Rich Paul Strikes Back Against Nerlens Noel in $58M Lawsuit

Knicks center Nerlens Noel sued Klutch Sports Group and ex-agent Rich Paul in early August of this year for lost earnings of up to $58 million and not fulfilling his duties as an agent. Now, Rich Paul answered back by filing a motion to dismiss in Texas Northern District Federal Court. Paul is arguing that the dispute should go to arbitration by the National Basketball Player’s Association (NBPA) and that Noel has not paid him for negotiating his Knicks contract last season. Paul filed a grievance against Noel with the NBPA in August regarding the pay dispute, according to the motion to dismiss. "Despite multiple written requests for payment, to date, Noel has failed to pay Paul any amount resulting from the Knicks,” the motion states. Noel has also filed his own arbitration case against Paul for “breach of fiduciary duty, breach of contract, negligence and gross negligence, and breach of the duty of good faith and fair dealing.” The case is now pending by NBPA arbitrator and retired Judge Richard Levie.

According to the NBA Collective Bargaining Agreement (CBA), “The NBA and the Players Association shall agree upon a System Arbitrator, who shall have exclusive jurisdiction to determine any and all disputes arising under Articles I, II, VII (definitions, uniform player contract, basketball related income, salary cap, minimum team salary, and escrow arrangement).” Luckily for both parties this arbitration will be heard relatively soon. “In no event shall the award and written opinion be issued more than thirty (30) days following the date upon which the record of a System Arbitration proceeding is closed.”

As I said in my first article, this could be a challenging case. It could go either way based on all the facts. If Paul deserves to be paid and has not been paid then Noel is in the wrong. Agents cannot be getting sued all the time because they told their player that the most money might not be the best option for them. In that case too much of the burden will be on the agents and they will make their players sign any contract instead of what the player wants. This will create open game for players to sue their agents if they sign a lesser contract. On the other hand, by not answering calls that could have helped Noel’s career Paul is negligent. Paul’s duty was to help Noel to the best of his ability. If shown that he did not help Noel then he would breach his duty of care to him. The NBA does not want agents slowing down free agency by not answering calls, or even focusing more on their high-end clients instead of their other players. With the new CBA looming agents do not want the NBA to restrict the number of clients they have if some cannot handle multiple clients. When more information comes out it will be very interesting to see what Judge Levie’s decision is.