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Jon Gruden-NFL dispute must go to arbitration, Nevada Supreme Court rules

Updated May 14, 2024 - 7:24 pm

The Nevada Supreme Court ordered former Raiders head coach Jon Gruden’s lawsuit against the NFL to go into arbitration outside of court Tuesday, reversing a previous ruling from a district judge.

The NFL has been trying to force Gruden into arbitration over the 2021 lawsuit, arguing that the NFL Constitution requires Gruden to resolve disputes in an arbitration process moderated by Commissioner Roger Goodell, another NFL official, or a third party.

The Nevada Supreme Court agreed with the NFL’s arguments in an order filed Tuesday, finding that because Gruden agreed to be beholden to the NFL Constitution in his employment agreement with the Raiders, he can be forced into the arbitration process.

“Gruden has presented no contract defenses that make that clause unenforceable,” wrote Chief Justice Elissa Cadish and Justice Kristina Pickering in Tuesday’s order.

Gruden sued the league and Goodell in November 2021, claiming that the NFL intentionally leaked derogatory emails he wrote and pressured the Raiders to fire him in an attempt to ruin his career and reputation. He resigned as the Raiders coach a month before the lawsuit was filed, after The Wall Street Journal and The New York Times published stories about racist, misogynist and anti-LGBTQ emails he had written.

The NFL has said it did not leak the emails, and it has disputed Gruden’s allegation that all of the emails leading to his departure were sent before he became the Raiders’ coach.

Under the NFL Constitution, league employees are subject to arbitration overseen by Goodell as long as the dispute involves “conduct detrimental to the NFL.” The justices wrote in Tuesday’s order that the NFL’s motion to compel arbitration and other court filings are sufficient to show that Goodell considers Gruden’s conduct to be detrimental, despite a “lack of a formal opinion.”

The justices ruled that former District Court Judge Nancy Allf improperly relied on arguments from Gruden’s attorneys about a confidential settlement agreement between Gruden and the Raiders. Gruden has argued that his employment agreement was terminated when he reached the settlement.

“Because Gruden did not disclose the settlement agreement or offer any evidence as to its contents, he failed to establish that it rescinded the employment agreement and its arbitration obligations, and the district court’s finding to the contrary was not based on substantial evidence,” according to the order.

Attorney Adam Hosmer-Henner, who represents Gruden, said he agrees with a dissenting opinion authored by Justice Linda Bell, which Hosmer-Henner said characterized the NFL’s arguments as “outrageous and unconscionable.” He said Gruden’s attorneys intend to ask the Supreme Court to reconsider the ruling.

“The panel’s split decision would leave Nevada an outlier where an employer can unilaterally determine whether an employee’s dispute must go to arbitration and also allow the employer to adjudicate the dispute as the arbitrator,” Hosmer-Henner said in an emailed statement on Tuesday.

In the dissenting opinion, Bell wrote that she found the arbitration clause in the NFL Constitution unenforceable, because Gruden was subject to a “take-it-or-leave-it” employment agreement, in which he could not negotiate the terms of the NFL Constitution.

The other justices wrote in Tuesday’s order that there was not unequal bargaining power between the parties, and that Gruden signed the employment agreement acknowledging he had read the NFL Constitution and understood its terms.

“As a former Super Bowl champion coach and long-time media personality signing the most lucrative NFL coaching contract in history, while being represented by an elite agent, Gruden was the very definition of a sophisticated party,” the justices wrote.

Contact Katelyn Newberg at knewberg@reviewjournal.com or 702-383-0240.

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