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Eller v. National Football League Players Ass'n

United States Court of Appeals, Eighth Circuit

September 23, 2013

Carl Lee ELLER, et al., Plaintiffs-Appellants
v.
NATIONAL FOOTBALL LEAGUE PLAYERS ASSOCIATION, et al., Defendants-Appellees.

Submitted: June 11, 2013.

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[Copyrighted Material Omitted]

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Michael D. Hausfeld, argued, Washington, DC Mark Feinberg, Thomas B. Caswell, III, Shawn D. Stuckey, Kaisa M. Adams, Minneapolis, MN, Michael P. Lehmann, Daniel S. Mason, San Francisco, CA, Swathi Bojedla, Washington, DC, on the brief, for Appellants.

Andrew S. Tulumello, argued, Washington, DC Jeffrey L. Kessler, David Greenspan, New York, NY, Scott P. Martin, Misha Tseytlin, Washington, DC, on the brief, for Appellees.

Before LOKEN, BEAM, and BYE, Circuit Judges.

LOKEN, Circuit Judge.

In March 2011, members of the National Football League (" the NFL" )— thirty-two professional football teams— commenced a lockout of players after bargaining to an impasse with the National Football League Players Association (" the NFLPA" ) over the terms of a new Collective Bargaining Agreement (" CBA" ). In response, active NFL players filed a class action lawsuit in the District of Minnesota alleging violations of the federal antitrust laws and other claims (the " Brady " suit). Retired NFL players also sued the NFL and its teams, alleging antitrust violations (the " Eller I " suit). The district court consolidated the cases and ordered mediation. In August, active player representatives approved a tentative settlement of the Brady suit, the players re-designated the NFLPA as their collective bargaining agent, the NFL and the NFLPA signed a new CBA incorporating the settlement terms, the Brady plaintiffs dismissed their lawsuit, the lockout ended, and the 2011 NFL season commenced. The settlement as reflected in the new CBA included some $900 million in increased benefits for retired NFL players.

On September 13, 2011, Carl Eller and other retired NFL players filed this class action lawsuit ( Eller II ) against the NFLPA, its executive director, and certain Brady plaintiffs, asserting that defendants wrongfully barred retirees from the Brady plaintiffs' settlement negotiations, negotiated on retirees behalf without authority to do so, and ultimately agreed to a CBA with fewer benefits for retired players than they could have obtained for themselves. The district court [1] granted defendants' motion to dismiss all claims. Plaintiffs appeal dismissal of their claims for intentional interference with prospective economic advantage. Reviewing the grant of defendants' motion to dismiss de novo, and accepting as true the facts alleged in the Eller II complaint, we affirm. See Schmidt v. Des Moines Pub. Sch., 655 F.3d 811, 815 (8th Cir.2011) (standard of review).

I.

For the last forty years, labor relations in the NFL have been affected by the players' use of federal antitrust lawsuits in the District of Minnesota to enhance their position in collective bargaining with the NFL's member teams under the federal labor laws. The Supreme Court has long recognized that " the congressional policy favoring collective bargaining ... requires that some union-employer agreements be accorded a limited nonstatutory exemption from antitrust sanctions." Connell Constr. Co. v. Plumbers & Steamfitters Local Union No. 100, 421 U.S. 616, 622, 95 S.Ct. 1830, 44 L.Ed.2d 418 (1975).

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But in the NFL context, this court limited the exemption to labor agreements that concern mandatory subjects of collective bargaining and are " the product of bona fide arm's-length bargaining." Mackey v. NFL, 543 F.2d 606, 614 (8th Cir.1976), cert. dism'd, 434 U.S. 801, 98 S.Ct. 28, 54 L.Ed.2d 59 (1977). Operating under that rule, every time a CBA between the NFL and the NFLPA expired, the union or its player members filed a new antitrust suit alleging that the NFL's player restrictions were unreasonable restraints of trade. For a concise summary of this complex history, see Brady v. NFL, 644 F.3d 661, 663-68 (8th Cir.2011), reversing the district court order that preliminarily enjoined the lockout that led to the negotiations and settlement at issue on this appeal.

The rules of this collective bargaining game changed significantly when a nearly unanimous Supreme Court held, overruling Mackey and subsequent lower federal court decisions, that the nonstatutory labor/antitrust exemption applies " to an agreement among several employers bargaining together to implement after [bargaining to an] impasse the terms of their last best good-faith wage offer." Brown v. Pro Football, Inc., 518 U.S. 231, 238, 116 S.Ct. 2116, 135 L.Ed.2d 521 (1996). But despite this clarification, the scope of the nonstatutory exemption remained unsettled, so antitrust lawsuits such as the Brady and Eller I suits continued to be part of the labor relations landscape when a CBA between the NFL's member teams and the NFLPA expired and bargaining over a new CBA reached an impasse.[2]

These historical realities are relevant to the issues raised by this appeal in two significant respects. First, the NFL in 2011 had a strong economic interest in avoiding future antitrust liability by resolving its labor relations impasse with the players through collective bargaining that resulted in an agreement protected by the nonstatutory exemption under the federal labor laws. Thus, as in prior years, the Brady lawsuit was settled and dismissed with a settlement that became the central part of a new CBA entered into after the NFLPA resumed its status as the players' certified collective bargaining representative. Cf. White v. NFL, 836 F.Supp. 1458, 1500-01 (D.Minn.1993), aff'd, 41 F.3d 402 (8th Cir.1994); White v. NFL, 822 F.Supp. at 1430-31. Second, the NFL's imperative need to resolve such disputes through collective bargaining put the retired players in a decidedly weaker position. Retirees are not " employees" within the meaning of the National Labor Relations Act. Therefore, they may not be joined with active players as members of the collective bargaining unit, and retiree benefits, while commonly bargained ...


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