By Helen Maher, Paul Fattaruso, and Andrew Steinmetz
The sports world was fraught with controversy in 2017. With labor turmoil in the NFL, a landmark sports gambling case before the U.S. Supreme Court, corruption litigation in FIFA, and bribery prosecutions in the NCAA, the courtroom drama often seemed to surpass the drama on the playing field, with athletes deciding they could no longer “stick to sports” and the federal government inserting itself into several sports-related controversies.
Here are four stories that dominated the headlines in 2017, and a look ahead at what to expect next year.
NFL Labor Relations Controversies
Disputes pertaining to labor relations in the NFL commanded national attention throughout 2017.
First, there was high-profile litigation surrounding the suspension of Dallas Cowboys running back Ezekiel Elliott. In August, NFL Commissioner Roger Goodell suspended Elliott for six games, citing “credible evidence” that Elliott had used physical force against his former girlfriend in July 2016.
Elliott and the NFL Players Association promptly challenged the decision, arguing that the league deliberately concealed and ignored key evidence that would have undermined the credibility of the accusations against Elliott. While a commissioner-appointed arbitrator did not adopt that argument, Judge Amos L. Mazzant of the Eastern District of Texas did. In September, just before the start of the regular season, Elliott obtained a preliminary injunction that halted the suspension on the grounds that the NFL did not afford him a “fundamentally fair” hearing.
The NFL immediately appealed and the Fifth Circuit vacated the district court’s preliminary injunction, holding that Elliott had filed his lawsuit prematurely — before the NFL’s arbitrator had issued a final decision. Subsequent efforts by Elliott’s team to revive the injunction in New York were unsuccessful. In November, the suspension was reinstated.
The Elliott litigation marked another instance (along with the Deflategate and Adrian Peterson cases) in which a federal court has found fault in the league’s administration of its disciplinary policy. Many commentators have also criticized the league’s policy for vesting too much power in the commissioner and for stacking the deck against accused players by preventing them from accessing relevant evidence and cross-examining key witnesses. As talks surrounding a new collective bargaining agreement draw closer, these issues are only likely to increase in salience and intensity.
A second major controversy erupted in October when former San Francisco 49ers quarterback Colin Kaepernick filed a grievance against the league and all 32 team owners alleging that they colluded to shut him out of the NFL. Under the CBA, teams are prohibited from entering into express or implied agreements to deny employment opportunities to any player. Kaepernick alleged that the owners entered into such an agreement in retaliation against his protest movement, which involved kneeling during the playing of the national anthem before games.
As of December, Kaepernick’s proceeding is still ongoing. A neutral system arbitrator has been appointed and discovery is underway. In November, Kaepernick’s attorneys requested electronic communication records from several teams that considered Kaepernick for a roster spot. Kaepernick’s attorneys also requested permission to depose the commissioner and several team owners. To prove collusion Kaepernick’s team will need to adduce evidence that two or more teams or owners conspired to deny him employment. They cannot rely solely on the fact that many NFL teams have chosen to employ other quarterbacks that arguably are less talented than Kaepernick. If Kaepernick is successful he stands to receive millions in compensatory damages. Any teams or owners found liable would have to pay punitive damages as well.
Relatedly, a third NFL labor controversy continues to roil both the league and the country at large. At a rally in September President Donald Trump sharply criticized Kaepernick and the other NFL players who have knelt to protest racial injustice and inequality during the national anthem. The president also urged team owners to fire any player who continues to kneel.
The comments touched off a firestorm. While only a handful of players protested during the 2016 season, after the president’s remarks hundreds of NFL players knelt, sat, raised a fist or remained in the locker room during the national anthem. Several owners and coaches took part in the protests as well.
The controversy continued to escalate in October, when President Trump suggested that tax breaks for the league should be revoked if the owners continue to endorse player protests. This threat prompted the commissioner and the owners to consider implementing a policy that would force players to stand. Numerous legal scholars weighed in on the legality of such a policy, specifically whether a league action undertaken in response to a presidential threat or directive could constitute state action, thus triggering constitutional protections for the players. Most concluded that a policy requiring players to stand, though potentially problematic from a public relations standpoint, would not run afoul of the First Amendment or the CBA.
Ultimately, the commissioner and the owners decided not to change the anthem policy and the protests have since decreased in number. However, according to multiple reports, several owners are considering an off-season change that would keep players in the locker room during the anthem in 2018, which could reignite this issue next year.
New Jersey’s Efforts to Legalize Sports Betting
New Jersey’s years-long quest to legalize sports betting is now in the hands of the U.S. Supreme Court.
The quest dates back to 2011, when New Jersey voters approved an amendment to the state’s constitution which authorized the state legislature to legalize and regulate sports betting. The legislature first attempted to exercise its new authority in a 2012 statute that would have licensed sports betting at casinos and racetracks. That statute, however, was struck down by federal courts as a violation of the federal Professional and Amateur Sports Protection Act, which makes it unlawful for a governmental entity to “sponsor, operate, advertise, promote, license or authorize by law or compact” sports betting (with specific exceptions for Nevada, Montana, Delaware and Oregon). The Supreme Court denied certiorari.
Trying again in 2014, New Jersey partially repealed its state-law prohibitions on sports betting. The federal district court and circuit court similarly struck down the 2014 repeal as a violation of PASPA — but this time the Supreme Court granted certiorari to consider New Jersey’s argument that PASPA violates the Tenth Amendment and the court’s anti-commandeering doctrine, which addresses the balance of authority between the federal government and the states.
The court heard argument in the case on Dec. 4. Gibson Dunn & Crutcher LLP’s Ted Olson argued on behalf of New Jersey that under New Jersey’s repeal, sports wagering at certain locations “would be as legal as buying a cup of coffee at Starbucks; New Jersey would regard it as a private transaction subject only to generally applicable state and federal laws” — but that PASPA improperly drafts New Jersey officials “into service as ‘puppets of a ventriloquist Congress,’” and should be stricken in its entirety as “impermissible commandeering.” Kirkland & Ellis LLP’s Paul Clement argued on behalf of the NCAA and professional sports leagues that PASPA “involves a straightforward application of the Supremacy Clause,” that the federal statute “does not compel states (or anyone else, for that matter) to do anything,” and that New Jersey’s 2014 repeal “was an authorization dressed up as a ‘partial appeal’” and thus “ran afoul of PASPA” and should not be permitted. The solicitor general, as amicus, likewise argued that PASPA does not commandeer the states, but merely prohibits states and private parties alike from operating sports betting schemes — “States need only refrain from licensing or authorizing” sports betting.
The outcome may have significant implications not only for fundamental principles of federalism, but also for New Jersey’s bottom line. As New Jersey observed in its opening brief, the American Gaming Association estimates that “Americans illegally gamble around $149 billion on sports events each year” — well more than the total market capitalization of Starbucks.
FIFA Corruption Trial: U.S. v. Napout
In November, the U.S. government began its first trial stemming from the $200 million bribery and corruption scandal embroiling the Fédération Internationale de Football Association, the international governing body of soccer. The trial, which is proceeding before Judge Pamela Chen in the Eastern District of New York, concerns only three of the 42 alleged co-conspirators who have been implicated in the scheme, but its result will undoubtedly have far-reaching consequences.
Two of the three current defendants, Juan Angel Napout (former president and vice president of CONMEBOL, the South American soccer confederation) and Jose Maria Marin (former president of the Brazilian soccer federation), are facing charges including racketeering conspiracy, wire fraud and money laundering conspiracy, interstate and foreign travel in-aid-of racketeering, obstruction of justice, and bribery, among others. The remaining defendant, Manuel Burga, former president of the Peruvian soccer federation, is facing money laundering and wire fraud conspiracy counts.
During the first several weeks of trial, witness Alejandro Burzaco, former head of the sports marketing firm Torneos y Competencias SA, testified that while he was an executive with Torneos he agreed to pay nearly $30 million in bribes to the three defendants to ensure that media rights for soccer matches were given to certain companies. Burzaco had previously pled guilty to racketeering conspiracy and other charges in exchange for a reduced sentence.
After testifying that he paid Burga $3.6 million in bribes, Burzaco claimed that he was threatened by Burga, who purportedly made several throat-slitting gestures to Burzaco. Judge Chen subsequently placed Burga under house arrest and cut off his access to phones and computers. The alleged threat comes on the heels of the death of Adolfo Lagos, the vice president of Televisa, who was killed in a purported robbery in Mexico City on Nov. 19. Burzaco had testified that Televisa was also involved in the bribery scheme to secure the media rights of certain soccer matches.
While the Napout case is teeming with cinematic appeal, many are watching it for its legal implications on sports corruption cases. The U.S. government is relying on the Racketeer Influenced and Corrupt Organizations Act — a statute generally used to prosecute members of organized crime — to prosecute the executives involved in the FIFA corruption scheme.
NCAA Fraud and Corruption Charges
In September, federal prosecutors dropped a bombshell on the world of NCAA men’s basketball when they announced that 10 individuals — including four college coaches and a senior executive at Adidas — were under arrest for their involvement in bribery schemes to secure talented high school players and pressure college players into retaining certain business managers and financial advisers. Acting Manhattan U.S. Attorney Joon H. Kim announced that the defendants “allegedly exploited the hoop dreams of student-athletes around the country, treating them as little more than opportunities to enrich themselves through bribery and fraud schemes.”
The four coaches — Chuck Person of Auburn University, Lamont Evans of Oklahoma State University, Tony Bland of the University of Southern California, and Emmanuel Richardson of the University of Arizona — each face a maximum prison term of 80 years on charges of bribery conspiracy, solicitation of bribes, honest services fraud and conspiracy, wire fraud conspiracy, and Travel Act conspiracy. Other defendants face maximum terms from 80 to 200 years.
The charges were an outgrowth of an FBI investigation begun in 2015 and involved substantial wiretapping. For example, prosecutors have indicated that they have collected 57 hours of "pertinent" calls from an FBI tap of Richardson’s phone.
The shockwaves of the federal investigation extend beyond the 10 individuals who were criminally charged. The University of Louisville, investigated as part of the probe, recently fired its head coach, Rick Pitino, who in turn has filed a $38.7 million suit over the firing.
The current charges and related turmoil may be just the beginning — the FBI has a special phone number to receive tips on other violations.
Looking ahead to 2018, the sports law world can expect the NFL to be a continued source of controversy. As the NFL and the NFL Players Association prepare to negotiate a new CBA at the end of the decade, both sides will increasingly look for bargaining leverage. Look for issues related to player discipline and player expression to receive increasing attention in the run-up to next season.
Additionally, the NFL, along with college and professional sports leagues, will continue to face a proliferation of litigation surrounding on-field injuries, specifically concussions. While the NFL entered into a billion-dollar class action settlement relating to player concussions, the disbursement of the funds has been met with an onslaught of complaints — mostly concerning the cut that attorneys will receive. The NCAA still faces the numerous class action lawsuits seeking damages for injuries that resulted from on-field concussions, along with a $75 million settlement agreement that has yet to receive final approval. The concussion lawsuits are not limited to the professional and collegiate leagues and will continue to be lodged at the high school and even pee wee league level.
Finally, expect more — not less — politics in sports. With the 2018 midterm elections approaching, political controversies will continue to abound. Whether it’s issues related to sexual harassment and exploitation or racial inequality, expect athletes to continue to speak out and expect sports executives to be roped into those discussions.
The opinions expressed are those of the author(s) and do not necessarily reflect the views of the firm, its clients, or Portfolio Media Inc., or any of its or their respective affiliates. This article is for general information purposes and is not intended to be and should not be taken as legal advice. It first appeared on Law360.com.
 BSF represents Jerral Jones in unrelated matters.
 BSF submitted an amicus brief in the matter on behalf of European Sports Security Association and The Remote Gambling Association.
 See, e.g., Foreman v. NCAA, No. 1:17-cv-1652 (S.D. Ind., filed May 18, 2017); Gobert v. Univ. of Tulsa et al., No. 9:17-cv-106-RC (E.D. Tex., filed June 8, 2017); Rose v. NCAA, No. 1:17-cv-1402 (N.D. Ill., filed Feb. 23, 2017).
 In re NCAA Student-Athlete Concussion Injury Litig., 314 F.R.D. 580, 583 (N.D. Ill. 2016).
 See, e.g., Hites v. Pennsylvania Interscholastic Athletic Ass’n, Inc., No. 8 C.D. 2017, 2017 WL 4507367 (Pa. Commw. Ct. Oct. 10, 2017); Archie v. Pop Warner Little Scholars, Inc., No. CV16-6603 PSG PLAX, 2017 WL 3084160 (C.D. Cal. May 12, 2017).