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Wall Street Journal: When Players Don't Pay

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Old 06-17-2005, 07:40 AM   #1
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Wall Street Journal: When Players Don't Pay

(Interesting stuff from the Wall Street Journal)

This past February, the Portland Trail Blazers made a routine if unhappy announcement: A player would be benched and fined for bad behavior. In this case, forward Darius Miles was suspended for two games without pay for shouting insults at his coach during practice. The suspension meant the 23-year-old Mr. Miles forfeited roughly $150,000 of his salary.

What followed the announcement, though, has also become routine in pro sports. Mr. Miles's agent quickly filed a grievance with the National Basketball Association's players' union. And behind the scenes, he lobbied the Trail Blazers to get some of his client's money back. One proposal called for the team to rescind the suspension -- and pay Mr. Miles interest on the sum -- in exchange for the agent's agreeing to drop the grievance, according to people familiar with the proposal.

The $150,000 is now sitting in an escrow account until an arbitrator makes a decision -- or the team cuts a deal with Mr. Miles. The agent, Jeff Wechsler, declined to comment. Steve Patterson, president of the Trail Blazers, says the point of fines is to deter misconduct, not collect cash. "I don't think anybody is interested in seeing athletes who are making millions of dollars turn over money to owners who are worth billions of dollars."

In the world of pro-athlete punishment, the true price of misbehavior is often negotiable and not paid in full. Unbeknownst to most fans, the fines and suspensions that leagues and teams loudly announce -- for transgressions ranging from starting a brawl to wearing a baggy uniform -- are regularly reduced or forgiven altogether. "Usually, a player only pays a portion of the fine," says attorney Jeffrey Kessler, lead lawyer for the NBA and National Football League players' unions. Leagues and teams "may make a deal to give back half the money, sometimes less, sometimes more," he says.

Among the athletes who've enjoyed relief from a stiff fine: NBA guard Latrell Sprewell -- who actually made money on a $25,000 penalty, because a corporate sponsor stepped in to pay it and the fine was later dropped by his team -- and pitcher John Rocker, who ended up paying just $500 of the $20,000 penalty originally imposed by Major League Baseball for his remarks about minorities and homosexuals.

And then there's Nascar, which returns penalty money as a matter of course. At the end of each season, fines collected from drivers and crews are pooled together and disbursed to the top 25 racers. (Shares are determined by where the drivers finish in the final point standings.) As a result, some violators not only get their penalty money back, but they actually earn a profit. In last year's Nextel Cup, Nascar's top series, the racing circuit levied 73 fines totaling $384,495, for infractions such as installing illegal windows or shoving another driver after a race. The team of champion Kurt Busch collected 22% of the total -- or $84,588. Not bad, considering the team had been fined several times during the season, for a total of $21,000. "We don't look at it as recouping fines," says a spokesman for Mr. Busch. "It's just prize money." Adds Chip Williams, a former public-relations director for the National Association for Stock Car Auto Racing, who now advises several top drivers: "It's sort of like a really good mutual fund. You put in money and you can get a solid return at the end of the season."

Three of the top four sports leagues -- the NBA, Major League Baseball and Nascar -- don't disclose the amount of the discrepancy between the penalties they announce and the money they actually collect. The NFL says it collected about two-thirds of the fines it levied last season. Interviews with dozens of sports executives, lawyers and players shed light on how the industry follows through on its disciplinary actions, and turned up numerous instances in which reprieves were granted away from public view. In particular, the NBA, whose championship series this week caps a season marked by record fines, often issues proclamations about the penalties the league and its teams assess. But the league almost never makes public when fines are reduced or rescinded. The NFL does not make public when individual penalties are cut or dropped. "We're not going to break out every little detail," says NFL spokesman Greg Aiello. Major League Baseball is less vocal about its discipline -- except in rare cases, fine amounts are not announced -- but it too declines to reveal how much fine money is collected.

Fines in pro sports are designed not only to deter rule-breaking by players, but also to send a public message about the status of athletes as role models and the consequences of misconduct. What's more, proceeds of fines are generally earmarked for charity. (See "Fine Gifts0.") But powerful players and their representatives act in concert with teams and leagues who don't want to antagonize the athletes, and typically don't push hard to collect the money. "It's all just a charade," says former baseball commissioner Fay Vincent. "With all these lawyers and all this process, the message of the discipline gets eroded."

'Think Twice'

Some agents and executives say reducing fines doesn't undercut discipline, since the deals are often accompanied by a player's pledge to reform. Fines are used "as a carrot and a stick," says veteran NBA player agent Bill Strickland. Fines "are a deterrent," says NBA Senior Vice President Stu Jackson, who oversees league discipline. Notwithstanding the big brawl involving Indiana Pacers, Detroit Pistons and spectators last November, he says, stiffer fines influence players to "think twice before they engage in violent behavior."

Pro-sports leagues are increasingly making an effort to penalize bad behavior, or at least show they're trying to do so. All told, the four biggest U.S. sports leagues announced nearly $15 million in fines and salary suspensions during 2004, up from about $10 million from 2001, based on a review of press releases and public salary information. Just in the last six months, there has been a series of high-profile penalties, including the NBA's seasonlong suspension of Indiana Pacers forward Ron Artest for fighting, and the $10,000 sum levied against Minnesota Vikings receiver Randy Moss for his "mooning" incident during the NFL playoffs.

Not all appeals are successful. After the NBA players' union appealed Mr. Artest's fine, it was upheld by an arbitrator. Mr. Moss initially appealed his fine but later withdrew the request after his actions were constantly replayed on TV during the week after the incident. "Things got so blown out of proportion, we knew it was going to be a waste of time," says Dante DiTrapano, the receiver's agent. In December, a federal judge upheld an arbitrator's decision to reduce the suspension of Indiana Pacers center Jermaine O'Neal, who punched a fan during November's Detroit brawl, to 15 games from 25.

In general, fines can be assessed by both leagues and teams -- though athletes are rarely penalized by both league and team for the same incident. Leagues handle transgressions that occur during games or high-profile wrongdoing that affects the integrity or appeal of the sport, such as steroid use or criminal convictions. Last year, for example, the NBA suspended Sacramento Kings forward Chris Webber for three games after he admitted lying during grand-jury testimony. Individual teams typically deal with nongame infractions, such as Mr. Miles's confrontation with his coach during a Trail Blazers practice.

'La La La La'

Minimum league fines have steadily grown larger in recent years; most NBA and NFL fines start at $5,000, and Nascar routinely issues $25,000 penalties. Even so, the amounts have hardly kept pace with athlete salaries, and some critics say the fines are too low to influence behavior. (After getting hit with a $10,000 fine in 1999 for criticizing referees, Shaquille O'Neal, then of the Los Angeles Lakers, quipped: "I only got fined 10? La la la la," and broke into a dance in the locker room.) In Mr. Miles's case, for example, the $150,000 he has forfeited pending appeal or settlement represents just over 2% of his $6.75 million salary. All leagues have appeals processes through which players can contest penalties, but they are closed-door proceedings whose results are almost never disclosed.

Mr. Sprewell's case is an example of a private arrangement by an NBA team to slash a fine. In 1999, the 6-foot-5 shooting guard -- then playing for the New York Knicks -- was fined $25,000 by the team after his agent complained publicly that Mr. Sprewell should be in the starting lineup. The penalty made headlines around the country. But it turns out the fine was later dropped, a fact the team never announced. Dave Checketts, then-president of the Knicks, cut a behind-the-scenes deal with Mr. Sprewell. "I told Latrell that if he kept his agent in line and stayed on good behavior, I'd give him his money back," Mr. Checketts says. The offer to rescind the fine "had an impact" because the agent didn't make further comments, Mr. Checketts says, and Mr. Sprewell led the Knicks to the NBA Finals.

In the end, Mr. Sprewell pocketed extra cash as a result of the incident. When the fine was announced, his shoe sponsor, And1, stepped in to pay the $25,000 on his behalf. "We've got Latrell's back, and we want him to concentrate on playing basketball," an And1 executive said at the time. In an e-mail, a company spokeswoman said the check was sent to Mr. Sprewell's agent. The agent, Robert Gist, acknowledges that because the team rescinded the penalty, "Latrell made money on that fine."

This year, another NBA team, the Dallas Mavericks, gave players a chance to knock down fines in a different way: through a shooting contest. Like many NBA teams, the Mavericks regularly impose cash penalties for infractions like missing practice (typically $2,500) or arriving tardy to the team bus ($1,000). But at the All-Star break earlier this season, then-coach Don Nelson offered a shot at redemption: Players could reduce thousands of dollars in fines by sinking baskets from designated spots on the floor, and several did. "I made enough of mine to get some money back," Mavericks guard Jason Terry said after a practice late this season in Los Angeles. Mr. Nelson could not be reached for comment.

Based on a review of league press releases, box scores and public salary information, the NBA levied about $13.9 million in fines during the recently completed 2004-05 regular season, and about $5 million during the 2003-04 season -- representing money from fines, technical fouls and salary docked for suspensions. The league wouldn't confirm this number, or disclose how much money was collected. A lawyer for the NBA players' union, Ron Klempner, said "there are settlements reached in many of the cases." Mr. Jackson, the NBA executive in charge of discipline, says: "We evaluate each case individually based upon the incident itself, based upon the player, whether he's had any prior offense, and finally on the severity of the act." The total amount of fines assessed and collected by individual NBA teams couldn't be determined.

'Violent' and 'Unnecessary'

In the NFL, a recent fine for a particularly vicious tackle was quietly reduced. Last December, Jacksonville Jaguars safety Donovin Darius struck Green Bay Packers receiver Robert Ferguson so hard in the head and neck that he left Mr. Ferguson temporarily paralyzed. The league promptly announced a $75,000 fine against Mr. Darius, describing the tackle as "violent" and "unnecessary." But weeks later, after the football season ended, the players' union appealed the fine and the NFL cut it by $20,000. According to a person familiar with the deal, the NFL reduced the fine in part because Mr. Darius had no previous record of misconduct and because he visited Mr. Ferguson in the hospital.

The NFL in recent years has begun levying fines on more types of infractions, and increased the amount of its announced penalties. The football league now cites everything from not wearing the proper socks ($10,000 for a second offense) to excessive celebration after a touchdown ($5,000 for first offense). The NFL says it levied about $3.3 million in fines for 594 incidents, and collected about $2.2 million. Those totals do not include fines issued by individual teams that were reduced or forgiven in informal deals.

The fines in Major League Baseball, by contrast, are generally smaller, in part because the league's powerful players' union has a strong record in litigation and collective bargaining. The league doesn't dock pay when players are suspended, and Major League Baseball also allows players to delay paying any fine over $2,000 until after the appeals process has been completed. Last season, MLB assessed $170,725 in fines, according to the league. It declined to say how much was collected. (In the NBA and NFL, fines are collected immediately and then returned after an appeal or settlement.)

In the case of Mr. Rocker, the former Atlanta Braves pitcher whose off-color comments before the 2000 season triggered a national outcry, Major League Baseball took the rare step of announcing a fine publicly. Commissioner Bud Selig slapped the player with a $20,000 fine, and suspended him for all of spring training and the first month of the season. The baseball players' union immediately appealed, arguing that the penalty was unprecedented and too harsh, and the matter went before an arbitrator eight days later.

A month after Mr. Selig's announcement -- and more than two months after Mr. Rocker's comments were published -- the arbitrator slashed the fine to $500 and allowed the pitcher to return in time for opening day. Details of the ruling weren't made public. Mr. Selig issued a statement saying he disagreed with the decision, and that it "disregards the player's position as a role model for children." Mr. Rocker, now a pitcher for the Long Island Ducks, a minor-league team in Central Islip, N.Y., declined requests for comment.
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