Arbitrator rules Falcons can recoup money paid to Vick

[BlainThePain]

http://sports.yahoo.com/nfl/news?slug=ap-v...p&type=lgns

Arbitrator rules Falcons can recoup nearly $20 million in bonus money paid to Vick

By PAUL NEWBERRY, AP Sports Writer

October 9, 2007

ATLANTA (AP) -- The Atlanta Falcons are entitled to recover nearly $20 million in bonus money paid to disgraced quarterback Michael Vick, an arbitrator ruled Tuesday. The players' union vowed to appeal.

Stephen B. Burbank, a University of Pennsylvania law professor and special master who led last week's arbitration hearing, sided with the team after hearing from Falcons president and general manager Rich McKay and attorneys from the NFL Players Association, which represented Vick.

The Falcons argued that Vick, who pleaded guilty to federal charges for his role in a long-running dogfighting operation, knew he was in violation of the contract when he signed a $130 million deal in December 2004.

The team said he used proceeds from the contract to fund his illicit activities and sought the repayment of $19,970,000 in bonuses he was paid over the last three years.

Any money the Falcons recover from Vick would be credited to its future salary cap, a huge step in recovering from the loss of the team's franchise player. Atlanta (1-4) is off to a dismal start with Joey Harrington at quarterback.

"We are certainly pleased with today's ruling," the Falcons said in a statement. "It is the first step in a process that our club has undertaken in an attempt to recoup significant salary cap space that will allow us to continue to build our football team today and in future years."

In a highly technical, nine-page ruling, Burbank said the Falcons were entitled to $3.75 million of the $7.5 million bonus that Vick was paid after signing the deal in 2004, $13.5 million of the $22.5 million in roster, reporting and playing bonuses he was paid in 2005 and 2006, and $2.72 million of the $7 million roster, reporting and playing bonus that he received this year.

Burbank wrote that his ruling in a bonus dispute involving former Denver Broncos receiver Ashley Lelie did not apply in Vick's case.

Last year, the arbitrator ordered the Broncos to repay $220,000 to Lelie, who reportedly had to give up about $1 million in fines, lost bonuses and a prorated portion of his signing bonus to get out of the final year of his Denver contract after a dispute over playing time.

Vick was suspended indefinitely without pay by the NFL after entering into his plea agreement. He also lost millions in lucrative endorsement deals.

"We have reviewed the decision handed down by Special Master Stephen Burbank and believe it is incorrect," the NFLPA said in a statement. "We will now appeal his ruling."

The case goes to U.S. District Court Judge David Doty in Minneapolis, who still has jurisdiction over the antitrust suit filed by players following the 1987 strike.

If upheld, the decision would be a further strain on Vick's finances.

He already has been sued by an Indiana bank that claims he failed to repay at least $2 million in loans for a car rental business, and by a Canadian bank that claims he owes more than $2.3 million for real estate investments.

Of course, Vick has more troubling issues to deal with than cash-flow problems. He'll be sentenced Dec. 10 in the federal dogfighting case and is expected to get at least a year in prison. He's also facing felony dogfighting charges in Virginia, which carry possible sentences of up to five years each.

In addition, Vick tested positive for marijuana last month, drawing the ire of the judge who will be sentencing him in December. U.S. District Judge Henry Hudson ordered Vick confined to his Virginia home between 10 p.m. and 6 a.m. with electronic monitoring. He also must submit to random drug testing.

Vick's stunning downfall began in late April when authorities conducting a drug investigation of Vick's cousin raided property that Vick owns in Surry County, Va. Officers seized dozens of dogs, most of them pit bulls, and equipment associated with dogfighting.

Vick initially denied any knowledge of the enterprise, then pledged after he was charged that he would fight to clear his name.

After his three co-defendants pleaded guilty, Vick followed suit in late August and admitted to bankrolling the enterprise and participating in the killing of eight dogs that performed poorly. In his only public comment since the admission, Vick took responsibility for his actions and asked for forgiveness.

"I offer my deepest apologies to everybody out there in the world who was affected by this whole situation," he said, "and if I'm more disappointed with myself than anything it's because of all the young people, young kids that I let down, who look at Michael Vick as a role model."

[HairOnFire]

In a highly technical, nine-page ruling, Burbank said the Falcons were entitled to $3.75 million of the $7.5 million bonus that Vick was paid after signing the deal in 2004, $13.5 million of the $22.5 million in roster, reporting and playing bonuses he was paid in 2005 and 2006, and $2.72 million of the $7 million roster, reporting and playing bonus that he received this year.

I have no love for Vick, but I hope the NFLPA wins the appeal. The recouped money was paid came in the form of roster, reporting, and easy to earn playing bonuses that are nothing more than loopholes that player agents and large market teams used to get around the salary cap....putting small market teams at a competitive disadvantage. In fact, Justin Smith's holdout was due to the Bengals unwillingness to pay exactly these types of split bonuses.

Besides, teams that draft character risks have to pay the price, right? Isn't that the lesson Bengal fans are being taught every single day? So f@ck the Falcons.

[HoosierCat]

The recouped money was paid came in the form of roster, reporting, and easy to earn playing bonuses that are nothing more than loopholes that player agents and large market teams used to get around the salary cap....putting small market teams at a competitive disadvantage.

"Loopholes" that "get around" the cap? I'd say that description is a bit much. All bonuses have to be accounted for under the cap, it's simply a question of how much and when. Yes, a team with deep pockets can give out tons of bonuses in a given year and delay the hit...but as teams like Tennessee and San Fran and DC have all found out, the hit inexhorably comes, nonetheless.

IMHO, the primary problem -- and I think this is what you're getting at -- is the ability of teams to "convert" non-proratable roster and option bonuses to proratable signing bonuses. It doesn't allow teams to escape the cap, but it does allow clubs with deep pockets to massage the numbers and delay the day of reckoning. Prohibit that, and not only do issues like Lelie's and Vick's vanish, but also you get a more level playing field between large and small market teams.

[HairOnFire]

IMHO, the primary problem -- and I think this is what you're getting at -- is the ability of teams to "convert" non-proratable roster and option bonuses to proratable signing bonuses. It doesn't allow teams to escape the cap, but it does allow clubs with deep pockets to massage the numbers and delay the day of reckoning. Prohibit that, and not only do issues like Lelie's and Vick's vanish, but also you get a more level playing field between large and small market teams.

Congrats, you've just described the loophole and much of it's impact. Now factor in how the loophole was a favored tool used by large-market teams, forcing small-market teams to follow or fall further behind....resulting in the loophole now being included in more than 90% of all NFL contracts, per John Clayton. The tactic quickly became standard operating procedure and was a driving force behind the dramatic rise in free agent and rookie salaries. Simply put, it served to soften the salary cap needed by small-market teams by sidestepping the restrictions placed upon signing bonuses.

As for delaying the day of reckoning, the new CBA guaranteed it never really came for teams like the Redskins and the Cowboys, and the arbitors ruling makes it clear that the NFL doesn't want to see the Falcon franchise wither for years due to hardships related to the salary cap. Thus, the already butter soft salary cap becomes even softer if the Falcons are bailed out. And that's what we're talking about.

[HoosierCat]

Thus, the already butter soft salary cap becomes even softer if the Falcons are bailed out. And that's what we're talking about.

It could soften it -- or firm it up. If the Vick ruling stands, and thus roster and option bonuses become recoupable by teams, look for those bonus forms to fall away and new guaranteed money pots invented by players and agents (and in some cases, teams). At the very least, look for players/agents to add language prohibiting teams from converting bonuses (and thus ensuring they cant come after the money later) and thus forcing them to actually take the cap hit in the year they spend the money, versus pushing it into a future that may or may not arrive.