- A legal effort by the Dallas Cowboys' owner against Roger Goodell would face a steep climb, but should he decide to go that route, how migh tthe lawsuit play out?
It’s been 21 years since Dallas Cowboys owner Jerry Jones sued the NFL. Back then, Jones insisted that NFL owners and league officials had conspired in an “illegal cartel” to deny him a larger stake of revenue from the sale of Cowboys apparel. Cowboys’ merchandise generated one-fifth of merchandise revenue in the NFL, yet per NFL revenue sharing, Jones and other owners all received equal shares of the proceeds. Jones and the NFL—which separately sued Jones for misappropriation of property after he negotiated sponsorship contracts with rival companies of NFL sponsors—ultimately negotiated a settlement.
The settlement led to an extended period of détente between Jones and the NFL. But is the NFL due for another courtroom battle with Jones?
According to Ken Belson of The New York Times, the answer may be yes. Belson reports that Jones has informed owners who serve on the league’s compensation committee that he intends to sue them and the league unless NFL commissioner Roger Goodell—whose contract is reportedly set to expire in March 2019—is denied a contract extension.
Jones is reportedly dismayed with Goodell over the controversial suspension of Cowboys running back Ezekiel Elliott, whom Goodell suspended for domestic violence. Goodell issued the suspension despite there being serious questions about the quality of the implicating evidence and the veracity of the accuser.
Jones, who has denounced NFL players who protest the national anthem, is likewise disappointed by Goodell’s handling of the national anthem issue. Jones believes that the NFL would benefit with a different commissioner. To that end, Jones has hired famed litigator David Boies to develop a legal strategy that would lead to Goodell’s ouster.
Frustrations raised by Jones about Goodell’s contract status are not aimed exclusively at Goodell. According to ESPN’s Chris Mortensen, Jones believes that compensation committee chairman (and Atlanta Falcons owner) Arthur Blank provided “misleading” statements about his committee’s negotiations with Goodell.
Should Jones sue, one likely objective would be to use the pretrial discovery process to expose any wrongdoing by Goodell and NFL owners. Such a process would begin if the lawsuit advanced past a league motion to dismiss. As part of pretrial discovery, Goodell and NFL owners would be compelled to provide sworn statements and also turn over emails and texts relevant to Jones’ legal claims. Jones, of course, would be vulnerable to the same process.
Realistically, a legal effort by any owner to block the continuation of Goodell’s tenure would face a steep climb. Such an attempt might even be regarded as quixotic.
For starters, Jones may have forfeited any potential claim in May. At the time, he and the 31 other owners unanimously voted to authorize the compensation committee—whose membership consists of Clark Hunt (Chiefs), Robert Kraft (Patriots), Bob McNair (Texans), John Mara (Giants) and Art Rooney II (Steelers)—to finalize an extension for Goodell. Once a vote is cast it normally can’t be undone. Jones might contend that circumstances changed so radically after May that he ought to be able to change his vote, but such a contention would likely face skepticism by a court.
Even if Jones could nullify his prior support of Goodell receiving an extension, he would still need to establish a legal theory that would empower merely one of 32 owners to block a pending extension of the commissioner. If Jones files a lawsuit, he would likely ask the court for an injunction that would thwart the continuation of Goodell’s services beyond the expiration of the commissioner’s existing contract. Jones might also insist that Goodell and owners (through their collaboration with Goodell and through their contemplation of Goodell’s continued services) have caused him financial harm. Jones would thus maintain that he is owed monetary damages from them.
What are the kinds of legal claims that Jones might raise in a complaint? Here are six possibilities:
1. Breach of Contract
Breach of contract would be an appealing claim for Jones since it requires less speculation than other potential claims. A breach of contract claim is exactly what it sounds like: Jones was owed a contractual right from the NFL and the NFL somehow broke it while negotiating a contract extension with Goodell.
For instance, Jones could cite Article VIII of the league constitution. Article VIII obligates the league to “select and employ a person of unquestioned integrity to serve as Commissioner.” Jones might contend that Goodell’s handling of the Elliott suspension proves that he fails to meet the standard of “unquestioned integrity.”
Along those lines, Jones could portray Goodell as intentionally avoiding steps that would have uncovered the truth. Goodell chose not to speak with Elliott’s accuser, Tiffany Thompson, or with Kia Roberts, the lone NFL investigator who actually met with Thompson. Thus, Jones might insist, he and the Cowboys have been harmed by the failure of the NFL to employ a commissioner of “unquestioned integrity.”
Jones may be able to cite additional rights found in other contractual relationships between the Cowboys and the league. His agreement to purchase the Cowboys in 1989, for example, likely contains language that accords him certain protections. Various league memoranda might also enunciate rights and protections for owners. If so, Jones could highlight them in a complaint.
2. Breach of Implied Covenant of Good Faith and Fair Dealing
As a related claim to breach of contract, Jones could stress that parties to contracts are bound by an implied covenant of good faith and fair dealing. Such a covenant forbids one party—or multiple parties (i.e., Goodell and other NFL owners)—from knowingly interfering with another party (i.e., Jones and the Cowboys) in a way that prevents them from receiving contractual benefits.
With that covenant in mind, Jones could portray the league and other owners as abusing discretionary powers in the league constitution and the collective bargaining agreement. In doing so, Jones would assert, they inflicted harm on Jones and his team. Indeed, Jones could insist that owners are knowingly derelict in their obligation to select a capable and honest commissioner. Likewise, Jones would contend that Goodell willfully abused Article 46 of the CBA while reviewing allegations against Elliott and in ways that harm Jones and the Cowboys.
3. Breach of Fiduciary Duties
Jones could also assert that as members of a joint venture of independently owned NFL teams, team owners and league officials owe each other certain fiduciary duties. One such duty is the duty to supply full disclosure of important facts and to not conceal key information.
Jones could assert that Goodell’s handling of the Elliott matter indicates that he was not an honest broker with Elliott or with Elliott’s employer, the Cowboys. Further, Jones could raise questions about communications by Goodell concerning national anthem protests and whether any such communications contributed to loss of sponsorship opportunities for the league or to Colin Kaepernick’s filing of a collusion grievance.
4. Fraud and Unfair Business Practices
If Jones sues the NFL, expect to see him argue that the league engaged in fraud and unfair business practices. Jones might insist that the league and owners have willfully deceived Jones by ignoring basic notions of justice regarding Elliott. He could raise a similar point by arguing that the league and owners have neglected basic elements of competence in relation to national anthem protests. Jones might also contend that the league and owners have knowingly made false representations to the detriment of Jones and the Cowboys.
5. Illegal cartel under antitrust law
Like in 1996, Jones could assert that the NFL and owners have conspired through an illegal cartel to inflict harm on him and the Cowboys. Jones could assert that the league and owners are colluding not against Kaepernick but against him.
Jones might argue that Goodell and owners have directly or at least tacitly come to a meeting of the minds that Jones’ views about Goodell and the handling of NFL matters ought to be ignored. Such an agreement, Jones might charge, is inherently anti-competitive. The accompanying logic would be that agreement harms the Cowboys, which obviously competes against other NFL teams. Jones would note that Section 1 of the Sherman Antitrust Act forbids agreements among competitors (such as competing NFL teams) that produce more anti-competitive effects than pro-competitive benefits.
6. Illegal interference
Jones could portray the league’s handling of Elliott and national anthem protests as unlawfully interfering with his ownership of the Cowboys.
To that end, Jones could stress that the team’s relationship with Elliott has been damaged and would be damaged further should Elliott be required to serve his six-game suspension. Jones could also highlight that his business dealings with Papa Johns—an NFL sponsor—have been harmed since Papa Johns CEO, John Schnatter, blames the NFL’s handling of national anthem protests for disappointing sales figures.
NFL’s legal defenses
The NFL would be armed with an impressive list of defenses in the event Jones sues. Those defenses include the following six:
1. Jones has contractually waived away any possible legal claims
If Jones sues, the NFL would ask a court to dismiss the lawsuit. A compelling reason to dismiss a lawsuit is if the plaintiff previously agreed not to sue.
With that in mind, the NFL would note that Jones voted to authorize the compensation committee to finalize a contract extension with Goodell. Jones thus had an opportunity to object, but instead voted along with other owners. The league would portray Jones support of Goodell receiving an extension as tantamount to a waiver of any legal right to later to object to Goodell receiving an extension.
2. Jones contractually accepts that Goodell has nearly unlimited authority in handling controversies
If Jones sues and if in the complaint Jones focuses on Goodell’s suspension of Elliott or the handling of player protests, the NFL would be poised to win.
Under Article VIII of the league constitution, the commissioner is charged with “full, complete, and final jurisdiction and authority to arbitrate [any dispute] involving any players . . . that in the opinion of the Commissioner constitutes conduct detrimental to the best interests of the League or professional football.” This language would make it extremely difficult for any owner to successfully sue the NFL over a player suspension or a player controversy. In essence, Jones would be suing over the use of a power when he already accepted that use.
Likewise, under Article 46 of the CBA, Goodell can decide when a player engaged in conduct detrimental to the NFL and what ought to be the punishment. As the NFL has maintained throughout the Elliott litigation, Goodell need not satisfy procedural requirements that aren’t actually stated in the CBA.
The NFL might also refer to Jones’ previous statements that enthusiastically supported Goodell, including those Jones made during Deflategate.
3. Courts are very deferential to private associations
As a joint venture of independently owned teams, the NFL is a private association. Courts generally defer to internal decisions made by a private association. This deference is of course not unlimited: courts have reviewed lawsuits brought by NFL owners. This was true when Al Davis when he owned the Raiders and battled with the NFL over the Raiders moving between Los Angeles and Oakland. It was also true when, as mentioned at the top, Jones and the NFL sued each other in the mid 1990s.
However, courts are much less likely to review a private association if it follows procedures agreed-upon by its members. California Judge Eugene Premo highlighted this point in 2005 when he ruled for the NFL in a case brought by the Raiders. In his ruling, Judge Premo stressed that courts owe the NFL and other private associations high deference in their internal decision-making. Stated differently, courts should avoid unduly interfering with the judgment of private associations and avoid questioning business choices of businesses.
As of now, there is no reason to believe that the NFL’s handling of Goodell’s contract extension has broken an internal procedure.
4. Jones might lack standing to sue over the extension of Goodell’s employment
As an owner of an NFL team, Jones clearly has a right to sue over NFL decision-making. However, the NFL might insist that Jones should not be able to sue over a decision made by a requisite majority of owners. Two-thirds of NFL owners must vote to approve Goodell’s extension; upon meeting that vote, the decision is over and any dissenting votes must accent the outcome.
Jones would also be on shaky grounds suing over Elliott’s suspension: the party that has a right to contest this suspension is Elliott. He can do so through the CBA and as represented by his union, the NFLPA. The party would not be Jones, who along with the league and other owners comprises the management side of the CBA.
As to Goodell’s qualifications and whether any circumstances could preclude him from serving, Article VIII of the league constitution only forbids a person who possess a financial interest in any professional sport from serving. There are no other requirements or set qualifications. Goodell is thus eligible to serve.
5. The NFL doesn’t owe Jones any fiduciary duties
As the NBA argued in response to former Los Angeles Clippers owner Donald Sterling’s lawsuit over his ouster, “sports leagues and their commissioners do not owe fiduciary duties to teams or team owners.” Instead, the NBA successfully argued, “the nature of the rights and duties of a sports league and its commissioner in relation to the member teams and their owners precludes the finding of fiduciary obligations between them; their relationship is strictly contractual.”
The NFL would raise the same basic point: unless Jones could identify a contractual right that the NFL failed to honor, his lawsuit should fail.
6. Jones can’t show he has been damaged in a way the law ought to remedy
Even if Jones could prove that the NFL has broken the law in a way that implicates him, Jones may be hard-pressed to show he has been consequently damaged. Jones might argue that Elliott missing six games would make it less likely the Cowboys make the playoffs or advance in the playoffs, but such a harm would be inherently speculative: courts normally avoid measuring damages based on whether a particular player appears in a game and his or her plausible impact on that game. Likewise, Jones might struggle to establish a firm nexus between Goodell’s handling of national anthem protests and Jones. While NFL viewership is down this season, the explanation for that decline remains a matter of debate.
Jones could pursue an alternative strategy: the vote of no confidence
While the legal system is unlikely to grant Jones’ wish that Goodell be exiled, Jones could pursue another option that might prove more effective. In any private association led by a commissioner, the association’s members can take a vote to measure whether they remain confident in the commissioner’s capacity to lead. Depending on the result of the vote, the vote is sometimes called a “vote of no confidence.”
In and of itself, a vote of no confidence has no legal effect: it doesn’t force the commissioner to step down or take any specific action. Such a vote, however, signals to the commissioner that he or she doesn’t have the support of those being led. The commissioner therefore knows that they could become a disruptive or inefficacious presence by remaining on the job. The commissioner is thus likely to step down.
A vote of no confidence occurred in Major League Baseball back in 1992. By a vote of 18 to 9, baseball owners expressed no confidence in commissioner Fay Vincent, whom had drawn criticism for his leadership on financial matters. Vincent then stepped down, saying “I cannot govern as Commissioner without the consent of owners to be governed . . . resignation -- not litigation -- should be my final act as Commissioner in the best interests' of baseball."
Although some reporting suggests that other owners agree with Jones that Goodell should be replaced, it’s unclear how many of them would actually vote no confidence. If Jones pursued this path and it failed badly, Jones—who chairs the NFL Network Committee and the Pro Football Hall of Fame Committee—would likely lose influence on league matters going forward.
The MMQB will keep you updated on any developments in Jones’ potential lawsuit.
Michael McCann is SI’s legal analyst. He is also an attorney and the Associate Dean for Academic Affairs at the University of New Hampshire School of Law, and co-author with Ed O'Bannon of the forthcoming book Court Justice: The Inside Story of My Battle Against the NCAA and My Life in Basketball.