If the NHL’s board of governors had its way, Gary Bettman would be carried into his induction into the Hockey Hall of Fame tonight on bed of roses by an entourage of imperial eunuchs while being hand-fed grapes and fanned with large feathers. On the same day Bettman is receiving hockey’s highest individual honor, the NHL officially announced it had reached a tentative settlement in the concussion lawsuit launched by more than 300 former players.
And guess what? The NHL wins again. Forget about the home run it hit on the financial front. The NHL is a $4 billion industry and managed to agree to pay its former players less than $19 million. In case you’re wondering, that’s what is known as a pittance. Lawyers have a term for these kinds of settlements. They call them “nuisance payments”.
But the more enormous windfall for the NHL and Bettman comes in the form of what it doesn’t have to surrender in this deal. No admission of one iota of liability, no admission that repetitive brain trauma is associated in any way with chronic traumatic encephalopathy (CTE), no acknowledgement of doing anything untoward. Former National Football League players got a billion dollars. The former NHL players, should they choose to accept the award, will get $22,000 each and some medical testing and treatment.
Actually, the total value of the settlement is guaranteed not to exceed $18.922 million. To put that into perspective, that’s only a little more than $3 million more than John Tavares will earn playing for the Toronto Maple Leafs this season.
No wonder Bettman is getting into the Hall of Fame. Of all the ways he has led the charge to save his bosses, this one might be his most triumphant. For years, Bettman repeatedly refused to give up one inch of turf in this issue, always maintaining the lawsuit was without merit and never, ever acknowledging any connection between concussions and CTE. And that strategy paid off for him and the NHL in enormous ways.
“The NHL does not acknowledge any liability for any of plaintiffs’ claims in these cases,” the NHL said in a statement. “However, the parties agree that the settlement is a fair and reasonable resolution and that it is in the parties’ respective best interests to receive the benefits of the settlement and to avoid the burden, risk and expense of further litigation.”
In reality, the death knell for the players came in the summer when a judge in Minnesota judge denied class-action status for the lawsuit. But it’s important to note that the NHL did not gain any traction in the pursuit of moral high ground here and the dirty laundry could still come out if a former player such as Mike Peluso or the estate of the late Steve Montador decides to opt out of the settlement and continue with individual lawsuits. The class-action aspect of the lawsuit was not killed because it lacked merit. It was quashed over jurisdictional issues. The court in Minnesota ruled that the laws are so different in so many of the jurisdictions that the cases were filed, that there’s no way to have a commonality of interest among the plaintiffs and what law to apply.
And that’s where the individual lawsuits will come in. In the meantime, the class-action group really had no alternative but to settle this. The only way to continue going on this action would have been for the lawyers involved to continue financing all the costs of litigation out of their own pockets to the tune of many million dollars.
In reality, this was all about risk/benefit analysis. There are, in fact, private equity firms that back law firms in class-action lawsuits. Once a lawsuit receives class-action status, there are a number of protections for the lawyers and guarantees of fees that are designed to protect them. When they lost that motion and chose not to appeal it, those protections were lost and there was no guarantee they were going to get anything. With them already several million dollars into this thing with their own money, the lawyers involved saw a small win for them and their clients as better than the possibility of no win at all. A league with a legal budget the size of the NHL’s has the ability to bleed those firms and their clients. But we won’t be having any tag days for the lawyers, since they’ll be getting $6.9 million for their troubles.
That basically matches the amounts the pool of money the 318 players will receive, based on them each receiving $22,000. Also included are $1.1 million in an additional payment fund and $2.514 million, paid in instalments over five years, in a “Common Good Fund” which will go to players in financial distress. Players will have three years to be tested for brain diseases such as Alzheimer’s, dementia and Parkinson’s disease.
Glenn Healy, the president of the NHL Alumni Association, said the settlement will give some former players an opportunity to get their lives back. “It’s not the financial remedy, it’s more the physical remedy where the brain gets back to north again and you’re functionally integrated with your world,” Healy said. “The calls that I get are not from the player. It’s usually from the wife or from the kids. They want Dad back. Does this help to get Dad back? Yeah, it does. Maybe the wake up tomorrow and instead of being on four Oxycodone they’re on two. They get 50 percent of their day back. We win if that’s the case.”
Well, if that’s how a win is framed for the players, then it’s pretty clear they had little chance of hitting a home run in the first place. This lawsuit was supposed to be a game changer. It was not. Any former player who wants to truly hold the NHL or any of its teams in this is now on his own. Some likely won’t care about the money and will simply want their day in court. For them, the fight continues.