Will Jerry Richardson Avoid the NFL Investigation by Selling the Panthers? Not Quite
On the same day Jon Werthim and Viv Bernstein revealed in an exclusive story that Carolina Panthers principal owner Jerry Richardson allegedly engaged in sexual harassment and inappropriate physical contact with women employed by the Panthers, Richardson has announced his intention to sell the Panthers at the end of the season. He did so on the Panthers’ official website and only hours after the NFL announced it that will investigate Richardson. As I explain in a separate article, the league’s investigation presents five key legal issues for the league, the Panthers, Richardson and the persons accusing Richardson.
By voluntarily leaving the NFL, Richardson avoids placing his fellow NFL owners in an awkward position to vote on terminating his ownership
Richardson is one of the NFL’s most influential owners. He is also thought to be on friendly terms with most other owners, Goodell and other league officials. Until now, Richardson had not at all been a source of controversy for the league.
Yet if the NFL concludes that Richardson engaged in serious wrongdoing, commissioner Roger Goodell could ask owners to vote on whether to terminate Richardson’s ownership. Article VIII of the NFL constitution—a legal document that governs the relationship between the league and owners—instructs that the commissioner or an owner on the Executive Committee can bring charges against an owner for conduct detrimental to the league. If sustained by a minimum of 23 of the 31 teams’ principal owners (the principal owner who is charged is excluded from the vote), ownership in a team can be terminated.
Would the league move to expel Richardson, in the same way the NBA moved to expel Los Angeles Clippers owner Donald Sterling (at least before Shelly Sterling seized control of the Clippers)?
It is worth noting there are crucial differences between the Richardson and Sterling situations. Richardson has spent more than two decades building friendships with fellow owners and with the league office, and he is highly respected in the Charlotte community. In sharp contrast, Sterling was problematic from the start of his ownership of the Clippers in 1981, and soon thereafter battled with the NBA in court over his move of the Clippers from San Diego to Los Angeles without the NBA’s blessing. Sterling was also not well liked by players or other owners. More troublingly, he was also accused of racism by his former general manager, Elgin Baylor, and by the U.S. Justice Department in its investigation of Sterling not wanting to rent property to minorities. Sterling, of course, was also caught on tape saying explicitly racist remarks to a woman with whom he was having an affair. In short, Sterling had built no goodwill with his fellow owners or the NBA, whereas Richardson has done exactly the opposite with his fellow owners and the NFL.
NFL owners might also express concern about the prospect of requiring an owner to sell against his wishes. For one, it’s possible that sexual harassment allegations against Richardson aren’t the last to be levied against NFL owners. If precedent is set that sexual harassment allegations leads to forfeiture of a team, it stands to reason some owners—perhaps mindful of their own histories—would find that unacceptable.
By leaving on his own, however, the 81-year-old Richardson avoids the possibility that the NFL and the 31 other principal owners would entertain whether his alleged misconduct warrants his forced removal.
Jerry Richardson’s Tarnished Legacy: Under a Cloud, Selling the Team That Made Him an Icon
NFL is nonetheless poised to proceed with the Richardson investigation
The prospective sale of the Panthers might lead one to conclude Goodell will drop the investigation into Richardson before it begins. After all, Richardson will no longer be part of the NFL once he sells the team. Plus, by the time the investigation into Richardson is complete, he might no longer be the owner or at least be in the process of selling the team. Put more bluntly, it may not be worth digging into the past of a lame duck owner.
There are several reasons why the exact opposite may be true.
First, an announcement of an intention to sell is not in any way binding and does not guarantee that Richardson will, in fact, sell the Panthers. It is not uncommon for a business to be put up for sale and for the sale to falter. There are many reasons why a business sale does not occur, including when a owner changes his or her mind about selling or when an acceptable offer does not surface. Again, Richardson only pledges to “put the team up for sale”—a pledge that does not mean anything more than what it says.
Second, even if Richardson sells the team, the timeline for the sale could last for many months and into the summer of 2018. As Richardson says, he “will not begin the sale process” nor “entertain any inquiries” until “the very last game is played.” The Panthers are currently 10–4. If the season ended today, the Panthers would have earned one of the two NFC wildcard spots. Their season will likely go into 2018. Several months will then pass between when the team is formally put up for sale and when the NFL approves a sale. Prospective buyers would likely take weeks to scrutinize the Panthers’ financial records, and then Richardson would take time to review the bids. The NFL would also carefully review the bids and those who placed them, especially the financial background of the winning bidder. In short, buying an NFL team is a complicated process that takes time.
Third, the fact that Richardson so quickly decided to sell the team could lead some at the NFL to infer that the extent and severity of the allegations may not yet be fully known. League officials may wonder if Richardson is trying to exit before more controversial accusations emerge. If officials take that view, the league’s desire to investigate Richardson and get to the bottom of the facts would only escalate rather than recede.
Fourth, it’s possible that Richardson isn’t the only Panthers official responsible for some of the alleged misconduct. The league probably wants to know if Panthers executives facilitated wrongful conduct or took steps to conceal it. If so, the team could face punishments in the form of fines, suspensions or forfeited draft picks.
Fifth, the NFL is likely concerned about the possibility that allegations against Richardson won’t be the last against an NFL owner. As I wrote earlier today, we are living in the #MeToo era. Victims of sexual misconduct are more inclined to come forward and share how they were harassed as they see other victims do so. While non-disclosure agreements may limit the disclosure of damaging information against NFL owners, the league might decide it would be smart to thoroughly investigate the first allegation and develop a game plan on how to address future allegations.
The story of Richardson’s alleged misconduct will likely not end so soon after it began.
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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.
