April 25, 2016 Practice Points

Second Circuit Reinstates Brady's Suspension

By Mitchell L. Marinello

The Second Circuit, in a 2–1 decision, reinstated the four-game suspension of Tom Brady based on his alleged involvement in deflating the footballs used in the 2015 American Football Conference Championship Game. In essence, the court held in National Football League Football Management Council et al v. NFL Players Association and Tom Brady (Case Nos. 15-2801 (L) & No. 15-2805 (CON), April 25, 2016) that the arbitration process was properly conducted and reversed the district court ruling that Brady had been denied a fair hearing.  

Summary
After an investigation had been conducted by his outside counsel, Roger Goodell, the NFL Commissioner (Commissioner), suspended New England Patriots quarterback Tom Brady for four games for Brady’s alleged participation in a scheme to deflate the footballs used in the 2015 American Football Conference Championship Game. Brady requested an arbitration hearing to review his suspension, and Goodell exercised his discretion under the NFL collective bargaining act to serve as the arbitrator. Goodell denied certain discovery requested by Brady, and, after an evidentiary hearing, issued an award upholding the suspension. The district court vacated the award on the ground that Brady did not have adequate notice that he could be subject to a suspension, rather than just a monetary fine, and for lack of fundamental fairness based on Goodell’s denial of Brady’s discovery requests. On appeal, the Second Circuit reversed and reinstated the award upholding Brady’s suspension.  

Standard of Review
The Second Circuit stated that its role was limited to determining whether the arbitration proceedings and award met “the minimum legal standards established by the Labor Management Relations Act, 29 U.S.C. §141 et seq.” In essence, this meant that the court was obliged to determine if the arbitrator was “even arguably construing or applying the contract and acting within the scope of his authority” and did not “ignore the plain language of the contract.”

Basis for Decision
The court noted that, under the collective bargaining agreement (CBA) between the NFL Players Association and the NFL, the Commissioner was authorized to investigate possible rule violations, impose sanctions, and preside over arbitration proceedings that challenged the sanctions that he imposed. The court stated that, although such a regime was unusual, it was the system the parties had agreed upon, and the court’s role was not to question it.  

The court then went on to review the facts revealed in the investigative report, as well as subsequent facts cited by the Commissioner indicating that Brady deliberately had caused his cell phone to be destroyed even though he knew that the investigators wanted to examine it for evidence. Given all of the circumstances, the court reached the “firm conclusion” that the Commissioner acted within his authority and that there was no basis for reversal.  

The district court had vacated the award on the ground that Brady was denied certain discovery, including testimony from the NFL’s general counsel and access to the notes of the law firm that prepared the investigative report for the NFL, and on the ground that Brady did not receive adequate notice that his actions could lead to a suspension instead of merely a fine. The Second Circuit rejected all of these arguments. 

As to notice, the Court stated that Article 46 of the CBA gave the Commissioner broad authority to take disciplinary action against a player whom he “reasonably judge[s]” to have engaged in “conduct detrimental to the integrity of, or public confidence in, the game of professional football.” Moreover, the provisions relating to equipment violations and monetary fines that Brady cited did not specifically cover tampering with footballs and did not say that discipline for violations would be limited to fines. Indeed, those provisions stated that discipline other than fines could be imposed, including “suspension.” Ultimately, the court had no trouble concluding that Goodell’s interpretation of his authority under the CBA was at least “barely colorable” which “is all the law requires.” 

As for the discovery issues, the court stated that procedural questions “such as which witnesses to hear and which evidence to receive or exclude, are left to the sound discretion of the arbitrator and should not be second guessed by the courts.” The court regarded the testimony of the NFL’s General Counsel as collateral to the issues presented at the arbitration. The court also stated that applicable arbitration rules did not provide for extensive discovery, but required only that both sides exchange the exhibits they intended to rely upon at the hearing. The court held that Goodell acted within his discretion in refusing to require the investigative file to be turned over, particularly when Goodell had not reviewed that file in making his decision but had relied only upon the final investigative report.  

Finally, the court also briefly addressed Brady’s challenge that the Commissioner was evidently partial because, as arbitrator, he was reviewing his own actions and decision. The Court stated simply:  

Here, the parties contracted in the CBA to specifically allow the Commissioner to sit as the arbitrator in all disputes brought pursuant to Article 46, Section 1(a)….Had the parties wished to restrict the Commissioner’s authority, they could have fashioned a different agreement.

Keywords: alternative dispute resolution, adr, litigation, Labor Management Relations Act, LMRA, fines, suspension, discretion, discovery, evident partiality 

Mitchell L. Marinello is with Novack and Macey LLP in Chicago, Illinois.


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