Deflated Discipline: Breaking Down Tom Brady’s Win and What It Means

On September 3, 2015, Judge Richard Berman vacated Tom Brady’s suspension from the NFL for his “awareness” or other involvement in Deflategate.[1]  Berman’s decision is significant not just for Tom Brady and the Patriots, but for all NFL players and teams because it provides a clear-eyed look at the NFL’s disciplinary process.

What Happened to Settling?

From the outset of this case, Judge Berman encouraged both sides to settle, indicating his clear preference that the parties work out their differences without his involvement.  This was already a longshot from the beginning, both because of the long history of disputes between the NFL and NFLPA and because informal discussions had reportedly been ongoing without any progress before the parties ever reached Berman’s courtroom.

The biggest issue preventing a settlement in this case was the opposing goals of each side.  Brady was unwilling to admit culpability.  The NFL was unwilling to admit it was wrong.  Anything less than Brady admitting guilt would have implicitly meant the NFL admitting to botching its investigation and disciplinary process.  Brady believed his reputation was on the line (especially after testifying under oath that he did nothing wrong), and though he was likely willing to accept some blame for failing to cooperate, he would not admit guilt, preventing the NFL from saving face.  Both sides believed that there was a better alternative to settling, which was to receive a favorable ruling from Berman.  It turns out Brady was right in that belief.

Judge Berman’s Decision

Judge Berman’s decision vacated Goodell’s ruling, which had upheld Brady’s suspension.  Generally, his decision confirmed what I, and many other sports law commentators, had thought after oral arguments.  At oral arguments, Berman seemed very supportive of NFLPA attorney Jeffrey Kessler’s arguments, and highly critical of NFL attorney Dan Nash’s arguments.  As I noted when I reviewed the oral arguments, Judge Berman’s questioning was not merely a chance to play devil’s advocate.  He truly had concerns about the NFL’s process.

Although this was not a home run victory for Brady (in the sense that he did not win outright all the arguments his legal team made), it was still an unqualified success.  All of the issues Berman ruled on went in favor of Brady.  He declined to rule on certain issues, but did not rule for the NFL on any issues at all.  Berman consistently referred to the Deflategate investigation as the “Pash/Wells Investigation” which is exactly what Kessler called it in his briefs, and Berman took repeated shots at the independence of the investigation, putting “independent” in scare quotes.

The NFLPA hammered home the point in its statement, which read, “The rights of Tom Brady and of all NFL players under the collective bargaining agreement were affirmed today by a Federal Judge in a court of the NFL’s choosing.”

Berman held that although judicial scrutiny of arbitration awards is limited, deference to an arbitrator does not extend to awards reached without fairness or due process.  In fact, he found that Brady’s suspension was premised on “significant legal deficiencies.”  Berman broke his decision down into three parts which dealt with two main arguments: that Brady did not have proper notice of his punishment and that the arbitration hearing before Goodell was fundamentally unfair.

Proper Notice

In what might have been his strongest and most detailed argument, Kessler relied on the Adrian Peterson case, arguing that “the CBA affords players advance notice of discipline, and arbitrators are not free to disregard that essence-of-the-CBA requirement.”  Kessler argued that Brady did not have proper notice of the punishment he received.

Relying on the Reggie Langhorne case, Berman determined that “it is the ‘law of the shop’ to provide professional football players with advance notice of prohibited conduct and potential discipline.”  “Law of the shop” is a labor law term for particular historical precedent based on the CBA.  Berman held that an “arbitrator is not free to merely dispense his own brand of industrial justice.”  The arbitrator must apply the CBA in accordance with the law of the shop.  Berman also quoted from arbitrator Michael Beck in the Ricky Browne case, who observed that “adequate notice is the fundamental concept in discipline cases.”

Berman found that Brady had no notice he could receive a four-game suspension for “general awareness” of ball deflation by others, or participation in any scheme to deflate footballs, or for non-cooperation with the investigation.  Berman found that the steroid policy was unique and was not a good comparison for Goodell to rely on when punishing Brady.  Moreover, Berman stated that no player found to have general awareness of inappropriate deflation could reasonably be on notice of steroid-like discipline.  He also noted that the NFL had never punished a player for being generally aware of another person’s violation of league policy.

One issue that concerned Berman was how Goodell’s ruling significantly expanded the conclusions of the Wells Report, the supposed basis for Brady’s discipline.  The Wells Report concluded that Brady was “generally aware,” yet Goodell ruled that Brady “participated in a scheme.”  On this issue, Berman relied on Second Circuit precedent in explaining that when the arbitrator bases his award on some outside thought, feeling, or policy, he fails to draw the award from the essence of the CBA.  This was part of the dispute between the NFL and NFLPA in their post-hearing letters.  The NFL argued Kessler’s cases were inapplicable because they only supported vacating awards when the arbitrator ignored the essence of the CBA.  Kessler responded by saying that was Brady’s argument all along – that Goodell ignored the essence of the CBA because he used some outside thought or feeling to move from “general awareness” to “participation in a scheme.”

A significant issue in the notice discussion, and the one the NFL is likely most concerned about is the question of Goodell’s punishment of Brady using his “conduct detrimental” power.  Article 46 of the NFL CBA grants Goodell the power to punish players for conduct detrimental to the league.  Berman found that Goodell’s reliance on his broad “conduct detrimental” power rather than the specific player policies regarding equipment violations was “legally misplaced.”

As he put it, applicable specific provisions in player policies are better calculated to provide notice to a player than a general concept such as conduct detrimental.  This correctly limits the application of Goodell’s broad Article 46 powers.  When courts interpret statutes or contracts, specific provisions govern over general ones.  For example, the use of steroids could be considered conduct detrimental to the league, but because the steroid policy already exists with specific punishments, Goodell must use that policy to punish PED users, rather than his Article 46 powers.

On the notice argument, Berman concluded, “Because there was no notice of a four-game suspension in the circumstances presented here, Commissioner Goodell may be said to have dispensed his own brand of industrial justice.”

Fundamental Fairness

I’ve discussed this issue at length before, so I won’t go much into depth on it here.  Essentially, Kessler’s argument was that Brady did not get a fundamentally fair hearing before Goodell because he was prevented from examining documents and an important witness (Wells Report co-author Jeff Pash) at the hearing.  Berman seemed to favor this argument the most at oral arguments.  He also relied on both cases I mentioned in my previous piece – Tempo Shain and Home Indemnity.  This matters because they are cases directly on point for this issue in this precise jurisdiction.  The Tempo Shain case is especially persuasive because it was a Second Circuit decision.

Pash’s testimony was directly relevant to Brady’s ability to defend himself because Pash apparently had significant involvement in the process of the Wells Report.  As I mentioned above, Berman insisted on calling it the “Pash/Wells investigation.”  Whatever Goodell may have thought of Pash’s testimony, he needed to provide a reasonable justification why he believed Pash’s testimony to be cumulative.  Wells himself appeared to have no idea of the extent of Pash’s role in crafting the report.  Berman determined that Kessler’s inability to question Pash denied Brady pertinent and material evidence in his attempt to undermine the basis for his discipline.

Berman also found that Goodell unfairly denied Brady access to interview notes involved in the investigation.  He noted that the “independent” investigators of the Paul, Weiss firm (whose investigations led to the Wells Report) shifted roles to become the NFL’s retained counsel at the arbitration hearing, affording the NFL an advantage that Brady did not receive – access to the investigation notes.  Wells even defended his independence after the report was released, but despite his independence, somehow the NFL wound up with access to the investigation notes but the NFLPA did not.  Berman found that the exclusion of the notes “compound[ed] Brady’s prejudice.”

Evident Partiality

Kessler also argued that Goodell’s direct involvement in the arbitration – for example, delegating his authority to Troy Vincent and declaring the Wells Report independent – rendered him objectively partial, requiring him to judge his own conduct.  His argument was also that Goodell’s decision evidenced a clearly biased agenda, rather than an objectively fair decision.

Judge Berman found that because he had already ruled in favor of Brady on the fairness and notice issues, there was no need to reach the issue of evident partiality.  This does not mean anything in particular for Brady or the NFL, but it leaves open the possibility that Berman could decide this issue if the cases is remanded to him after a reversal by the Second Circuit.

What’s Next for Brady’s Case?

The NFL has already filed its notice of appeal to the U.S. Court of Appeals for the Second Circuit, doing so on the same day as Berman’s decision.  It’s a short trip to the Second Circuit for the appeal record – the buildings are right next to each other.  The Second Circuit will assign a panel of three judges to hear the appeal.  The panel will most likely be composed of any three of the twenty-three judges (appointed by six different presidents) on the Second Circuit.[2]

It appears that the NFL will not seek a stay of Judge Berman’s decision.  Stays are extraordinary forms of relief, and the big hurdle the league would have had to jump over is showing that it would suffer irreparable harm if Brady plays while awaiting the appeal, which would have been hard to demonstrate.  The NFL could request an expedited review from the Second Circuit, which might take only a few months.  However, it appears they have no plans to seek an expedited review so far.

Without being expedited, the appeal would easily last into 2016.  Should Brady lose his appeal, he could have to serve his suspension at a later date – perhaps in the 2016-2017 NFL season.  Second Circuit appeals tend to last around eight to twelve months.  The process of the appeal is lengthy because of what it involves.  The NFL will file its initial appellate brief. Then the NFLPA will respond. Then the NFL will get to reply to that.  Then there will be oral arguments.  Finally, the court has to make and write its decision.  So the appeal will certainly go into 2016.

After the appeal, the losing party could request a rehearing en banc, which, if granted, would assemble a panel composed of all thirteen active judges to hear the case.  It is unlikely that an en banc rehearing would be granted in this case (these occur in less than one percent of cases – more specifically, around two-tenths of one percent – and the Second Circuit considers fewer cases en banc than other circuits).  It requires a majority of the court’s active judges to determine whether it is heard.  Rehearing is rare due to deference to the circuit panel’s decisions and is only done in rare and exceptional circumstances.[3]

It’s impossible to know how the Second Circuit might decide.  Generally in arbitration cases, appellate courts affirm decisions by district judges (with a rate of reversal of less than ten percent in civil cases), but this is a special and unusual case different from other facts that Second Circuit judges have seen before.  The review of Berman’s decision will be de novo, which means that the Second Circuit will not treat Berman’s decision with any deference.  The situation is also complicated by the uncertainty of which judges will be on the panel.  Some of the judges could be labor-friendly, while others could be supportive of management.

The NFL is now the underdog on appeal, having lost the first round with Judge Berman.  The league must convince a majority of the Second Circuit panel that Berman was wrong.  In the end the NFL is unlikely to be successful for several reasons.  There is a chance that Berman could be reversed based on his explanation of the “law of the shop,” which is generally the province of the arbitrator to apply.  However, some minimal form of notice is required by law, even without reference to the law of the shop.  Berman ruled for Brady on every conceivable point on the notice issue.  All the Second Circuit has to do on the notice issue is find one point of Berman’s with which they agree.

But even if the Second Circuit were to reverse Berman on notice, they will probably not reverse him on the fairness issue.  Berman’s ruling on fairness (related to the exclusion of Pash’s testimony and the interview notes) was specifically based on Second Circuit precedent directly comparable to Brady’s case.  That part of the decision is on fairly solid footing.

Although some speculated that the owners would pressure Goodell to give up the appeal now that Berman has ruled for Brady, this case significantly impacts Goodell’s powers as commissioner, and failing to appeal would provide players with a roadmap to challenge future disciplinary decisions, by litigating their way to reduced or vacated punishments.

Still, the NFL should be seriously concerned about the outcome of this appeal.  The league risks the Second Circuit affirming Berman and creating strong precedent for the NFLPA in the future, limiting Goodell’s conduct detrimental power.  Even if the Second Circuit reverses Berman’s decision, the NFL would not be out of the woods yet.  In remanding the case back to Berman, it could enable Berman to take up the issues he decided not to address because he had already ruled on notice and fairness.  Berman could determine that Goodell was evidently partial, setting up a second arbitration hearing and even more litigation over that decision.

What Does It All Mean?

We are now entering four years of labor strife between the NFL and NFLPA, much of it focused on the power of the commissioner.  As Andrew Sensi has outlined, four straight disciplinary decisions by the NFL leading up to Deflategate had been overturned or reduced on appeal: former NFL commissioner Paul Tagliabue vacated all player discipline in Bountygate, arbitrator Barbara Jones vacated the indefinite suspension of Ray Rice, Judge David Doty vacated Adrian Peterson’s suspension, and arbitrator Harold Henderson reduced Greg Hardy’s suspension.  Judge Doty is currently considering the NFLPA’s motion to hold the NFL and Roger Goodell in contempt of court.

In that context, we can better understand this decision by Judge Berman.  It’s not only a loss for the NFL, it’s the capstone on a series of losses rebuking the NFL and Goodell himself for abusing his powers under the CBA.  The NFLPA can now claim five consecutive victories in major commissioner disciplinary appeals.  In fact, the timeline of Deflategate is a reminder of how the league might have done things differently each step of the way.  The NFL’s decision to file suit in New York was designed to avoid the player-friendly jurisdiction in Minnesota that Brady wanted, with the expectation that New York would be a friendlier jurisdiction to the league.  It has now become a classic case of “be careful what you wish for.”

It’s important to remember that this decision does not change the NFL’s disciplinary process.  Berman criticized mistakes the NFL made during its process, but he did not rule on the NFL’s actual disciplinary structure, and nothing he said forces the NFL to change that structure.

Although there has been much discussion that this will finally force the NFL to change its policies, there is no evidence that Deflategate will be the straw that breaks the camel’s back.  Remember that during the last CBA, Goodell shifted NFL disciplinary precedent to punish players without waiting for the legal process to work its course as former commissioner Paul Tagliabue did.  That change in discipline sparked outcries from players and the NFLPA which then sought to limit Goodell’s power.  Judging by the results of the most recent CBA negotiations, they were not as successful as they hoped.  Some owners have suggested re-thinking the disciplinary process, but that has also happened before.  Owners in the Rice and Bountygate cases were both unhappy with how league discipline was handed down, but nothing changed.

You can certainly count on the NFLPA to attempt to limit commissioner power much further in the next CBA negotiations in 2020, but it seems unlikely that Goodell will either willingly concede power or that the owners will finally reach a consensus to alter the disciplinary process.

In the end, Berman’s decision was a rebuke to the NFL and to Roger Goodell specifically.  While his powers may be broad, they are not that broad.  Players still deserve a minimum threshold of due process.  For now at least, Brady can be satisfied that Judge Berman vindicated his decision to defend himself.  The NFL and Roger Goodell, on the other hand, need to take a long look at the league’s disciplinary process – investigations, punishments, appeals, hearings, and evidence admissions – before they suffer another stinging loss like the one Berman delivered.

[1] You can read Judge Berman’s full decision, as well as all the other Deflategate Legal Filings, here.

[2] The court could appoint a single federal district judge to the panel in addition to two Second Circuit judges, but that is much less likely than receiving a full panel of appellate judges.

[3][3] My thanks to Dan Wallach for providing significant assistance in researching Second Circuit statistics, including this helpful post.