NFL Owners Facing Some Major Problems

With billions in television fees in jeopardy and a $1.32 billion antitrust case about to go to trial, the uncertain economic and legal future of the National Football League will be the topic of major concern Monday when the league calls to order its annual meeting.

The league owners, general managers and coaches will also be discussing subjects ranging from last year’s Jim McMahon headband controversy to a growing concern over the need for tougher drug testing policies.

On Monday, the NFL owners will be briefed on the latest developments in the United States Football League-NFL antitrust case scheduled to go to trial in New York federal court this spring.

The USFL contends in its suit that NFL has attempted to monopolized the lucrative television market for fall professional football. Currently, the NFL has a five-year, $2.1 billion contract with the three major networks running through next season.

ABC did televise a schedule of USFL games played on Sundays in the spring and summer in the league’s first two years of existence. It paid the league $18 million for the first two years and picked up its option for the third season. But in the third year, ratings dwindled and the network balked at paying the $15 million the contract called for. The league sued and the parties are still in litigation.

When the USFL announced its switch to the fall, each of the three networks declined to pick up the broadcasts.

The USFL maintains that it has been unable to get a satisfactory national television contract for its fall schedule “as a result of the (NFL’s) unlawful influence on, and express or implied threats (to impair their NFL coverage) to the three television networks.”

League spokesman Joe Browne said the case will not go to trial as originally scheduled on March 18.

“Our best assessment right now is that the trial will begin sometime this spring,” he said. “Both sides agreed to the March 18th trial date, but since at that time both sides felt all the discovery and dispositions in the case would be completed by Oct. 31. We are still taking dispositions.”

The owners will also be briefed on two other antitrust matters.

The first is a suit filed Feb. 11 in New York federal court against the league by St. Louis Cardinals owner Bill Bidwell challenging the NFL’s right to control franchise movements. The same principle was challenged successfully by Al Davis and the Los Angeles Raiders three years ago.

If Bidwell’s suit is successful, the entire infrastructure of the league could be thrown in doubt. When a San Francisco federal appeals court ruled in Davis’s favor in his antitrust suit, Judge Spencer Williams said the case could bring an end to the NFL.

“Holding that the NFL is not a single entity but rather an aggregation of economic competitors is tantamount to ruling that the NFL structure itself is invalid under the Sherman Act,” the judge wrote. “This will spell the end of sporting leagues as they are currently used in football, hockey, golf, soccer and basketball.”

The U.S. Supreme Court refused to hear the NFL’s appeal of the Raiders decision. The damage portion of the case, more than $70 million, is under review by the federal appeals court in San Francisco.

Another case likely to get some mention during the session is a suit currently under way in Minneapolis in which Minnesota Vikings President Max Winter’s right to sell his third interest in the team to a consortium of Irwin Jacobs, Minnesota Twins owner Carl Pohlad and Fran Tarkenton is being challenged by the club’s two other owners.

The league’s lucrative fees for television rights, long the economic heart and soul of the NFL, are also in some jeopardy.

Last year, the league’s television ratings were up about 20% over 1984. However, according Jerome H. Dominus, vice president for sales CBS, more than $75 million in ads were pulled from NFL broadcasts on the three networks.

NFL Commissioner Pete Rozelle recently said the league has considered looking at alternatives to network coverage, possibly the emerging lucrative pay-per-view cable market.

With the legal issues aside, the league owners will turn their attentions toward a number of proposals by the NFL’s Competition Committee, headed by Dallas General Manager Tex Schram.

The major issues expected to be presented for the owners’ considerations will be the use of instant replays, the 45-man roster and how to deal with the problem of crowd noise in domed stadiums.