On March 1, a federal judge in New York issued a split decision in a class action lawsuit brought by three Black coaches against the National Football League and certain clubs, alleging a pattern and practice of race discrimination. At issue was the NFL’s motion to compel arbitration.

According to the decision by Judge Valerie Caproni of the Southern District of New York, some claims in the lawsuit will be arbitrated, and others will be tried in federal court. That should be interesting.

In a July post on this issue, I said that the court was likely to determine that the arbitration provisions in the coaches’ contracts covered claims against the coaches' employer clubs but not claims against the other clubs that were named as defendants. That is essentially the way Judge Caproni ruled.

Background 

Brian Flores was initially hired as the defensive coordinator of the Minnesota Vikings, but he initiated this lawsuit based on his termination in January 2022 as head coach of the Miami Dolphins and his unsuccessful candidacy for head coach positions with the Denver Broncos, the New York Giants, and the Houston Texans during the 2022 offseason. 

Steve Wilks is now defensive coordinator for the San Francisco 49ers. His claims stem from his termination in 2019 after one year as head coach for the Arizona Cardinals. 

Ray Horton is a coach in the U.S. Football League but has alleged that he was discriminated against when he interviewed in 2016 for the head coach position for the Tennessee Titans. 

The Dolphins, Giants, Texans, Broncos, Cardinals, and Titans are named defendants along with the NFL.

The court's decision

Judge Caproni determined that the coaches’ claims related to their respective employment with the Dolphins, Cardinals, and Titans must be arbitrated pursuant to the arbitration provisions in the coaches’ contracts with those clubs. She also ruled that the arbitration agreements cover the coaches’ claims against the NFL. The plaintiffs had alleged that the NFL was a joint employer with the clubs for purposes of their race discrimination claims. Thus, because “Plaintiffs treat the NFL and its member teams ‘as a single unit[,]’ they cannot now claim that the two entities are distinct in order to avoid arbitration.” 

On the other hand, Judge Caproni ruled that the arbitration provisions do not cover the claims against the Broncos, Giants, and Texans because the coaches had no contracts with them. Here, the NFL seems to have made a significant and avoidable error. After filing the lawsuit, Mr. Flores was hired by the Pittsburgh Steelers as a senior defensive assistant and linebackers coach. The NFL alleged that the arbitration provision in Mr. Flores’ contract with the Steelers retroactively covered any claims against the Broncos, Giants, and Texans. The basis for this claim was Mr. Flores’ commitment in that agreement to abide by the NFL Constitution, which the NFL contends requires arbitration of any employment-related disputes. However, as noted by the court, “[t]he Flores-Steelers Agreement required the approval of the NFL Commissioner before it became effective.” Because NFL Commissioner Roger Goodell never signed the contract, even after the court raised this issue, it is not a binding agreement. As a result, Mr. Flores can pursue his claims against the Broncos, Giants, and Texans in federal court. Judge Caproni also said that claims against the NFL that relate to the claims against those clubs should be heard in federal court. 

It seems likely that there will be a dispute about the extent to which certain issues concerning the NFL should be in the arbitration proceeding or in federal court. The facts will certainly overlap, but bifurcating potential legal liability will be complex. This is particularly true given that the lawsuit includes class claims.

Will Goodell be arbitrator for claims against the NFL and NFL clubs? Probably not.

The court’s decision to compel arbitration on some claims is particularly meaningful given that the court rejected the coaches’ challenge to having NFL Commissioner Roger Goodell be the arbitrator. On this issue, the court relied on a decision by the U.S. Court of Appeals for the Second Circuit that rejected the same contention made by Tom Brady and the NFL Players Association in litigation over the Deflategate controversy. The courts generally agree that the parties are bound by the bargain they made. Judge Caproni was also unmoved by other court decisions that have declined to enforce arbitration agreements when the commissioner of the sports league is appointed as the arbitrator. In those cases -- including the ongoing lawsuit against the NFL brought by former Las Vegas Raiders coach Jon Gruden, which I've written about here and here -- the concern is that the commissioner will be biased in favor of the league or the clubs. Acknowledging the Gruden decision, to which Nevada state law applied, Judge Caproni called it "interesting but not controlling."

On the whole, the court’s decision is a win for the NFL. The bulk of the claims must be arbitrated in a proceeding presided over by Commissioner Goodell. 

Assuming the plaintiffs do pursue arbitration, it will be interesting to see how Mr. Goodell serves as arbitrator. Because he is not an attorney, he usually takes one of four routes: (1) he serves as arbitrator with the assistance of counsel; (2) he designates internal NFL counsel to preside over the matter (generally General Counsel Jeff Pash); (3) he designates an outside attorney who formerly worked for the NFL or one of its clubs to be arbitrator (Harold Henderson and Bob Wallace, for example); or (4) in high-profile matters where judicial scrutiny is likely, he designates a respected arbitrator to serve, usually a former federal judge.

In this case, it is hard to imagine that Mr. Goodell will let the case get too far out of his grasp. Although prior cases concerning player discipline were controversial and important, they did not concern the type of systemically wrongful conduct alleged in this case. From a public relations and legal perspective, the allegations in the Flores case seem about as bad as they can be for the NFL. Mr. Goodell is believed to be nearing the end of his tenure as Commissioner and will certainly not want to leave with a finding of systemic race discrimination as the capstone to what has otherwise generally been a successful (but often controversial) 17-year run.

Nevertheless, it seems unlikely that Mr. Goodell or General Counsel Pash will serve as the arbitrator in this case. Both are likely to be witnesses, which should preclude them from presiding over the matter. Moreover, the case clearly requires a hearing officer with experience or expertise in employment law. Nor should the arbitrator be an attorney who has advised the NFL on discrimination issues in the past. The most likely choice would be a labor and employment attorney from a prominent firm that has NFL ties but whose work on behalf of the NFL concerns other areas of law.

The coaches are likely to appeal Judge Caproni's decision, given the uphill battle they now face in arbitration. But they also face an uphill battle at the Second Circuit, where the NFL has generally been successful. I will continue to follow this case and will provide updates as developments occur.