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Political Activity of the National Football League Download PDF File Download PDF File
 
 
The NFL’s activity relative to the following legislative issues:
 
Communications/Broadcast
Internet Gambling
Antitrust Regulation
Labor
Eminent Domain
 
 
Of all of the major sports leagues in the United States, the NFL is by far the most active in the political arena, perhaps as evidenced by the fact that it is the only league that employs in-house lobbyists. The NFL’s government relations team first registered January 22, 2009, following Q4 2008 activity on broadcast concerns, but has since been deployed to tackle almost every issue on which the league hires outside lobbyists.

Between Q4 2008 and Q3 2010, the NFL reported $2.8 million in lobbying expenditures on its in-house government relations team, retained initially to petition Congress on issues related to broadcast policies, and nearly $7.8 million overall between 2008 and 2010, up from a total of $4.4 million spent between 1999 (the start of the Senate database) and 2007.
 
 
 
Broadcast Concerns
 
From the time of initial registration the NFL lobbied exclusively on broadcast concerns for two quarters, amassing $570,000 in internal government relations expenses related to fighting for broadcast interests.
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Figure 1: The initial LD-2 disclosure form indicating in-house expenditures for Q4 2008 indicates $280,000 spent at the end of 2008 on lobbying the House of Representatives on “issues relating to the NFL Network and broadcast policies.” (From the Senate’s Lobbying Disclosure Database)


Considering that one of President Barack Obama’s main objectives as it relates to communications policy is to “encourage diversity in the ownership of broadcast media . . . and clarify the public interest obligations of broadcasters who occupy the nation’s spectrum,” which is understood to mean restricting further media consolidation and increasing owners’ community obligations, it makes sense that the NFL would begin lobbying on these issues following his victory in the general elections. The league was the first to broadcast a number of games exclusively on cable (when it signed a contract with ESPN in 1987), the first to offer subscriptions for packages with games that were not nationally televised (Sunday Ticket), one of the first to offer high definition broadcasts, and the first to experiment with games in 3-D1.

Because it primarily makes its money by selling rights to air games, President Obama’s model of open access could be a threat to the NFL’s expanding media revenue. As the league looks to expand its broadcast platform (including streaming games online, via mobile web, in 3D) and to increase the brand through the NFL Network and package options, it will continue to try to restrict the content available on local networks. Already, in cities with an NFL franchise, only one game is aired during the time the home team is playing. If you’re an Eagles fan in Washington, and both teams are playing at 1:00, you’re out of luck unless you buy the NFL Sunday Ticket or a similar package.
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Figure 2: The Q2 2009 reports added H.R. 2994 to NFL’s list of communications/ broadcast issues. The bill was introduced on the House floor just one week before the close of the quarter.


H.R. 2994 was introduced June 23, 2009 by Rep. Rick Boucher (D-Va.) and proposed an extension of provisions allowing satellite companies to air copyrighted material without express written permission, but would not require the satellite companies to pay royalties on the transmissions. The Glover Park Group, LLC was retained in 2009 for the sole purpose of fighting this resolution, and was paid $90,000 over two quarters (Q2 and Q3 2009) to do so. H.R. 2994 has not yet reached a vote; the last major Congressional action on the item was December 2, 2009, when it was placed on the Union Calendar. 2 Through Q3 2010, The Glover Park Group, LLC continued to report $45,000 in income per quarter to continue representing the league’s interests on the issue.

The Law Offices of Philip R. Hochberg received $10,000 in income from the league in Q1 2009. The firm was retained to petition the U.S. Copyright Office at the Library of Congress in anticipation of the renewal of the Satellite Home Viewer Extension and Reauthorization Act, and represented the interests of “Joint Sports Claimants” (of which the NFL was one such claimant).
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Figure 3: The Law Offices of Philip R. Hochberg were retained by the NFL from Q1 2009 to Q3 2009 to appeal to the U.S. Copyright Office on the league’s behalf as it relates to copyright royalties addressed in the Satellite Home Viewer Extension and Reauthorization Act.


Based on the LD-2 filing, which listed “sports” as the issue code on a filing on royalties, instead of “communications/broadcasting/radio/tv,” the Hochberg firm appeared not to be the best firm to lobby before Congress and federal agencies moving forward as the reauthorization bill was introduced. This is not to say the firm is not qualified; it has represented several athletic leagues in the hearing on copyright royalties, but its services were not appropriate for pushing the league’s agenda on Capitol Hill.

In 2010, additional broadcast concerns were raised as similar legislation was introduced in the Senate:
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Figure 4: S.1670, S. 3186 and S. 2764 all pertain to the ability of satellite companies to retransmit stations (and hence, games) to subscribers.


The NFL maintains that it has “not taken a formal position on the satellite bill*s+, but will continue to monitor all legislation that may affect our ability to distribute NFL games to our fans,” according to Jeffrey Miller, VP Government Relations and top in-house lobbyist3.
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Figure 5: The Q4 2009 report filed by The Glover Park Group, LLC reports income attained for “legislative monitoring and outreach,” which supports Miller’s statement that the league had not taken a formal position on the pending legislation, instead, it sought only to ensure its interests were accounted for.
 
Internet Gambling and Sports Betting
 
John Dudinsky & Associates received $120,000 to lobby on internet gambling and sports betting issues during 2008. The NFL had long opposed H.R. 2267 on Internet Gambling Regulation, Consumer

Protection, and Enforcement Act because of its proposal to establish a licensing and regulation system that would enable internet gambling. In Q2 2009, the third quarter for which the NFL filed a registration on its own behalf, it added internet gambling issues to its disclosure form for the first time. The league maintains that betting on the outcomes of its games is bad for the purity of the sport, and Congress finally relented. Finally, in July 2009, the bill was passed including language the NFL sought: companies were prohibited from licensing sports betting, except on horse racing.
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Figure 6: In 2009, the NFL employed the services of its internal government relations team to lobby on internet gambling issues, after John Dudinsky & Associates spent 2008 representing the league on the issue.
 
Antitrust Issues
 
Aside from broadcast concerns, the NFL is also very interested in antitrust legislation. The league’s in-house team remains the only representative employed on its behalf to lobby on antitrust proceedings. Its efforts target all three branches of government, indicating that this is a crucial issue for the league.

President Obama harped on his predecessor’s antitrust regulation during campaign rhetoric, saying it was “the weakest record of antitrust enforcement of any administration in the last half century,” and promising to increase enforcement if elected.

The league contended that it should be granted antitrust immunity, as it is a single entity, not a collection of 32 separate teams (or businesses). In the first three quarters of 2010, the league exerted a great amount of internal resources to get the courts to embrace its viewpoint, but in the end, an opinion by Justice John Paul Stephens declared that “Although NFL teams have common interests such as promoting the NFL brand, they are still separate profit-maximizing entities.”

This is not the first ruling in which the NFL was deemed not to be a single entity, but rather an organization of separate entities working to promote common interests. In 1984, a California court ruled that NFL teams are separate competitive entities under separate ownership, independently valued and not sharing profits and losses, and that “ancillary restraints” on stadium locations were more harmful than beneficial to the notion of competition (incidentally, this ruling made it possible for Los Angeles to have two basketball franchises).
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Figure 7: The Players Association has also taken an interest in antitrust legislation: opposition to the NFL’s contention that it is a collective organization


The Players Association, which lobbied against blanket antitrust exemptions, benefits greatly from the ruling. As the NFLPA prepares to negotiate the new collective bargaining agreement, the statute will prevent the league from acting as one entity for negotiating purposes.
 
Labor Issues
 
Intrinsically tied to the league’s antitrust issues is the labor debate. No one really thinks of NFL players as legitimate employees – with unions, pensions, insurance, sick leave and other typical labor issues. But in light of the pending expiration of the collective bargaining agreement, these issues are taking center stage as the Players Association draws light to the players’ plight as “workers.”

The league has seemingly lumped antitrust and labor issues together in its lobbying efforts.
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Figure 8: The NFL deployed its GR team to lobby the president, the House of Representatives and Senate on a block of labor-related issues, including safety concerns and “antitrust issues related to…negotiation of new collective bargaining agreement” in Q2 2010.


On the league’s part, it is a business, and like many US companies, the teams saw their revenues decrease in 2010. Owners are now looking for a way to recoup that revenue. According to Forbes, team values dropped an average of 2% last year, the first decrease since the publication began keeping track in 19984. The owners, who do not have a collective association, are now facing the possibility of a collusion suit.

Related to its labor and antitrust fights, the NFL contends that federal labor law preempts state laws for the purposes of setting uniform standards for drug testing across teams (and as such, across state lines). Some players argue that the league is subject to independent laws in each of the states it operates, and therefore it cannot enact standard testing practices.
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Figure 9: The NFL is concerned with steroid testing, as it relates to blanket antitrust legislation (can the team act as one entity when enacting testing policies?).
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Figure 10: Covington & Burling LLP also lobbies on labor issues on the league’s behalf, including making congressional lobbying contacts on the steroids testing and questions of benefit, both likely to be issues of quiet contention in upcoming collective bargaining negotiations.


The Players Association has centered its biggest fight around labor issues, going to great lengths in recent months to align itself with the labor movement. The NFLPA even enlisted the help of megaunion American Federation of Laborers and Congress of Industrial Organizations (AFL-CIO), whose president, Richard Trumka, believes a mediation session between the league, its owners, and NFLPA executive director DeMaurice Smith is “an immediate and important step toward saving football for the 2011 season and avoiding the significant job losses that will occur if owners lock out the players and cancel games.5"

Players from each team have strategically joined AFL-CIO to “tackle greed and take on any challenge” presented by owners, according to a statement by Trumka6. “This act of solidarity is the kind of action we need to confront the issues facing all working people, especially in these difficult economic times.”

The association is pitting the interests of those involved as a major reason to strike a balance: imagine all of the people that would be left jobless, the economic devastation a city would face in the event of a football-less season in 2011.

It is interesting that, in 2009 when electing a new executive director following the death of Gene Upshaw, NFLPA reps looked overwhelmingly to football outsiders. There were four candidates in contention for the job, including eventual triumphant Smith, David Cornwell, previous assistant general counsel for the league, who is often heralded as the best lawyer in sports, and two former players, Troy Vincent and Trace Armstrong.

Also interesting is Smith’s lack of experience in football prior to taking the helm of the Players Association. Outside of being a Redskins fan (which could, in itself indicate that he doesn’t know a great deal about the sport), Smith has no NFL ties. Prior to accepting the position, he chaired the government investigations and white collar practice group at Patton Boggs LLP and served as counsel to (then-deputy) Attorney General Eric Holder.

A top litigator, Smith was the most practical choice to lead the union through a labor fight. And while he himself is not registered as a lobbyist, he was employed by Patton Boggs, LLP, one of the nation’s most influential lobbying firms, for many years.
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Figure 11: Between Q2 2009 and Q3 2010, Smith’s former firm has received over $600,000 to lobby on the players’ behalf, primarily on labor issues as the association gears up for collective bargaining negotiations.
 
Eminent Domain
 
The league is also concerned with issues around eminent domain, specifically opposing the use of eminent domain to control a franchise’s relocation. In 1984, when the Baltimore (Md.) Colts looked to relocate to Indianapolis where the team would receive more favorable leasing agreements, the city tried to exercise eminent domain to force the team to stay. The state Senate deferred the vote on the bill, but since then, the league has faced several instances in which governments attempted to regulate relocation and league expansion. So far, the NFL has been able to stave off much involvement in its franchising affairs. Despite rules that limiting expansion to certain cities is bad for competition, and thus in violation of fundamental antitrust provisions of the Sherman Act, the league has been able to skirt around this by limiting the number of franchises it authorizes (which was ruled to be permissible under the same legislation, because it promotes competition by another league, should one arise).

Somewhat related to the theme of eminent domain, the NFL has deployed Covington & Burling LLP professionals to lobby on the flight patterns of aircraft near the stadiums.

 
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Figure 12: Q4 2008 filings show petition on “overflight of stadiums by private aircraft.”


Already, the league has sought to declare the ten-mile radius around Arlington Stadium a no-fly zone for Superbowl XLV. Private aircraft may also be an issue of interest for the league because they carry advertising banners, which generate revenue for teams. Not much is known on the league’s interest in private aircraft legislation, but certainly interference with aircraft permissions and regulations could limit team revenue. However, it seems more logical that these concerns would be addressed with the Federal Aviation Administration as well as Congress itself, and the lobbying disclosure forms do not indicate such parallels.
 
Conclusion
 
The NFL is, by far, the most profitable league in sports (MLB is 2nd, NBA is 5th, and NHL doesn’t crack the top five at all). How this attributes to the league’s lobbying spending is a chicken-or-the-egg question: is the NFL able to spend so much money to influence Washington because it has the most money to spend, or are its profits so high because of its successful Washington strategy?

Whether it is antitrust issues and court rulings on licensing contracts to apparel companies which impact merchandise revenue, or labor issues relative to benefits requirements and contract spending that deduct from teams’ bottom line, or the ability of teams to sidestep eminent domain and operate in cities willing to offer the most favorable terms, or broadcast policies that enable maximized profits, one thing is certain: the league is doing something right.

For more information on the methodology, to report an error, or for questions on this report, please contact:

Autumn A. Jones
Columbia Books, Inc. / Lobbyists.info
ajones@columbiabooks.com
888-265-0600 (ext. 115)

Lobbyists.info, a division of Columbia Books, is the leading provider of reference information on the government relations and lobbying industry. For over 40 years, Lobbyists.info has tracked information on the ever expanding industry and now maintains a database of over 22,000 government relations professionals, their firms, clients, and legislative issue areas of representation. For more information, visit www.lobbyists.info: Washington Representatives online.
 
 
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1 According to the New York Times article, “Football’s Media Scrimmage”
 
2 According to the Library of Congress Bill Summary & Status report found here:
   http://thomas.loc.gov/cgi-bin/bdquery/z?d111:h2994:
 
3 According to a statement to Scripps Howard. Read the full story here:
   http://www.scrippsnews.com/node/50910
 
4 From “The Business of Football,” August 25, 2010. See full article here:
http://www.forbes.com/2010/08/25/most-valuable-nfl-teams-business-sports-football-valuations-10_land.html
 
5 According to a statement made to the Associated Press. Read the full story here:
   http://www.philly.com/inquirer/sports/20101001_NFL___AFL-CIO_boss_ready_to_mediate_dispute.html
 
6 In a statement issued to Roll Call mid-November.
   http://www.rollcall.com/news/-200448-1.html