Case Study - A Power Play For Howard

As a sophomore during the 1995-96 NBA season,to make room for Howard. Now left with a
Juwan Howard posted superstar-like numbers forshallow roster of talents, Miami will be facing an
the Washington Bullets. The fifth pick in the 1994uphill challenge to stay competitive and maintain its
NBA Rookie Draft was immediately courted bybase of loyal fans in market rich Miami.
many teams as he was about to be a free agentIf the Heat decides to slug it out in court, as
in the 1996-1997 season.would be expected if the matter reaches
Although publicly stating he wanted to stay witharbitration, the players union and the team
the Bullets, Howard and his agent, David Falk,owners would be coming into the picture as the
were not attracted to the team's seven yearsunion was supporting Howard and the Heat was
$78 million offer. Howard felt that his marketgetting sympathy from some team owners. In
value was far more than that. Then Miami Heatthat situation, a lock-out scenario could be
offered a 7-year/$98M contract. The Bulletsinevitable and it's one scenario that the NBA -
pushed their offer to $89M, but stopped short offrom Howard Stern down to the last man in a
matching the Heat's offer.team's staff - dreads.
On July 15, 1996, Howard signed a $101 millionGive Concessions to Miami
contract with the Miami Heat. However, thisThe NBA can opt not to pursue sanctions against
contract was voided by the NBA citing that thethe Heat as a concession. At the same time the
Heat exceeded its salary cap. On August 5, 1996league should recognize the Heat's disadvantages-
Howard returned to the folds of the Bullets afterif losing Howard is not enough, losing key players
signing a seven-year contract worth $105 million.just to make salary room for Howard has given a
The Heat went to court to challenge the NBA'sserious dearth in team competitiveness. The
ruling.league should stay away from giving impressions
Assumptionsthat it favors certain teams.
The NBA indicated that the Heat violated itsCoach Riley had suggested that the Bullets' first
salary cap and only used this as basis to void itsround pick should have been given to the Heat.
contract with Howard. However, salary capGiving Miami concessions would allow it to stay
violations come with strict penalties - $5 millioncompetitive and maintain their fan base.
penalty to the team and a season long suspensionThe NBA decided that that Washington can keep
for Heat Coach Pat Riley. The NBA maintainedthe players it had signed up after renouncing
that the Heat already had an agreement withHoward - Tracy Murray and Lorenzo Williams, Rod
center Alonzo Mourning before signing HowardStrickland and Harvey Grant. These are high
and, that the bonuses of two other players werecaliber players that Washington could not have
not counted against the cap when they shouldbeen able to sign up if their initial deal with Howard
have been.pushed through in the first place. Sure the Bullets
Vantage pointsforfeit their next year's first-round draft choice
1. Impose the $5 million penalty against the Heatfor the right to re-sign Howard still they got a
and season suspension for Coach Riley.huge concession in this case.
2. Give concessions to Miami for it to stayThe league can also require the Bullets to release
competitive in the league during the season.one or both of their free agent signings (Tracy
3. Leave the case to courts to settle the matter.Murray and Lorenzo Williams) and pay the
Diagnosisdifference between the final offer for any player
Impose Sanctions against the Heatcut and the deal they signed with the Bullets.
For the NBA to pursue its allegations of salary capIn the overall picture, Washington became a
violations against the Bullets it would have to seekpowerful team by a stroke of circumstances. And
imposition of the $5 million penalty against thethe Heat just had to start from scratch, again.
Team and a season long suspension of Coach PatLeave the case to courts to settle the matter
Riley.The Heat had gone to Florida state court and was
The league maintained it had evidence that thegranted a temporary injunction. According to the
Heat had an agreement with its center AlonzoHeat, the judge's order stated that Howard could
Mourning prior to signing Howard - a violation ofnot sign with another team, and that the league
salary cap rules. The league also maintained thatcould not approve Howard's contract with the
that the bonuses in the contracts of TimBullets, unless the contract recognized the prior
Hardaway and PJ Brown were not tallied the capvalidity and superiority of Miami's contract. If the
by Miami, and that those bonuses should haveHeat won the case it would have been disastrous
been included. These allegations, as expected,for the league as its powers to scrutinize and
were denied by the Heat camp.approve player contracts will be put to question.
Voiding Howard's contract with the Heat andTeam owners can follow suit and bend the salary
imposing severe penalties on the team may havecap rules then bring the matter to court and have
been the right thing to do, but many things woulda reference case to peg against.
have to be given consideration - the Heat canOn the other hand, if the league wins the case
contest the matter in court and the league couldand Miami gets sanctioned, the Heat would claim
face a backlash from Miami fans and other fansthat David Stern succumbed to pressure by the
of the league who might view this action as tooBullets and, more importantly, by the players'
much on the part of the NBA. Remember, theunion -an idea that would not sit well with a lot of
Heat took pains to prepare for drawing Howardteam owners.
to Miami unloading several of its high value players