I recently attended the Western Economics Association conference in Seattle. I heard a fantastic talk on a type of analytics, that I’ll confess, is out of my wheelhouse – sports law analytics. And while listening, I heard something that floored me: it may be legal, via federal laws, for the NBA to change the outcome of games.

Some background: Ryan Rodenberg, is a professor in just that subject at Florida State University. He also has an impressive resume that includes Nike, Octagon Sports Marketing, and the ATP tour. In his paper “Master of Puppets: Legally Preserving Uncertainty of Outcomes in Sports”, Ryan discusses the legality of fixing games in the NBA. His killer line is here:

Working in concert with affiliated referees, coaches, players, facility personnel, commercial sponsors, or broadcast partners, a sports league cognizant of such demand function can, in theory and practice, manipulate their own contests to artificially inflate consumer interest and revenue potential. So long as such manipulation has no nexus to gambling, the rigging of game outcomes or individual events therein is legal. No federal law definitely prohibits it.

Wow! Read that a few times. Ryan brings up the “quiz show scandal” statute that was passed in 1960. However, he notes that this doesn’t explicitly include sports and, in fact, has had a commentator exclude sports as they are not of an intellectual nature.

As I understand it: Adam Silver/David Stern can not bribe his referees ala Ed Rush. Nor can Adam Silver or anyone else in the NBA have any money on the line via gambling, ala Tim Donaghy. However, the commissioner can inform his refs that as part of their job to keep the sport compelling they need to keep the games close. This is nothing more than an employer telling an employee what to do, something which happens all the time in companies every day.

In fact, the NBA telling referees to change how they are calling games is not new. Via the Pedowitz Report: In 2005 the Dallas Mavericks lost two playoff games to the Houston Rockets. Mark Cuban sent the league several e-mails complaining about 29 illegal screens (focusing, in particular, on Yao Ming). The NBA reviewed the screens and confirmed Mark Cuban was indeed correct. Even before Mark Cuban’s e-mails, they had also sent out information to their referees in regards to how to call these. The league made a change in how they were calling games that probably impacted the outcome. To stress, there was nothing wrong with this. In fact, it certainly seems like the NBA did the right thing. But the point is simple, the NBA can instruct its employees to change their actions in a way that can change the outcome of a game or a series. As long as money isn’t on the line, it is perfectly legal!

Summing Up

The reason Ryan was looking into this was via the recent legality in sports betting brought forth by New Jersey’s Chris Christie. Every league has been opposed to this and wants to uphold Bill Bradley’s betting act from 1992. The reason has been, of course, to argue about keeping the game pure. However, as Ryan subtly points out, the NBA (and other sports) are not pure. Conflicts of interests (such as television contracts related to ratings) and no overt laws mean that the very thing the leagues are arguing about is perfectly legal, as long as you word it correctly — a troubling idea for any fan expecting a fair contest.

And this is just the tip of the iceberg. Ryan is looking into even more fascinating NBA law analytics. The laws at the state level are even crazier! The case of the Sacramento Kings vs. the Los Angeles Lakers in 2002 for instance! I can’t wait to see what else Ryan will have at next year’s WEA (which will be taking place in my hometown of Denver!)

-Dre