Lloyd Howell’s first significant move as the executive director of the NFL Players Association (NFLPA) has backfired spectacularly, resulting in a hefty financial blow. The contentious issue at hand involves a staggering $7 million that the NFLPA has been ordered to pay Panini as a consequence of an arbitration ruling over the termination of their exclusive trading card contract from the previous year.
The dispute unfolded when the NFLPA decided to sever ties with Panini after a series of key employees at Panini departed for rival company Fanatics. The NFLPA cited a “change in control” clause to justify their contract termination. However, Panini quickly countered, alleging that this termination was a thinly veiled excuse to shift their alliance to Fanatics. Subsequently, the arbitrators sided with Panini.
In response to the verdict, Panini’s attorney, David Boies, articulated, “The unanimous decision of the arbitrators confirms what we have said from the beginning: The NFLPA’s termination of its contract with Panini violated its legal obligation to Panini, its moral obligation to fans and collectors, and its fiduciary duties to its members.” He further elaborated, “The PA’s actions cost its members millions of dollars in damages and lost royalties. The damages would have been many times greater except for Panini’s commitment to protecting fans and collectors, and the players themselves, by continuing to supply cards despite the PA’s purported termination.”
While Fanatics was not directly implicated in the arbitration proceeding, Panini has taken legal action separately with an antitrust and tortious interference lawsuit against them. Notably, the NFLPA has yet to provide any commentary in response to inquiries from Puck.news, leaving many to ponder their stance on the situation.
This consequential arbitration outcome not only has severe financial implications for the NFLPA but also casts a shadow over their decision-making protocols and their commitments to their members, supporters, and the wider trading card community. The ramifications of this dispute are likely to reverberate throughout the industry and may prompt a reassessment of business practices and partnerships within the professional sports realm.