How to Hold Onto Your Sports Franchise

The Oklahoma City Thunder had a nice run in the recently concluded NBA playoffs, but it was nothing compared to their run from Seattle.  The story of the escape of the former SuperSonics from Seattle is the central case study in a new paper on the retention of major league franchises by Paul Anderson and William S. Miller.  

Anderson and Miller point to the sports facililty lease agreement as the key legal document by which communities attempt to secure long-term commitments from their teams.  However, as the City of Seattle discovered, there are significant legal and practical impediments to enforcing these commitments.  It may be especially difficult to obtain the remedy of specific performance, i.e., a court order requiring a recalcitrant team to continue playing in a city it wishes to desert.

Anderson and Miller helpfully survey a range of non-relocation agreements that have been negotiated between different cities and sports franchises.  They identify the agreement between Bexar County, Texas, and the San Antonio Spurs as a model of a strong agreement that seems much better designed than the Seattle contract to keep a franchise in its city over the long run.  Among other things, the contract includes a liquidated damages clause that starts at $250,000,000 and declines to $106,000,000 over the term of the lease.

Continue ReadingHow to Hold Onto Your Sports Franchise

Do Changes in Benefits for Public Employees Violate the Contracts Clause?

Paul Secunda has a new paper on SSRN that considers under what circumstances statutory changes affecting public-employee benefits might violate constitutional restrictions on the impairment of contracts.  Paul particularly focuses on a very timely case study: Wisconsin’s recent budget-repair bill and its impact on city employees in Milwaukee.  Here is the abstract:

The recent spate of high profile efforts by state governors to roll back public employee pension rights in light of recent budgetary challenges has shone the light directly on the importance to public employees of the Contracts Clause provisions of the federal and state constitutions. Using as an example the controversial budget repair bill in Wisconsin and the application of the bill’s pension provisions to Milwaukee City employee pension rights, this article has sought to show how, under certain specified circumstances, such legislative attempts may be constitutionally impermissible if such laws substantially impair employee contracts with the state without the necessary legal justification.

Continue ReadingDo Changes in Benefits for Public Employees Violate the Contracts Clause?

Defendant Can Raise Tenth-Amendment Challenge to Her Conviction, SCOTUS Rules

Earlier today, in Bond v. United States (No. 09-1227), the Supreme Court ruled that the defendant should have been permitted to raise a Tenth-Amendment challenge to the chemical-weapons statute that she was convicted of violating.  In response to her indictment for violating 18 U.S.C. § 229, Bond had argued

that the conduct with which she is charged is “local in nature” and “should be left to local authorities to prosecute” and that congressional regulation of that conduct “signals a massive and unjustifiable expansion of federal law enforcement into state-regulated domain.” Record in No. 2:07-cr-00528-JG-1 (ED Pa.), Doc. 27, pp. 6, 19. The public policy of the Commonwealth of Pennsylvania, enacted in its capacity as sovereign, has been displaced by that of the National Government. The law to which petitioner is subject, the prosecution she seeks to counter, and the punishment she must face might not have come about if the matter were left for the Commonwealth of Pennsylvania to decide. Indeed, petitioner argues that under Pennsylvania law the expected maximum term of imprisonment she could have received for the same conduct was barely more than a third of her federal sentence.

The Third Circuit, however, ruled that Bond lacked standing to raise her constitutional objections.

In reversing this decision, the Court did not address the merits of the objections.  As a result, it’s hard to say whether there is any sympathy on the Court for the basic claim that the Tenth Amendment may be violated when a federal law criminalizes conduct that is “local in nature.”  Still, it is interesting to put Bond alongside last month’s decision in Fowler, in which the Court cited similar federalism concerns in rejecting an expansive interpretation of a different federal criminal statute.  Perhaps the Court is entering a new phase of heightened concern over the federalization of criminal law.

Cross posted at Life Sentences Blog.

Continue ReadingDefendant Can Raise Tenth-Amendment Challenge to Her Conviction, SCOTUS Rules