Wide receiver Kenny Golladay will have his choice among lucrative offers now as free agency opens, but his choice of agents has led to an ongoing court battle.
U.S. Federal Magistrate Judge Susan Schwab recently denied sports agency CAA’s motion to dismiss a lawsuit that centers on Golladay’s autographing memorabilia at a private signing hosted by a Pennsylvania-based business. The case pits agent Jason Bernstein and his agency, Clarity Sports, against CAA Sports and a group of sports memorabilia companies. The denial, issued on March 4, means the case will advance to pretrial discovery in a Pennsylvania federal district court.
In late 2016, Bernstein signed Golladay—a top NFL prospect at Northern Illinois—to an exclusive agency relationship. Bernstein would be entitled to a 3% commission on Golladay’s player contracts and a 15% commission on his endorsement and marketing contracts, including those for autograph signing appearances.
The Lions went on to select Golladay in the third round of the 2017 draft. He would emerge as one of the NFL’s elite receivers in 2018, when he caught 70 passes for more than 1,000 yards. A year later Golladay led the league in touchdown receptions and earned a spot in the Pro Bowl. The 27-year-old will become a free agent on Wednesday, with the Giants, Jets, Dolphins and Patriots reportedly courting him.
Golladay’s emergence brought him fan recognition and the attraction of sports memorabilia companies. On Jan. 2, 2019, Redland Sports, which markets sports memorabilia signed by NFL players on its Facebook page, announced that it would hold a private autograph signing with Golladay a few weeks later. The event would also involve memorabilia businesses Boone Enterprises and MVP Authentics.
This development came as a surprise to Bernstein, who hadn’t arranged the event and was negotiating a different memorabilia signing for Golladay. Bernstein texted and emailed Redland, asking that the Facebook post be taken down and that the company call him. According to court documents obtained by Sportico, the messages went unanswered. Bernstein maintains the companies had underhandedly coordinated with CAA to set up the event and arranged for Golladay’s travel logistics.
Golladay signed about 600 items, with a price of $40 per autograph on flats and mini helmets and $50 on premium items. Court papers indicate he earned $9,000, a 15% commission for which amounts to $1,350. The next day, Golladay allegedly called Bernstein and said he planned to fire him after a five-day notice period ended. He cited “resources,” or lack thereof, as the reason. Golladay then hired CAA agent Brian France.
The dispute has sparked two levels of legal action, one out of court and the other in court.
In response to Golladay’s agency switch, Bernstein filed an NFLPA grievance against France. The NFLPA licenses and regulates agents and arbitrates disputes between them. As a condition of obtaining a license, an agent contractually assents to arbitrating matters against fellow agents out of court.
Bernstein argues that France wrongfully poached Golladay. As portrayed by Bernstein, France induced Golladay to attend a signing event in hopes it would convince Golladay into switching agents. NFLPA regulations prohibit agents from offering money or items of value to players who are already represented. Bernstein insists the autograph show counted as a “thing of value.”
NFLPA arbitrator Roger Kaplan ruled for France and U.S. District Judge Yvette Kane denied a motion by Bernstein to vacate Kaplan’s award (ruling). Although court records indicate that “several witnesses, including Golladay, his mother, and [the] memorabilia dealers failed to appear at the [Bernstein-France] arbitration hearing, despite subpoenas from the Arbitrator,” available testimony advantaged France. Golladay apparently approached France (rather than the other way around) at a September 2018 charity bowling event in an effort to network and build his brand. France testified that Golladay asked France if he was with CAA. Golladay also mentioned that he was planning “to make an agent move.” France testified that he did not arrange the autograph signing and never communicated with Golladay or his family members about it.
Bernstein has used the courts to pursue his claims against the memorabilia companies and CAA. Bernstein asserts they engaged in tortious interference with existing contractual relationships. He argues they knew that Golladay wasn’t represented by CAA and that France hoped to woo Golladay. As expressed in court filings, the defendants insist they followed the law and that Bernstein’s claims are groundless.
The memorabilia companies sought dismissal on several grounds, including their contention that Bernstein failed to explain how their “alleged actions [as an autograph signing host] had more than an incidental effect on Golladay’s decision” to switch agents. To that end, the companies maintained they had “no incentive” to interfere with an agent-player relationship. In response, Bernstein asserted the companies possessed a financial incentive by (allegedly) conducting regular business with CAA and France’s clients.
CAA, meanwhile, sought dismissal in part based on Bernstein purportedly failing to plead facts that would “demonstrate [Golladay] himself had any desire to continue on in his at-will relationship” with Bernstein. Bernstein rejected this line of reasoning as legally irrelevant, pointing out the interference would have occurred while Golladay was still under contract to Bernstein.
Judge Schwab denied the motion to dismiss on grounds that Bernstein’s claims require more analysis. This means the case will continue (barring a settlement), and the parties will be asked to share emails, texts and other sensitive records. As for Golladay, he would be a key witness if the case advances to trial.