David Stern Q&A about CBA negotiations

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Sunday, June 12, 2005
DAVID STERN
NBA Commissioner

RUSS GRANIK
Deputy Commissioner


MODERATOR: Thanks for joining us tonight for our annual update from Commissioner David Stern and Deputy Commissioner Russ Granik. We'll start with an opening statement from the Commissioner, and then we'll take your questions. David?


COMMISSIONER DAVID STERN: I initially decided I wasn't going to talk to the media but Russ said I'd be fine, so here I am.

First, thanks for coming and we're at the culmination of what we think is a terrific year. We know about some of the road bumps in the season and some of the road bumps in previous seasons, but here we are at the end of a third year of a six year network television contract and a year where we had record attendance from our fans liking our game. As we've said in previous releases, we, like certainly our cable partners, ESPN and TNT, really ruled the cable roost during the sweeps period. Our push on globality continues, and in some ways, the Spurs are sort of a United Nations team, which has demonstrated the impact of globality I think.

Contrary to what may have been written, we're delighted with the two teams in The Finals. We've got teams that have fought their way through here against different teams with different styles of play, and it's great to have a defending champion defending it's championship on the court, and the team that has someone like a Tim Duncan, which is a player that is not only one of the best in the league but may be one of the best of all time. Sort of in a soup that's wonderfully spiced by the likes of Tony Parker and Manu Ginobli and the likes. So welcome to The Finals and we're delighted to be here. We look forward to a very good series.

I assume that there's going to be some question here about collective bargaining, so I thought we would start and then answer any questions you have on the subject. Our last Collective Bargaining Agreement basically provide for 55 percent, that was the target, with the ability for the NBA owners to extend a deal for one year if they agreed to 57 percent. Again, as a target. And we had begun negotiations with our players for a new, long term deal prior to the time we had to exercise that option. We decided in that context, it was a good thing to exercise the option, and go for one year. We knew what was coming in the NHL and we thought that as sort of a labor stand off at that point would be awful for sports and not very good for us, and our players told us that they thought in light of our negotiating with them at that time, it would be a hostile act. We actually agreed with them. So Russ and I recommended to the owners and the owners agreed, that we would extend it for a year.

In terms of the negotiations that went on, we laid out for the players, for us at least, several points initially of what we wanted to achieve. I would sort of call them maybe four different categories: Some were reputational, about the reputation of our league and our game. Some went to the quality of the basketball on the court. Some went to maintaining the competitiveness between our teams because we feel pretty good about having a system where a San Antonio, a Utah, Sacramento can compete. And some went to the economics and we had these thick books of proposal from our teams talking about how 53 percent was what we had to get to and the like. We made a series of proposals to our players. Certainly on the non economic side, we thought had to do with shortening contracts, raising the minimum entry age, and the players took the position that those were economic terms, that those were designed initially to somehow reduce the amount that the players were getting. And in order to make those into non economic issues, the labor relations committee authorized us and itself did agree to raise our offer to 57 percent, and, for the first time in our negotiations, to guarantee so that it could no longer be an economic matter with respect to our negotiations; the players were guaranteed the same 57 percent that they had received this past year and actually the year before under our expiring agreement.

That was based upon our own view that if we could avoid a work stoppage, and given the progress that we had made, even though the percentage was up there and higher than the owners initially wanted, the better view was we could push together and raise revenues. That was why I have been before you exuding optimism that we would be able to make a deal and I thought we were close to a deal because the owners initially proposed four and three for contract lengths, moved it to five and four, and we persuaded them and the labor relations committee persuaded the ownership that it would be okay to go for six and five, which was a considerable drop back from our initial position and a fair compromise.

With respect to the minimum entry age, the union had said to us that that was negotiable and the question was really about money, "What would you give us for it?" We thought that the better view was to compromise that between the current 18 and our proposal of 20 with 19, and we so proposed that.

So we're in a strange position. We read that somehow the owners, the labor relations committee and we want a lockout. I assure you that that is not the case. We have worked too hard to want that. Somehow it has been suggested that the owners of the NBA who also own hockey teams have been interested in a lockout. I promise you, that is not the case. I am saying here today, as I've been saying all along, that the last thing we want is a lockout. The one thing we wanted was to negotiate, and we don't understand the rhetoric that's been coming out, and that's been repeated by you. We would love for you to understand the facts here.

Obviously, the most recent communication from us to the players expressed our willingness to negotiate, to meet, and to make a deal, but if we don't have a deal by July 1, there will be a work stoppage. No question about it.

Anyone who thinks or writes that that doesn't have enormous economic impact is wrong. Because once the lockout comes, the damage that we have already begun to suffer through cancellation orders and sponsors slowing down and coming into our business, will only accelerate, and the economic view of the world that underlies our current offer to the players will be changed dramatically, and that's another fear that we have about a lockout. Because once there's a lockout, anything can happen.

You want to add anything to the collective bargaining?

DEPUTY COMMISSIONER RUSS GRANIK: I think the one issue you didn't mention was the drug agreement, where we've really been perplexed because we thought that with what's happened, in this country over the past several months that it would be pretty obvious that what we need and what every sport needs is, you know, absolute state of the art drug agreement. We've always felt that we are leaders in this area, but our agreement has not changed since our last deal and a lot of things have changed in the world of sports. That's one other sort of non economic area where the union has suggested that even for modest changes, and changes that clearly would not allow us to go in front of Congress and be pleased about it, even for those changes, that should require payment of more money into the Collective Bargaining Agreement, and that has been somewhat of a surprise to us.

COMMISSIONER DAVID STERN: And I guess one other thing. You have heard the words thrown around like, "hard cap." I would assure all of you that the current cap system, which is a soft cap, which has mid level exceptions, and the like, has continued in any framework that we've discussed with the players, and in addition, we have agreed to their suggestions that, A, the cap be raised, and B, the impact of the so called luxury tax be reduced, which we think would encourage more teams to spend more on players.

So there's something in there for us. It's not to suggest that we are just doing these as acts of charity. What's in it for us is to avoid a work stoppage so that we can continue to grow the business. The response to our game on a global basis has been astounding, the number of people tuning in worldwide has been spectacular. The use of technology, whether it's downloads on cell phones or hand held devices of our games or highlights and the like, is putting us in a place where we really think we have the ability to grow and to break through. We feel very good about our strategies in terms of locking in the six year TV deal and watch what happens as the marketplace changes dramatically, and it has. But in order for us to take advantage of that, we have to be operating.

So we think it's smart to be where we are now economically in our offerings, so that we can do well. Obviously, in any deal which says the players will earn no less than 57 percent, that's a big deal because they will get 57 percent of every dollar.

One reason why the owners initially proposed a lot less percentage wise was that the costs post 9/11, insurance, security, fuel, have gone up dramatically and have, in fact, changed the operating nature of expenses with respect to all NBA teams. But our present proposal ignores that, or at least puts it on the owners' side of the ledger and says to the union, here we are, let's make a new deal.

We'll be happy to answer any questions.

Q. I'd like to ask you a question about the minimum age proposal, everybody understands I think the problems that Darko Milicic and those kind of cases have raised, but if you get a minor league agreement as part of this deal, then my question is, given that Major League Baseball, the National Hockey League, the military, all kind of employers recruit out of high school, what is your principal objection to the NBA doing the same?

COMMISSIONER DAVID STERN: Well, there are many objections, but one of those is that as it relates to the pressure on our teams to make judgments about 18 year olds who have never played against a higher brand of competition, and having such players for the most part not play a prominent role and replace a veteran, it's not good for our game. It would be improved if we were closer to those employers who don't employ out of high school and the NFL, which employs three years out of college.

Q. There are a lot of numbers in there, not having a box score, so I want to make sure I was clear on some of those. It sounded like between the four and three contract years and six and five and 57 percent and 53 percent, it sounds like there is no room for compromise, is that your final --

COMMISSIONER DAVID STERN: I would say this is our last offer. I'm not one to say "never". I mean, from seven to six, to six and five, doesn't suggest a lot of room to compromise. We don't give contracts in half years. But we have done the movement.

With respect to 57, it's only not less than 57; we are quite certain it will be somewhat more than 57, but we've moved there. I can't say where the negotiations will go, but I think it's important in light of some of the rhetoric that's been describing the owners as on some suicidal lockout mission, that the players understand that, and the players understand where we are. But we don't have a lot of runway left here. And so that would be a fair description.

Q. Is it fair or inaccurate to say this is as far as you've gone or you've gone as far as you're going?

COMMISSIONER DAVID STERN: I would say this is as far as we have gone. But, you know, if we do have a lockout, we will not go this far. This offer will not be on the table again. It would be fair to say that. That's why we are pushing so hard to get a deal done.

Q. In hockey, the owners set out to re work the financial system of the game and it appears they are close to doing that. Because of what they have done, have there been any owners in your game that have been beholdened into thinking of anything like that?

DEPUTY COMMISSIONER RUSS GRANIK: I think that there may be a few, and maybe a few that from the very beginning feel that our system still needs to be reworked. But the way this was approached as David said by our labor relations committee, which is seven or eight of the owners who have been charged with supervising the negotiations here, is that if we don't feel we need to do that. That's where we were seven years ago, and that's another reason why I think we are somewhat surprised by where we are, because we didn't set out to redo the deal, and, in fact, as David said, guarantee the economic circumstances.

You know, we haven't approached this with any kind of Doomsday mentality.

COMMISSIONER DAVID STERN: Even after those same reports were heard by our labor relations committee, their resolve to try to do the deal that I'm describing to you remains firm; that they would like to make a deal and not be as confrontational as people have described them as being.

Q. Maybe somewhat of a similar question, but are most of the owners telling you, "Don't jump to get a deal done, get it right"?

COMMISSIONER DAVID STERN: No. The answer is, we know, we know about our system. It's a soft cap system. We think it's the best system for our league. This is not a unanimous view, but it is the current majority view, more than the majority of the NBA owners, and is the current view of the labor relations committee. They would like to jump to get a deal done because we want to get a deal done by July 1.

Q. Would federal mediation law come in at all at any point?

COMMISSIONER DAVID STERN: Well, if it's mandated by the labor laws of two countries there would be mediation, but right now we seem quite capable of talking and understanding about what the other side is thinking.

Q. David, I believe your statement when you broke off talks was, you thought you had a deal with the union on length of contracts on five and four, are you saying that you've gone up to six and five since then?

COMMISSIONER DAVID STERN: Yes, we thought we had a deal at five and five, actually. We've since said, "Look, if it takes six and five to close it out, we're sufficiently anxious to get it done, as you should be, then we're prepared to do that." That's correct.

Q. The union at one point had been throwing around the idea of adopting a system with regard to the age limit similar in many ways to baseball, where players could come in, if they didn't get drafted in the first round, they could go to college and would not be able to come back until after their junior year. Did that ever gain any traction in the discussions?

COMMISSIONER DAVID STERN: In fairness and another reason I should have answered on the earlier question, we really would, I guess it falls into different categories, we'd like to get our general managers and scouts out of high school gyms and we think that would address that and that was our stated view, that we would rather negotiate over the age limit itself rather than splitting the class. Once you have kids who are eligible to be drafted, whether they are or not, they come out, our scouts scout them and look at them and make judgments, and indeed, the very fact our scouts are there cause more kids to think that they are going to be drafted and therefore, come out.

I can't remember the exact number, but I think 130 some odd players came out this year, announced themselves eligible for the 60. Those are just underclassmen and high school seniors for the 60 spots in the draft. Anything that would begin to cut down on that would be good for our business.

Q. On the issue of contract lengths, is there more of an importance attached to the increments within those years as there is to the lengths involved, the step increases?

DEPUTY COMMISSIONER RUSS GRANIK: I mean, they are both important issues. But I think we made it clear that the length is more important, has been more important to the owners than the annual increases. We do have a situation where I remember the deal, the last time we did a deal was seven years ago, and in different economic times and we have increases of ten percent, if it's a free agent and 12 1/2 percent if it's your own player. Now we've had several years since then of three, four percent inflation; that clearly is out of whack, and we would like to see that changed, because that does create some unusual circumstances. Again, where a player at the end of his contract, where sometimes maybe his skills have declined rather than improved, the annual salary has gone up dramatically as you add on 12 1/2 percent increases, so that is an issue.

But I think the bigger issue in terms of how it affects the game is players that have guaranteed years pass the time when they are maybe not performing at anything like the level that was expected at the time the contract was signed.

COMMISSIONER DAVID STERN: And we don't suggest it's an easy issue, but it is one when we approach it that is that we're guaranteeing that the union will receive the full amount of the money, and the argument is about the distribution, whether somebody in the seventh year of a contract should be getting that money or whether that money should be spent on perhaps players who are doing a better job on the court and put the teams in a better position to redo their competitive team on the court. And the same thing holds true with respect to younger players, as well, at least the ones who are not starting and just taking up a roster spot.

Q. There are only 17 days left until the end of the month. When are the next talks scheduled and do you anticipate since you've started this, philosophically, not very far apart, do you think simply the urgency of getting this deal done will make sure that it happens or are you still pessimistic?

COMMISSIONER DAVID STERN: How do you feel, Russ?


DEPUTY COMMISSIONER RUSS GRANIK: I'm the pessimist. I counted 18 days.

Q. Starting tomorrow. (Laughter).

DEPUTY COMMISSIONER RUSS GRANIK: I think that, you know, time is just about run out to get a deal before July 1. It's not impossible. Things can be done quickly if parties are really negotiating, but certainly to me it seems unlikely, and the thing that concerns me the most is this notion that, well, so there will be a lockout, so they won't have summer camps, contracts won't get signed, people will go on vacation, I've read, from July and August and then they will put it together in September. But labor disputes tend not to work so easily and then once the ball starts rolling, things tend to get more difficult rather than less. So that's the part that I'm very concerned about.

COMMISSIONER DAVID STERN: You see, we've only been doing this together for 30 years. I'm the optimist. Because post July 1, and with respect to that period of time, I am so pessimistic if we go into it that I find it to be incredible that the players when they finish their meetings, and I know they are having meetings tomorrow in Chicago, Tuesday in New York, etc., that I would be shocked if they didn't, not just the union, but the players themselves, players who are averaging 4.4 million dollars apiece and who this year we think will go up to 5.5 million won't just say, let's just go sit down someplace and get a deal done. That would be inconsistent with the rhetoric that has been coming out. But I'm optimistic that in light of what's at stake, we'll find someone to negotiate with.

Q. Was there a mutual willingness to settle for 19 on the age limit question?

COMMISSIONER DAVID STERN: Was there?

Q. A mutual willingness to settle for 19 or are you hard and fast on 20?

COMMISSIONER DAVID STERN: Well, at one point, there was. We thought we had a deal on that issue. But as I've said before, we acknowledge that you never have a deal on any one point.

DEPUTY COMMISSIONER RUSS GRANIK: But their position now as they have stated to us at our last meeting was that for players drafted in the lottery, the first 14 picks could be 18 years old; that it would be only, you know, a question was asked about that. We foresee a lot of complications in that solution.

Q. But you dropped to 19?

DEPUTY COMMISSIONER RUSS GRANIK: Yes.

COMMISSIONER DAVID STERN: Many weeks ago.

Q. Is there any one issue, whether it be the age limit or length of contracts, anything that's been argued that is in your mind that is a deal breaker?
And second question, what's your gut telling you, David? Is this deal going to get done end of June or early in July or are you going to grow another beard this summer?

COMMISSIONER DAVID STERN: I'll spare you the beard this time. You know, it's interesting, I'm trying to find a way to make sense out of it, because from the owners' perspective, we've moved a lot. And so you always get to a place where the gap seems so narrow, as this one does logically. You say, well, why can't you bridge it? But the movement I think has been mostly by the owners. You know, these are the blood issues on both sides, I guess wrong phrase. We need to shorten contracts. We need to get an absolute state of the art anti drug agreement, and we need to deal with the issue of young players, we need to keep a system where we keep our teams competitive so that, so, that we may be a league that in any city in a well managed situation can compete. If we don't have a deal by July 1, we won't make a deal any time soon thereafter, because Russ and I, and actually the labor relations committee are very active vis a vis our ownership in support of the proposition that it would be much better to go all out to make a deal. You know, that's why it pains me to see our owners described in some predatory way because they are not here. In fact, they are being much more conciliatory than they have been painted. But if that's not reciprocated, then we are going to have a real problem.

Q. To follow up on that a little bit, you said, you know, if we do have a lockout, we don't go this far. You've spoken in owners' terms if it gets past July 1. Is there a sense that there is a significant block of owners, that if you do go into a lockout will say, okay, we haven't been talking about tweaking the system before, but we really want some system reform here. Is this what you're talking about?

COMMISSIONER DAVID STERN: You know, I tell you what, we have seen the damage that a lockout can do across the board, the fans, sponsors, licensees, network partners and the like. Our fear, given who we are, given our life's experience in the NBA, that our business will slip away from us faster than even some other sports. And that's the case, then I'm not in good conscience going to sit in front of owners trying to get in front of a train to say, you know, it's okay, we'll make the same deal that we were willing to make before all of this damage to your business occurred. I'm not going to do it.

Q. So you do feel when business starts to slip away, they tend to look more at, well, these are things we were getting before but now we're not going to move?

COMMISSIONER DAVID STERN: Absolutely. The price that the owners are willing to pay to keep the peace is, I think, justifiably, high, and they are willing to pay it. But if the peace doesn't hold, if for reasons that we are having trouble understanding, we can't get the deal done, then it's going to be a new game.

Q. I think I read somewhere that you were considering advertising on the team jerseys, I would like to know it it's true, and if it is what kind of money you think it will generate.

COMMISSIONER DAVID STERN: It's not true. We're not getting any credit for the fact that we are the only league that has no other sponsors' logo on our uniform. The NBA of all of the sports league is the only league that has only one logo on it's uniforms, that of the NBA. And I was asked a question whether I thought at some point it would be something that our owners would do, and I said probably, you know, at some point when the price gets to a place where they can no longer ignore the offer.

But we haven't received the offer and we don't have a "for sale" sign out, because brand NBA is for us the most important thing on our uniforms. A couple of our teams took the opportunity to say, well, we should do it tomorrow, and if you asked me, I would say that would not be a good idea. But as we become more global and as we learn from our compatriots in Chelsea and Man U and Real Madrid and FC Barcelona, maybe we will learn there's more money out there than we ever thought, but right now, I don't think so and we don't have any plans for selling space on our uniforms.

Q. In your meetings with the players, how much talk has there been about the amount of damage that has been done in the NHL and that fear that if the lockout does occur, that it could be a full season loss, like the NHL did?

DEPUTY COMMISSIONER RUSS GRANIK: I mean, we don't spend a lot of time talking about that, but I think both sides have acknowledged that there ought to be a lesson learned from what the NHL has gone through and is still going through.

But obviously, it hasn't translated into any benefit to our negotiations at this point.

Q. You said at the start that one of the things you wanted to address was reputational, how do you legislate that? Is that something through the drug talks?
COMMISSIONER DAVID STERN: The drug issue is one. We just don't think that there should be any reason why management and labor can't get together here and say, we're not going to have any drugs in our league and we're going to test and demonstrate and we're going to adopt the appropriate penalties so that it doesn't happen. That's easy.

Q. And the reputation aspects you want to address and you think you can through collective bargaining?

DEPUTY COMMISSIONER RUSS GRANIK: One thing we've had discussion about, how we reduce underwriting, I don't know what the union has really introduced a willingness to deal with that issue. It has to do with player demands for being traded. I think that's something particularly in the last year or so, we've been hit with a lot with players saying, you know, "I don't want to play here anymore. Trade me." We just don't think that's appropriate when a player has a contract in place.

I think we're in agreement on that point. How we legislate it, we haven't figured out yet, but I think we may try to get to that as well when it comes down to doing the draft.

Q. You've addressed the garden variety fan that can't believe that you guys would walk down the same path as the NHL, but I'm curious, what percentage of your owners would save money by a cancelled season or a partial season?

DEPUTY COMMISSIONER RUSS GRANIK: I think it's very few. I think there's a handful that would save money.

COMMISSIONER DAVID STERN: Very small.

DEPUTY COMMISSIONER RUSS GRANIK: Very small.

COMMISSIONER DAVID STERN: Very small.

DEPUTY COMMISSIONER RUSS GRANIK: We have a situation, and that was true in the last time we had a work stoppage, where our teams would receive their network television revenues during a lockout, but it ultimately has to be repaid if there are no games. So it helps a lot with cash flow for that first year, but nobody would consider it a financial benefit to be going through a lockout.

COMMISSIONER DAVID STERN: Actually, in our last deal when we did restart the league, we made adjustments with then NBC against the remaining years of the deal to repay the dollars by reducing future rights fees and we have three years remaining with our Disney and Time Warner deals and we would have to do the same thing there.

Q. David, have you started going through in your head what you might have to say on July 1 to a public that doesn't really understand the numbers and can't believe that we're going down this road?

COMMISSIONER DAVID STERN: No, because the optimist that I am, I remain disbelieving here, actually, because whatever the public would think of us, the fact that we could explain it is not going to change the view that in a time when the world seems to be pretty much on fire, and people are obsessed with things like the sanctity of Social Security and the development of healthcare, and you keep naming it, that we couldn't sit down and come up with a way to divide up the three billion dollars a year of revenues that we are going to generate, in a sport that in Russ' and my lifetime, when we first started negotiating was back in 1976 was probably generating 75 million dollars in total. It is incomprehensible and in some ways inexplicable and I'm not looking forward to it.

Q. You mentioned the figures you were talking about contract length and other figures, 57 percent, what is being asked for? Could you tell us what the positions are that you're not going to that you're being asked for that has caused this rift?

DEPUTY COMMISSIONER RUSS GRANIK: Well, it has to do with the unwillingness to have a drug agreement that we can feel comfortable about, and the unwillingness on the rookie eligibility, the length of contracts we talked about, and a demand that, you know, gets very complicated with our system which has so many, you know, pulleys and pushes and pulls, but a demand that the escrow withholding be reduced, which is simply asking for more money, a demand for pension increases to be paid entirely by the league, and these things will add up to simply more than the 57 percent that the players have currently got and that we have offered to give.

So the combination of the union wanting more money and being unwilling to do the things that we think we have to do that won't cost them any money has just left us, you know, with no way to put it together.

Q. David, if I can try one more follow up on this minimum age issue: The public sees LeBron James and Kobe Bryant and Kevin Garnett, all of the stars that came into the league straight out of high school, if you have a place to put them, in the NBDL, if it's parallel to baseball that they can go play in a farm system somewhere, what is the principle that you have to your people being in a high school gym?

COMMISSIONER DAVID STERN: The fundamental point I would argue with you on your statement of facts is really, LeBron was extraordinary out of high school; Tracy McGrady and others were not. They just grew to be All Stars.

So for us, a player coming in a year later will be just the same great player; he just will be more skilled and more schooled. So it's not about the fact that we thrive with high school graduates. The important thing is to look at it, and there's no doubt LeBron was great, I just don't believe that we should be in a position whereas a business matter, our teams are making judgments upon 18 year olds playing against other 18 year olds and by virtue of being in the gymnasiums, encouraging these kids to think that they are going to be drafted by the NBA and have careers in the NBA, because they are not. And I recognize that there are very valid opposing views on that. To change sports, that's what makes horse races.

I accept that the opposing views as put forward are rational, but we have stated it, I give a plug to the New York Daily News, we have op ed pieces today that apparently were published, I commend you to Mort Zuckerman's newspaper.

I guess we do, and we have put on the table, the issue of even players who are drafted beyond 18, even at 19 and 20, the idea that you could farm out players, is something we would like, as well. We would like to keep those players charged against the team's roster, we would like to pay them the full amount of their salaries, and we would like them to have the opportunity to grow their game, because at bottom, we want to make sure the game, which looks, we think, much better this year than it has, that our fans are increasingly pleased and even better by making sure that the level of skill of our players continues to grow.

Q. So you think there's something destructive about baseball drafting people out of high school, for example?

COMMISSIONER DAVID STERN: I wouldn't call it destructive. You know, anyone I think that it's either destructive or not destructive for the NFL to have a rule that says, well, we'll draft people after three years of college. It depends. It's a business question. These are the kinds of situations that get negotiated at collective bargaining and we've staked out our position here, which is not two years out of high school, but high school plus one as a business matter, would make our sport stronger. The union can agree to it or not agree to it and they can argue it or not argue it. That's the way negotiations go. The NFL's union said high school plus three. We're saying high school plus one. Baseball has an interesting set, I understand, of rules, where if you don't get drafted or if you don't come out and you do choose to go to college, you must stay in college for three years. You know, you could argue that that's destructive. Why should you just having past one year, why should you not be allowed to come out.

So there are a variety of different systems and hockey I know puts kids into the junior leagues at a very young age. I mean, every business addresses its issues in a different way, and we have staked out where we think we should be, and it's not a matter of theology. It wasn't handed down along with the Ten Commandments that it has to be this way. It's union and management sitting across the table, bargaining in their own interests and that's where we are.

Q. Why are we at this point?

COMMISSIONER DAVID STERN: Ask Russ.

DEPUTY COMMISSIONER RUSS GRANIK: I don't know what else we can say, Shelly. We're just at this point because we can't get a meeting of the minds. I think, you know, I hate seeing that this notion that, well, the union just wants the old deal, because on the economics, we thought we put that to bed months ago by offering the guarantee that they would have the economics of the old deal and then it was just an issue of how we perceive these other things. That's not what's happened because the union is looking for something richer than the old deal. That's a place where we don't see ourselves going.

COMMISSIONER DAVID STERN: And they are making a tragic mistake in their calculation, given the coalition that has been put together amongst NBA owners to make this deal, to be this conciliatory, if July 1 comes and there's a lockout, the union will have made a mistake of epic proportions that I don't think the average member of the rank and file understands is taking place.

Q. With 18 days between now and July 1, is there a meeting scheduled?

DEPUTY COMMISSIONER RUSS GRANIK: We don't have any meetings scheduled.

Q. David, when you and Billy (Hunter) testified before Congress, you both expressed an anticipation of an agreement that would have year round drug testing. If you agreed with that premise, has he or the union now backed off that pledge? COMMISSIONER DAVID STERN: Year round can be defined differently by different people. Some people might think it's a single test during the season or two tests, and some might say it's for certain drugs and not others. And there are others of us who think that "year round" means testing out of season and testing for all drugs.

So we don't have exactly the same definition of what "year round" means.

Q. In that case, then, do you believe he has backed off what you considered at that time to be an agreement?

COMMISSIONER DAVID STERN: No, I wouldn't say that we have had a meeting of the minds on the drug testing.

DEPUTY COMMISSIONER RUSS GRANIK: I don't know what was in Billy's mind in front of Congress, but in terms of across the table, that's where we haven't come together. You know, I thought if there was a point where we thought we were getting close, but we haven't come together.

COMMISSIONER DAVID STERN: It would be fair to say that the union has expressed a willingness to have increased drug testing. But it would not be accurate to say that they are anywhere near year round drug testing for all drugs that are performance enhancing and drugs of abuse. We're not even close.

[LRB]

Personally the only way I see avoiding a lockout is if the players fire Billy Hunter at their June 27th meeting.