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CHILDS v. MEADOWLANDS BASKETBALL ASSOCS.

February 4, 1997

CHRIS CHILDS, Plaintiff,
v.
MEADOWLANDS BASKETBALL ASSOCIATES, d/b/a NEW JERSEY NETS, Defendant, and NATIONAL BASKETBALL ASSOCIATION, Intervenor.



The opinion of the court was delivered by: ACKERMAN

 ACKERMAN, District Judge:

 This matter is before the court on motions by defendant Meadowlands Basketball Associates, d/b/a New Jersey Nets ("Nets") and by defendant National Basketball Association ("NBA") to dismiss plaintiff Chris Childs' complaint, or to compel arbitration. For the following reasons, the defendants' motions are denied in part and granted in part.

 I. FACTUAL BACKGROUND

 The New Jersey Nets employed Childs as a professional basketball player during the 1994-1995 basketball season. Complaint, P 2. During the 1994-1995 season, Childs received as salary $ 150,000, the minimum salary in the National Basketball Association ("NBA"). Complaint, P 8. Steven A. Kauffman, Esq. is Childs' certified player agent. Complaint, P 6.

 The NBA imposed a lockout against its players after the collective bargaining agreement between the parties expired. See Complaint P 11. During the lockout, on August 7, 1995, Childs received an offer to play basketball for the Panionios Sporting Club ("Panionios"), a professional basketball team in the Greek Basketball Federation ("GBF"). Complaint, P 9. The Panionios offered Childs the United States equivalent of between $ 650,000 and $ 700,000 to play basketball in the GBF. Id. However, after consulting with the Nets, Childs rejected the Panionios' offer. Complaint, P 13.

 Childs' agent Kauffman informed the Nets General Manager, Willis Reed, of the terms of the offer. Complaint, P 11. Reed expressed the Nets' intention to re-sign Childs for the 1995-1996 season, and acknowledged that the Panionios' offer was appropriate for a player of Childs' caliber. Id. However, Reed also explained that the Nets could not sign Childs immediately because the NBA's "lock-out" of its players was still in effect, i.e., on August 7, 1995. Id. "Reed assured Kauffman, however, that after the lock-out was lifted, the Nets would promptly resign Childs to a contract that was as financially attractive as the Panionios offer." Complaint, P 8.

 The NBA's lock out of its players was lifted on September 18, 1995. Complaint, P 14. However, when Kauffman approached Reed to negotiate a contract for Childs, the Nets refused to offer Childs a contract that was as financially attractive as the Panionios offer. Complaint, P 15. At this point, after the lock-out had ended, it was too late for Childs to accept the Panionios' earlier offer. Complaint, P 16.

 Due to the restrictions of the salary cap in the NBA, the Nets were able to offer Childs only a one year contract for $ 350,000. Complaint, P 16. Childs claims that he was forced to accept the offer because he had no other choices. Complaint, P 17.

 II. DISCUSSION

 Childs' complaint alleges four state-law grounds for relief against the Nets. First, Childs claims that Reed committed fraud in falsely claiming that the Nets would match the Ponionios's offer. Second, Childs claims that Reed made negligent misrepresentations during the contract negotiations. Third, Childs claims that Reed and the Nets intentionally interfered with Childs' prospective economic advantage. Finally, Childs claims that the actions of Reed and the Nets in this action constituted breach of contract. As a result of all of the foregoing, Childs claims that he is entitled to damages in excess of $ 100,000.

 Soon after Childs filed his complaint, the Nets filed a motion to either dismiss the action or to compel arbitration. In addition to their briefs and arguments, the Nets submitted affidavits in support of their motion. While this motion was pending, the NBA filed a motion to intervene in this action, which was eventually granted as unopposed by U.S. Magistrate Judge Stanley R. Chesler. The NBA ...


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