Posted: 10:00 a.m. Friday, July 26, 2013
Author's note: Nothing that has been written should be construed as legal advice to Tarell Brown, or any other claims for attorney malpractice. We are simply considering hypotheticals based on publicly available information.
Yesterday morning, Brian McIntyre reported 49ers cornerback Tarell Brown effectively voided a $2 million salary escalator, because he did not participate in the 49ers voluntary offseason workout program. It was no secret Brown's 2012 performance had triggered an escalator that increased his base salary from $925,000 to $2,925,000. In addition to his base salary, Brown was scheduled to receive a $75,000 workout bonus.
When news broke, my first inclination was something went very wrong. It is simple math. Brown is not a top NFL earner. Obviously, $2 million dollars is a lot of money to most people. Likewise, it is a lot of money to Tarell Brown. Considering the short careers of most NFL athletes and players like Brown -- every dollar counts. If a rookie makes the roster his first year, the average NFL career is six years. For players who do not make the 53-man roster, the average career is 3.5 years.
In that short period of time, an NFL player must make his earnings "last his lifetime." So, while these six and seven figure incomes appear to be an excessive amount to the average household, every penny a football player earns happens between these 3 and 6 years (on average). Money has to be managed carefully. Consequently, a $2 million escalator could have had an enormous impact for Brown and his family.
It is illogical he would leave that kind of money on the table. While it is not unusual for players to forego a workout bonus (e.g., the $75,000 workout bonus), $2 million dollars is another story. That figure is 1/3 of the money he has made to date in football. And, given how players make every dollar count, it is unthinkable Brown would forfeit that kind of money - for any reason.
Since the news first broke, Brown spoke with the media at training camp, and indicated he had not been aware of the clause. Brown said the first he learned of it was on Twitter after the McIntyre report broke. He said he fired his agent shortly after learning about the mistake.
Some have suggested Brown should accept a certain amount of responsibility for "not reading" his contract. What should be understood is the language in NFL contracts is legally sophisticated, usually an agreement formed by a series of negotiations. There is a standard player contract (see Appendix A of the CBA), but it is filled with legalese, not including any negotiations on top of the basics.
For this reason, professional athletes hire agents. Agents are not only responsible for negotiating, reviewing and explaining the contract, but an agent also has a fiduciary duty to his or her client's financial wellness. Ninety percent of the time, it requires some form of legal consultation.
Neither the law nor the NFL require an agent hold a license to practice law, but most agents have law degrees and/or are licensed attorneys. Tarell Brown's agent, Brian Overstreet, was licensed to practice law in the State of Texas. Since he undoubtedly negotiated the contract and had a fiduciary duty to his client, any negligence that causes harm to a client could be construed as legal malpractice.
Tarell Brown fired Overstreet yesterday, and during player availability, he stated, "That's what agents get paid to do...." Brown is absolutely correct. What does not help is public records reveal Brown's former agent, Overstreet has already faced disciplinary action by the State Bar of Texas. The public website of the State Bar indicated Overstreet was on "fully probated suspension" from 2009 to 2011. A further search revealed that his suspension came about due to practicing law after he failed pay necessary fees on time (PDF). While this is not the same as his potential mistake with Tarell Brown, it does begin to reflect a certain pattern.
Each state has its own disciplinary counsel and ethics code or rules. Most disciplinary actions come from complaints of clients. I would venture to say, if these reports are correct, Brown has a legitimate complaint. It has not been released what Overstreet actually advised; however, Brown's comments yesterday make it appear as though he was not aware of the full stipulations of the escalation clause. If Overstreet made the mistake or was negligent in communicating the necessary requirements, Brown could file a malpractice claim.
The fact is agents, even lawyers, make mistakes. We saw it with Elvis Dumervil and the fax machine fiasco. This is why attorneys carry professional liability insurance. Malpractice lawsuits arising from errors and omissions (or even failing to meet a client's expectations) are not uncommon. It is unfortunate in Brown's case, because if this happened as Tarell Brown stated, it was easily preventable. If Brown decides to file suit against Overstreet, the agent's insurance carrier would defend and indemnify Overstreet. These kinds of claims settle behind the scenes.
The NFL stipulates a 5-day waiting period to change agents. Brown has likely contacted a new agent, so I suspect the official change will be made shortly. With good representation, Brown should go after the $2 million difference. And, since he would be seeking it from an insurance carrier, I do not believe he will think twice about it. And, while he's at it, he should let the State Bar of Texas know Overstreet dropped the ball. Like Brown stated, "this is ... business."