Sports Litigation Alert

SPORTS LITIGATION ALERT

June 4, 2021 Vol. 18, Iss. 11 Case Summaries Injuries Sustained to a Minor from injuries sustained from a collision with a baserunner wearing metal cleats who slid into the third baseman. Metal Cleats Falls Within the Fabian Torres, playing third base, was injured when Ballpark of Inherent Risks a baserunner wearing metal cleats slid into the base and collided with his left shin. By Jon Heshka, Associate Professor at Thompson In Torres v. Loisaida, Inc., 2021 N.Y. App. Div. Rivers University LEXIS 1974 *; 2021 NY Slip Op 01875 **; 2021 WL 1132875, the Supreme Court of New York, Ap- he Supreme Court of New York reaffirmed in pellate Division, First Department upheld an Octo- March 2021 that infant minors, as young as T ber 2019 order of the Supreme Court, Bronx County 13-years old, can voluntarily assume risks inherent holding that: “Since recovery is precluded by the fact in playing baseball, which in this instance included that he assumed the risks inherent in playing baseball, Table of Contents

Here’s the latest issue of Sports Litigation Alert, the nation’s • Medina Spirit and the Future of Anti-Doping in only subscription-based periodical reporting on the intersec- Horseracing ...... 10 tion of sports and the law. We also publish 11 other sports • Former Louisville Assistant Men’s Basketball law periodicals. Visit www.hackneypublications.com to learn Coach May Wind Up Exchanging Cardinal Red for more. Jumpsuit Orange ...... 11 Case Summaries • Proposed Law Would Authorize Student-Athletes to Unionize...... 12 • Injuries Sustained to a Minor from Metal Cleats • Name, Image, & Likeness Creates Challenges for Falls Within the Ballpark of Inherent Risks...... 1 Compliance Departments...... 13 • Gagliardi v. Sacred Heart University: Plaintiff’s • After Being Promoted to General Counsel of the Discrimination Appeal Rejected ...... 3 Rockets, Clay Allen Talks about the Journey, and • Court Dismisses Defamation Claim Against Utah Significance of the Promotion...... 16 Jazz and Russell Westbrook...... 5 • Will New Jersey be the center of the Esports • It May Be a ‘Minor’ Win, but a Win Nonetheless Universe? According to the Head of the NJ for Soccer Prodigy...... 6 Division of Gaming Enforcement, that’s the Goal. . . 17 • Court Issues Temporary Restraining Order • Attorney Derrick Crawford Named NCAA VP of Preventing UConn from Cutting Its Rowing Program. . 7 Hearing Operations ...... 18

Articles News Briefs • The European Super League, Florentino Perez, and • Jaguars Promote Chief Legal Officer Megha Parekh International Contract Law ...... 8 to Executive Vice President...... 19 • Canadian Sports Lawyer Set to Become Judge in Ontario...... 19 • Chambers Honors Firms for Sports Law Work. . . . 19

Copyright © 2021 Hackney Publications. All rights reserved. Page 2 Sports Litigation Alert Volume 18, Issue 11 June 4, 2021 plaintiffs may not recover under a theory of negligent [2008], affd. 10 N.Y.3d 889, 861 N.Y.S.2d 603, 891 supervision.” N.E.2d 719 [2008], quoting Napoli v. Mount Alvernia, In granting summary judgment to the defendant Fe- Inc., 239 A.D.2d 325, 326, 657 N.Y.S.2d 197 [1997]. lix Millian Little League’s motion to dismiss the com- The court in Navarro also found that there was no plaint, the court built on a long line of legal authority evidence that her injury resulted from any “unassumed, involving baseball including Navarro v City of New concealed or unreasonably increased risks” (Benitez York, 87 AD3d 877, 877-878, 929 N.Y.S.2d 236 [1st v. New York Bd. of Educ., 73 N.Y.2d 650, 658, 543 Dept 2011]). N.Y.S.2d 29, 541 N.E.2d 29 [1989]). In Navarro, the 16-year-old infant plaintiff was Similarly, the court in Torres rejected the argument injured when, during an elective high school softball that the baserunner’s metal cleats created an enhanced class, she was hit by a bat wielded by another player or concealed risk that was not assumed. Both the hitting ground balls in warm-up. Chelise Navarro told 13-year-old infant plaintiff and his father were aware the other player, consistent with the teacher’s instruc- the baserunner was wearing metal cleats and the wear- tions for practice drills, that she should not take full ing of such cleats was permitted under the little league swings. Upon being handed the bat, however, the play- rules. Citing Bukowski v Clarkson Univ., 19 NY3d 353, er immediately threw the ball in the air and took a full 356-357, 971 N.E.2d 849, 948 N.Y.S.2d 568 [2012], swing before plaintiff had time to get out of the way. the court in Torres also rejected the argument that the As a result, the bat hit Navarro on the cheek, causing little league failed to provide safety equipment that injury. would have prevented the inherent risks. The court found that a participant in an athletic ac- In Burkowski, a college baseball pitcher was injured tivity is deemed to have assumed “those commonly ap- after being hit by a line drive during indoor practice. preciated risks which are inherent in and arise out of Plaintiff alleged that the risk of being hit by a batted the nature of the sport generally and flow from such ball was enhanced due to the multi-colored pitching participation” (Morgan v. State of New York, 90 N.Y.2d backdrop and low lighting at the indoor facility, which 471, 484, 662 N.Y.S.2d 421, 685 N.E.2d 202 [1997]). made it harder to see the white ball, and the failure to In establishing whether the injury sustained fell use an L-screen. The court held that ordinary reason- within the ballpark of the risks ordinarily associated able care must be exercised to protect student-athletes with the game, the court found that it is well estab- voluntarily participating in organized athletics from lished that “‘the danger associated with people swing- unassumed, concealed, or enhanced risks. “If the risks ing bats ... while warming up for the game’ is inher- of the activity are fully comprehended or perfectly ob- ent in the game of baseball” (Roberts v. Boys & Girls vious, plaintiff has consented to them and defendant Republic, Inc., 51 A.D.3d 246, 248, 850 N.Y.S.2d 38 has performed its duty” (Turcotte v Fell, 68 NY2d 432, 439 [1986]). The court in Burkowski also held said that risks which are commonly encountered or “inherent” in a sport, such as being struck by a ball or bat in base- Sports Litigation Alert (SLA) is a narrowly focused ball, are “risks [for] which various participants are le- newsletter that monitors case law and legal develop- gally deemed to have accepted personal responsibility” ments in the sports law industry. Every two weeks, (Morgan, 90 NY2d at 484). SLA provides summaries of court opinions, analysis In addition to being struck by a ball or bat in base- of legal issues, and relevant articles. The newsletter ball, we can add to the list of inherent risks a baseman is published 24 times a year. being injured by a baserunner wearing metal cleats sliding into the base. Torres is a reminder that the as- To subscribe, please visit our website at sumption of risk doctrine applies where a consenting http://www.sportslitigationalert.com participant, even 13-years of age, in sporting activities “is aware of the risks; has an appreciation of the nature

Copyright © 2021 Hackney Publications. All rights reserved. Page 3 Sports Litigation Alert Volume 18, Issue 11 June 4, 2021 of the risks; and voluntarily assumes the risks” (Mor- SHU’s season, Gagliardi arrived late to every single gan v State, 90 NY2d 471, 484 [1997]). practice, and missed several practices entirely. He also did not attend the first day of the UConn Men’s Invi- Return to Table of Contents tational Tournament (Id.). In his deposition, Gagliardi justified his behavior: Gagliardi v. Sacred Heart University: “And that was the gist of the conversation in Plaintiff’s Discrimination Appeal terms of if I’m part-time, then I’m going to work Rejected part-time hours, and how that was going to play By Jeff Birren, Senior Writer out. And I didn’t want to go into my first couple aul Gagliardi was the men’s tennis coach at Sacred weeks of teaching and take a sick day or a per- PHeart University (“SHU”). He felt he was being sonal day for another job, considering that in- mistreated because the women’s tennis coach was paid formation was publicly available on the Sacred more. Gagliardi raised this issue and was later termi- Heart website. And so I felt that would not be a nated. He filed a Complaint that asserted federal claims good idea …” (Id. at 5). of gender discrimination, and for retaliation after he Gagliardi admitted that he did not tell his supervisor reported his “inequitable treatment.” Gagliardi’s Com- that he was going to miss the first day of the UConn plaint, however, left out many relevant facts. SHU tournament until that week. He also admitted that he prevailed in its motion for summary judgment and the Second Circuit recently affirmed in an unpublished opinion, (Gagliardi v. Sacred Heart University, (“Ga- SPORTS LAW EXPERT gliardi”), No. 20-629-cv, 2021 U.S. App. LEXIS 8991, Sports Litigation Alert is proud to offer a directory at 3 (3-29-21)). of Expert attorneys and witnesses at our Sports Facts Law Expert website. Gagliardi played high school tennis at Branford High Here is this issue’s featured expert. School in Connecticut, college tennis at Providence and three years as a professional player in Mexico, Expert Attorney Argentina, Chile, Poland, and Australia. He later started coaching and became SHU men’s coach in 2006. His position was “at will” (Gagliardi v. Sacred Heart, U.S.D. Conn, No. 3:17-cv-857 (VAB), Ruling And Or- der On Motion For Summary Judgment, at 2 (7-16- 19)). Almost immediately, “Gagliardi viewed the position as “a full-time position with part-time pay… and began asking for a raise and a full-time appointment” (Id.). He complained about what he viewed as a major discrepancy between his part-time salary as the men’s Anthony J. Dreyer coach and the much larger salary of the women’s Expertise: Commercial litigator concentrating coach. Despite his complaints, Gagliardi continued to on intellectual property, sports, entertainment get positive performance evaluations and a raise (Id. at and related licensing disputes. 3). However, it was not enough to satisfy him. Skadden, Arps, Slate, Meagher & Flom LLP In August 2016 Gagliardi accepted a full-time posi- and Affiliates tion at a high school, intending to keep his SHU posi- (212) 735-3097 tion, and sent an email to SHU’s Athletic Department to inform them (Id. at 4). During the first six weeks of

Copyright © 2021 Hackney Publications. All rights reserved. Page 4 Sports Litigation Alert Volume 18, Issue 11 June 4, 2021 missed most of the first day of the Yale Invitational. As Discrimination a result, SHU fired Gagliardi in late September (Id.). Gagliardi initially claimed that he was discriminated He received a right-to-sue letter from the U.S. Equal against because he was a man coaching a men’s team. Opportunity Commission in February 2017. Gagliardi His Amended Complaint alleged that he was discrimi- filed the Complaint in May 2017, and an Amended nated against because he was paid less than similarly Complaint several weeks later (Id.). He alleged that he situated female coaches, that he did not receive the was a man coaching a men’s team, and that he was same benefits, nor the same support (Id.). However, the discriminated against because he was paid less “than District Court concluded that he failed to establish a other, similarly situated female coaches, by failing to prima facie case by showing that this “occurred under provide the same benefits to him as female coaches, circumstances that gave rise to an inference of discrim- and by failing to provide the same support to him … ination.” On appeal, Gagliardi argued that it “failed to that was provided to female coaches” (Gagliardi at 4). properly consider his evidence of discriminatory in- He also claimed that SHU retaliated against him be- tent” (Id. at 5). This requires showing that the plaintiff was treated cause of his complaints about how he was treated (Id. less favorably than a similarly situated person outside at 6). SHU moved for summary judgment in 2018. The of the protected group. Gagliardi argued that he was motion was granted in 2019 and Gagliardi appealed to merely a part-time coach while the women’s tennis the Second Circuit. coach was fulltime and had a higher salary. The Circuit In the Second Circuit stated that he was “hardly a suitable candidate to establish gender discrimination” (Id.). In the first place, Oral argument was on March 11, 2021, and the “Opin- the women’s coach was also a man. Furthermore, that ion” came 18 days later. The Circuit stated that sum- man had worked for SHU for 24 years as opposed to mary judgment “is appropriate only if ‘there is no gen- Gagliardi’s twelve years. Moreover, that man was also uine dispute as to any material fact and the movant is the Senior Athletic Director who only devoted approxi- entitled to judgment as a mater of law.” It is reviewed mately 30% of his time to coaching tennis. In addition, de novo. The facts are viewed in the light most favor- the uncontroverted evidence was that the women’s able to the non-moving party, though the non-moving tennis team had “significantly more members than the party “must offer some hard evidence showing that its men’s tennis team.” Gagliardi thus failed to “put forth version of the events is not wholly fanciful” (Id. at 4). evidence from which a rational trier of jury” could find Discrimination and retaliation claims are both ana- that any of the women’s teams coached full-time by lyzed under “the burden-shifting framework estab- women “were suitable comparators” (Id.). lished by the Supreme Court in McDonnell Douglas His conclusory assertions that he was similarly situ- Corp. v. Green, 411 U.S. 792 (1973).” A “plaintiff ated to female coaches was “insufficient to satisfy his must first establish a prima facie case of discrimina- minimal prima facie burden.” Other than his “unsuc- tion.” The “burden then shifts to the employer to ‘ar- cessful attempt to find an even arguably similarly situ- ticulate some legitimate, nondiscriminatory reason for ated comparator, there is a complete absence of any evidence … to support his claim of gender discrimi- the adverse employment action.’” If that happens, “the nation.” Finally, Gagliardi also admitted that no one plaintiff’s claims survive summary judgment only of at SHU made anti-male or sexist comments against his evidence ‘show[s] circumstances that would be suf- males. The District Court therefore “properly granted ficient to permit a rational finder of fact to infer that summary judgment” on the discrimination claims (Id. the defendant’s employment decision was more likely at 6). than not based in whole or in part on discrimination’ or, in the case of a retaliation claim, that the retaliation Retaliation ‘would not have occurred in the absence of the retalia- Gagliardi also appealed summary judgment on his tory motive’” (Id.) (internal citations omitted). retaliation claim, based on his “protected activity” of

Copyright © 2021 Hackney Publications. All rights reserved. Page 5 Sports Litigation Alert Volume 18, Issue 11 June 4, 2021 making oral and written “complaints of gender dis- would not have terminated him “but-for his complaints crimination.” He claimed the District Court “erred in of gender discrimination” (Id.). The Court ended with concluding that no inference of causation could be a footnote stating it “considered all of Gagliardi’s re- drawn from temporal proximity.” However, his first maining arguments and conclude that they are without complaint was almost a full year prior to his termi- merit,” affirmed the judgment, and attached a bill of nation. Undeterred, he argued that his second letter costs instructions sheet and application (Id.). to Human Resources was much closer in time to his termination, and that “is certainly enough time” to set Conclusion forth a prima facie case (Id.). Gagliardi is coaching back at Branford High School. Even if Gagliardi could establish a prima facie Hopefully, counsel made it clear that he had an ex- case of retaliation, SHU “articulated legitimate, non- tremely thin case before filing the Complaint, as he li- discriminatory reasons for terminating” him. While able for SHU’s costs. This should be a lesson to others coaching at SHU that September, he was “also teaching seeking to use the courts to gain revenge for perceived full time at a high school.” Consequently, Gagliardi’s slights. Finally, other colleges may think long and hard performance at SHU “deteriorated in a substantial way, before hiring him in the future. Some cases should not including habitual lateness to practices, missed prac- be filed. tices, late arrival to a tournament, and a missed day of a tournament.” The burden shifted back to Gagliardi to Return to Table of Contents “prove that the desire to retaliate was the but-for cause of his termination.” The District Court found he “failed Court Dismisses Defamation Claim to produce evidence that could meet that ultimate burden.” The Circuit agreed (Id.). Against Utah Jazz and Russell Gagliardi attempted to create disputed facts, but it Westbrook was “uncontroverted” that he missed between two and federal judge has dismissed a lawsuit filed by two five practices, that he was significantly late for one of Utah Jazz fans in state court in Utah against the the matches, that he missed the first day of the UCo- A Utah Jazz and NBA star Russell Westbrook, which al- nn Tournament, and that he “regularly arrived thirty leged that the Jazz and Westbrook defamed the plain- minutes late to every practice that he attended in the tiffs when they publicly branded them racists, after the fall 2016 season because of his other job.” Gagliardi plaintiffs directed insensitive remarks against West- tried to make light of these issues by stating that he brook during a game. had informed SHU that because it had not made him a fulltime employee, he would be late and that he would In so ruling the court found that plaintiffs Shane miss a match. However, he did not deny that these Keisel and Jennifer Huff were never identified by name events occurred or claim he received permission to be and that the term “racist” is not an actionable word. late to each practice. He “knew full well” that his high The incident in question occurred on March 11, school position “would conflict” with his SHU com- 2019 in a game in Salt Lake City at Vivint Arena in a mitments (Id. at 7). game between the Jazz and the Oklahoma City Thun- Gagliardi thus “set forth insufficient evidence” to der, the team Westbrook played for. In the aftermath, support a rational finding that SHU’s articulated rea- the Jazz organization banned Keisel and Huff from at- sons “were a pretext for retaliation.” He stated that tending future events at the arena, issuing the follow- one of his supervisors had called him a “liar,” but this ing statement: had nothing to do with his discrimination complaints. “The Utah Jazz and Larry H. Miller Group an- None of the proffered comments “could be viewed a nounced today a permanent ban of the fan who en- reflecting a retaliatory pretext.” Finally, he admitted gaged in the inappropriate interaction with the Okla- that after his initial complaint, SHU raised his salary homa City Thunder’s Russell Westbrook last night at by forty percent and made him eligible for part-time Vivint Smart Home Arena. The ban is effective imme- benefits. Thus, “no rational jury could find” that SHU diately and includes all arena events.

“The organization conducted an investigation Another factor in the decision was the fact that through video review and eyewitness accounts. The Westbrook never identified Keisel or Huff, so “the ban is based on excessive and derogatory verbal abuse statement is not actionable in defamation.” directed at a player during the game that violated the Return to Table of Contents NBA Code of Conduct.” In comments to reporters after the incident, West- It May Be a ‘Minor’ Win, but a Win brook described the plaintiffs’ speech as racially mo- tivated. Then-Utah Jazz owner Gail Miller said “This Nonetheless for Soccer Prodigy should never happen. We are not a racist community. By Robert J. Romano, JD LLMS, sports law We have a code of conduct in this arena. It will be professor at St. John’s University, with assistance strictly enforced.” from Emily Constanza of Quinnipiac Law School The plaintiffs then filed the lawsuit in the 4th Dis- he United States District Court for the District of trict Court in Utah County, alleging that Westbrook’s TOregon has enjoined, albeit temporarily, the Na- postgame comments as well as a subsequent Utah Jazz tional Women’s Soccer League (NWSL) from enforc- press release and comments by Miller were defama- ing its rule that all rostered players must be at least 18 tory and caused intentional and negligent infliction of years of age (Age Rule). With this decision, 15-year- emotional distress to the plaintiffs. old soccer prodigy Olivia Moultrie, who currently In response to the lawsuit, Jazz Senior Vice Presi- scrimmages with the Portland Thorns squad, now has the opportunity to compete for a position as a profes- dent of Communications Frank Zang responded to sional free from the age restriction. the lawsuit with the following statement: “We be- The District Court’s ruling is a result of Ms. Moult- lieve there is no legal or factual basis for these claims rie’s filing a Complaint and Temporary Restraining Or- against the Utah Jazz. The organization investigated der (TRO) request on May 4, 2021 against the NWSL, the underlying incident and acted in an appropriate and claiming that the League’s Age Rule is a violation of responsible manner. We intend to vigorously defend the Sherman Antitrust Act, 15 U.S.C. § 1. The Plain- the lawsuit.” tiff’s argument that the Age Rule violates the Sherman The defendants moved for summary judgement on Act was based on the following: the claim. The court heard oral arguments in the case “The ten teams that make up the NWSL have on April 5. agreed among themselves, and with the League, not In granting a summary judgment to Westbrook and to contract with soccer players under the age of 18, the Jazz, the court ruled that being called a “racist” is a without regard to their talents or ability to compete in matter of opinion and cannot be factually proven true the League.” or false. Thus, statements made by Westbrook and the “That the Age Rule serves no legitimate business Jazz were constitutionally protected by the opinion justification or procompetitive purpose.” “There is an absence of any age restrictions for privilege. male soccer players.” “The Court’s conclusion today — that calling a Section 1 of the Sherman Act prohibits any “con- person racist or attributing racist statements to him is tract, combination in the form of trust or otherwise, not actionable in defamation — serves important poli- or conspiracy, in restraint of trade or commerce, is cies underlying the First Amendment,” it wrote. “It is intended to prohibit actions that unreasonably re- only in the free expression of these ideas the nation can strain competition.” In order for a plaintiff to estab- hope to heal the historic wounds of slavery and racial lish that the defendant’s actions violate the Sherman injustice that fester still today. That healing cannot oc- Act, the following three elements must be established: cur if public dialogue about racism is silenced under “(1) the existence of a contract, combination, or con- threat of defamation liability.” spiracy among two or more separate entities that (2)

Copyright © 2021 Hackney Publications. All rights reserved. Page 7 Sports Litigation Alert Volume 18, Issue 11 June 4, 2021 unreasonably restrains trade and (3) affects interstate his high school class graduation, as determinative as or foreign commerce.” to why the NWSL’s Age Rule unreasonably restrains The NWSL’s defense against the antitrust claim trade in violation of the Sherman Act. was that no contract, combination, or conspiracy Finally, the District Court found unequivocally among two or more separate entities existed, because that the business of the NWSL “affects interstate com- the NWSL is a single entity. This argument, however, merce,” since it has ten teams in ten states and each was rebuffed by the Court. team travels to each of those states regularly to play Section 1 of the Sherman Act targets only “con- games. In addition, the District Court stated, “[m]any certed action” between separate entities and does not of those games are broadcast around the United States apply to anticompetitive actions taken by a single en- on TV, radio, and the internet pursuant to contracts entity acting unilaterally. The determination of whether tered into by the NWSL or its teams.” targeted activity is “concerted action” between sepa- In concluding that the Plaintiff met her burden by rate entities is a “functional consideration of how the making a sufficient showing that all three elements parties involved in the alleged anticompetitive conduct have been satisfied, the District Court then determined actually operate and does not turn simply on whether that the “Defendants offered no legitimate procompeti- the parties involved are legally distinct entities.” In- tive justification for treating young women who want stead, “the crucial question is whether the entities al- an opportunity to play professional soccer differently leged to have conspired maintain an ‘economic unity,’ than young men.” In fact, the Court noted that, “Lifting and whether the entities were either actual or potential the rule will promote gender equity in athletics.” competitors.” Note, however, that Ms. Moultrie’s win may be Here, the District Court found that based upon the short-lived, as the TRO expires after fourteen days record, although limited, the NWSL was not a sin- unless extended by a further ruling of the court. In gle entity for the purposes of this Section 1 analysis. addition, the District Court’s order only prevents the The Court based its ruling on the fact that the various NWSL from enforcing the Age Rule up until the time NWSL teams compete for players on the open mar- that the rule is adopted by both the League and play- ket, and because the Age Rule, even though adopted ers union in a collective bargaining agreement, which in 2013 when the NWSL was arguably a single entity, is currently being negotiated between the two parties. has now been agreed upon and enforced by separate entities in an anticompetitive manner. Return to Table of Contents In continuing with its antitrust analysis, the court found that the NWSL’s Age Rule “unreasonably re- Court Issues Temporary Restraining strains trade” because a) Ms. Moultrie has been injured Order Preventing UConn from Cutting by being excluded from the market, b) competition in the market is injured by the exclusion of otherwise Its Rowing Program qualified players, and c) the NWSL and its members federal judge has granted a motion for a tempo- have pooled their market power to “in effect, establish Arary restraining order that will prevent the Univer- their own private government.” The District Court rea- sity of Connecticut from shuttering its women’s row- soned its findings on the fact that the NWSL has what ing program until a hearing on a preliminary injunction it referred to as ‘market power’ based on the fact that is held on August 2. it is the only professional women’s soccer league in The impetus for the legal controversy was a deci- the United States and therefore has no real competi- sion by the university last year to cut the rowing pro- tion in the labor market for female professional soc- gram and three men’s sports programs. The cuts were cer players. In addition, the District Court relied on the reportedly part of a mandate for the athletics depart- case of Haywood v. National Basketball Association, ment to reduce by 25 percent the $42 million subsidy it wherein the Plaintiff, Spencer Haywood, successfully receives from the university. challenged the NBA’s rule prohibiting a player from Twenty-three members of the rowing team sued, negotiating with any NBA team until four years after claiming the court was violating Title IX.

The court seemed to agree, finding that they had Education’s Office for Civil Rights. UConn -is enor carried their burden of proof that they “will suffer ir- mously proud of the success of our athletics program. reparable harm in the absence of injunctive relief.” The University’s support for its women’s teams, as Further, it noted that there is a “substantial likelihood” well as all of its student athletes, is longstanding and that it will reverse UConn’s decision and allow the pro- resolute. gram to continue. “Nonetheless, last summer the University’s Board Its rationale centered on the fact that UConn isn’t providing “genuine athletic participation opportuni- of Trustees made the very difficult decision to elimi- ties” to female athletes in proportion to the under- nate four Division I Athletic Teams, including Wom- graduate student population. The court also gave great en’s Rowing. That decision was made following a weight to the testimony of expert witness Dr. Donna comprehensive review of UConn’s athletic program, Lopiano, who opined that UConn has not complied including its Title IX obligations. UConn used its best with Title IX since 2008. efforts to eliminate the fewest number of teams as pos- “Plaintiffs have shown that it is substantially likely sible, but there was no path forward that would permit that UConn is not presently in compliance with Title the University to preserve the long-term viability of its IX’s effective-accommodation mandate, and cutting athletics program in the absence of cuts. the women’s rowing team would only exacerbate that “While the University understands, appreciates, noncompliance by magnifying UConn’s disparity in athletic participation opportunities,” according to the and fully shares the significant disappointment of the opinion. student athletes, alumni and fans of all four eliminated Meanwhile, UConn released the following teams, we believe that our actions in regard to Wom- statement: en’s Rowing and the other teams were consistent with “The university disagrees with the standard applied the University’s obligations under Title IX.” by the court in this proceeding as it is inconsistent with longstanding guidance provided by the Department of Return to Table of Contents

Articles

The European Super League, provoking an immediate and overwhelmingly negative re- Florentino Perez, and International sponse from fans, broadcast- Contract Law ers, financiers, sports regula- tors and even governments Real Madrid president Florentino Perez has reiterated that the 12 founding members of the ESL, including the worldwide. The backlash nine clubs that announced they will no longer take was fierce; UEFA, FIFA, Se- part, have legally binding contracts preventing them rie A, Premier League and La from backing out of the heavily criticised league. If this Liga were quick to state they statement is true, what barriers does Perez face with would ban the clubs involved enforcing sanctions on the Premier League clubs? Where and their players from other Santiago could the legal battle be pitched and how could it work? Graffigna competitions, threatening ex- By Santiago Graffigna, Commercial Litigation tensive legal action, whilst fans protested in their hun- Associate at BLM dreds of thousands in an unprecedented show of soli- he announcement of the 12-team European Su- darity. UEFA in particular have taken swift action, and Tper League (ESL) proved to be one of most dra- according to media reports are gearing up to pursue matic developments across all of sport in recent years, severe disciplinary measures against clubs that signed

Copyright © 2021 Hackney Publications. All rights reserved. Page 9 Sports Litigation Alert Volume 18, Issue 11 June 4, 2021 up to the clubs yet to distance themselves sufficiently which now looks like a doomed project. In these cir- from the project, following a settlement with those that cumstances, beyond the wasted costs of setting up the have abandoned the project. league, there would need to be an assessment of what There was particular backlash against the English costs the departed clubs could be responsible for, if clubs involved, with UK prime minister Boris Johnson that provision is absent in the agreement. Again, cue vowing to do everything in his power to prevent its the lawyers and forensic experts who will be combing creation, the Premier League introducing a new own- over the initial contract in fine detail. ers’ charter and legislation to protect its ‘core princi- If Perez is to go ahead and pursue recompense from ples’ and subject to significant sanctions if broken, all the clubs which have backed out of the agreement, it backed by the UK government. will no doubt be strongly defended. As the ESL is reg- Spanish courts took a decidedly different approach. istered in Spain, then subject to the terms of the agree- The 17th Commercial Court of Madrid provided pro- ment on governing law and jurisdiction, the Spanish tection to the Spanish clubs involved, passing an of- courts are most likely to have jurisdiction, and these ficial court order, which stated: “we prohibit adopting operate differently than English courts. The approach any measure that stops, restricts, limits or conditions taken by the 17th Commercial Court of Madrid is a in any way, directly or indirectly, the launch of the Su- clear example. Enforcement of any judgment obtained per League…We also prohibit any sanction against the in England may take much longer now that Brexit has ESL clubs and their players.” materialised and the EU is yet to approve the UK’s ac- However, this certainly was not enough to stop the cession to the Lugano Convention – the body which wave of anti-ESL sentiment. Ultimately nine of the provides for the recognition and enforcement of a wide founding clubs stepped away from the project within range of civil and commercial judgments between the 48 hours of its announcement, with only Juventus, EU and EFTA states. Real Madrid and Barcelona remaining. However, it remains to be seen whether the Spanish Many believed this meant the saga was done-and- courts would entertain enforcement of, for example, a dusted, with even Juventus chairman Andrea Agnelli penalty clause, even if entered unconditionally. Those admitting it now “could not happen”, Real Madrid defending the departed clubs would ask the court to president and ESL joint-chair Florentino Perez has view this as a textbook case of impossibility of perfor- however since made a series of statements concerning the 12 clubs, essentially arguing that “binding con- mance. The Spanish law doctrine of “incumplimiento tracts” mean they “cannot leave”. These claims have imposible” (“impossible fulfilment of an obligation”) provoked further debate – how true is Perez’s state- also recognises this concept. ment, and could his club and others feasibly invoke any Otherwise, it would be “damned if you do, damned punishment on the departed Italian or English clubs? if you don’t” for the clubs that withdrew from the ESL, As a starting point, we do not know the detail of whose owners have taken full responsibility and paid the agreement reached between the 12 clubs, and it is the fines imposed by UEFA without delay. possible that we never will. It would however be sur- Even if there is an argument for Perez and the re- prising if it turned out that the departed clubs would maining clubs that the frustration or impossibility of be forced to play ad aeternum (i.e. a specific perfor- performing the contract was caused by the clubs with- mance of the agreement). If the agreement was binding drawing; and even if therefore they are obliged to com- and there was no means of “backing out”, there would pensate their departure from the ESL, this begs another potentially be a means of leaving at a cost, possibly question: is it worth the risk? Potential bans from the through a liquidated damages or penalty clause in the most iconic tournaments in European football, a ruined agreement if this were enforceable. But that is a lot of relationship with Europe’s other top clubs, and a PR assumptions, which may or may not be correct; any war (which Real Madrid may, across Europe, lose) are ambiguity will be seized upon by lawyers for the par- all commercial points that must be considered before ties to any litigation. This is before the actual league pursuing action. Even if Mr Perez had legal arguments has been formed and a competition has commenced, to win, fans worldwide would rather see all the clubs

Copyright © 2021 Hackney Publications. All rights reserved. Page 10 Sports Litigation Alert Volume 18, Issue 11 June 4, 2021 playing and winning on the pitch and on their own of trainer Bob Baffert, Medina Spirit was forced to un- merits. dergo enhanced medical screenings to race. This in- Many of the legal assertions concerning the col- cluded, three negative drug screenings leading up to lapse of the ESL may or may not stand up to close in- the race, and a review by race organizers of Medina spection in a court room, but desperate times require Spirit’s medical records2. desperate measures. In fairness to Perez and the clubs Currently, no official action has been taken against he represents, in this moment, he appears genuine in Medina Spirit by Churchill Downs with respect to the his assertions that Europe’s top clubs are in a financial race results. The second sample analysis has not yet crisis. Real Madrid, alongside many other clubs in Eu- been completed. Should there be a confirmation of the rope, has been in dire financial straits and this has been presence of betamethasone, any disqualification would exacerbated immensely by the pandemic. More big be subject to an appeal, which would likely be initiated money investors into the game have tipped the power by trainer, Bob Baffert. balance against the traditional European powerhouses Churchill Downs has suspended the trainer, Bob of Real Madrid and Barcelona, driving transfer fees up Baffert, from entering any horses into races at their to a frankly unsustainable level and lacing Spain’s big- track. Currently the length of the suspension has not gest clubs with seemingly insurmountable debts. You been announced, and there is an ongoing investigation can understand why Perez is upset. by the Kentucky Horse Racing Commission. The ESL story is far from over, and it will be in- After an initial denial of the use of betamethasone, teresting to see what, if any, legal action is taken by Baffert and his team later acknowledged that Medina the three remaining ESL clubs against the others, or Spirit was given Otomax leading up to the Kentucky whether this is just a war of words. Derby. Otomax is an ointment used to treat betametha- Return to Table of Contents sone, and the levels in the sample from Medina Spirit were consistent with this explanation. Treatment appli- cations were provided on April 9 and April 19, accord- Medina Spirit and the Future of Anti- ing to the medical records of Medina Spirit3. Doping in Horseracing In 2020, Congress passed the Horseracing Integrity By Jared P. Vasiliauskas and Safety Act (the “Act”)4, which shall take effect on July 1, 2022. Under the Act, a board overseen by the n May 9, 2021, Kentucky Derby winner, Medina OSpirit was announced to have failed a pre-race Federal Trade Commission will have the authority to drug test for the corticosteroid betamethasone1. Beta- write rules and penalties for the sport. These rules, and methasone is classified as a therapeutic under the cur- the penalties are to be enforced by the United States rent anti-doping rules, and thus was only prohibited Anti-Doping Agency (“USADA”). within 14 days of a race. Along with the announce- In consideration of the authority granted under the ment came the potential that Medina Spirit would be Act, the intention of Congress to provide standard rules disqualified and stripped of the Derby title. However, for anti-doping in horseracing, and to protect the hors- before any such determination could be made, the sec- es was made clear. Under the new rules, the Horserac- ond sample collected at the same time, generally re- ing Integrity and Safety Authority (the “Authority) has ferred to as the “B” Sample, must confirm the positive the ability to develop rules governing, amongst other test result. matters, anti-doping in horseracing. What this should The positive result also required Medina Spirit to lead to is a consistent administration of protocols and undergo far more stringent testing to compete in the 2 https://www.washingtonpost.com/sports/2021/05/14/medina-spirit- Preakness Stakes on May 15, 2021. As part of an agree- preakness-drug-tests/ ment between race organizers and the representatives 3 https://www.washingtonpost.com/sports/2021/05/14/medina-spirit- preakness-drug-tests/ 1 https://www.nytimes.com/2021/05/09/sports/horse-racing/bob-baf- 4 https://rules.house.gov/sites/democrats.rules.house.gov/files/BILLS- fert-kentucky-derby-medina-spirit-drug-test.html 116HR133SA-RCP-116-68.pdf#page=5448

Copyright © 2021 Hackney Publications. All rights reserved. Page 11 Sports Litigation Alert Volume 18, Issue 11 June 4, 2021 procedures for testing horses, and a clear list of prohib- place with respect to a horse. Furthermore, the Author- ited substances. ity should consider whether such a defense would pro- As the Authority sets out to develop their rules, vide specific Covered Persons with no sanction ora protocols and authority surrounding anti-doping in the reduced sanction under their newly developed rules. sport, there are several key considerations that should be addressed. The most significant of those consid- Jared P. Vasiliauskas concentrates his practice primarily in Corporate, Labor/Employment and Sports erations is the impact of a positive test result on the Law. He has experience in drafting and negotiating applicable Covered Persons5 responsible for the Cov- a variety of different business agreements on behalf ered Horse6. As there can be multiple Covered Persons of both companies and employees. His current sports charged with the care and responsibility of the Cov- law practice includes working with agents on the ered Horse, there is the potential that one positive test representation of their Athletes, and their legal affairs. He has represented Athletes in matters against the result could warrant multiple suspensions. Addition- United States Anti-Doping Agency and the US Center for ally, the Authority will need to address the length of SafeSport. the suspension, and whether various Covered Persons could have suspensions for different lengths arising out Return to Table of Contents of the same positive test result, due to their level of culpability. Former Louisville Assistant Men’s An additional consideration in developing the rules, Basketball Coach May Wind Up protocols and authority is what defenses to make available to potential Covered Persons facing a suspension. Exchanging Cardinal Red for Generally, in anti-doping cases the affirmative defens- Jumpsuit Orange es are fairly limited and the burden that must be met By Robert J. Romano, JD LLM, St. Johns’ by a defendant is difficult to attain. This is due, in large University sports law professor part, to the strict liability standard that governs doping proceedings. he United States Attorney’s Office of Western Within the sport of horseracing, several Covered TKentucky has criminally charged former Louis- Persons collectively care and have various responsi- ville assistant basketball coach, Dino Gaudio, with one bilities for the horses. This could include the trainer, count of violating 18 U.S Code Section 875 –Interstate owners, veterinarians and each of their employees. Communication with Intent to Extort for attempting to As each of those individuals do not necessarily have extort money from the University. Coach Gaudio’s ac- control or access to the horse on a regular basis, there tions when told by Louisville that his contract was not must be procedural safeguards in place to protect vari- going to be renewed allegedly violated subsection D of ous Covered Persons with limited control or access to the Code which reads as follows: the horses. This may include a defense if a Covered D) Whoever, with intent to extort from any per- Persons could demonstrate they did not know or have son, firm, association, or corporation, any mon- a reason to know that a doping violation was taking ey or other thing of value, transmits in interstate or foreign commerce any communication 5 Under the Act, ‘covered persons’’ means all trainers, owners, breed- ers, jockeys, racetracks, veterinarians, persons (legal and natural) containing any threat to injure the property or licensed by a state racing commission and the agents, assigns, and reputation of the addressee or of another or the employees of such persons and other horse support personnel who are engaged in the care, training, or racing of covered horses. reputation of a deceased person or any threat to 6 The term ‘‘covered horse’’ means any Thoroughbred horse, or any accuse the addressee or any other person of a other horse made subject to this Act by election of the applicable crime, shall be fined under this title or impris- State racing commission or the breed governing organization for oned not more than two years, or both. such horse under section 4 1205(k), during the period— 5 (A) begin- ning on the date of the horse’s 6 first timed and reported workout According to the U.S Attorney’s Office, after be- at a racetrack that participates in covered horseraces or at a training facility; and (B) ending on the date on which the Authority receives ing informed by the Louisville athletic department written notice that the horse has been retired. that his $500,000 a year contract was not going to be

Copyright © 2021 Hackney Publications. All rights reserved. Page 12 Sports Litigation Alert Volume 18, Issue 11 June 4, 2021 extended, Coach Gaudio, “threatened to report to the Coach Mack’s statement is ironic due to the fact media allegations that the University of Louisville that he University of Louisville is currently on proba- men’s basketball program had violated NCAA rules in tion, had to vacate 123 wins, including the 2013 Na- its production of recruiting videos for prospective stu- tional Championship, and had to return hundreds of dent-athletes and its use of graduate assistants in prac- thousands of dollars in shared revenue for issues sur- tice, unless the University of Louisville paid Gaudio rounding the ‘escort scandal’ involving prostitutes and his salary for an additional 17 months or provided the recruits. In addition, Louisville is currently awaiting lump sum equivalent of 17 months of salary.”7 Both a ruling from the NCAA’s Independent Accountabil- alleged acts, the production of recruiting videos for ity Resolution Process stemming from its involvement prospective student athletes and that the graduate as- in the 2017 federal investigation of college basketball: sistants participated in practice, would qualify as Level you know the investigation wherein the FBI uncovered II NCAA violations. Since, as the U.S. Attorney’s of- mass corruption, bribery and various wire fraud issues fice claims, Coach Gaudio “sent a text message to the involving both Louisville and some of the other top University of Louisville personnel containing one of college sport’s programs in the country. the recruiting videos he was threatening to send to the Return to Table of Contents media,”8 and that text message traveled outside of the State of Kentucky, such act is therefore a federal crime in violation of Section 875. Proposed Law Would Authorize Louisville head coach Chris Mack commented that Student-Athletes to Unionize the reason Coach Gaudio’s contract was not renewed By Gregg E. Clifton and Patrick L. Egan, of was because of the program’s performance on the floor. Jackson Lewis “That was the first time I let anybody go in the 12 years group of Democratic U.S. Senators, led by Sena- I’ve been a head coach, so this isn’t anything that is tor Chris Murphy (D-Conn.) and Senator Bernie taken lightly,” Coach Mack stated. “And the honest as- A Sanders (D-Vt.) have introduced the College Athlete sessment: Our program wasn’t where I wanted it to be Right to Organize Act. The proposed legislation would at the end of this past season. We could write down all amend the National Labor Relations Act (NLRA) and the reasons as to why I think, or you think, we didn’t provide student-athletes collective bargaining rights, qualify for the NCAA tournament. But the bottom line regardless of any existing state law restrictions. is we didn’t.”9 Regarding his proposed legislation, Senator Mur- The head coach went on to comment that, “While I phy stated, “Big time college sports haven’t been ‘am- cannot comment on the details or substance of the mat- ateur’ for a long time, and the NCAA has long denied ter, I am grateful for the professionalism of members its players economic and bargaining rights while treat- of law enforcement and the United States Attorney’s ing them like commodities.” He added, Office, the University and I were the victims of Coach “That’s why I’m introducing the College Athlete Gaudio’s conduct and I will continue to fully cooperate Right to Organize Act, which finally recognizes col- with authorities in their investigations. We take seri- lege athletes as employees and allows athletes to col- ously any allegation of NCAA violations within our lectively bargain with their colleges and across con- basketball program and will work within the NCAA ferences. Having the right to do so will help athletes processes to fully review the allegations.”10 get the pay and protections they deserve and forces the

7 https://www.espn.com/mens-college-basketball/story/_/id/31467518/ NCAA to treat them as equals rather than second-class former-louisville-basketball-assistant-coach-dino-gaudio-faces- citizens.” federal-charge-alleged-attempt-extort-program. This proposal far exceeds the student-athlete rights 8 Id. previously sought and currently covered by the Col- 9 https://www.courier-journal.com/story/sports/college/louisville/2021/05/18/reports-ex-u-l-coach-dino-gaudio-federally- lege Athlete Economic Freedom Act (“Freedom Act”), charged-extortion/5150349001/ which was introduced by Senator Murphy and U.S. 10 Id. Representative Lori Trahan (D-Mass.). The Freedom

Act would protect the name, image and likeness rights cannot wait for the NCAA to share its billions with the of current collegiate student-athletes. Senator Mur- workers who create it.” phy’s proposed legislation provides jurisdiction to the While treating athletes as employees, the bill would National Labor Relations Board (NLRB) to exercise seek to exempt them from paying income and payroll authority over all institutions of higher education that taxes for the scholarship, grant-in-aid or other money sponsor intercollegiate sports in relation to collective they receive from the institution. The bill provides that bargaining and labor disputes. “nothing in this Act shall change the current tax status The latest bill proposes that the definitions of “em- and treatment of any compensation college athletes re- ployee” and “employer” under Section 2 of the NLRA ceive, otherwise create additional tax burdens that do be rewritten and amended to consider any college-ath- not currently exist due to an athlete being considered an lete who receives a grant-in-aid or other compensation employee, or affect college athletes’ federal financial from a college or university to participate in intercol- aid status as well as any current reporting requirements legiate athletics to be an “employee” of the respec- within the Internal Revenue Code.” It is unclear if the tive college or university, whether a public or private institution would have to make social security, Medi- institution. care or other payments on behalf of its new employees Student-athletes would be recognized as “employ- to exempt them from paying income and payroll taxes ees” of the institution and thereby entitled to exercise for the scholarship, grant-in-aid or other money they the rights of employees guaranteed by the NLRA, in- receive from the institution. cluding the right to seek redress for alleged violations The proposed College Athlete Right to Organize of those rights by their university “employer” through Act would also authorize the NLRB to recognize the the NLRB. Those protected rights include, for exam- creation of multi-employer bargaining units composed ple, efforts to form a union among members of a sports of student-athletes from multiple schools within a team, challenging alleged discriminatory or retalia- single conference. This would allow student-athletes tory conduct by coaches, administrators or others in from various schools to join together to negotiate col- response to a student-athlete’s protected actions. lective bargaining agreements to “establish uniform According to the bill’s language, this provision only rules and standards related to compensation, hours, recognizes the employee-employer relationship that its working conditions, and other related mandatory sub- proponents assert already exists between college ath- jects of bargaining.” letes and their respective colleges or universities, and This NCAA said the Murphy-Sanders bill would it helps athletes to successfully organize and collec- “directly undercut the purpose of college: earning a tively bargain over their compensation, hours, work- degree.” It added that “turning student-athletes into ing conditions, and other related mandatory subjects of bargaining. union employees is not the answer.” Possible topics of bargaining could include practice Return to Table of Contents time, dates and content, travel accommodations, over- time compensation and team rules. Unionized student- athletes would, of course, also have the right to engage Name, Image, & Likeness Creates in a strike or other job action. Challenges for Compliance While far exceeding the anticipated granting of Departments name, image and likeness marketing rights for student-athletes, the proposed bill seeks to introduce of By Jason Re – The George Washington University a specific “pay for play” process, authorizing student- Law School athletes to negotiate for specific compensation and he next era of college sports is nearly upon us. In benefits for playing their sport. Tjust months, college athletes in certain states will Senator Sanders commented on his proposal: “Col- be allowed to profit from the use of their name, image, lege athletes are workers. They deserve pay, a union, and likeness (NIL). In several states, NIL legislation and to own their own name, image, and likeness. We has been introduced or formal law has been passed,

Copyright © 2021 Hackney Publications. All rights reserved. Page 14 Sports Litigation Alert Volume 18, Issue 11 June 4, 2021 including Georgia, Florida, Alabama, New Mexico, uniquely educated and prepared to take on NIL pro- and Mississippi, with more states, (such as Louisiana, grams as July approaches. Arkansas, and Texas), looking to join the group. These In a recent webinar, hosted by Spry (a technol- states’ NIL laws will come into effect on Julyst 1 of ogy company that “creates a way for institutions and 2021, a date that is as momentous as it is uncertain student-athletes to embrace the NIL”) and the Na- for current and future student-athletes, athletic depart- tional Association of Collegiate Directors of Athletics ments, and compliance offices across the country. (NACDA), a panel of collegiate athletics professionals Student-athletes will soon under these laws be al- discussed how NIL opportunities and payments may lowed to use their NIL to promote athletically and non- affect need-based aid. Todd Hairston, former Senior athletically related business activities. Athletes would AD of Compliance with over 20 years of experience, be allowed to mention their involvement in their col- led the discussion. He was joined by Maura Smith, As- legiate sport and the name of the school they attend sociate Commissioner, Governance & Compliance of to represent in their respective sport, giving the ath- the Sun Belt Conference; Tim Duncan, Vice President letes greater control of their NIL in order to advertise of Athletics and Recreation of the University of New or promote the sale or use of a commercial product Orleans; and Brad Hunt, Head Coach of the Princeton or service. The new guidelines would open up numer- University Women’s Cross Country Team. ous opportunities for student-athletes, including, but What follows is a summary of their opinions. not limited to, making money for signing autographs, One point of interest in the discussion of NIL was providing instructional lessons, or hosting for-profit the impact it may have on need-based aid and Federal training camps, selling their own memorabilia, accept- Pell Grant award. They suggested compliance offices ing sponsorship for products, and more. Taken togeth- should strive to be aware of how NIL can alter awards er, this is also sometimes referred to as the “right of such as these, and thus if NIL is worth it to the stu- publicity.” dent-athlete. Calculating need-based aid is already a There is no set methodology to estimate how much a complicated process with various moving parts and student-athlete would be able to earn through endorse- mingling elements, and NIL earning will undoubtedly ment, business opportunities, and other NIL usages, but factor in. In many cases it is likely that a student-ath- one would assume that it would be somewhat propor- lete will earn less in need-based aid if there is an NIL tional to popularity. The combinations of opportunity and earning are nearly endless, and there are countless earning agreement in place for them, as this prospec- moving parts and mitigating circumstances that will tive and actual earning will factor into aid calculation. shape NIL individually for each student-athlete. Similarly, an interesting issue for the student-ath- One part of a university’s athletic department must letes may arise when their NIL earning puts their fam- be particularly on top of NIL bills, programs, and pro- ily outside of the qualifying range for a Federal Pell cesses – compliance offices. The compliance office of Grant. The United States government awards these an athletic department is tasked with educating, moni- Pell Grants to individuals, often student-athletes, who toring, verifying, and ensuring that the student-athlete display a particularly extreme financial need for assis- and athletic department as a whole are in compliance tance to pay tuition. These grants are the single larg- with any and all pertinent NCAA (and conference) est source of federally funded grants and are awarded rules from top to bottom, and team to team. It is the solely on the basis of financial need. Thus, in a situation mission of the office of athletic compliance to provide such as this, a student-athlete would in essence be re- student-athletes, coaches, and staff with the knowledge placing passive “free money” with active merit-based needed to be successful within the guidelines provid- NIL earning. This may potentially lead to discontent in ed by state, NCAA, and conference legislation. Thus, student-athletes and/or their families, as many will feel while it will be a group effort, much of the ensuring that NIL programs are hard-earned money that should that the university and student-athlete follow these not cut into grant money. Nevertheless, compliance of- new NIL rules will fall upon the shoulders of compli- fices and student-athletes alike should be educated on ance offices around the country, requiring them to be the risks and benefits of NIL programs such as this.

On the other hand, state NIL bills generally provide a valuable skill beyond NIL. Similarly, open forums that athletic scholarship may not be reduced or revoked of communication between teams themselves may be when a student-athlete earns money through NIL pro- useful in acting as a sounding board for understand- grams. Thus, a student-athlete on a full academic or ing, utilizing, and discussing the NIL earning process athletic scholarship need not worry that any NIL earn- beyond a student-athlete’s own team. It is important ing will have negative implications on financial award. to not only keep student-athletes in conversation, but Even so, it is crucial to note that many NIL earning also ensure that each singular student-athlete is getting arrangements may not be in the best interest of the individualized attention on NIL, as it can be difficult student-athlete. Some NIL related opportunities may to navigate alone, and can vary wildly from person to incur substantial fees and expenses – such as paying person. agents, lawyers, facilities, marketing representatives, Further, this NIL education should be a constant taxes on earnings, etc. – which can add up to a signifi- conversation throughout the student-athlete’s time with cant deduction of earning, or even leave the student- the university – from recruitment to graduation. The athlete in the red. As noted, prospective NIL earning NIL conversation is not just one single consideration, will likely be proportional with relative popularity and nor is it made in a vacuum – shifting circumstances success of the sport, school, and student-athlete. NIL in a student-athlete’s life may impact their proclivity earning programs may be lucrative endeavors for those towards NIL programs, and thus NIL discussions will at the top of a popular sport, but they may be inadvis- be sustained and personalized for the student-athlete’s able to those in less popular sports or historically less time at the university. As noted, one potential option is successful universities. Thus, athletic departments and a weekly meeting with the student-athletes, be it one- compliance offices have a duty not only to ensure that on-one, team wide, or otherwise, as an open forum for state, NCAA, and NIL rules are followed, but also that NIL discussion and learning programs. NIL is a new the student-athletes’ best interests are being looked out program, subject to shifting and changing of guide- for. lines, so constant updates will be key. The education An important element in the smooth transition to system on NIL should be a living process, not just a NIL earning in these states with related bills is early singular meeting upon arrival on a respective campus. and constant education. While some state NIL bills Ultimately, the implementation of NIL earning pro- will require universities to provide student-athletes grams will be a learning process for student-athletes, with education programs held by athletic department their families, athletic departments, compliance of- compliance offices, these processes are vital even when fices, and all other parties involved in the process as a not explicitly mandated and should be extensive and whole. Whether legislatively mandatory or not, educa- informative. As with other new initiatives, education tion for these groups will be vital in the smooth imple- of the ins-and-outs of NIL is irreplaceable and should mentation and functioning of NIL programs as these be the focus of athletic departments in NIL earning practices go into effect. Compliance offices should not states. Compliance offices should take an active role in only be acutely aware of any statutory provisions in this education process – ensuring that student-athletes their state’s NIL bill which would require education – and those university staff that he or she comes into of some kind, but also aid in this education process as contact with – are fully equipped to take on NIL ques- much as possible to ensure adherence to the various tions, concerns, and earning. new opportunities, rules, and restrictions in the NIL This education on NIL can take many forms. Some sphere. suggestions include one-on-one meetings between As of now, there is no federal NIL bill imminent in student-athlete and compliance office representatives, the legislative pipeline. State NIL bills will inevitably team-wide education programs, inter-team discus- differ in various ways, leading to grey areas for com- sion groups, and more. One popular suggestion for pliance offices in how the rollout and implementation each team to meet weekly with the compliance office of these programs will operate. It may take years to on a set time and date to discuss NIL and other finan- see where exactly the gaps are in the coming NIL leg- cial considerations, as financial literacy generally is islation and flesh out any problems that will arise. All

Copyright © 2021 Hackney Publications. All rights reserved. Page 16 Sports Litigation Alert Volume 18, Issue 11 June 4, 2021 parties will take part in a learning experience from the With all of the uncertainty surrounding NIL legis- very start. It is important to remember that all parties lation and implementation, and unanswered questions involved are working towards clarity in understanding as to the earning process itself, student-athletes, ath- and practice as questions and issues inevitably arise. It letic departments, compliance offices, and any other seems inevitable that a university’s legal department parties involved in the NIL process must be constantly will play a role in the implementation and functioning vigilant. Compliance offices in particular must stay NIL earning in conjunction with compliance offices. on their proverbial toes in the coming months as NIL Ignoring the impact that NIL bills will inevitably legislation will be passed, implemented, practiced, and have on state-vs-state recruiting for the time being, become clearer as it takes more substantial shape. A one question that will become clearer in the coming careful reading of their state’s respective NIL bill, con- months is the role of the conference offices. Confer- stant education, and continuous discussion on the topic ence offices will likely play a key role in the introduc- are all key in the smooth operation of such programs tion and solidification of the NIL process – acting as a under adherence to the law. forum for discussion and consideration of best practices, a think-tank of NIL compliance to educate and Return to Table of Contents better the entire process. On the other hand, conference offices pose a unique problem, as athletic conferences After Being Promoted to General often span several states, and these states may have dif- Counsel of the Rockets, Clay ferent (or non-existent) NIL rules and guidelines. In this way, conference coordination can only go so far Allen Talks about the Journey, and until a federal NIL bill is passed into law. Significance of the Promotion Another prospective point of contention that ath- here are a litany of ways that attorneys rise to the letic departments are concerned about is compliance Tlevel of general counsel of a professional sports with recruiting rules in terms of discussing NIL earn- team. For Clay Allen, the recently appointed general ing with prospective student-athletes in the recruiting counsel of the Houston Rockets, the journey was about process. It is unclear as of now what may or may not patience and a “dream.” be said or promised in this regard. Again, as there is no We recently visited with Allen, who actually grew federal NIL bill, and states may vary, this could cause up in Houston and vividly remembers the champion- friction as guidelines will differ by state. Compliance ship years, and has become the first openly gay general offices should take a close look at their respective states counsel of a professional sports team. NIL bill and related provisions to ensure the university is adhering to any recruiting-related NIL rules. Question: What does your rise say with regard to be- Taxation on NIL earnings, and the tax process more ing with one organization for so long? generally, will become another potential problem that Answer: While I joined the Houston Rockets in 2001, will have to be overcome, or passed on to another par- I left for several years to go to law school and then ty. Athletic departments and compliance offices are not to work at a large law firm in Houston, so my official legally tax advisers, but student-athletes will naturally tenure is 14 years (8 in the legal department, 6 in Mar- have questions about taxes and the tax considerations keting). I think my rise within the organization speaks on their NIL earnings. Thus, a question arises as to who to how much experience and hard work are valued by will provide the student-athlete with guidance on the the team and by our ownership. Along with my pro- subject. Again, compliance offices will have to look to motion, the Rockets also recently promoted Gretchen the text of their state’s NIL bills with a fine-toothed Sheirr to President and Larry Kaiser to Chief Finan- comb in order to comply with statutory provisions. It cial Officer—both of whom have been with the team is entirely likely that an outside agency will have to be for over 20 years themselves. Together, the three of us hired to help answer, and handle, these NIL earning have nearly 60 years of experience within the organi- taxation questions and processes. zation. The future’s bright in Houston, and I’m excited

to be part of the continued success of the Rockets and this translates into what New Jersey will do to develop Toyota Center. a successful esports market. Rebuck said that New Jersey Governor Phil Murphy Q: What does it say in the LGBTQ with regard to the has made clear that he wants his state to become the es- Rockets, NBA, and pro sports in general? tablished hub for esports and related gambling. In that A: It’s 2021, and while we’ve had a handful of former vein, Rebuck noted that the NJ DGE has been in talks professional athletes come out after retirement, there with stakeholders across the esports industry about are still no openly gay athletes in the big four men’s what esports gambling should look like. He further professional sports. I don’t have much control over invited stakeholders and entrepreneurs to engage the what happens on the court, but I hope to have some DGE in discussions as they assess and build an esports effect on what happens in the boardroom. It’s impor- gambling model. According to Rebuck, it is the entre- tant to me that I highlight that I’m a member of the preneurs, as opposed to the esports publishers, who are LGBTQ+ community because representation matters. most aggressively pushing to monetize esports in this Throughout my career, I’ve been one of only a few gay fashion. team members, and that is at least partially due to the While esports is still “very much a niche industry,” lack of representation in sports as a whole. I hope oth- as Rebuck noted, operators, publishers, and entrepre- ers will see me and my success and know that opportu- neurs have been presenting a host of ideas to the DGE nities exist. Additionally, I am working to provide re- on how to monetize the industry. He was clear that sources to other LGBTQ+ sports professionals through esports professionals see esports as an athletic event my role as an advisor to HomeField Alliance, which is and that esports are authorized as sporting events un- a nationwide affinity group for LGBTQ+ sports pro- der New Jersey’s sports wagering law. fessionals that offers opportunities for networking and Some takeaways from Grove’s conversation with mentorship. Rebuck: 1. The DGE views the separate esports games Return to Table of Contents (e.g., Fortnight and League of Legends) as leagues and their respective players as athletes Will New Jersey be the center of the of each particular league. In other words, each Esports Universe? According to the game publisher would be akin to the NFL or MLB and players specialize in a particular Head of the NJ Division of Gaming game without crossing over to other games. Enforcement, that’s the Goal 2. Developing a gambling model for esports is By Nicole Kardell, of Ifrah Law not as clear cut as traditional sports betting and entrepreneurs are across the map with ideas. he EGR’s East Coast Virtual Briefing 2021, took Tplace May 26, 2021 with a packed agenda, includ- 3. Nevada and New Jersey are the two states most ing revealing the winner of the Ifrah Pitch Competi- focused on monetization of esports while both tion. We wanted to provide some highlights on devel- are still grappling with how to convert it into a opments in esports as a gambling vertical. Esports was legal gambling opportunity with all the protec- the focus of a Q&A session hosted by Chris Grove, tions in place for other gambling verticals. a partner at Eilers & Krejcik Gaming. Grove inter- 4. Certain esports publishers have been reluctant viewed the director of New Jersey Gaming Enforce- to open themselves to esports gambling out ment, David Rebuck on the future of esports and New of concerns over scrutiny faced in regulated Jersey’s efforts to become the hub for all things esports. gambling. The DGE has worked with others to The conversation started off with an overview of educate the publishers that, like sports leagues, New Jersey’s journey as a “vanguard” of online gam- it is not the leagues, but the gambling operators bling regulation, the reasons for its success, and how who are subject to gaming licensing.

5. Rebuck anticipates that, once a successful Crawford said. “I have spent roughly one-third of my model for esports gambling is developed others 30-year professional career actively engaged in the are likely to follow and join. NCAA infractions process. I am strongly committed At the end of the session, Grove asked a question to the principles of integrity, competitive fairness and related to what’s near and dear to his heart: online pok- sportsmanship in intercollegiate athletics. I look for- er. He wanted to know Rebuck’s thoughts on whether ward to actively working with the membership, na- there will be growing liquidity in poker through inter- tional office colleagues and practitioners in ensuring national compacts. While Rebuck believes growth in that those principles are consistently supported and the international poker pool is tricky (noting that regu- advanced.” latory schemes are apples to oranges between the U.S. Crawford also will serve as the primary spokesper- and other jurisdictions), he is confident more U.S. states son for the infractions process. He will report to Scott will join the Multistate Internet Gaming Agreement. Bearby, interim senior vice president of the office of legal affairs, human resources and hearing operations. Return to Table of Contents In his role as NCAA managing director of enforcement since 2013, Crawford provided oversight Attorney Derrick Crawford Named of the NCAA’s investigations and processing group NCAA VP of Hearing Operations for the three NCAA member divisions and more than 1,100-member institutions. Before joining the NCAA errick Crawford, an attorney with decades of le- national office staff, Crawford served in various senior- Dgal, regulatory and higher education experience, level roles related to diversity, equity and inclusion has been named the NCAA’s new vice president of spaces within higher education. He was the first chief hearing operations. diversity officer and ombudsperson at Cal State San Crawford, formerly the NCAA managing director Marcos and the chief equal employment opportunity of enforcement — investigations and processing, be- and diversity officer for The Citadel. gan his new role May 24. In addition, Crawford brings decades of experience “Derrick brings deep regulatory experience, in- within legal affairs, both as an attorney and investiga- credible knowledge and a strong record of serving the tor. Crawford served as counsel for policy and litiga- membership while supporting the integrity of college tion at the National Football League for eight years. sports,” NCAA President Mark Emmert said. “With He also served as an assistant attorney general in Ala- his skill set, combined with a demonstrated leadership bama. Before his work with the Alabama Attorney acumen, Derrick is well-positioned to making an im- General’s Office, Crawford spent five years with the mediate and significant impact supporting this impor- Federal Bureau of Investigation as a special agent and tant work for the Association.” legal advisor. In his new role, Crawford will serve as direct liaison Crawford received a Bachelor of Arts in political to the NCAA Committees on Infractions and Infrac- science and Juris Doctor from Alabama. tions Appeals Committees in all three divisions and oversee the staffs that support the committees. These Return to Table of Contents committees decide on penalties for member schools and involved individuals who violate NCAA rules. He also will provide strategic coordination for the NCAA’s Independent Accountability Resolution Pro- cess. Specifically, Crawford will serve as the NCAA’s primary liaison with the Independent Accountability Oversight Committee, Infractions Referral Committee and the Independent Resolution Panel. “I am honored and beyond excited to have been se- lected to serve as vice president of hearing operations,”

News Briefs

Jaguars Promote Chief Legal Officer raised in Niagara Falls. She earned her B.A. from Car- leton University, LL.B. from Western University in Megha Parekh to Executive Vice 1996 and was called to the Ontario Bar in 1998. At the President time of her appointment, Justice Standryk was a Senior he Jacksonville Jaguars have announced the pro- Partner with Lancaster Brooks & Welch LLP special- Tmotion of Megha Parekh to executive vice presi- izing in labour, employment, human rights and sports dent within the organization. Parekh was elevated to law. She has represented national, provincial and grass executive vice president and chief legal officer having roots sport organizations. She has appeared before all already served as chief legal officer since 2016. She levels of courts, administrative tribunals and the Sport manages the legal, technology, office services and peo- Dispute Resolution Centre of Canada. She has also ple development teams for the Khan family’s portfolio acted as mediator and arbitrator in sports-related dis- of sports, entertainment and development companies. putes. A former competitive athlete, and advocate of Her group is responsible for all legal matters, employee SafeSport, Justice Standryk offers her experience to training, support and development, technological sys- several sport organizations on matters including diver- tems, security, capital project management and local sity, SafeSport and good governance. real estate development opportunities. Parekh joined Chambers Honors Firms for Sports the Jaguars in 2013 and has worked on Shad Khan’s acquisition of Fulham Football Club, public-private Law Work funded improvements to TIAA Bank Field, the 2017 he highly respected Chambers & Partners USA opening of Daily’s Place, multiple naming rights part- Thas recognized several US law firms in its annu- nerships, the launch of All Elite Wrestling and potential al rankings of those legal teams with the best sports real estate developments around the stadium. Parekh law practice. Notable among this group were Skad- also serves on the board of the Jaguars Foundation, the den, Arps, Slate, Meagher & Flom LLP & Affiliates, Florida Sports Foundation and the Black News Chan- Latham & Watkins LLP, Winston & Strawn LLP, Bry- nel and volunteers with Habitat for Humanity and the an Cave Leighton Paisner LLP, Herrick, Feinstein LLP Crisis Text Line as a crisis counselor. Prior to joining and Gibson, Dunn & Crutcher LLP. Ifrah Law was the Jaguars, Parekh worked in the New York office of also ranked nationally in Chambers and Partners Proskauer, an international law firm renowned for its USA for Gaming & Licensing earlier this spring. One sports law group. Parekh joined Proskauer in 2009 af- of only six firms to be recognized, clients reported that ter graduating magna cum laude from Harvard College the firm was “responsive”, “experts” in the space and and Harvard Law School. highly “diligent.” Canadian Sports Lawyer Set to Return to Table of Contents Become Judge in Ontario he Honourable David Lametti, Minister of Jus- Ttice and Attorney General of Canada, announced recently that Leanne E. Standryk, a partner at Lan- caster Brooks & Welch LLP in St. Catharines, will be appointed a judge of the Superior Court of Justice of Ontario. Justice Standryk replaces Justice R.A. Lococo (St. Catharines), who was elected as a supernumerary judge earlier this year. Justice Standryk was born and