Archive | October 22, 2015

Heads Up: Concussions, Class-Actions and the National Hockey League

October 22, 2015

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By Brianna Meyer – Thompson Rivers University 2L JD Student

The Stanley Cup. Sidney Crosby. Wayne Gretzky. These buzzwords ignite dreams of aspiring elite hockey players across Canada as children of all ages commence the journey to the National Hockey League (NHL). For those that make it, the NHL provides the ultimate platform of hockey excellence. A dream come true. But at what cost?

For over 200 former NHL players, the lasting effects of head injuries sustained during their professional hockey careers have motivated a class action lawsuit against the NHL. The players allege that the league was wilfully withholding information about the long term health effects of repeated head trauma and was actively encouraging dangerous behaviour.

This lawsuit follows the successful $765 million dollar settlement for players of the National Football League sustaining similar head injuries. Boston University researchers have diagnosed several deceased NHL players as victims of trauma-related brain disease. Although this area of research is novel and still advancing, Boston University has identified a link between chronic traumatic encephalopathy (CTE) and repeated blows to the head. CTE is a degenerative brain disease found in former deceased athletes often identified by the presence of hyperphosphorylated tau (an abnormal protein in brain cells).

This link is currently being questioned by the NHL who has since subpoenaed records from the Boston University researchers conducting these studies. NHL commissioner Gary Bettman has rejected the very notion that the link between CTE and sports-related concussions exists at all. Besides this league denial of a connection, there are other significant obstacles that stand in the way of former NHL players claiming damages from the NHL for their injuries. The majority of the claimants are retired, which raises questions as to the limitation period upon which this litigation is brought. In addition, we are talking about professional hockey players who grew up playing in minor and amateur hockey leagues. Isolating causation and liability specifically to the NHL will be a significant burden to prove.

Despite these impediments, this issue is not going away. In February 2015, Steve Montador died at the age of 35 from an undisclosed cause. He had been exhibiting signs of a brain disorder including depression, memory problems and erratic behaviour leading up to this death. An examination of his brain post-mortem revealed that he suffered from CTE. The scope of this class-action lawsuit demonstrates that Steve Montador is not alone.

Changes to the NHL official rules to prohibit illegal checks to the head were made in 2011. But is that enough? For players suffering from the long-term effects of traumatic brain injuries sustained while playing professional hockey the answer is clearly no. When elite athletes elect to participate in a sport there are always inherent risks. However, the core of this lawsuit alleges that the NHL withheld the very information players needed to know to make a rational, informed choice about taking such risks. The lawsuit emphasizes that the NHL has the capacity and the resources to better prevent head injury but failed to do so. Players can only consent to risks they are aware of. The NHL, it is alleged, blurs the lines of what players actually consent to.

CTE. Second-impact syndrome. Traumatic brain-injury. These words are killers of professional hockey dreams unless there are significant changes in the prevention, treatment and and return-to-play protocols of concussed players in the NHL. Legal accountability is one mechanism that can trigger this process. For the sake of aspiring hockey players across North America, I hope that the courts can force the NHL back into the reality of the game to deal with this issue head on.

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R. v Riesberry – horse racing, doping, fraud and the Supreme Court

October 22, 2015

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By Chris Gall – Thompson Rivers University 2L JD Student

A unique case involving horse doping has reached the homestretch as it was heard by the Supreme Court of Canada last week. Here are the facts of the case: Derek Riesberry, a standardbred racehorse trainer, was caught by hidden camera injecting a performance-enhancing drug into a horse. Further, a syringe containing drugs was also found in his truck. He was charged with cheating and attempted cheating at a “game” as well as fraud and attempted fraud – all of which fall under the Criminal Code.

At trial, he was acquitted, with the judge ruling that horse racing is not a “game” within the meaning of the Criminal Code, and further, the Crown had failed to prove “deprivation” i.e. that anyone relied on his injecting or not injecting the horse with the drug. In essence, no monetary loss occurred from relying on the information so there was no deprivation and therefore no fraud. The charges of cheating were also dropped because the judge concluded horse racing was not a “game of chance or mixed chance and skill,” and thus did not meet the Criminal Code definition of a “game”.

The appeal court overturned the ruling and entered convictions on fraud, because he deprived bettors of an honest race and violated the rules of horseracing. The Supreme Court of Canada reviewed the meaning of “game” under the Criminal Code and raised questions concerning fraud, cheating, and whether horse racing involves chance.
There are three potential outcomes for Riesberry: 1) the fraud convictions are confirmed, 2) the fraud convictions are overturned, and 3) a new trial is ordered on fraud charges.

This case is being watched closely by the racing industry in Canada which insists doping is rare, however it is severe enough that six Ontario police officers have been seconded to the regulatory body for horse racing, the Ontario Racing Commission. This case also has implications throughout North America, where horse racing is still big business with $11 billion being bet on horses last year ($5.7 billion of that in Canada). It will be interesting to see how the issue of doping sorts itself out. One possible solution from the USA is the recently introduced Thoroughbred Horseracing Integrity Act of 2015, which seeks to grant authority to an entity created by the United States Anti-Doping Agency for making and enforcing rules as well as testing for drugs and medications used in horse racing.

Another solution involves pressure applied by corporate sponsors. Scared by doping scandals in other sports, they do not want their brand associated with cheating or scandal. However, this is likely not enough. A real struggle comes from the veterinary business itself, where animal doctors prescribe and sell the drugs they administer. In this instance, the more drugs they prescribe the more money they make which raises issues of animal welfare as well. It is likely the courts themselves do not possess the power to compel real change. This poses a greater challenge when the potential health risks from doping are not faced by the person doing the injecting, and owners themselves may be unaware of what a trainer is doing. All bets are off until regulators, lawmakers, and industry insiders can work together and those in racing come clean.

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Uncertainty in Outcomes – Draft Kings Class Action Lawsuit Promotes Fair Play

October 22, 2015

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By Edward Hulshof – Thompson Rivers University 2L JD Student

Sport is a big-money industry. Players, coaches and team owners make millions. Teams are worth billions. Apparel, soft-drink and other spin-off companies make billions. Fans relish in entertaining contests of skill and talent and this fan participation is enhanced by fantasy sports. Fantasy sports date back to the early 1960s when Oakland Raiders partner Wilfred “Bill” Winrenbach helped start the GOPPPL (Greater Oakland Professional Pigskin Prognosticators League).

The .dot com boom has brought fan participation in fantasy sport contests to new levels, becoming a multi-million dollar industry. Money makes the world of sport go round, shaping the interests of stakeholders and participants. The entertainment value in sport stems from the uncertainty in outcomes. When the outcome becomes certain, aggrieved parties often head to the courts.

Indeed, class action proceedings were recently commenced against FanDuel, Inc. and DraftKings, Inc. (the “Defendants”), operators of daily fantasy sports (“DFS”) websites. The Class Action Complaint (the “Complaint”), filed October 8, 2015 in the southern district of New York, alleges the Defendants “fraudulently induced the Plaintiff and the proposed class to give Defendants money, which ultimately went to Defendants and employees through fees and contest prizes.”

“Fish,” DraftKings’ endearing name for new inexperienced users drawn to DFS contests in the hopes of winning large cash prizes, paid entry fees of varying amounts which, as alleged in the Complaint, found its way into the hands of “whales,” DFS top-earners, a significant number of whom are “employees – often executives – of other sites.” The Plaintiffs allege that as a result of misrepresentations and omissions, they were fraudulently induced to participate in the Defendants’ DFS websites, which were marketed as games of “skill.” The Complaint paints the DFS contests as nothing short of scams.

The scam works like this: the Defendants aggressively promoted their DFS contests as games of skill. The “skill” in the game is a participant’s unique exercise of analytical abilities including culling large amounts of player statistics to make informed purchases of athletes for their fantasy teams. The better informed players – those with knowledge of athlete performance statistics – create the best teams and perform best. Access to information is key: the more a player knows, the better positioned they are to win. Unfortunately, “whales” have access to more information than “fish.” They also have access to analytics tools and “years of data on optimal strategies” enabling them to better analyze and detect the purchasing patterns of “fish.” “Whales,” it is alleged in the Complaint, used this inside information to their benefit. The game of “skill” wasn’t a game of skill at all.

There are inequities in all sports. Some athletes are stronger and faster than others. Some deal with pressure better than others. Some have more time to practice The law often steps in to level the playing field by placing limits on access to unfair advantages; for example, professional golf authorities place limits on equipment technology and most sports ban performance enhancing drugs.

In the sport of DFS contests, the law can be used to promote fair play by restricting who participates and how they play. Indeed, the allegations surrounding fraudulent misrepresentation coupled with a large class action lawsuit, if successful, will surely serve as a useful deterrent against future unfair play in the DFS arena.

In order to be successful, however, the Plaintiff must satisfy the test for class action certification. In New York this consists of satisfying the elements of numerosity, commonality, typicality, adequacy, and superiority. The Plaintiff addresses each of these elements by arguing (1) the joinder of all members of the plaintiff class would be impractical, (2) the plaintiffs share questions of law and fact, (3) the plaintiffs were all induced by the Defendants’ advertisements, (4) the plaintiffs do not have any conflicts of interest and would protect the interests of the class, and (5) the class action will permit fair and efficient adjudication. A fundamental policy rationale for class actions – that is behaviour modification – is best served, however, if the Plaintiff class can keep their case in court.

Interestingly, the Complaint makes an effort to thwart any attempts by the Defendants to avoid a class action by arbitrating pursuant to the DFS website “Terms of Use,” arguing the Terms of Use are invalidated by the fraudulent misrepresentations of the Defendants. (There can be no contract if the Plaintiffs were fraudulently induced.) Arbitration, it could be argued, would not serve the interests of the plaintiff class, and the larger policy rationale of behaviour modification, by potentially sheltering the legal claims behind closed doors. If the class action is to have its intended benefit, avoiding arbitration is an important strategic approach to pleading.

The DFS class proceeding is still in the early stages and it is too soon to tell whether it will continue. In any event, this looming lawsuit will likely cause many DFS websites to modify their Terms of Use and make efforts to level the playing field. Like all sports, uncertainty in outcome is the source of entertainment. If DFS is to remain entertaining, companies would be wise to take note of this class proceeding.

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