Stadiums may be Dryer Places Soon

Both professional and collegiate sports and arena operators may need to revisit their policies on the sale of alcohol at their stadiums following a landmark ruling from a New Jersey jury last week. In a case brought Aramark, the concessionaire at Giants Stadium, a New Jersey jury awarded the family of a seven year old girl pemanently paralyzed in an automobile accident caused by a drunken driver following a Giants game $135 million dollars in damages.

The jury awarded $60 million in compensatory damages divided equally between Aramark and David Lanzaro the drunk driver and $75 million in punitive damages against Aramark. The driver is serving 5 years in jail on a vehicular assault charge.

While the NFL has a policy of not selling beer after the 3rd Quarter, the Giants supposedly cut off sales the start of the 3rd Quarter. In addition, the Giants supposedly prohibit selling a person more than two beers at a time; however Lanzaro tipped the beer seller $10 and bought six beers at once. Aramark intends to appeal the jury's decision.

The impact of this decision will be felt in stadia and arenas across the country, even if it is overturned on appeal. I think we will see much tighter controls on beer sales and earlier closing times. Concessionaires and teams will be held responsible for the sale of beer and other alcoholic drinks to obviously drink patrons so tighter control on vendors will be needed. This will add to the growing movement in the NCAA to eliminate the sale of alcohol at collegiate games as is already the case at a number of campuses across the country. In fact, I believe it is a rule of some conferences, including I believe the SEC, to prohibit alcohol sales. We may even start to see searches of bags and coats for alcohol being brought into the stadium by fans in a further effort to control behavior and minimize the club or school's risk.

Tidbits

I was perusing the attendance figures for the American Hockey League through last week's games and it is not good news for the NHL. You would think that with no NHL games being played, that fans would be turning out in higher numbers for the highest level professional hockey in North America. You would be wrong. AHL attendance is up only 1.6% and most of that is due to the 83% boost in Edmonton after the team moved there from Toronto.

Another note on the C-USA television contract I mentioned earlier. According to Sports Business Journal, since CSTV is paying the bulk of the freight in the deal, none of the ESPN portion of the games will be carried on the new ESPNU network, which will be a direct competitor of CSTV. Apparently Fox is also about to start a collegiate sports network as there was a mention of that in the same article. Sorry, I don't have the online link to the article for you, but the link to the home page is on the right.

Lamar Hunt may be selling the Kansas City Wizards to a group of investors in Kansas City who will not only keep the MLS team in Kansas City but try to get a soccer specific stadium built. There are two local groups interested who meet his minimum qualifications of $25 million in financial capability. Other cities are interested but he would like to keep the team in KC if possible, as would the league. A soccer specific stadium will be a must for the team to remain in town I think. Arrowhead is just to big and the rent too high for the team to make money playing there.

Now They're Really Stretching Things

The eternal search for the next great soccer player has taken an unusually young twust among European clubs. It seems that some of the greatest European professional soccer clubs, including famed Manchester United, are now looking at the possibility of signing - are you ready - a Nine-year-old Brazilian youngster!!! Who knows what's next, toddlers?

Congrats Fulmer

Congratulations are in order to Phil Fulmer who is now in line to become the third highest paid football coach in NCAA Division I. With Michigan's upcoming renovation of the Big House removing 4,000 seats, Neyland Stadium will once again become the largest stadium in the country. You can put two and two together and the pressure to win and keep the stands full of orange clad faithful will only grow with his new contract, if that is even possible in Knoxville. Good luck Phil.

UEFA Turns Protectionist

The English Premier League is the world's best collection of soccer players not curretn playing for Real Madrid. In a story reported in the fine blogThe Sports Economist, it appears that UEFA. The sports governing authority in Europe is taking steps to end that status. The proposal now before UEFA would limit any team qualifying for European competition to 25 players on the first team, four of whom in the 2007 must be home grown and two having been trained between by the club between the ages 15-21. In 2008, the number increases to six (3 and 3) and in 2009 to eight, (4 and 4).

The Premier League is, predictably, against the proposal as I would imagine will be the clubs in the Spanish La Liga, both of whom rely heavily on imported players. Nevertheless, there are many more leagues than these two or the other top leagues in France, Germany and Italy, so the fate of the proposal is unclear at this point. I would not be at all surprised to see it pass.

Protectionism is not a healthy step for a global sport such as soccer. It is not however the first time we have seen roadblocks put in the place of the free movement of players. Even now, US players who want to play in the Premier League need a UK work permit. To obtain a work permit, they often have to show that they start regularly for the US National Team, a remarkably high standard to impose on Americans. Clearly this regulation only places additional barriers in front of foreign players.

Sebastian Telfair: The Jump

Ian O'Connor, a New York sportswriter spent last year following around Sebastian Telfair, the highly rated New York City point guard who is now playing for the NBA's Portland Trailblazers. In an interview promoting his soon to be released first book The Jump, O'Connor previews the book and recounts some of the Telfair story.

It is interesting to see how much correct information Telfair received throughout the season about his likely place in the draft. While he committed to attend the University of Louisville during the November early signing period, it is clear that by December he had decided to turn pro. Despite Louisville coach Rick Pitino continued insistence that he was 95% certain that Telfair would come to Louisville for at least one year based on Pitino's extensive network of NBA contacts, Telfair's information confirmed for him that he would go high enough in the draft to make the jump worthwhile. He dreamed of being the first 6' high school player ever to be taken in the NBA lottery and his dream would soon come true.

After workouts for several teams, most notably in a one on one with Jameer Nelson for the Clippers, he is drafted by the Trailblazers in part because he has signed a guaranteed contract with addidas, which has a relationship with Portland where it is based. So, in the end, Telfair wound up with star money more befitting a high scoring, game changing, player around whom a team builds than a good but still young point guard in a small media market far from the New York City playground where his reputation was built.

I'm very interested in reading the book when it comes out. It will be one of the first account that I'm aware of that will relate the odyssey of today's star high school seniors trying to make the direct leap to the NBA. The fact that I'm also a fan of Louisville basketball has only a little to do with it. You can order the book here

So Now We Talk Football Coaches

The other day we discussed the difficulty that private schools were having payingtop basketball coaches salaries comparable to the ones that public schools with enormous football revenues were able to pay. Now comes Sportsline to give us an insight into just what the price tags for top coaches has become.

With football revenue soaring in the BCS conferences in particular and the competition for head coaches becoming ever more fierce as coaches hop from job to job, $1,000,000 a year is now becoming commonplace. There are at least 35 coaches believed to be making $1 million a year and at least 9 estimated to be making more than $2,000,000. No matter how often Myles Brand, the President of the NCAA, speaks out for fiscal restraint, as long as your conference rival is spending money on a coach or facilities, you will so the same. Why? Well, you have to be competitive don't you? How else will you continue to get the recruits that you need to field teams that will compete for conference championships and bowl bids? How else will the coach earn his bonuses?

It may be a never ending cycle that may not be capable of being fixed. There is a limited amount that the NCAA can do to stop the train. The federal antitrust laws limit what the NCAA can do to hold down university spending. So, even if the member schools decided to enact rules to control spending, which they have shown no inclination to do, one rebel institution would be all that is necessary to overturn them.

Is there an answer then to this new game of runaway spending? It would not appear so in the short term, but in the long term the answer may come from outside sources. Spending has been fueled by the public seemingly insatiable appetitie for collegiate athletics and has been built on colleges revenues from large, free spending football crowds and alumni and most importantly television. With the BCS contract signed now through 2010 for basically the same money with an additional bowl, we starting to see the glimmer of a slowdown in television revenue. Whether that will continue as conferences sign new deals when their existing television contracts come up for renewal will tell the real story.

Anaheim is Left with Damages

The Anaheim Angels have decided to change their name to the Los Angeles Angels in a bid to broaden their market reach. However, it appears to be backfiring as the City of Anaheim, reminding the Angels of a clause in their stadium lease that requires the team name of the Angels to "include the name of Anaheim therein". The Angels had renamed the team the Los Angeles Angels of Anaheim and an Orange County Superior Court Judge found that it technically complied with the lease.

Judge Peter Polos found that the City of Anaheim was unlikely to prevail on the merits of its suit against the Angels and refused Anaheim's request for a preliminary injunction against the name change. As a result, Anaheim is left with little recourse at this point but to sue the Angels for damages.

The measure of damages that Anaheim will be able to prove is, of course, highly speculative. Nevertheless, the reason that Anaheim was so insistent on keeping the name of the city in the team name was the tourist benefit of the repeated mention of the city in newspapers, television , radio and internet broadcasts across the country. Each of those have value and their repititon has a cumulative effect that dramatically magnifies that value. While the Angels may have technically complies with the lease, they have clearly violated the spirit of the lease and have prevailed solely on the basis of sloppy legal drafting. The Angels will no longer be identified as the Anaheim Angels and the City of Anaheim will have lost the benefit of the bargain it struck with the Angels when it agreed to spend a considerable sum renovated the Angels stadium. We can only hope that the City is able to demonstrate substantial damages at trial for which they should be compensated.

On to the World Cup

I don't intend to spend much time on labor disputes in this space but I can't let this one pass without comment. The US Soccer Federation and the members of the men's National Team make a deal for a temporary settlement of their pay dispute allowing the National Team to play in World Cup qualifiers this year. For those of you who may not be soccer fans, the National Team and the Federation, which is not only the governing body of soccer in the US but the employer of the National Team, have been embrolied in a pay dispute for months.

The team refused to play without a new contract and the neither side could agree to mediate the dispute. Finally, both sides agreed to sit down with an mediator and one day later agreed on a temporary contract through all of 2005 containing a no strike clause. As a result, all of the qualifying games for the 2006 World Cup tpo be played in Germany will be played by the National Team members and not the minor league players that the Federation had threatend to use when the players refused to play without a contract.

This is a labor dispute that is even more shortsighted than that of the NHL. Soccer is finally making major progress in the US in its march towards wide acceptance in this country. It is the most widely played youth sport and the Major League Soccer teams are making money in those cities whose teams have built soccer specific stadiums. Nevertheless, it was the surprise success in the 2002World Cup that helped continue that boom and the failure to qualify for World Cup 2006 could be disastrous. For the Federation to play with fire like that is even more short-sighted than the NHL expanding beyond all recognition into every sun belt city with an ice machine. It's good to see that common sense finally hit before it was too late.

And you thought just football coaches got the big bucks

In a fascinating analysis of the high cost to compete for many of the private schools battling in the upper echelons of Division I, SI's Luke Winn examined the burden borne by Marquette and Gonzaga, among others. Those two in particular don't belong, at least this year, to one of the Big Six BCS football conferences (Marquette joins the Big East next year) and don't field football teams. Unlike Duke, Syracuse or even Catholic colleague Boston College, Gonzaga and Marquette must pay top salaries to in demand basketball coaches without any football revenues to help pay the bills.

Interestingly, in 2003-04, Syracuse's basketball revenue was $11,688,023, helped in great part by playing in the 33,000 seat Carrier Dome. Duke's revenue was $10,581,992 while playing in 9,300 seat Cameron aided by the ACC's rich television deals. Marquette brought in more than $6,000,000, playing in the18,700 seat Bradley Center which it shares with the Milawaukee Bucks. so it could well afford to pay Tom Crean's million dollar salary. Yet, Gonzaga, playing in the 4,000 Kennel and the mid-major West Coast Conference brought in only $1,950,000.

Clearly, something more is at work here than just the dollars and cents of the athletic program. Both Marquette and Gonzaga have seen noticeable increases in applications for admission and donations to both the athletic programs and the universities as a whole since the basketball teams started winning regularly. While several scholarly studies in recent years have made the point that there is no direct connection between success on the playing field and increases in alumni contributions, the experience of both Marquette and Gonzaga would seem to contradict those studies. Both schools' administrations are firmly convinced of the psychic and financial benfits to their campuses of continued basketball success and were willing to be proactive in signing Tom Crean and Mark Few to big contract raises befit large state school budgets in order to keep that success rolling along.

Academic Reform: More Details

The NCAA has released more details of its academic reform plan so Division I schools can now start planning on how to cope with the new graduation ratios. The NCAA is estimating that 51% of schools will have at least one team that will fail to meet the new guidelines. Releasing them now will give schools a chance to put procedures in place to begin the necessary monitoring to keep on top of their athletes during the offseason, which will be more important now than ever before. It's also going to be more important than ever before to thoroughly understand the academic background and projected performance of high school recruits as schools will no longer be able just to brush off as unimportant a non-performing student. This will be an interesting story to follow in the years ahead.

Task force to tackle schools' spending

It appears that the NCAA may be getting serious about finally addressing the schools' spending race that is threatening to turn Division I into a sea of red ink. Whenever you have a situation where there is no more than a handful of schools out of more than 300 members of Division I which are operating in the black, it is a situation that crys out for reform. We can never lose sight of the true mission of the institution, which is not to serve as an unpaid minor league for professional sports. Collegiate sports are a welcome extracurricular activity and an excellent way for some students to attend college who would not otherwise have the opportunity. If the result of this task force is a decreased empahsis on athletics, it may well turn out to be a dramatic turning point in academia.

The tide feels like it is starting to shift beneath collegiate athletics. Academic reform has started to take hold. Reining in spending is the logical next step. The addition of a fifth BCS bowl to increase access for the non-BCS conference schools may have been nothing more than a bone to buy them off to avoid an anti-trust lawsuit, but it will spread the wealth slightly, and I do mean slightly. It is interesting to note, in this regard, that Utah will net only about $2,000,000 after expenses from the Fiesta Bowl, while the rest of the Mountain West members will net about $1,000,000 each. To show you how much of the disparity still remains, doormat Baylor of the Big XII, which I believe divides its bowl money equally among its members after paying the participating schools participation stipend for expenses, will net something like $2,100,000. This is money that Baylor can and does count on each and every year and factors into its budget as opposed to the once in a lifetime occurrence of Utah crashing the Fiesta Bowl of the "big boys".

The arms race continues on campuses across the country. The latest wave of football coach hirings has escalated salaries for both the new hires and some of the coaches mentioned for new jobs but convinced to remain in their current jobs, for one reason or another, including Cal's jeff Tedford and Louisville's Bobby Petrino just to name two. Both California and Illinois have announced major stadium renovation projects with estimated costs of $150-180 Million in the case of Cal. No costs have been announced for the Illini as they are in the beginning stages of the project.

It will be interesting to see if the latest task force comes up with proposals that the NCAA membership can adopt that will have any long-tem effect. Myles Brand, the NCAA President, has made this one of his pet projects and we can only hope that he will be as successful as he has been with academic reform.

C-USA deal revisited

So maybe I was too hasty in thinking that the new C-USA deal was really going to be a dose of harsh new reality. It seems that from a dollars and cents standpoint the league may make out just fine after all.New TV deal no step backward However, from an exposure standpoint, I stand by earlier comments that the league is now firmly relegated to the back of the bus, particularly in basketball. I realize that CSTV is the fresh, new face of collegiate athletic television, but it's still the second tier (well, third tier behind Fox Regional Networks) outlet. It's only significant package before now was a new contract with the Mountain West, not exactly the power player among D-I basketball conferences. Nevertheless, I have to hand to the guys at C-USA for being able to pull together a series of deals that will keep their tv revenue essentially stable after losing almost all of their bell cows to the Big East. Well done Mr. Banowsky

NCAA toughens academic standards

In what may prove to be the most far-reaching academic reform in years, the NCAA Division I Board of Directors has approved new penalties for schools failing to meet graduation standards.NCAA Division I Board of Directors Sets Cutlines for Academic Reform Standards.

You will soon become as familiar with the term APR, for Academic Performance Rate, as you are RPI, as this will be the standard by which schools will be measured to determine if scholarships will be lost. The APR will be calculated each year for each team based on the academic performance of each member of the team who remain eligible, continue as full-time students and on pace to graduate, including transfer students. Student athletes who leave the school in good academic standing will not be counted against the school, which is different than the way in which the NCAA had been reported graduation rates previously.

If schools fail to graduate approximately 50% of their athletes, then starting in 2005-06 or 2006-07, depending on the school, they may lose up to 9 football scholarships and up to 2 basketball scholarships. There are also what the NCAA terms historical penalties built into this new system which are harsher than the so-called contemporaneous penalties. It will be interesting to see how vigorously all of this is actually enforced.

Whether all of this will lead to better academic performance or enhanced academic fraud is hard to say. While we can hope that academic institutions would have the best interest of the student athletes at heart and would take steps to insure that the goals of these reforms are met, the history of the NCAA and many of its members doesn't make me all that confident.

Conference USA faces new reality

Conference USA faced its new reality today as it signed a new ccontract with ESPN calling for a drastically reduced number of television appearances, particularly in
men's basketball. .commercialappeal.com - Memphis, TN: Other SportsIn football, expect to see a continuation of your favorite C-USA Tuesday or Friday night game or look to CSTV if you're a C-USA fan

SPORTS BIZ BLOG

This is post number one so I suppose I should explain what this blog is about and a little about who I am. I intend to write about sports and business and the business of sports with a bit about the law thrown in for good measure. I'm am attorney in private practice and spend a considerable part of my time dealing with sports related matters so I hope to be able to bring a bit of a practical angle to some of the questions we see on the sports pages and sportscenter everyday that take away from our enjoyment of the games.

Most of my practice is centered in collegiate athletics although this blog will not likely be as limited. At least in the beginning, many of the posts may skew in that direction so if you would rather see a different focus, just let me know.