LELIE RULING affects forfeiture rules

[Merman]

From PTF

POSTED 5:58 a.m. EDT; LAST UPDATED 6:25 a.m. EDT, March 27, 2007

LELIE RULING UPHELD ON APPEAL

The owners got a bit of bad news on Monday when the ruling that option bonuses are not subject to forfeiture was affirmed on appeal.

The case arose from the efforts of the Denver Broncos to collect a portion of receiver Ashley Lelie's option bonus due to his 2006 holdout.

The end result? It will be harder for teams to apply leverage to malcontented players by threatening them with the possible recovery of millions of dollars in "guaranteed" payments that they have received. It appears that the only moneys at risk are pure signing bonus payments.

Coincidentally, salary cap dynamics driven by the CBA have resulted over the past few years in low (or no) signing bonuses paid to most first-round draft picks. If/when any of those players get unhappy about their contracts, the teams' arsenal for getting the players to honor their deals will be greatly diminished.

With the ever-increasing salary cap driving free-agent deals to unprecedented heights, such disputes are not a matter of if but when.

PFT Link ()


Well it seems now if a player is a behavior risk he will get a signing bonus and any option bonuses will be turned into signing bonuses. Will have to find the original report to read the details of the option bonus involved.

[Philter25]

I read that article earlier..... this is going to effect every team in the NFL.

Some teams, instead of giving signing bonuses which are pro-rated over the course of the contract, give option bonuses in earlier years so that the entire bonus counts towards that years cap and that way they preserve future cap space and use current available space..... with teams no longer able to collect prorated portions of option bonuses, they are going to have to work harder to signing possible trouble players.

In the end, this should only really hurt teams and hurt troubled players. Its going to be harder to sign troubled players to contracts because teams are going to be reluctant to use option bonuses but then they are going to be forced to use signing bonuses which spread out the cap hit and therefore they basically use a way of managing the salary cap when dealing with a troubled player. Its going to reduce a team flexibility when managing the cap when going through contract negotiations with players.

Personally, im not a fan of the ruling.

[Merman]

I think I see an article topic. 8-)

[Merman]

I have been looking around the net for more news or background and it is very quiet about this arbitration result. :smt017

[Philter25]

I have been looking around the net for more news or background and it is very quiet about this arbitration result. :smt017


Yup. I only found the article on PFT but nothing else..... I wonder why they would be so hush hush about this as this is a pretty significant ruling.....

[Merman]

OK I had to give away my soul for this but least now I'm off to the original source.

Lelie Arbitration Ruling Could Affect Future NFL Contracts

An arbitrator’s ruling last Friday in favor of Falcons WR Ashley Lelie against his former team, the Broncos, “could have ramifications for many existing and future contracts around the NFL,” according to Bill Williamson of the DENVER POST. Lelie argued that he was “forced into signing an agreement that he would forgo $220,000 in option bonuses in order to be traded” to the Falcons in August. Because of the ruling, “which was based on new language in the NFL’s [CBA] reached in March, the forfeiture provisions of option bonuses are expected to be changed.” Players who have contracts “heavy on option bonuses rather than signing bonuses no longer will be in danger of losing those bonuses in holdout situations. This could mean option bonuses no longer will be part of contracts” (DENVER POST, 11/19).

Sports Business Daily ()

Registration required and the quote is all they had.

Landmark ruling goes Lelie's way
By Bill Williamson
Denver Post Staff Writer
Article Last Updated: 11/19/2006 12:07:34 AM MST

Beyond Ashley Lelie receiving $220,000 from the Broncos on Friday, his grievance ruling could have ramifications for many existing and future contracts around the NFL.

An outside arbitrator ruled in favor of the former Denver receiver in his grievance against the team, it was announced Friday. The Broncos can appeal the ruling.

Lelie argued he was forced into signing an agreement that he would forgo $220,000 in option bonuses in order to be traded to Atlanta in August.

Because of the ruling, which was based on new language in the NFL's collective bargaining agreement reached in March, the forfeiture provisions of option bonuses are expected to be changed.

Players who have contracts heavy on option bonuses rather than signing bonuses no longer will be in danger of losing those bonuses in holdout situations.

This could mean option bonuses no longer will be part of contracts, which could have a major effect on how contracts for first-round draft picks are constructed.

"It feels good to have that money back in my pocket," Lelie said Friday after the Falcons' practice. "To lose that much money, cash, after taxes, is kind of tough."

Attorneys for the NFL, which was representing the Broncos, and the NFL Players Association, representing Lelie, presented arguments to the arbitrator Nov. 6.

"There's no animosity toward the Broncos," Lelie's Denver- based agent Peter Schaffer said. "We just want to move on. We wish Denver a great season, and Ashley a great career, and want to put this all behind us."

While Lelie won his grievance, the Broncos' grievance will be heard in coming weeks. That grievance is based on a forfeited bonus and fines accrued during Lelie's holdout before the Aug. 23 trade. Lelie amassed $378,000 in fines for missing training camp, $11,000 for missing minicamp and gave up a $100,000 bonus by not attending a offseason workout program.

Denver is expected to try to recoup the fines and a portion of Lelie's original $3.3 million signing bonus. The total is expected to be more than $1 million.



Link to The Denver Post ()

Note that the date of this article is November 2006. This is the background of the appeal the NFL just lost.