Saturday, November 26, 2011

N.B.A. and Players Reach Tentative Deal to End Lockout

With handshakes, sighs and weary smiles, the N.B.A. and its players resolved a crippling labor dispute early Saturday, allowing them to reopen their $4 billion-a-year business. A 66-game season will start on Christmas Day, ending the second-longest lockout in league history.

On nearly every count, the deal favors the owners, who had sought an overhaul all along. The players made significant concessions, including a reduction of up to $300 million year in salaries, $3 billion over the life of the agreement.
Based on tentative agreements made earlier this month, it is expected to be a 10-year deal, the longest in N.B.A. history, with an option for either side to terminate it after six years. It will include a significant pay cut for players, along with shorter contracts, smaller raises and a more punitive tax system to rein in the top-spending teams.
The deal was reached about 3 a.m. Saturday, on the 149th day of the lockout, after a final 15-hour bargaining session at the law offices of Weil, Gotshal and Manges in Midtown Manhattan.
“We’ve reached a tentative understanding that is subject to a variety of approvals and very complex machinations,” the league’s commissioner, David Stern, said, “but we’re optimistic that that will all come to pass, and that the N.B.A. season will begin on Dec. 25, Christmas Day, with a tripleheader.”
Training camps and free agency will open, simultaneously, on Dec. 9, giving teams two weeks to prepare.
The three Dec. 25 games are likely to be the ones that were on the schedule: the Boston Celtics at the Knicks, followed by the Miami Heat at the Dallas Mavericks and the Chicago Bulls at the Los Angeles Lakers. The rest of the schedule will be reconstructed and released in the coming days.
“We’re really excited,” said Peter Holt, the San Antonio Spurs owner and chairman of the league’s labor-relations committee. “We’re excited for the fans. We’re excited to start playing basketball, for players, for everybody involved.”
The 2010-11 season, shortened by 16 games, will be the second shortest in the modern era, after a 50-game season in 1999, which also occurred after a lengthy lockout. Teams will play a compressed schedule, and the season will be extended into late April. The season had been scheduled to begin Nov. 1. The playoffs and finals will also be pushed back.
But much needs to be done before the basketballs hit the court.
Officials on both sides must still negotiate myriad so-called B-list issues, including drug testing, the age limit and use of the Development League, and the entire collective bargaining agreement must be formally constructed.
The deal must be ratified by a simple majority of the 30 teams and a simple majority of the 430-plus players. Before that can happen, the parties must dispense with two pending lawsuits, and the players must reconstitute their union, which was dissolved on Nov. 14.
Both Stern and Billy Hunter, the head of the National Basketball Players Association, expressed confidence that the deal would be approved. Because of the early hour, the deal had not been shared with crucial committees on each side, and officials demurred on any questions about the details.
While Stern, Holt and Adam Silver, the deputy commissioner, smiled through their fatigue, the players’ representatives — Hunter, Derek Fisher and Mo Evans — looked grim.
“For myself, it’s great to be a part of this particular moment, in terms of giving our fans what it is that they so badly wanted and want to see,” said Fisher, the erstwhile president of the players union.
He did not smile as he said it, appearing more relieved than happy. Evans, another member of what was the union’s executive board, sat stoically next to Fisher. No one on the players’ side praised the agreement.
The deal will feature a 50-50 split of revenues, but with the possibility of the players making as much as 51 percent or as little as 49, depending on whether the league exceeds or falls short of projections. The players had been earning 57 percent.
It is unclear at this point how the final, thorny issues — primarily regarding limits on tax-paying teams and other restrictions on free agency — were resolved.
Generally, the agreement will curtail sign-and-trade deals, eliminate extend-and-trade deals and place several new limits on teams that pay the luxury tax. In that respect, the owners will have achieved their two broad goals: to reduce spending league-wide and to promote competitive balance by shrinking the spending gap between the richest and poorest teams.
The N.B.A., which reported a loss of $300 million last season, had been seeking even more dramatic changes, including a rollback on salaries and a hard salary cap.
“This was not an easy agreement for anyone,” Silver said. “Owners came in having suffered substantial losses and feeling that the system wasn’t working fairly across all teams. And I certainly know that the players had strong views, expectations, in terms of what they should be getting from the system. So it required a lot of compromise on both parties’ part. And I think that’s what we saw today.”
While negotiators worked feverishly to get a deal done in time to play on Christmas, thousands of holiday shoppers streamed in and out of stores on the plaza below. At one point, Silver wandered out for a breath of fresh air, and was excitedly greeted by a fan who asked to take a photo with him. Silver, smiling, obliged.
Talks had started and stalled countless times over the last two months of the lockout. A federal mediator intervened twice, failing both times to bridge the divide. Stern tried threats and ultimatums in the final weeks, then declared that negotiations were over on Nov. 10.
Four days later, the players dissolved their union and filed an antitrust lawsuit in federal district court. Stern promptly predicted a “nuclear winter” for the league, amid widespread predictions that the 2011-12 season would be canceled.
But the dialogue never truly ended, even amid the litigation, according to one person involved in the talks. And it was the lateness of the calendar, more than the lawsuit, that drove the parties back together this week.
The final push came with the involvement of a new figure: Jim Quinn, a former outside counsel to the players union, who was hired by Hunter last week to help restart the talks.
Quinn essentially replaced Jeffrey Kessler — the current outside counsel — as the lead negotiator for the players when the parties resumed talks on Tuesday. That meeting set the stage for Friday’s critical session.
N.B.A. officials regarded Kessler as a contentious negotiator who has been an impediment to a deal. Quinn, a partner at the Weil, Gotshal law firm, is highly regarded by all parties and has a strong rapport with league officials, most notably Stern.
Oddly, neither Quinn nor Kessler was present for Friday’s meeting. Kessler participated by conference call. Quinn was replaced by one of his partners, Bruce Meyer.

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