Written By Satvik Ramakrishna
Kevin Durant, Stephen Curry, Kyrie Irving, Kobe Bryant and Lebron James. Now imagine a world where the biggest names in basketball did not play the game we all know and love. This is what took place in 2011 when a lockout halted league proceedings, namely, preseason, training camps as well as the regular season games for 5 months (161 days). It was the fourth and most recent lockout and was preceded by the lockout in 1998-1999 lockout which lasted for 6 months.
What is a Lockout
In professional sports, a lockout refers to the ceasing of operations within a professional sports league initiated by the owners of various clubs and franchises in the sport. It serves as a tactic used by owners to exert pressure on workers during negotiations or to get the other side to give in at the bargaining table. This usually occurs when there is a failure to reach a collective bargaining agreement between the league's management and the player union. During a lockout, team facilities are closed, and all team-related activities are halted, leading to the potential cancellation of games, loss of player paychecks, and dissatisfaction among fans.
From a legal lens, a lockout can be termed to be any deliberate withholding of employment of employees by an employer, either to resist their demands or to gain concessions from them. Employers have the authority to prevent employees from working and thereby they withhold their payment.
However, it's important to note that a lockout is deemed unlawful if its primary aim is to discourage union membership or infringe upon employees' organizational rights. Lockouts can occur both before and after a bargaining Mexican-standoff has been reached.
Some notable instances of lockouts include the Major League Baseball strikes of 1972, 1981, and 1994–95, NFL strikes of 1982 and 1987, NHL lockouts of 1994–95, 2004–05, and the MLB lockouts of 2021. The lockout the National Basketball Association went through in 2011 is the case study which will be examined in detail.
What resulted in the 2011 lockout
On account of the lockout’s predecessor, following the shortened 1998–99 season, a six-year agreement was reached between NBA owners led by Commissioner David Stern and the players, led by National Basketball Players Association (NBPA) Director Billy Hunter and President Patrick Ewing. About three decades after the initial negotiation of the first salary cap between the NBA and its union, the economic landscape of basketball has been more precarious compared to baseball and football. Presently, basketball generates approximately $4 billion in revenue annually, while football boasts $9 billion and baseball surpasses $7 billion in revenue. This revenue contrast, along with losses experienced by less successful and small-market teams, set the stage for the 2011 basketball negotiations.
Economic disparity among teams, which has contributed to relatively poor competitive balance in basketball was another factor for the same. The NBA's presence in smaller markets, such as Portland, Sacramento, and San Antonio, has added to the league's economic challenges. Race also played a role in the backdrop of the 2011 basketball negotiations. Given that a majority of NBA players are Black while a significant portion of the affluent fan base is White, players often find themselves at a disadvantage in labour disputes. This dynamic led a union lawyer and a television personality to compare the NBA commissioner to a plantation owner.
Derek Fisher succeeded Ewing as NBPA president and in early 2011, negotiations for a new Collective Bargaining Agreement began, with the league claiming annual losses of $300 million and proposing significant reductions in player salaries and the introduction of a hard salary cap. The union disputed these figures and opposed such changes, leading to tensions.
The deadline of June 30, 2011, popularly referred to as D-Day, approached with the owners proposing a "flex cap" system and the players offering a reduction in their share of Basketball Related Income (BRI). However, neither side could reach an agreement on the key issues. The negotiations thus failed, and the CBA expired at midnight, leading to the NBA lockout.
161 days without professional basketball
The major legal framework for the 2011 basketball negotiations was the Supreme Court’s 1996 ruling in Brown v. Pro Football, Inc. which established players' limited ability to pursue antitrust lawsuits. This decision, despite a strong dissent from Justice Stevens, limited the application of antitrust law to actions restraining player mobility under the non-statutory labour exemption, except in cases where collective bargaining was unlikely to resolve disputes or the union was effectively defunct. In the context of basketball, the implementation of a lockout underscored that despite the existence of numerous guaranteed individual contracts between players and owners, the prevailing policy in other industries would prevail—meaning players would not receive pay due to the superiority of the collective bargaining process under Labour Law. The owners opted for the lockout strategy because in the event of a strike, players who chose to cross the union picket line could still play and potentially file antitrust lawsuits simultaneously.
On the other hand, a lockout exerted more pressure on the players to reach a settlement, as it directly impacted their ability to earn income by playing their respective sport.
The NBA lockout officially began on July 1, 2011, initiated by the owners, leading to restrictions on player-team interactions and access to facilities. Negotiations resumed on August 1 but quickly broke down. On August 2, the NBA filed unfair labour practice claims against the NBPA, alleging uncooperative behavior in negotiations. Union president Derek Fisher expressed the belief that the entire 2011–12 season might be canceled. Negotiations resumed on August 31 with urgency, but no specifics were disclosed. However, both sides expressed a desire to reach an agreement. Further negotiations on September 13 collapsed primarily due to disagreement over the salary cap structure, with owners pushing for a hard cap and players advocating for maintaining the current structure.
Prominent sports agents discussed decertification of the union in order for the players to gain leverage. Fisher urged unity among players and countered agents' suggestions of disbanding the union in an email to over 400 players on September 15. There were reported disagreements among owners regarding the players' proposal and willingness to compromise. NBA Commissioner David Stern denied the existence of a rift among owners. The NBA lockout led to the cancellation of training camps and preseason games in September 2011, marking only the second time in league history that games had been lost due to a labour stoppage. Negotiations between owners and players continued, with disagreements over revenue split and salary cap structure. Attempts to salvage the season failed, resulting in the cancellation of the first two weeks of regular-season games in October. Despite efforts to reach a compromise, including federal mediation, the sides remained divided on key issues. Reports of internal conflicts among players and owners surfaced, further complicating negotiations. As talks stalled, the NBA announced the cancellation of all games through December 15.
After rejecting the owners' offer on November 9, the players' union dissolved, allowing individual players to file antitrust lawsuits against the NBA. Two separate lawsuits were filed by groups of players in California and Minnesota federal courts. The lawsuits alleged that the lockout constituted an illegal group boycott. On November 23, negotiations resumed, leading to a tentative agreement on November 26, 2011 to end the lockout. The NBPA re-formed as a union on December 1, 2011, and on December 8, 2011, the new CBA was ratified. This gave way for the start of the NBA season with its opening day coinciding with Christmas for the very first time on December 25, 2011.
Impact
During the NBA lockout, both team owners and players faced significant financial losses, totaling around $400 million due to a reduced season schedule and canceled preseason games. Players felt the impact immediately, with an average loss of $220,000 after missing their first paycheck. To mitigate some of this loss, the NBA provided each player with $100,000 to compensate for salaries falling below the agreed-upon 57% Basketball Related Income (BRI) level from the previous season.
Facing uncertainty about the duration of the lockout, many NBA players explored alternative options to continue playing basketball. More than 90 players opted to sign with foreign teams, seeking opportunities overseas. While some, like Deron Williams, secured lucrative contracts, most faced comparatively modest salaries, with earnings potentially ranging from $50,000 to $75,000 per month, significantly less than their NBA counterparts. Additionally, players remained stateside, engaging in various exhibitions and tournaments such as the Drew League, the Melo League, and the Goodman League, showcasing their talents in front of fans eager for basketball entertainment. These exhibitions became more prominent during the lockout, offering players a platform to stay active and connected with fans while negotiations between the league and the players' union continued.
Recognizing the need for continued training and preparation in case the lockout ended, players also organized workouts and training sessions across different cities. The National Basketball Players Association (NBPA) even established workout centers in key locations like Las Vegas, Los Angeles, Houston, and Miami, providing players with facilities to maintain their fitness and skills during the hiatus. The lockout's impact extended beyond the players themselves, affecting various stakeholders such as arena workers who relied on NBA games for income. With games canceled, many faced financial hardships, unable to recover lost wages from the canceled events. In this climate of uncertainty, the NBA's lockout prompted players to explore diverse avenues to stay connected with the sport, maintain their skills, and navigate the financial challenges posed by the prolonged labour dispute.
It is rational to gather that the lockout served as a bane for not only players and the organizations, but also fans of basketball around the globe who missed out on watching their favourite stars in action. For the good of basketball as a whole we can only hope that the players and the owners are able to work out their negotiations in peace without impacting the conduct of games and that there will be no such lockout in the near future.
*The Author is a legal Scholar from India
(The Image used here is for representative purposes only)
References:
Feldman, G. A. (2011, August 21). The Legal Issues Behind the Looming NBA Lockout. HuffPost. https://www.huffpost.com/entry/the-legal-issues-behind-t_b_881409.
Gould IV, William B. "The 2011 Basketball Lockout: The Union Lives to Fight Another Day—Just Barely." Stanford Law Review, vol. 64, January 2012. https://www.stanfordlawreview.org/online/the-2011-basketball-lockout/#:~:text=The%20lockout%20substantially%20disadvantaged%20the,the%20threat%20of%20antitrust%20litigation.
Brown v. Pro Football, Inc., 518 U.S. 231 (1996).
"NBA Lockout and Lawsuits." Lawyer 2 Lawyer, Legal Talk Network, August 4, 2011. https://legaltalknetwork.com/podcasts/lawyer-2-lawyer/2011/08/nba-lockout-and-lawsuits/
Parlow, Matthew, and Marquette University Law School. "Lessons from the NBA Lockout: Union Democracy, Public Support, and the Folly of the National Basketball Players Association." Oklahoma Law Review 67, no. 1 (2014). https://digitalcommons.law.ou.edu/olr/vol67/iss1/1/