Contract Negotiation NFL Teams

Red Pill or Blue Pill?

Which one is the Poison Pill?

So aside from seeing Laurence Fishburn in Las Vegas this past week (see: Subject of this post), there has been a little bit of discussion in the NFL about “Poison Pills.” Like myself, I imagine that the general public had no idea what a “Poison Pill” was in this context, and still may have absolutely no idea what it means.

As Greg Skidmore states in his article at the Sports Law Blog, “In corporate law, Poison Pills are defensive measures intended to prevent hostile takeovers through stock acquisition.”

Recently, this same tactic was used in the NFL by the Minnesota Vikings in their attempt to acquire offensive guard Steve Hutchinson of the Seattle Seahawks. For more about that issue, go read Greg’s post at the Sports Law Blog.

Instead of focusing on that specific case, I want to examine some intricacies of contract negotiation in the NFL. It is important to know the different kinds of ways that you can manipulate contracts to benefit your clients and also understand the methods by which organizations will try to manipulate contracts against your client.

Poison Pill
Since we have already discussed the “Poison Pill” technique, lets finish off the discussion with a full understanding of how it is used. It is used when player’s former team (Seattle Seahawks in the example) has the ability to match the offer from a new team (Minnesota Vikings) in free-agency. By using the “Poison Pill”, the new team (Minnesota) may insert a clause into a signed contract. The clause says that for the offer to be matched by the former team (Seattle), the player must be the highest payed person at that position after the first year of the contract or else the rest of the contract is gauranteed. This makes it tough for the former team because it means that the player may have to take an enormous pay increase or will have a gauranteed contract (which is basically unheard of in the NFL).

Whether this is in violation of the NFL Collective Bargaining Agreement has not yet been decided by means of arbitration. If anyone knows more about this impending issue, please leave a comment.

I will dedicate many more posts to the NFL’s many forms of contract negotiation. Next up: Franchise Tags. Get excited!

[tags]nfl, contracts, poison pill, arbitration, steve hutchinson, vikings, seahawks, sports, law[/tags]

By Darren Heitner

Darren Heitner created Sports Agent Blog as a New Year's Resolution on December 31, 2005. Originally titled, "I Want To Be A Sports Agent," the website was founded with the intention of causing Heitner to learn more about the profession that he wanted to join, meet reputable individuals in the space and force himself to stay on top of the latest news and trends.

Heitner now runs Heitner Legal, P.L.L.C., which is a law firm with many practice areas, including sports law and contract law. Heitner has represented numerous athletes and sports agents as legal counsel. He has also served as an Adjunct Professor at Indiana University Bloomington from 2011-2014, where he created and taught a course titled, Sport Agency Management, which included subjects ranging from NCAA regulations to athlete agent certification and the rules governing the profession. Heitner serves as an Adjunct Professor at the University of Florida Levin College of Law, where he teaches a Sports Law class that includes case law surrounding athlete agents and the NCAA rules.