Geno Smith’s signing with Jay-Z’s Roc Nation agency raises questions regarding the ‘runner rule’

By Doug Farrar | Shutdown Corner – Sun, May 26, 2013 9:35 AM EDT

http://sports.yahoo.com/blogs/nfl-shutdown-corner/geno-smith-signing-jay-z-roc-nation-agency-133525207.html

Jay-Z and Geno Smith in a recent picture. (Instagram)

Perhaps New York Jets rookie quarterback Geno Smith should have known that his name would be mired in controversy when the Jets took him in the second round. After all, the Jets are far more adept at collecting headlines than wins lately. But Smith, who is now competing with embattled Mark Sanchez for the team's starting job, set himself up for his current situation by firing his former agents, Jeff Nalley and Erik Burkhardt of Select Sports Group, after he fell out of the first round of the draft and was selected with the 39th overall. Then, Smith hired the growing Roc Nation agency, led by rapper Jay-Z. And that process has raised several questions regarding the way business is supposed to be done.
In 2012, the NFLPA banned the use of "runners" -- people without appropriate credentials used by agencies to recruit clients. And though Smith was technically signed by attorney Kimberly Miale, the potential involvement of Jay-Z, who is not certified as an agent, has other agencies wondering if the rules aren't being circumvented in this case. Albert Breer of NFL.com recently reported that the NFLPA will investigate the process by which Smith was signed.
The "runner rule" was sent to agencies in April, 2012, and was a specific point of focus among a number of amendments.

While all of these amendments are important, we ask you to pay particular attention to Resolution 1 which repeals the so-called “junior rule” and prohibits a Contract Advisor from using, employing or entering into any business relationship with an individual to recruit prospective player-clients who is not an NFLPA Certified Contract Advisor. Because of this significant change we will not make these amendments effective until June 1, 2012.

The amendment then specified that "Using, associating with, employing or entering into any business relationship with any individual in the recruitment of prospective player-clients who is not certified and in good standing as a Contract Advisor pursuant to these Regulations" was prohibited conduct.
Jay-Z's appeal to potential clients is clear: If you want to benefit from on-field stardom off the field with endorsements and other opportunities, few in the field better understand the entertainment industry. And Roc Nation has made other big splashes since entering the sports agency business this year. It signed New York Yankees second baseman Robinson Cano (a former Scott Boras client), gave WNBA third-overall pick Skylar Diggins a Mercedes-Benz after her selection, and signed New York Giants receiver Victor Cruz to a marketing deal, which the NFLPA approved because of a "pre-existing relationship." Cruz is with CAA, the agency that has also established other partnerships with Roc Nation.
"When you talk about being in New York, from the standpoint of what they can do in the city, I think it's a good move," Smith said of his decision. But he also said that the obvious claim that this was an image-based move is erroneous.
"That's perception," Smith said, "I don't worry about the outside world's perception when it comes to that kind of stuff. I'm strong in my faith, I know this isn't because of an image thing or marketing myself. It's more about being comfortable with the people representing me."
Miale's involvement in Smith's career raises additional questions, because it's unusual for an agent with only two small-time clients to date -- Arena League kicker Carlos Martinez and ex-Florida linebacker Brandon Hicks -- to acquire a client of Smith's magnitude, especially when Smith was on the open market. Many wonder if Miale isn't just providing a front for Jay-Z to move around the league's rules regarding agent certification.
“When I read [the amendment], I thought it must have been written by Jerry Seinfeld. It’s funny and it’s about absolutely nothing,” Josh Luchs, a former football agent and author of the book "Illegal Procedure: A Sports Agent Comes Clean On The Dirty Business Of College Football," told Forbes.com's Darren Heitner on June 1, 2012, the same day the "runner rule" was to go into effect. "This new runner rule isn’t difficult to enforce, it’s impossible. This is another rule that won’t be enforced by the NFLPA, because they don’t have a mechanism by which to do it. Agents are going to continue to have arm’s-length recruiting relationships with non-certified individuals. The only thing that is going to change is that agents are going to be even more careful in the way they recruit, and who they trust in their inner circle, than they were before. People who violate the rules are just going to do it more clandestinely now.”
Those who were wondering such things added ammo to their arsenals when former NFL defensive tackle John Thornton, now an adviser to Smith, recently told CBS Sports' Jason La Canfora that "It really all came down to who [Smith] was most comfortable with. I was in those meetings and Jay-Z connected with him on many levels."
Technically, Jay-Z wasn't supposed to be connecting with Smith on any level in those meetings. Thornton later backtracked, claiming he was misquoted, and a Roc Nation representative later told La Canfora that Jay-Z was in London at the time of those meetings.
Other agents, as one would expect, are none too happy about this process -- and if the NFLPA doesn't reinforce its regulations, the "runner rule" won't have any teeth at all.
“The process is being made a mockery of,” one anonymous agent told Ben Volin of the Boston Globe. “If the PA doesn’t regulate it, it opens a Pandora’s box. They’d have to throw out the runner rule.”