NFL Snyder Demands Cover as Gruden NFL Suit Hinders Commanders Sale
If all goes as planned, a group led by Josh Harris will gain NFL approval as the new owners of the Washington Commanders next Thursday.
The word “if” is doing a lot of work in that sentence.
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According to The Washington Post, Commanders owner Daniel Snyder is demanding the league indemnify him and the Commanders’ limited partners from payments the league could be obligated to make to Jon Gruden should it be held liable in the former Raiders coach’s lawsuit or if it reaches a settlement with Gruden.
Like with the NFL’s $790 million settlement to end a lawsuit over the Rams’ relocation from St. Louis to Los Angeles, each owner would likely share a portion of the cost to pay Gruden to drop his claims.
Snyder’s demand, which could eventually spark litigation between him and the league, might give other owners pause before they approve the sale.
Two years ago, Gruden sued the league and commissioner Roger Goodell for interference and negligence in a Nevada court. His basic claim: Goodell or someone on Goodell’s behalf illegally leaked to The Wall Street Journal and The New York Times emails Gruden wrote in 2011 to then-Washington president Bruce Allen in which Gruden, an ESPN employee at the time, made racist, sexist and homophobic comments and ridiculed Goodell, too. The emails were uncovered as part of a league investigation into workplace misconduct involving Snyder and other Commanders officials. Besieged with public accusations of bigotry, Gruden resigned as coach and walked away from about $60 million left on his contract.
The NFL flatly denies Goodell or anyone in the league office leaked the emails. The league further argues the lawsuit is frivolous and illogical. If Goodell wanted Gruden out of the league, the league stresses, Goodell had the legal right as commissioner to simply cancel Gruden’s contract on grounds he engaged in conduct detrimental. From that lens, Goodell didn’t need to orchestrate a surreptitious—and risky—plot wherein he used journalists to inflict payback on Snyder.
The league has also noted that, per the NFL’s constitution and coaches’ employment contracts, disputes between coaches and the commissioner must first go to an arbitration process overseen by Goodell.
But last year Judge Nancy Allf denied the NFL’s motion to dismiss. She enunciated concerns that Goodell having “sole power” over employment disputes is problematic when those disputes implicate him. The case remains in litigation.
To date, the identity of the leaker(s) remains a mystery. There’s a good chance the mystery will never be solved.
The Washington Post has suggested Snyder might be the leaker since his team had custody of the emails and the leaks also included emails sent by NFL executive vice president Jeffrey Pash, who is close to Goodell and with whom Snyder has disagreed over the years. Snyder fully denies the suggestion and, as part of a Congressional investigation, reportedly provided sworn testimony saying he didn’t do it and doesn’t know who did. On Wednesday, ESPN published a lengthy story on the email leak and possible ties to Snyder (among other suspects), but cautioned the mystery remains and that many people working at different companies had access.
Snyder reportedly does not believe he should be financially responsible for any unlawful acts committed by Goodell or others in the league office. Snyder apparently eyes a legally meaningful distinction between league behavior, of which owners are contractually liable, and the behavior of league officers.
The Harris-led group, which has agreed to pay $6.05 billion for the team, will need at least 24 teams to approve the sale.
Odds are Snyder’s demand won’t stop owners from voting yes.
The league is unlikely to go to trial with Gruden and allow Goodell to appear before a jury and face cross-examination on a potential range of topics; it would much more likely reach a settlement with Gruden. A settlement of even $100 million would require each team to pay a dollar amount dwarfed numerous times over by what the Harris group is going to pay for the Commanders. In reality, Snyder’s demand concerns what is comparatively a drop in the bucket or a rounding error.
Plus, indemnity or not, the NFL’s relationship with Snyder isn’t going to end once he’s a former owner.
The Commanders are under criminal investigation by the U.S. Attorney for the Eastern District of Virginia for possible fraudulent practices. There is also ongoing litigation involving Washington D.C. suing the Commanders, Snyder and Goodell over alleged collusion to deceive D.C residents about a workplace misconduct investigation. The underlying misconduct is also a source of litigation. Snyder would be, at minimum, a witness in these matters.
Snyder, who is the target of a league-commissioned investigation led by former SEC chairperson Mary Jo White into alleged misconduct, could also sue the league over disclosures he deems unlawful and in violation of contractual rights and privacy safeguards.
The most likely outcome is the Commanders will soon have a new ownership group, but the one leaving will remain in the league’s orbit for many years to come.
