Always nice to be quoted about current sports law issues (Courtesy of Chicago Daily Law Bulletin–Roy Strom)
When negotiations in the NBA lockout looked stalled and the chances of a season-ending labor dispute seemed high, Wilson Chandler searched for a place to play basketball.
Chandler’s search ended in the Chinese province of Zhejiang, where the former DePaul University player now plays for the Lions of the Chinese Basketball Association (CBA).
Unlike its European league counterparts, the CBA did not offer players opt-out clauses should the NBA lockout end, meaning Chandler will remain in China until March at the latest, Wilson’s agent Chris Luchey said.
“Now, the dream or the thought of, ‘What if?’ has become reality,” Luchey said. “The NBA season will start and you could possibly be back home. But you’re not.”
Local lawyers said the possibility of NBA talent in China getting “back home” could be difficult without a clause to terminate CBA contracts. They said negotiations to do so could lead to expensive buyouts and that China might be unwilling to let players go because it wants to build the status of its national league.
“They made a bad bet of sorts by playing in China,” said Matthew J. Parlow, an associate law professor at Marquette University Law School. “It sounds like China’s playing hard ball.”
Scott A. Andresen, founding partner of sports and entertainment firm Andresen & Associates P.C., said players knew China would not offer opt-out clauses and that signing a CBA contract meant playing for a full season.
“Now maybe they don’t want to live up to their contracts,” Andresen said. “And that might be part of America’s sports culture, but it’s not what their contract says.”
Luchey said he and Wilson discussed the fact that Chinese contracts lacked an opt-out clause “about 15 times,” but that the CBA offered the opportunity to play more games in a shorter season than European leagues and paid more money. Luchey also said Chandler intends to fulfill the remainder of his Chinese contract.
Parlow said the most likely route for a player who wants to escape a contract is to reach a settlement with his CBA team.
The NBA decided teams could spend up to $500,000 that would not be applied to the team’s salary cap on buying out players’ foreign league contracts. Any amount more than $500,000 will count toward a team’s salary cap number.
Roy D. Kessel, founder of consulting firm Sports Loop, where he works to set up nonprofit events and advise players on business ventures, said Chinese teams and their NBA players will have to negotiate the price of a buyout.
“Typically, what goes on with these things is everybody puffs up their chests and fights for a little while, but then they try to reach financial settlements,” he said.
“The problem is they didn’t agree to a specific (amount for a buyout) up front and, as a result, there’s no assurance for the players that they can get out of their contract for anywhere near the $500,000 the NBA teams can contribute.”
Luchey, Wilson’s agent, said money would not entice Chinese owners to relieve NBA players of their Chinese contracts.
“Owners in China don’t need any money,” Luchey said. “They’re financially stable. It’s a good clause to be in the collective bargaining agreement, but it’s not needed (in China).”
The other avenue to negate the Chinese contracts would be to simply breach them and leave the CBA, lawyers said.
Michael H. LeRoy, a labor and industrial relations law professor at the University of Illinois College of Law, said an English court decision from 1852 might provide direction for a possible legal fight over a breach of contract.
The English case, Lumley v. Wagner, involved an opera singer under contract in London who received a lucrative offer to leave London and perform in an Italian opera house, LeRoy said.
“The gist of Lumley is that the English court said it cannot compel Ms. Lumley to perform in London, but it can enjoin her from performing anywhere else that violates her contractual promise,” LeRoy said, adding that if a court followed this case, the Chinese league could enjoin its players from performing in the NBA.
“That kind of case has been litigated many times before with performers who have a unique type of skill,” he said.
LeRoy said adding to the difficulty of scrapping Chinese contracts is that Fédération Internationale de Basketball or the International Basketball Federation (FIBA), the worldwide governing body for basketball, must give players leaving the CBA clearance to sign contracts in the NBA.
LeRoy said FIBA would be reluctant to clear a player for a NBA contract unless the player and his Chinese team reached a deal to end their contract.
Aside from the difficulties of negotiating a buyout for their contracts, some of these lawyers said the situation shows the CBA’s efforts to become a more prevalent international basketball league.
Timothy L. Epstein, a partner at SmithAmundsen LLC, who focuses primarily on sports law, said the CBA sees the opportunity to employ NBA talent as a way to grow in popularity.
“There’s some thinking on the CBA’s part that long-term, they want a league with some star-power that can compete on an even level with what’s going on in the United States,” Epstein said. “They want China to be ’1-A’ as opposed to ‘C.’”
