Snyder Sex Misconduct Allegations Cloud Sale by Washington Limited Partners
In the most direct threat yet to Daniel Snyder’s ownership of the Washington Football Team, The Washington Post reported on Tuesday that the team paid a female former employee $1.6 million in 2009 after she accused Snyder of sexual misconduct. The alleged misconduct stems from an incident on Snyder’s plane. The agreement, as described by the Post, does not contain an admission of wrongdoing. The Post’s story also revealed that the team initially classified the accuser as fired with cause only to change it to without cause. The team also provided her with a letter of recommendation.
A New York Times story on Dec. 18 painted a very different picture of the 2009 incident and its resolution. The story noted that two investigations, one by the team and the other by a law firm retained by the team, “were unable to substantiate the woman’s claim that Snyder had accosted her.” The story also reported that the accuser was fired for lying to team attorneys. As to the settlement and its nondisclosure language, both are depicted as stemming from the team’s desire “to avoid any potential negative publicity if the woman sued Snyder.”
The 2009 incident is also referenced by a group of attorneys representing the team’s three limited partners—Robert Rothman, Dwight Schar and Frederick Smith. The trio has sued Snyder in Maryland federal court, arguing that he lacks the contractual authority to deny the trio a chance to sell their equity to one buyer. The league has intervened in the lawsuit and, as first reported by Sportico, league outside counsel Benjamin Block argued in a memorandum the dispute should be resolved by league arbitration.
In a Dec. 21 filing obtained by Sportico, the attorneys lambast Snyder for what they contend is revealing confidential information to the New York Times for the Dec. 18 story. They write, “This self-serving and one-sided framing [by the New York Times] of a serious accusation of sexual misconduct against Mr. Snyder, which depicts the victim as someone who ‘lied’ and portrays the settlement solely as a payment ‘to avoid negative publicity if the woman sued,’ further confirms that Mr. Snyder or his agents are the source of the leaks of confidential information to the New York Times.”
Meanwhile, in Virginia, former team general counsel David Donovan has sued the league’s outside investigator, attorney Beth Wilkinson, demanding that Wilkinson and the league not reveal information about a 2009 agreement to which Donovan is a party (possibly as an attorney of record). Snyder has intervened in the lawsuit, essentially reiterating Donovan’s arguments for confidentiality. It’s unknown if the 2009 agreement is, or is related to, the settlement agreement reported on by The Washington Post and New York Times.
The NFL’s investigation into Washington workplace conduct has been portrayed as focused on team employees, rather than on Snyder. While the merits of the accusation from 2009 are unknown, it highlights that the scandal extends to Snyder himself. As private investigators, Wilkinson and her team lack subpoena powers. They can’t compel disclosure of records or demand witness statements. Yet they can apply investigative pressure to try to corroborate or refute the 2009 allegation and other allegations.
To the extent Snyder is personally implicated in wrongdoing, the league is more likely to punish him individually, such as through a fine or suspension. Whether any wrongdoing by Snyder was limited to one incident, or whether it reflected a pattern of misconduct, would be an important consideration for NFL commissioner Roger Goodell in calculating an appropriate sanction.
A far more consequential punishment would be to expel Snyder from the league. It would be an unprecedented measure. While the NFL is thought to have persuaded or pressured Jerry Richardson into selling the Carolina Panthers to David Tepper, the decision to sell remained with Richardson. The league fined Richardson $2.75 million for alleged physical and sexual misconduct against women employees and for allegations of making racially insensitive remarks.
In that same light, while the NBA banned Los Angeles Clippers owner Donald Sterling from NBA activities in the wake of his racially insensitive remarks, the league did not force him to sell. In fact, NBA commissioner Adam Silver and NBA owners never voted on Sterling’s ownership. The billionaire attorney “lost” the franchise when his wife, Shelly Sterling, won control of the family trust in court and then sold the team to Steve Ballmer.
Under the NFL’s constitution, removal of Snyder would require, among other conditions, at least 24 of the 32 ownership groups voting in favor. Keep in mind, it’s possible that other owners have signed pre-litigation settlement agreements with employees who accused of them sexual misconduct and other forms of workplace wrongdoing. Some might worry about precedent, specifically that they can lose their equity in a franchise over allegations.
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