November 4, 2011
In the News: NBA Decertification Threat Looms; Groupon, the Highest Tech Valuation Since Google and More
- NBA Decertification Threat Looms Over Weekend Talks
At least 50 NBA players held a conference call Thursday to lay the groundwork to decertify from the players union if this weekend’s talks do not result in significant progress or a deal. The threat of decertification gives the players much-needed leverage in the labor dispute.
Anticipating the players’ actions, the owners filed a federal lawsuit claiming the decertification threat an “impermissible pressure tactic” that would have a “direct, immediate, and harmful” effect on negotiations.
The union asked the judge to dismiss the suit in a hearing that took place this week in Manhattan, N.Y. The judge asked for additional briefs from both sides before making a decision.
Decertification is such a big threat to the owners because if the players dissolve the union, the antitrust laws that currently protect the owners would no longer apply. Without the antitrust laws, much of the economic structure of the NBA – salary caps, minimum salaries, rookie-scale salaries and luxury tax – could be challenged as a form of price fixing. It also means the players could challenge the lockout as a group boycott.
Since the lockout began in July 2011, the players have accepted many system changes in favor of the owners, including conceding 4.5% of the league’s revenues.
- Groupon’s Debut Makes It the Highest Tech Valuation Since Google
Groupon Inc. debuted on Nasdaq at $20 a share Friday. The three-year-old company raised a reported $700 million on its initial public offering, making Groupon the highest tech valuation since Google raked in $1.7 billion in 2004, according to Reuters.
The world’s largest daily deals company is now valued at close to $13 billion after increasing its shares to 35 million in total and pricing them above the initial range of $16 or $18 a share.
It’s Lights Out for One Michigan City
As a struggling city unable to pay its electricity bill, Highland Park, Michigan took measures residents never could have imagined–it cut off the lights. Elected officials turned off 1,000 streetlights, removing everything from the bulbs to the poles.
The debt-ridden area is dealing with a $4 million electricity bill that requires $60,000 in monthly payments, so Mayor Hubert Yopp asked the City Council to consider reducing lighting and they approved.
Public safety is a big concern now that it’s lights out for this community. “How can you darken any city?” asked resident Victoria Dowdell. “I think it’s a disgrace.”
The city is reportedly $58 million in debt.