Lloyd Howell’s first major business move as executive director of the NFL Players Association has blown up in his face.
Via Eriq Gardner of Puck.news, the NFLPA has lost $7 million to Panini in an arbitration over last year’s termination of the exclusive contract between the union and the trading-card company.
As explained by Gardner, the NFLPA ditched Panini after Fanatics hired away several of its key employees. The union relied on a clause allowing the contract to be broken after a “change in control” at Panini. But Panini argued (successfully, apparently) that the union dumped the deal as a pretext for making the switch to Panini to Fanatics.
“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,” attorney David Boies told Gardner. “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.”
Fanatics was not a party to the arbitration. However, Panini has a separate antitrust and tortious interference lawsuit pending against Fanatics.
The NFLPA did not respond to Puck’s request for comment.