When the Seattle Seahawks and the Denver Broncos take to the field on Sunday for the annual extravaganza that is the Super Bowl, Joseph Leccese will be watching from a private box with a mixture of pride, excitement and a touch of vigilance.
His law firm advised on the building of the new stadium in East Rutherford, N.J., where the game is being held, a project worth $1.6-billion (U.S.). Earlier this week, one of his lawyers went to court on behalf of the National Football League to block the sale of counterfeit merchandise. And if a performer does something crude during the half-time show (last year one raised her middle finger), that entertainer could hear from Mr. Leccese’s colleagues.
Mr. Leccese, 53, is the chairman of Proskauer Rose LLP, the most influential law firm in sports. From its headquarters in midtown Manhattan, Proskauer counts as its clients all four major professional U.S. sports leagues – football, baseball, hockey and basketball – plus a number of other lucrative sports businesses: men’s and women’s tennis, U.S. soccer, individual football teams, university football associations and NASCAR.
Proskauer has capitalized on the transformation of professional sports over the past three decades into an increasingly valuable commodity, one whose importance to broadcasters, advertisers and sponsors has swelled. By 2017, the North American sports market will be worth $68-billion, according to a recent report from PricewaterhouseCoopers.
“What we did over the last 25 years was to ride this tidal wave of sports becoming a major business,” said Mr. Leccese, who is also co-head of the firm’s sports law group. “We’ve tried to represent anybody and everyone.”
As the pie has expanded, so have the battles over how to divide it. Proskauer dominates the business of representing sports owners in negotiations with their employees, a role that has not endeared them to players or fans, to put it mildly (Proskauer partners played key roles advising the leagues in each of the recent lockouts in professional sports – hockey in 2012-2013 and 2004-2005, football in 2011, basketball in 2011).
For now, the firm sees a period of relative peace between owners and players on major economic issues. It is gearing up for transformations on other fronts, from changes in the ways viewers watch sports to interest from foreign buyers in acquiring professional sports teams.
Some other large firms do legal work for the major leagues, but “if you had to pick one firm that is leading the way, it would be Proskauer,” said Michael McCann, a law professor at the University of New Hampshire and director of its institute for sports law. Proskauer, he said, strikes fear into its opponents: “They are a hard-charging law firm that is certainly well-known for being tough in negotiations.”
Proskauer has 725 lawyers around the world doing everything from mergers-and-acquisitions to securities litigation. Its sports law practice is a small percentage of the its overall business, occupying several dozen lawyers at any one time, Mr. Leccese said, but such clients generate enormous attention. The practice has also produced some famous alumni: A young lawyer named David Stern joined Proskauer in 1966 and later became the commissioner of the NBA. Gary Bettman, commissioner of the National Hockey League, spent three years at Proskauer at the start of his career.
Mr. Bettman now describes himself as a satisfied client. “Their days and hours and weeks know no boundaries when there is a job to be done," he said. "The people I’ve dealt with I trust and I have confidence in and I’m comfortable with.”
Proskauer’s calling card is a forceful approach to owner-player disputes. It notched significant victories in anti-trust litigation for professional tennis and Major League Soccer, noted Prof. McCann. But the tactic most associated with the firm is a lockout, where owners prevent a sports season from starting or taking place as a way to extract concessions from players.
Bob Batterman, a Proskauer partner who joined the firm in 1966, described lockouts as a means to an end. “The difference between a strike and a lockout is simply a question of which side is pulling the trigger,” he said. If a union is happy with an expiring labour agreement and the employer is not, “the only way you can get something back in that context, if negotiations fail, is a lockout.”
Mr. Batterman said that the commissioners of hockey, football and basketball “now believe they have a balance that works.” Unless something unanticipated happens to costs for owners, “there shouldn’t be a need in the foreseeable future for more confrontation” over money.
Adversaries criticize Proskauer for what one described as its “lock out first, ask questions later” approach. But they concede that such tactics have produced results. “It’s been an effective strategy,” said Bruce Meyer, a partner at Weil, Gotshal & Manges, who has represented players’ unions. Although, he adds, “I don’t think it’s a magic pill.”
The current absence of major clashes is probably short-lived, said Mr. Meyer. “There’s a lot of money at stake for both sides. When there’s a lot of money at stake, you see these big battles.”
That money is also attracting interest from overseas in North American sports. Mr. Leccese says Proskauer has had discussions with potential buyers from Asia, the Middle East and Europe. He notes that in the English Premier League, one of the world’s most successful soccer leagues, “very few of those teams are actually owned by U.K. nationals.” He predicts that U.S. sports will also see an increase in foreign ownership.
The transformation of viewing habits now underway presents another challenge for sports leagues, as traditional television and cable broadcasting gives way to a greater number of ways to watch events.
Mr. Leccese, for one, is sanguine. “Almost everything that at first blush seems like a challenge for sports turns into an opportunity,” he said. “All of us would be pretty optimistic about what the future of the business is. And if the business is healthy, then things will be alright for us too.”