Court Finds Arbitrator Failed to Recognize Flaw in NFL’s Commissioner’s Ruling in Peterson Case

Mar 6, 2015

A federal judge from the District of Minnesota has interceded on behalf of the National Football League Players Association (NFLPA), and star running back Adrian Peterson, and vacated an arbitration award that favored the National Football League and the National Football League Management Council (collectively, NFL).
 
This dispute centered on the discipline imposed by NFL Commissioner Roger Goodell on Peterson following Peterson’s corporal punishment of his son in May 2014, which had been reported to the authorities.
 
The parties’ relationship is governed by the Collective Bargaining Agreement (CBA), signed on August 4, 2011. Of relevance is Article 46 of the CBA, which authorizes the Commissioner to impose discipline on NFL players for “conduct detrimental to the integrity of, or public confidence in, the game.”
 
Article 46 allows a player to appeal the Commissioner’s disciplinary decision to a hearing officer appointed by the Commissioner. The Standard NFL Player Contract, which is part of the CBA, further provides that on a finding of conduct detrimental to the league, the Commissioner “will have the right, but only after giving Player the opportunity for a hearing … to fine Player in a reasonable amount; to suspend Player for a period certain or indefinitely; and/or to terminate this contract,” according to the CBA.
 
The NFL’s Personal Conduct Policy (Policy), which is revised periodically, sets forth what constitutes conduct detrimental to the league and what discipline may follow. The Policy in place during the underlying incident provided that the NFL may impose discipline when the player has committed a criminal offense, including domestic violence. Consistent with the Player Contract, the Policy also stated that discipline may include fines, suspension, or banishment from the league, according to the court. The policy did not set forth the presumed length of suspension for particular types of conduct, but noted that the disciplinary response “will be based on the nature of the incident, the actual or threatened risk to the participant and others, any prior or additional misconduct (whether or not criminal charges were filed), and other relevant factors,” according to the policy.
 
On August 28, 2014, in response to a well-publicized domestic violence incident involving Baltimore Ravens running back Ray Rice, the Commissioner issued an enhanced Personal Conduct Policy (New Policy), increasing the sanctions for domestic violence and sexual assault incidents. Specifically, the New Policy announced a “suspension without pay of six games for a first offense, with consideration given to mitigating factors, as well as a longer suspension when circumstances warrant.”
 
Peterson’s troubles began in earnest of September 11, 2014, when a Montgomery County, Texas grand jury indicted him on a charge of felony reckless or negligent injury of a child, as a result of the May 2014 incident involving his son. After learning of the indictment, the Vikings deactivated Peterson for the next game on September 14. Four days later, the NFLPA, on behalf of Peterson, and the NFL agreed in writing to place Peterson on the Commissioner’s Exempt List with full pay, with the idea that more discipline may be imposed “after the pending criminal charges are adjudicated.”
 
On November 4, Peterson pleaded nolo contendere to a reduced misdemeanor charge of reckless assault. Over the next two weeks, the NFLPA sought to schedule a hearing in which Peterson would participate as well as present his side of the story.
 
In a letter dated November 18, the Commissioner informed Peterson that his May 2014 conduct was “detrimental to the league and noted, without specificity that Peterson had engaged in similar conduct in the past and appeared inclined to repeat the behavior in the future.”
 
The Commissioner suspended Peterson without pay for “at least the remainder of the 2014 season,” fined him six weeks’ pay, inclusive of any amounts forfeited during the suspension, and ordered him to participate in a counseling and treatment program, the results of which would dictate when and if Peterson would be permitted to return to the league.
 
The Commissioner specifically directed Peterson to participate in counseling supervised by NFL designee Dr. April Kuchuk, rather than Peterson’s chosen therapist. The Commissioner indicated that he would review Peterson’s progress periodically, beginning on April 15, 2015. He also warned that a “failure to cooperate and follow your plan will result in a lengthier suspension without pay.” Finally, the Commissioner advised Peterson that he would remain on the Exempt List with pay pending any appeal.
 
The NFLPA immediately appealed the discipline, triggering the arbitration procedure set forth in Article 46 of the CBA.
 
The NFLPA specifically challenged the application of the New Policy to conduct occurring before its implementation, as well as the Commissioner’s “new and obfuscated disciplinary process,” which prevented Peterson from participating in pre-disciplinary discussions in violation of his “industrial due process rights.”
 
Further, the NFLPA requested that the Commissioner recuse himself from hearing the appeal and that he appoint a neutral arbitrator. The NFL responded by setting the arbitration for December 2 and appointing Harold Henderson as the Commissioner’s designated hearing officer.
 
The NFLPA balked, noting that Henderson had “inextricable ties to the League Officer and Commissioner Goodell” and evident partiality. Further, it identified the following issues: “(1) whether the Commissioner impermissibly applied the New Policy to Peterson; (2) whether Peterson was deprived of a fair disciplinary process; (3) whether the imposition of a psychiatric counseling component is permissible under the CBA; and (4) whether the Exempt List can be used as a form of discipline under the CBA.”
 
Nevertheless, the arbitration took place on December 2 and 4, and Henderson upheld the Commissioner’s ruling.
 
On December 15, 2014, the NFLPA filed a petition to vacate the arbitration award under Section 301 of the Labor Management Relations Act, 29 U.S.C. § 185 (LMRA) and Section 10 of the Federal Arbitration Act, 9 U.S.C. § 10 (FAA).
 
It argued specifically that vacatur is warranted because “(1) the award violates the essence of the CBA; (2) Henderson exceeded his authority by deciding the matter based on the hypothetical question of whether Peterson’s punishment was permissible under the old Policy; (3) the award was fundamentally unfair given the retroactive application of the New Policy and the procedural irregularities in the pre-discipline process; and (4) Henderson was an evidently partial arbitrator.”
 
The court was receptive to the appeal, especially the part about the retroactive application of the New Policy.
 
“The Commissioner has acknowledged that he did not have the power to retroactively apply the New Policy,” wrote the court. “Yet, just two weeks later, the Commissioner retroactively applied the New Policy to Peterson.”
 
In rendering the arbitration award, the court wrote that Henderson “simply disregarded” this flaw in the Commissioner’s ruling. “As a result, the arbitration award fails to draw its essence from the CBA and vacatur is warranted.” See Trailways Lines, Inc. v. Trailways, Inc. Joint Council, 807 F.2d 1416, 1423 (8th Cir. 1986).
 
The court also found that a vacatur was warranted based on the NFLPA’s argument that Henderson exceeded his authority by “adjudicating the hypothetical question of whether Peterson’s discipline could be sustained under the previous Policy. The NFL responds that the NFLPA submitted that issue to Henderson. The record belies the NFL’s argument. … Henderson strayed beyond the issues submitted by the NFLPA and in doing so exceeded his authority.”
 
These two determinations clinched the ruling for the NFLPA, meaning the case “is remanded for such further proceedings consistent with this order as the CBA may permit.”
 
Adrian Peterson v. National Football League and National Football League Management Council; District of Minnesota; Civil No. 14-4990(DSD/JSM); 2/26/15
 
Attorneys of Record: (counsel for petitioner) Jeffrey L. Kessler, Esq., David L. Greenspan, Esq. Winston and Strawn LLP and Barbara P. Berens, Esq. and Berens & Miller. (counsel for respondents) Daniel L. Nash, Esq., Marla S. Axelrod, Esq. and Aikin Gump and Joseph G. Schmitt, Esq. and Peter D. Gray, Esq. of Nilan, Johnson, Lewis.


 

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