David Stern is a master of influence and is trying to use that gift strategically in this make-or-break time in the NBA. He has sent the NBA’s final proposal -- given to the NBPA on Friday -- to the entire player population of the NBA, setting in motion a “divide and conquer” strategy to foster some cracks within the rank and file.
And, with the players threatening the nuclear option of decertification, Stern has sounded the ominous warning to players that this strategy could have drastic consequences to their finances. Stern warned, "If the union is not in existence, then neither are $4 billion worth of guaranteed contracts that are entered into under condition that there's a union."
Stern and the NBA have asked a judge in the Southern District of New York to essentially rule the same. The NBA’s argument is that in the event the players' disclaimer is found valid, and if it's determined that the collective bargaining relationship between the players and the owners has ceased, then all player contracts should also cease, becoming null and void.
Stern is tying his argument -- and asking the Court to tie his argument -- to a 1999 arbitration heard by an arbitrator named John Feerick. In that case, during the 1998-99 lockout, the NBPA had claimed that the NBA breached those contracts by advising the NBPA that teams would not pay during a lockout.
Feerick found that "salary provisions of the Player Contracts are not effective or operative during a valid lockout," due to the fact that the CBA is the creator and governor for such contracts. Feerick’s decision was based on the premise that player contracts specifically refer to numerous CBA provisions. According to Feerick, the contracts are "dependent upon and closely intertwined" with the CBA.
Of course, what a system arbitrator determined 12 years ago does not bind the Southern District of New York. They will make their own determination.
I would find it very unlikely that the Court would agree with the NBA's position.
The player contracts in the NBA have guarantees that are laid out with specific language about payment even in the event of release for lack of skill, injury, etc. Unless they make explicit reference to what Stern is referring to -- such as the guarantee "not applicable during a strike, lockout or other work stoppage" -- I would not anticipate the Court reading that language in nor invalidating the contracts.