Mendoza School of Business

NBA Players’ Risky Strategy Could Pay Off In Big Way

Published: November 15, 2011 / Author: David Lariviere

In the high-stakes poker game that the labor negotiations between the NBA owners and players have become, the players have moved all their chips to the middle of the table now.

It’s something Commissioner David Stern couldn’t have expected and now the ball’s in his court, to use his own sport’s analogy. The players have decided to disband their union and are prepared to file an antitrust suit against the owners for an illegal lockout within the next few days.

Along with Jeffrey Kessler, who represented the NFL players in an unsuccessful lockout suit against the owners, the players also have hired David Boies, who was the owners’ counsel in that suit. Why would Boies align himself with the other side of a case when the circumstances seem eerily similar? Unless he knows something that nobody else does. And he thinks he can use that knowledge to win and really make a name for himself as well as a ton of money for him and the players.

University of Notre Dame Finance Professor Richard Sheehan, who specializes in the economics of sports, senses that “the owners have been put in a box here” and that the players may have the upper hand with the legal team they have assembled. “They may smell blood in the water and the owners may get to the point where they feel they better settle to avoid the triple damages (that would be awarded),” Sheehan said.

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