The most important tool in any negotiation is leverage. The side with more leverage has the upper hand and a better chance of obtaining their ideal agreement.
When negotiating sports contracts, the amount of leverage an entity has is determined by a myriad of different factors, such as talent level, team position, and available funds. While contract information has become more public in recent years, player conduct has becoming a growing factor in athlete contracts.
To paint a real life picture of how conduct affects contract negotiations, look no further than Jacksonville Jaguars' first-round pick Justin Blackmon. The former Oklahoma State star recently got into legal trouble with a DUI arrest during contract negotiations. Before playing his first down with the Jaguars, Blackmon learned a hard lesson in how an off-the-field issue can affect your wallet.
After blowing a .24 BAC on a breathalyzer test, a level three times over the legal limit, Blackmon was arrested and released on a $1,000 bond. Not only does Blackmon face a possible suspension, he has perhaps established a reputation for being a distraction to his team.
Blackmon had already received a DUI when the wide receiver was at Oklahoma State in 2010. Not only do the two arrests hurt his current contract negotiations, they could factor into future ones, as well.
Even for a player on the verge of a lucrative salary, the financial cut for this latest DUI is deep.
The guaranteed money in his contract will likely be reduced, which serves as protection for the Jaguars in case he is suspended, arrested, or out of shape at the start of the season. Blackmon will also be denied payment if he is suspended, which seems probable. NFL Commissioner Roger Goodell has been known to levy harsh punishments during his tenure, and Blackmon may have to wait a few weeks before seeing his first in-game action.
If Blackmon avoids problems for the rest of his career, his former delinquency will benefit his club. If Jacksonville uses their leverage to backload his deal, he may eventually earn the money he lost in these negotiations, but should that case he would be worth the money the Jaguars spent. If not, then the Jaguars will lose money, though significantly less than if a deal was signed before this recent DUI.
The possibility of losing a player to suspension or prison is not the only reason that teams protect themselves against felonious players. Locker room chemistry factors into that equation just as much. What goes on behind the scenes can be just as important to team success as the play on the pitch and a possible disruption to the team psyche could lead to poor performances.
American teams are increasingly functioning like corporate franchises. Teams protect their brands from being damaged by the players that represent them. The Philadelphia Eagles saw immediate public backlash following their August 2009 acquisition of much-maligned quarterback Michael Vick, who had served a prison sentence for dog fighting.
The Eagles wisely signed Vick to just a one-year deal worth $1.6 million, which wasn't guaranteed. The deal contained a team option for the following year worth $5 million. After Vick proved to be a model citizen, the Eagles retained him. Vick has remained the Eagles' starting quarterback, and was given a six-year deal worth $100 million in 2011, after an impressive 2010 season.
The Eagles are an example of a team that used the leverage afforded to them by Vick's checkered past to get the most out of a talent player. By protecting the franchise against transgressions by Vick, the Eagles were set up to either benefit greatly from his performance at a discount rate, or cut ties with him for an insignificant cost.
An NFL team that has benefited the most from taking a chance on risky players has been the New England Patriots.
The Patriots, who have been perhaps the most successful team in the NFL over the past decade, have brought in a number of players with questionable reputations. The most prevalent example of a player bought in at a discount rate is future Hall of Famer Randy Moss. The star wide receiver was acquired by New England in 2007 from Oakland Raiders in exchange for just a fourth-round draft pick. New England received a player that went on to set the single-season record for touchdowns. The pick Moss was traded for ended up being cornerback John Bowie, whose has just two tackles in his NFL career.
The Patriots have used this strategy in selecting draft picks, and to great success. Aaron Hernandez, who was predicted in many mock drafts to be selected early in the third round of the 2010 NFL Draft, slipped midway through the fourth to New England, due to the tight end testing positive for marijuana.
Hernandez would later sign a four-year deal with a low signing bonus that could be made up with incentives that hinge on him staying clean and making the roster. Hernandez has since been earning those incentives, but at the first sign of trouble, New England can part ways with him for less than his talent alone was worth.
Comparatively, Jimmy Graham, who was picked 18 picks ahead of Hernandez, received a signing bonus worth more than three times what Hernandez received. Unlike Hernandez's contract, Graham's holds more guaranteed money and less of it is tied to incentives. Graham's contract is basically a carbon copy of what Hernandez would have received if conduct was not an issue.
Smart teams use the leverage afforded to them by a player's personal mistakes and to acquire high-quality talent with conduct issues for the same price as a model citizen with less talent.
However, the method does not always work. Sometimes adding a controversial player to a locker room can be likened to adding an infected cell into a human body. The malady spreads throughout and infects other players, leading to a chaotic locker room that becomes the subject of intense media reports.
The Patriots saw this coming with Moss in 2010, and proceeded to trade him to the Minnesota Vikings. The result was not good for Minnesota, as Moss publicly criticized the club and was waived less than four weeks after arriving.
So what is the difference between teams like New England and Minnesota? Why did the Patriots get so much out of a player that failed to produce with the Vikings?
The answer likely comes down to leverage. Being a three-time Super Bowl champion with a talented roster gave New England leverage. If Moss failed to be a model citizen, he would have been removed from the squad and missed out on a potential title shot.
In Minnesota, there was no such incentive to behave. The Vikings had a 1-2 record when Moss joined and the team finished last in their division. Minnesota surrendered a third-round draft pick for Moss, which could have been used to strengthen a roster in need of young talent.
As for the Jaguars, Blackmon has yet to sign and his deal will likely be altered by his recent actions, which could work out great for Jacksonville if the team handles his contract right.
It will be interesting to see where Blackmon goes from here.
Does the 22-year-old prove his detractors wrong by being a star on the field and a respectable citizen off of it, or is he in for a career plagued by personal behavior issues that deprive him of success?