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Houston Oilers v. Neely

United States Court of Appeals for the Tenth Circuit
361 F.2d 36 (1966)


Facts

University of Oklahoma football player Ralph Neely (defendant) was one of the top senior college players in 1964. At the end of the 1964 regular college season, but prior to scheduled bowl games, Neely was drafted by the National Football League’s (NFL) Baltimore Colts and by the American Football League’s (AFL) Houston Oilers (plaintiff). Immediately after the draft, Baltimore offered Neely a four-year contract with salaries from $16,000 to $25,000 annually and a $25,000 signing bonus. A few days later, Houston Oilers President Bud Adams offered Neely a four-year “no cut” contract for $16,000 per year and a $25,000 signing bonus. Additionally, Adams offered to find Neely a position with a local real-estate firm and to build a gas station for Neely to own and operate. Neely accepted Houston’s offer and contracts were executed December 1, 1964. Despite Neely’s wish to keep the contracts a secret so that he could play in the Gator Bowl on January 2, 1965, the contracts were required to be filed with the AFL within 10 days of execution. Neely then learned that the Colts had traded its right to negotiate with him to the Dallas Cowboys. After Neely’s father-in-law secretly negotiated a deal with Dallas, Neely informed Houston and Adams that he was withdrawing from his agreements with him. After being formally declared ineligible to play in the Gator Bowl, Neely signed a four-year contract with Dallas on December 31, 1964. Houston brought suit against Neely seeking an injunction to prevent him from playing for Dallas or any other football team. The trial court found for Neely and Houston appealed.

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Holding and Reasoning (Pickett, J.)

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