UFL Transfer Fee Raises Important Issues for League

The UFL’s relative success can arguably be attributed to its strategy of complementing the NFL, rather than attempting to compete with the most popular sport in America.  After all, besides the NCAA, the NFL has lacked a feeder system since the owners shut down NFL Europe.  The UFL appeared to be on its way to filling that void.

But a clause in the UFL players’ contract may threaten the league’s complementary position to the NFL, and ultimately, the league’s success.  As Mike Florio of Pro Football Talk has covered in detail, the UFL contracts include a transfer fee.  Should an NFL team wish to sign a UFL player to its active roster (practice squad signings do not trigger the fee), it must pay the UFL $150,000. 

Apparently players signed this contract with the knowledge that, last season, the UFL waived its transfer fees for the 43 players who signed with NFL teams.  Following this season the UFL has been unwilling to waive the transfer fee, and no UFL players have been signed to the active roster of an NFL team.  As a result, the UFL has received some negative publicity from its players, including Lorenzo Booker of the Hartford Colonials.  Booker boycotted the Colonials final game in protest of the rule

Here are a few observations on the transfer fee and the resulting controversy:

  • UFL players are generally bound by the terms of  the contracts they signed, regardless of whether the league chose not to enforce the transfer fee last season, or whether the UFL made oral assurances to the players that the fee would be waived.  As a rule of law, a written contract cannot be altered by oral terms not committed to writing.
  • As mentioned on Pro Football Talk, the UFL could threaten the NFL with an antitrust claim should no team add a UFL player to its active roster.  Of course, the USFL prevailed over the NFL in an antitrust suit in 1986 and was awarded $1, which was trebled to $3.  The league subsequently folded.
  • Is the UFL’s position reflective of the labor situation in the NFL?  Perhaps the UFL wants to keep its best players for next season, in case it is the only game in town.  Of course, the UFL may merely be trying to recover some of its costs.
  • The UFL has successfully recruited quarterbacks with NFL experience, such as J.P. Losman, Daunte Culpepper, Jeff Garcia and Hartford’s Josh McCown.  If these established players find that the UFL presents a hurdle to returning to the NFL, the UFL will likely have a less talented player pool from which to draw.  Established players may find it more advantageous to wait for a call from a NFL team rather than contractually obligating themselves to the UFL and its transfer fee.

Comments

  1. A lot of fans have asked the question “why doesn’t the player just pay the fee?” Do you know what the rules are about a player paying the transfer fee?

  2. Dan Fitzgerald says:

    I don’t know if there are any rules that would prevent the player from paying the fee, or if there is a buyout clause in the contract. I will try and find out. My suspicion is that $150,000 is a lot of money for a player who would make the NFL minimum pro-rated for the remainder of the season. A higher profile veteran like Garcia or Culpepper might be interested in such an arrangement. I have read that the fee is open to negotiation, but NFL teams haven’t offerred to pay any fee at present.

  3. Your fourth bullet point does not go far enough. This would seem to be the death knell for the UFL. No player in his right mind would sign with the UFL for next season and thereafter – once the NFL labor dispute is resolved – if doing so actually presents an obstacle toward his goal of returning to the NFL rather than a means toward achieving that goal.

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Trackbacks

  1. […] UFL has modified its $150,000 transfer fee, which Connecticut Sports Law covered this week.  With the recent change, an NFL team can sign a UFL player to its active roster for a reduced fee […]

  2. […] Leave a Comment Posted by Dan Fitzgerald on December 16, 2010 As of December 1, not a single UFL player had made the jump to an NFL team, raising important questions concerning the intentions of two year-old league.  The UFL’s […]

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