Mercury Morris: Questions for De Smith
Clarification on the 1993 CBA and the Commencement of Revenue Sharing
Dear Mr. Smith:
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You state the following:
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“On whether owners should help more with benefits for retired players: All the retirement benefits right now that come to the retired players come from the pool of money that’s dedicated to the current players.”
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For the record, Sec. 3.1 of the Plan document states basically that any monies contributed to the Plan will be under “the express control of the owners.” Given that fact, please clarify the above statement.
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Simply said: In 1993, then NFLPA Executive Director, Gene Upshaw met with then-Commissioner, Paul Tagliabue. The two agreed to a revenue-sharing that gave the players over 50% of the revenue from the NFL profits. That agreement included all of the funds that were, by Law, contributed to the Retirement fund for retired players. Technically, the Retirement Board could not shift the fiduciary obligation from the owners to the NFLPA. Therefore, your statement using the term “dedicated” implies that ALL the CBA funds went to the current players, which is incorrect. Please provide for the retired players the exact language agreed upon by the collective bargaining parties in 1993. Additionally, please provide a copy of this agreement.
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Prior to your arrival, Gene Upshaw, in February 2007, stated the following:
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“Don’t forget this money did not come from the owners, it came directly from the active players. To say the active players don’t is BS. They are the ones paying the freight. Until 1993, did any other group of players ever go back and improve the pension plan, reduce the vesting, create several new disability benefits, bring the pre-59′ers in the Plan? Facts and truth is something they can’t stand. My silence on this will say it all.”
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Mr. Upshaw is clearly stating that the “active players” are “paying the freight.”
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In May, 2007, Greg Johnson of the LA Times stated the following:
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“Federal Law requires union leaders to represent the interests of current and future players rather than aging athletes, so improvements to previously negotiated benefits must be approved by current union members — and often by the franchise owners who foot the bills.”
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Read the rest of Greg Johnson’s definitive piece on NFL pensions – click HERE.
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For the record, the Plan clearly states that players do not contribute to the Retirement Fund nor have they ever been bound by law to contribute to the Retirement Fund.
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An article by Ron Snyder of the Baltimore Examiner, dated April 26, 2007, stated the following:
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“At issue is how retired NFL players received their benefits. Right now, the owners designate money that goes toward benefits and the NFLPA decides how to use those funds.”
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Read the rest of Ron Snyder’s piece on NFL pensions - click HERE.
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If the above statement is in fact true, then the owners, directed by the Retirement Board, would be violating Section 404 of the ERISA Code. Under Section 404, it states the following:
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ERISA Code Regulations, Fiduciary Duties Act. Sec. 404. Subject to Sections 403(c) and (d), 4042, and 4044, a fiduciary shall discharge his duties with respect to the Plan solely in the interest of the participants and beneficiaries and
(A) for the exclusive purpose of (i) providing benefits to participants and their beneficiaries; and (ii) defraying reasonable expenses of administering the Plan;
(B) with care, skill, prudence, and diligence under the circumstances then prevailing that a prudent man acting in a like capacity and familiar with such matters would use in the conduct of an enterprise of a like character with like aims.
(C) by diversifying the investments of the Plan so as to minimize the risk of large losses unless under the circumstances it is clearly prudent not to do so; and in accordance with the documents and instruments governing the Plan insofar as such documents and instruments are consistent with the provisions of this Title and Title IV.
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A prudent person would say that the owner members of the Retirement Board are violating their fiduciary duty to the retired players.
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For the record, each and every improvement stated by Mr. Upshaw comes to the current players.
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Mr. Smith, you seem to be BS’ing the people who are called retired players. Perhaps you can clarify each and every issue I have addressed. It appears as though you and the late Gene Upshaw are not on the same page as stories go. I’m sure you will be forthright in your response.
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Eugene “Mercury” Morris
Miami Dolphins & San Diego Chargers
1969 – 1976
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Dave Pear
May 21st, 2010 at 11:44 AM #
Dear De Smith,
We’re ALL anxiously await your answers to Mercury Morris’ questions.
In keeping with your message of working with retired players, I hope you’ll openly provide answers soon to all of those who have been kept in the dark for too many years. I for one believe that with many of the people you still have working at the NFLPA, it isn’t matter of not being able to provide you the real answers but the fact that they won’t provide you the answers. As a former white collar attorney, you probably already know that if you want real answers and ideas, you might want to start with the victims and not the perpetrators. Continuing to follow the advice of people who were part of the problem will only make things worse.
Thank you.
Sincerely,
Dave & Heidi Pear