October 9, 2009 6:47 PM

The Missing Greek Money Chronicles: A Hoops-Filled Look at Sports and the Law

Posted by Zach Lowe

As a hoops junkie who grew up near New York City and can remember obscure New Jersey Nets players from the 1990s, we were delighted to come across a bizarre sports-related court case involving Chris Morris, the talented but enigmatic ex-Net who hasn't played in the NBA since 1999.

What's the deal? Well, according to recent story in the Cleveland Plain Dealer, the powerhouse Greek team Olympiakos, for whom Morris played at the end of his career in 2001, allegedly never paid Morris the final $1.3 million on his contract and $400,000 in fees owed to Morris's agent. The agent, Tom McLaughlin, filed suit five years ago seeking payment of his fee. But Olympiakos did what many overseas defendants do--they simply ignored the lawsuit, according to court records. That worked out okay. for the team until this week, when Olympiakos arrived in the UnitedStates for a goodwill basketball tour that will include an Oct. 12 game in Cleveland against LeBron James and the Cleveland Cavaliers. McLaughlin's suit happens to have been filed in federal court in Ohio. Uh oh. 

McLaughlin's attorney, Jon Yormick, filed papers this week asking a federal district court judge in Cleveland to allow U.S. marshals to seize basically everything Olympiakos arrives here with--the club's uniforms, sneakers, cash, even its private plane. Judge Christopher Boyko last week refused to grant the order until Yormick could take a deposition of an Olympiakos official who could provide a bit more information about what the team was bringing with it to the states and its knowledge of the five-year-old complaint.

That was enough for Olympiakos to retain Squire, Sanders & Dempsey principal Joseph Rodgers, who immediately filed papers calling Yormick's seizure request "an unprecedented attempt" to seize property and one with "fundamental defects." Rodgers also represented Olympiakos general manager Christos Stavropoulos in a deposition taken Friday afternoon.

Good news for the Greek team: Judge Boyko denied Yormick's request based largely on Stavropoulos's (mostly hilarious) testimony. The Greek GM testified that the team doesn't own its own uniforms, that the club, as an entity, carries no currency, and that the team paid $109,000 to fly Delta instead of using a private plane, court records show. (Nike owns the team's uniforms and allows Olympiakos to use them under a sponsorship deal, court papers show.) All in all, the total value of goods the marshals could seize is somewhere between $5,000 and $10,000, Boyko wrote in his order. The cost of deploying the U.S. Marshal's Service on this quest? About $10,000. And so: Request denied. 

Yormick did not return calls for comment after Boyko issued his order at about 5 p.m., Friday. Earlier in the day, Yormick explained that his firm (Yormick & Associates) got McLaughlin's business because one of Yormick's partners is a former NBA agent who represented well-known players such as Nene and Leandro Barbosa.

Rodgers did not return several messages seeking comment. We also reached out to Squire Sanders partner Frederick Nance, who has represented LeBron James, to see if he was helping on the matter. Nance did not return our calls seeking comment.

Olympiakos plays the Cavaliers on Monday. We don't know how they will fare against arguably the NBA's best team, but at least they'll have their uniforms.

A few other quick hits in the world of sports law:

• Judge Judith Kaye isn't hurting for interesting work after leaving her spot as chief judge of the New York Court of Appeals last year for an of counsel role at Skadden, Arps, Slate, Meagher & Flom. As first reported by our friends at the New York Law Journal, an Am Law Daily sibling publication, Binghamton University in New York (a SUNY school) has tapped Kaye to head an independent inquiry into a budding scandal surrounding the school's basketball program. The team, which made the NCAA tournament last year under coach Kevin Broadus, a former assistant at big-time hoops factory Georgetown University, recently dismissed six players from the team. The dismissals came after months of grumbling that Broadus was skirting the school's usual academic standards to recruit top players, including a star point guard who was arrested last month for possession of crack cocaine. 

Kaye declined to comment through Skadden. The firm referred calls to a university official. He did not return our phone calls. We're curious as to whether Kaye is getting paid, and if so, who is paying her. Maybe we'll find out next week.

• Finally, we turn to the issue of preemption, a word that got bandied about quite a bit last year as the U.S. Supreme Court considered whether federal approval of a Wyeth drug preempted state-level torts. But it's now emerging as a key issue in the would-be suspension of two National Football League players who tested positive last season for a banned diuretic found in some dietary supplements. (The league bans the diuretic because it can be used to mask steroid use, which the players have adamantly denied. See our prior post on the case for further background.)

The players, represented by Crowell & Moring and Fulbright & Jaworski (with help from the players union's regular counsel at Dewey & LeBoeuf) challenged the suspensions on several grounds. Among them: That the suspensions could violate state employment laws in Minnesota, where two of the accused play for the Vikings. In a bit of a surprise, the U.S. Court of Appeals for the Eighth Circuit ruled last month that the suspensions of the players (Kevin and Pat Williams, no relation) should be upheld until the players fully contest them in state court. 

The league balked, arguing that allowing players to contest suspensions under more employee-friendly state laws could undermine strong league drug policies. (Several sports leagues and the U.S. Anti-Doping Agency filed briefs with the Eighth Circuit on the NFL's behalf.)

The league still is deciding how to respond to the ruling. But in the meantime, the House Energy and Commerce Committee (chaired by U.S. Rep. Henry Waxman, Democrat of California) will hold hearings on the preemption matter as it relates to sports leagues and drug policies, according to The New York Times. And Waxman may have telegraphed his stance in announcing the hearing. He said he is concerned that the Eighth Circuit's ruling "could result in weaker performance-enhancing drugs policies in professional sports," the NYT says.

Stay tuned.

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