The restarting of the American economy has become a vexing issue. As the country tries to quell the coronavirus disease pandemic through limiting in-person interactions, concerns about collateral damage—particularly rising unemployment and increased business closings—are growing louder.
That is true for many industries, including sports. Millions of jobs are connected to the playing of games. There are obvious positions impacted. Players, coaches, staff, scouts and referees are among them. But numerous other sports-related occupations, including in venue operations, finance, media, broadcasting, advertising, apparel, merchandise, insurance, health, food, beverage, concessions, hotel and travel, are also jeopardized. Re-watching classic games and concocting new kinds of “all-time player” lists can be enjoyable exercises, but they do little to generate the massive revenues lost by the suspension of sports.
“When will things return to normal?” is thus as important of a question as it is straightforward. Yet how that question ought to be answered—and whose answer counts—are unsettled. No political leader, including the President of the United States, has the legal capacity to unilaterally restart the economy or to define what “restart” even means. States possess wide latitude under the U.S. Constitution and accompanying case law for determining matters of public health, safety and the general well-being of citizens. Tribes, counties, cities and towns likewise enjoy relevant authorities. The federal government doesn’t call all of the shots.
The lack of unitary power in Washington D.C. will prove influential in the months ahead. Given that COVID-19 will impact different parts of the country at different times and to varying degrees, communities will be poised to adopt, enforce and, if necessary, re-adopt and re-enforce gathering restrictions, shelter-in-place and non-essential services closings. These communities will prioritize “safety” and “economy” in contrasting ways, too, leading to disparities in how they define rules under the law.
We’ve already seen this phenomenon play out. While Massachusetts has banned gatherings of more than 25 people—thereby making it impossible the state’s pro teams to host games—Florida has defined professional sports activities, so long as those activities are closed to the general public, within the ambit of permissible “essential services.”
It’s not just about differences between the states. Consider the scheduling (and then cancellation) of UFC 249 at the Tachi Palace Casino Resort, which is located on sovereign tribal land located within the state California. This led to a thorny issue where the event itself would have complied with tribal law but assembling the event—including movement of people for it—would have triggered violations of California law. Under pressure from Disney and ESPN executives, UFC 249 was cancelled. If nothing else, it highlighted how the multilayered structure of American law is a complicating force during a pandemic.
That’s also only a sample of issues. States and other governing bodies have crafted numerous pandemic restrictions, often with unique definitions and divergent policies. Each will decide when to lift their restrictions, when to alter them and whether they ought to be re-imposed in the event of new outbreaks.
The country therefore isn’t going to restart at the same moment, no matter how appealing that sounds. Certain pockets of the country will resume activities in modified ways, such as re-opening of certain types of businesses while continuing to mandate adherence to social (physical) distancing. As a result, in some parts of the country, business meetings and grade school classes that were previously held in person might occur through video conferencing for the foreseeable future. Still other pockets of the country will remain largely closed for longer periods, particularly if it takes several years for the medical and regulatory communities to develop and distribute a safe and effective vaccine. The restarting of our economy will reflect a patchwork that might necessitate starts-and-stops depending on the trajectory of infections and the varying availability of key medicines, supplies and equipment.
This is a terrible dynamic for national sports leagues like the NBA, WNBA, NFL, MLB, NHL, MLS and NWSL. They are built on playing before thousands of spectators in venues across the United States and, in some instances, Canada. They are also accustomed to predictable and reliable scheduling of games, which is crucial for their contracts with broadcast networks and sponsors. While gate receipts are no longer the primary driver of revenue for pro leagues—TV revenue is king—ticket sales remain considerable sources of revenue that are shared by owners and players. According to Statista, gate receipts account for approximately 22% of NBA revenue, 30% of MLB revenue, 15% of NFL revenue and 37% of NHL revenue. The presence of spectators also impacts revenue related to sponsorships, signage, concessions and parking. Yes, leagues can operate without spectators, but franchises will be worth less for a time being and players will sign contracts that are less lucrative.
Leagues could face a multi-year situation where teams in some cities could host games, perhaps eventually with spectators, while teams in other cities will be legally barred from doing so. Making things more complex, the list of cities capable of hosting games could change depending on when and where outbreaks strike. In response, leagues could alter what a “home” game means so that neutral sites are considered “home.” Alternatively, they could play all their games in one shared facility, a concept under consideration by leagues. With the consent of the respective players’ associations, leagues could also implement virus testing and the quarantining of players, coaches and staff. Some of the potential legal concerns, such as possible liability for teams’ physicians and other health care providers, could be extinguished or at least reduced through assumption of risk and waiver clauses signed by the participants (players, coaches and staff).
These are intriguing options and would serve to revive sports, but they would be novel and unfamiliar for all involved. Would leagues secure enough test kits at a time when they remain unavailable to some health care providers? How frequently would players, coaches and referees need to be tested? How well would quarantining people for weeks or months work when many have families? Would injured players have access to surgical care when many hospitals have cancelled surgeries? Would players who refuse to return under these abnormal conditions be suspended without pay? Would everything shut down again if safety protocols fail and a player, coach or referee has the virus and spreads it?
Sports and entertainment companies without teams, like the UFC and WWE, are nimbler and better equipped for this new world. With the cooperation of the TV networks that broadcast their competitions, with the blessing of their insurance companies and with skilled legal representation, these companies have more leeway in the placement of events and in the negotiation of contracts for those competitions. They could move their competitions to locales that are less afflicted by the virus and that have adopted fewer pandemic restrictions.
Florida is a useful example. Although the state has the eighth-highest number of COVID-19 cases among the 50 states, Governor Ron DeSantis and other state officials appear determined to host sports during the pandemic. As mentioned above, Florida has amended its definition of essential business to authorize “employees at a professional sports and media production with a national audience – including any athletes . . and any others necessary to facilitate including services supporting such production – only if the location is closed to the general public.” This definition is tantamount to an invitation to play.
As states craft their own pandemic rules and as they jockey for medical resources, the NBA and other leagues will largely be sidelined. That’s not to say they’ll be irrelevant. To that point, President Donald Trump announced on Tuesday that he has formed a committee of 14 sports leaders to advise him on reopening the country. Here is the roster:
· NBA commissioner Adam Silver
· Dallas Mavericks owner Mark Cuban
· NFL commissioner Roger Goodell
· New England Patriots owner Robert Kraft
· Dallas Cowboys owner Jerry Jones
· MLB commissioner Rob Manfred
· NHL commissioner Gary Bettman
· LPGA commissioner Michael Whan
· PGA Tour commissioner Jay Monahan
· NASCAR vice chairperson Lesa Kennedy
· MLS commissioner Don Garber
· UFC president Dana White
· WWE chairman Vince McMahon
· USTA commissioner Patrick Galbraith
It’s sensible for the White House to be in communication with industry leaders. There’s also no downside having the league commissioners discuss pandemic-related issues in a shared forum.
But it’s important to acknowledge the limitations of this group.
First, the group of 14 is tilted towards management rather than labor. Five of the 11 sports/entertainment organizations represented—the NBA, NFL, NHL, MLB and MLS—are unionized and operate through collective bargaining agreements. Those CBAs will almost certainly require amendments in order to address pandemic-related changes in workplace policies impacting hours, wages and other working conditions (like virus testing and quarantine restrictions). Those five leagues won’t reopen absent consent by their unions.
Second, as explained above, the definition of “reopening America” and the decision to authorize it isn’t up to the President or, more broadly, the federal government. There is no one decider. There are many. To that point, states and other levels of government have, and will continue to possess, substantial legal authority during the pandemic. Some will work together and collaborate. For example, the governors of Connecticut, Delaware, Massachusetts, New Jersey, New York, Pennsylvania and Rhode Island have formed a pact to coordinate reopening. Others will act more autonomously and competitively.
This is how a constitutional democracy that shares powers across multiple levels of government works. Until the pandemic struck, sports leagues and their partners functioned well in it. We all hope that continues as the world battles a virus that has taken more than 129,000 lives, more than 26,000 of whom were Americans. Still, as much as we love them, sports are secondary. Public health and economic considerations will remain at the forefront of the many leaders who will decide when and how America reopens.
Michael McCann is SI’s Legal Analyst. He is also an attorney and the Director of the Sports and Entertainment Law Institute at the University of New Hampshire Franklin Pierce School of Law.