Stephen D. Atwater v. The National Football League
2010 U.S. App. LEXIS 24067
| 11th Cir. | 2010Background
- Plaintiffs, former NFL players and related entities, invested about $20 million in IMA run by Wright and Bond, later revealed as a Ponzi scheme.
- Wright and Bond were investigated by NFL and NFLPA; Wright and Bond were listed as Registered Financial Advisors without adequate disclosure.
- Plaintiffs allege that NFL/NFLPA failed to provide accurate information and perform adequate background checks, leading to their investments.
- Plaintiffs asserted Georgia-law tort claims (negligence, negligent misrepresentation, breach of fiduciary duty) in federal court under diversity jurisdiction.
- NFL/NFLPA raised § 301 LMRA preemption, arguing the claims depend on interpretation of the CBA Career Planning Program.
- District court granted summary judgment for NFL/NFLPA on the state-law claims; district court ruling on counterclaims followed, with appeals to the Eleventh Circuit.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Does § 301 preempt the state-law claims? | Plaintiffs contend preemption applies because the claims require CBA interpretation. | Defendants contend claims arise from the CBA Career Planning Program and are preempted. | Yes; § 301 preempts the state-law claims. |
| Is the NFL bound to the CBA for § 301 purposes even though not a formal signatory? | Plaintiffs argue NFL should not be bound as non-signatory. | Defendants argue NFL is bound through agency and CBA terms. | NFL bound; § 301 preemption applicable. |
| Do the duties challenged by Plaintiffs arise from the CBA's Career Planning Program? | Duties alleged as to background checks and information stem from the Career Planning Program. | Duties are derived from the CBA language and the program’s requirements. | Yes; duties arise from the CBA, supporting preemption. |
| Are the negligent misrepresentation and fiduciary-duty claims preempted because they depend on CBA language including the disclaimer that players are responsible for personal finances? | Reliance and duties depend on supposedly misrepresented financial information within the program. | Misrepresentation and fiduciary duties are shaped by the CBA and its disclaimer about finances. | Yes; preempted due to dependence on CBA language. |
Key Cases Cited
- Lingle v. Norge Div. of Magic Chef, Inc., 486 U.S. 399 (1988) (complete preemption framework under § 301)
- Allis-Chalmers Corp. v. Lueck, 471 U.S. 202 (1985) (federal-law interpretation of CBAs to resolve disputes)
- Caterpillar Inc. v. Williams, 482 U.S. 386 (1987) (preemption and federal-law framework in removal and claims)
- Local 174, Teamsters v. Lucas Flour Co., 369 U.S. 95 (1962) (federal-law applies exclusively to certain labor disputes)
- United Steelworkers v. Rawson, 495 U.S. 362 (1990) (preemption when tort duty created by a CBA)
- Bartholomew v. Nat’l Football League, 361 F.3d 1333 (11th Cir. 2004) (Eleventh Circuit on § 301 preemption scope)