credible complaint that the NHL is an illegal monopoly and break the league in two.”

If it is going to take a court battle to settle things between the NHL and NHLPA, perhaps the Toronto-based union would benefit from home-ice advantage. Either way, there is only so much that can be achieved through decertification. "Neither the courts nor the National Labor Relations Board can make the parties agree," Mitten said. "The only way they can play hockey is if they both agree on things. Neither labor nor federal antitrust law requires the sides to reach an agreement. Each side is trying to get leverage—the NHL does it by locking out the players and hoping they'll crack or cave in, and the players would like to try to find a way to prevent the NHL from locking them out. That's the crucial part of this, is that it's up to the parties to reach an agreement."