Competitive Ruling: Team Impulse

Riot·May 9, 2016·8 votes·42,237 views

TL;DR: Team Impulse management has repeatedly failed to pay their players on time and to provide valid contracts for their players, as required by the LCS Rules and Team Agreement. League officials have, on multiple occasions, clarified requirements and even directly intervened in team operations to ensure payments, and have determined that Team Impulse does not meet League standards for a professional organization. As such, they will not be permitted to continue participating in Riot-sanctioned leagues.

CONTEXT:

Since Team Impulse took over the LCS spot from LMQ, there have been several reports of failure to sign contracts with their players or to provide prompt payment, despite multiple interventions by League officials.

No Contracts: In March 2016, a routine League-wide contract audit revealed that Team Impulse had no contracts signed with any of their players, despite submitting summary sheets which falsely claimed that full contracts existed. Upon further investigation, it was additionally determined that no player from the previous split had contracts either. Team Impulse quickly moved to resolve the problem, and showed League officials actual signed contracts for several players, but failed to sign contracts with all players on their Active Roster, remaining in violation of LCS rules which require all rostered team members to have a valid contract.
Late or Missing Payments to Players: Over the course of 2015 and 2016, Team Impulse ownership has been chronically late in paying its players the League-mandated Minimum Player Compensation (MPC), in addition to any other contractual payments owed under their respective arrangements with their players. During the 2015 Summer Split, League officials learned that TIP players had not been paid for the duration of the split, and immediately intervened to ensure that MPC was paid in full to date for all players. During the investigation following the contract audit in March 2016, it was discovered that TIP had again failed to pay its players their owed MPC for the duration of the split. In addition, several players notified League officials that they had not been paid their agreed-upon full salaries (money owed in addition to the MPC), but, given the lack of proper contracts, League officials were unable to verify these claims. As of this ruling, several team members are still believed to be owed money, in some cases amounting to multiple months of pay.

RULING:

Team Impulse’s management has repeatedly violated its Team Agreement, and is hereby disallowed from participating in the LCS. In order to minimize disruption to their players, TIP management will be granted a grace period until 11:59pm PST on May 18th to sell all rights and legal claim to their LCS berth, meaning a finalized transfer agreement must be presented to League officials, and the owner must pass the standard approval process. This grace period is contingent on TIP cooperating with League officials in any requests/communication around player welfare and payments and/or the transfer process, and is subject to revocation.

TIP is also fined $20,000 from its final team payment from the league.

RELEVANT RULES

2.2 Player Compensation

Each team must distribute the required Minimum Player Compensation ($12,500/€11,250 per starting player per split during the 2016 season and the designated substitute stipend) to its starting players, in accordance with the terms of the applicable Team Agreement...

3.2 Roster Requirements

…All Starters must have a written contract with the team they are playing for.

Q&A:

Q: Can you help the 2015 players get the money they’re owed?
A: We approached TIP about this issue and they deny that they owe players from their 2015 roster any further payment. We verified that all players have received their minimum player compensation, but since there is no written contract between both parties, we have no objective way to determine who is correct about the additional money owed. That said, this situation is entirely the result of TIP management failing to have written contracts with their players, which is in part why they are not being permitted to continue in the League.

Q: Why wasn’t TIP’s owner fined or publicly warned for non payment issues before now? Why was this allowed to get to crisis point?
A: When players came to us in Summer 2015 regarding non-payment by TIP ownership our first priority was to get them paid to the point of compliance with League minimums. After TIP paid their players, we opted to give them a final warning rather than penalize them because they had been reasonably cooperative and prompt in addressing that issue.

After discovering the continued misconduct this split, including TIP ceasing payments to players on its 2015 squad after our investigation ended last year, TIP ownership exiting the league is for the best. Moving forward, we’ll be putting much harsher penalties into place for teams who fail to pay their players promptly, hopefully avoiding any repeated patterns.

Q: If these guys broke League rules, why are you letting them sell the spot at all?
A: We believe that this is the best way to protect the players, as a buyer for the team will hopefully be inclined and able to negotiate for the assignment of the players’ contracts as well. If the team agreement was simply terminated, the players’ existing contracts cannot be transferred by Riot to a new owner, so would require new negotiations and would not necessarily include all former players.

Q: Isn’t 10 days an unrealistic time frame to sell an LCS team?
A: While we want to give TIP ownership a fair window in which to exit the league, we also want to make sure a new team has a reasonable amount of time to prepare for the Summer Split. Further, we believe that 10 days is more than sufficient to sell an organization; from past experience, we are aware of multiple potential buyers who have expressed interest in becoming part of the League. Given the time remaining before the start of the Summer Split, we believe this is the fairest solution for Team Impulse ownership, their players, and the league.

Q: Why not give the slot to the TIP players?
A: While we appreciate the work that the TIP players have put in to that team’s success and continued performance in the LCS, legally, the slot belongs to the TIP organization. By allowing TIP to transfer the spot to an established ownership group (who will still need to qualify through the LCS vetting process), we can bring closure in the most efficient and amicable manner. We hope that any new owner would consider bringing the TIP players onto the new squad.

Q: What happens if TIP fails to sell their spot by the deadline?
A: While we’re not able to fully discuss them to avoid disrupting a potential sale, we will have follow up steps should a new owner not be found (and deal agreed upon) within the timeframe. Our primary concern is to hopefully facilitate a smooth sale process that protects existing players as much as possible, and we will be transparent about further steps in the event that either team fails to sell.

32 Comments

MeilinIIMay 9, 201616 votes

This disgusts me. I hope riot is way harsher on this sort of thing in the future, as it makes the competitive scene seem cagey right when it's starting to get respectable. I hope some rich guys swoop in to buy up these teams and the players like Rick Fox did. Most of these players don't deserve this.

TrollFan01May 9, 20164 votes

Esports I'd still new so there are still too many loopholes existing for this sort of thing to happen.

Hope this is the last time this happens.

MeilinIIMay 9, 20165 votes

Yeah, I know. It sucks though because every time gaming starts to gain legitimacy something happens, like the Starcraft max fixing issues or this bullshit.

TrollFan01May 9, 20162 votes

Tell me about it! In a way though the scandals do make esports like traditional sports but not in a good way.

MeilinIIMay 9, 20162 votes

I mean I try to keep it in perspective than in less than 10 years we're tougher on teams than baseball and football were for decades, but it's still super lame......

PAULBROKEACHAIRMay 10, 20161 votes

What you are failing to account for is how does a team like tip make enough money for the owner to have them pay the players the riot mandated salary as well as housing, equipment, etc.

BLAME RIOT, they should play these forced salaries as who do you think is making the most money off the lcs games.

MeilinIIMay 10, 20166 votes

It's riots fault that a team owner/manager lied about paying their employees? Do you hear yourself? [slayer-jinx-unamused] That last sentence doesn't even make sense.

PAULBROKEACHAIRMay 10, 20161 votes

Riot requires players to be paid a certain amount of money and have contracts....riot is the one who makes the most money off the lcs..........let riot pay the players the minimum. The way this was handled will just deter people from investing in lcs teams and shrink the lcs.
If that doesn't make sense to you then I don't know what will.
I'm not trying to say tip did not do anything wrong (although I don't see any comments from players, something from a court, news of a lawsuit, settlement, etc.), all i'm saying is riot is wrong.

MeilinIIMay 10, 20166 votes

That's not how this works. Riot sets the rules for what employees have to be paid and the payment is buy the actual employer. Just like a call center for Sony or Google or Microsoft will set guidelines for what the call center has to pay workers, and if the company fails to pay them there are repercussions. Riot is doing its part. The only ones at fault here are TIP. Riot would lose way more money letting this go under the rug, because they'd lose their reputation.

Kal Vas FlamMay 10, 20167 votes

{quoted}

Riot requires players to be paid a certain amount of money and have contracts....riot is the one who makes the most money off the lcs..........let riot pay the players the minimum. The way this was handled will just deter people from investing in lcs teams and shrink the lcs.
If that doesn't make sense to you then I don't know what will.
I'm not trying to say tip did not do anything wrong (although I don't see any comments from players, something from a court, news of a lawsuit, settlement, etc.), all i'm saying is riot is wrong.

But... This is not how any sports league works. If esports want to be considered legit then it needs to have legit organizations running the teams. That means organizations paying their employees themselves.

ChavamanMay 10, 20163 votes

Don't waste your time with this ignorant (PAUL). He obviously does not understand how a sports league work. But, let me take another shot: So take FIFA for example, they watch worldwide football leagues. Now if a team, Spain for example, decides not to pay its player how is FIFA responsible for payment? The players are not playing for FIFA, they are playing for spain. FIFA is just in charged of overlooking and enforcing the rules.

My Sea CowMay 9, 201610 votes

That is insane. That's horrible that TIP wouldn't pay the players on time or by rumors has it, the right amount. Hopefully they can find new ownership that will bring them to success and be able to pay them on time

pyroHedgeMay 10, 20161 votes

Suddenly the struggles of TIP the last two years (along with the exodus of much of their talent) makes so much sense. I'm glad they're gone. But I really feel sorry for all the players paying the consequences. I mean, TIP earned extra profit by not paying their players, and then on top of that still get to sell the team for even more profit. That's all win for them. The players are the only ones suffering from this.

Miror BMay 9, 20165 votes

Speechless reading these articles. Also surprising to see that all three teams had seraph on them at some point during the spring, definitely got the proverbial "snake bite".

CoffeeDaveMay 9, 20165 votes

Yikes, Three teams getting hit like this so close to the summer split. I hope the players find a new home that will treat them right.

Senpai SeamenMay 9, 20163 votes

Good guy Riot

BrygmoSNyanMay 9, 20163 votes

I may be naive, but why doesn't Riot require carbon copies of all players' contracts? This would have easily prevented this from happening.

FalseshadowMay 9, 20165 votes

"Team Impulse had no contracts signed with any of their players, despite submitting summary sheets which falsely claimed that full contracts existed."

In other words TIP did provide "proof" of the "contracts" that were supposedly signed. They didn't actually exist though. My guess is having a carbon copy of each player's contract was considered too costly on administration and so only needed a summary of the contract details, which would be easier to keep on file. No doubt they'll change their requirements to prevent this situation from happening again.

Kal Vas FlamMay 9, 20163 votes

Let this be a reminder of why you don't just start up a company or organization without any clue of how to do it. This sounds like just incompetent management to me. People think it's easy to be an owner, "all you do is sit around and tell people what to do." Yeah, OK, go start your own esports team and get it disbanned. Or better yet, hire people to do that stuff for you, oh wait, you're not TSM, you can't afford to do that.

pyroHedgeMay 10, 20164 votes

I'm pretty confident TIP's issues weren't "incompetent management." You don't choose to not pay your players for two years, or intentionally omit any paper trail detailing promised pay by accident. Critically, TIP was fully compliant in things many disorganized teams struggled with, like travel, visas, and prompt reporting to Riot requests. But TIP management were just crooks.

ShibuyaXTechmoMay 10, 20162 votes

But you gotta realize that Andy Started from the bottom and from there he built up TSM to what it is now....

Kal Vas FlamMay 12, 20161 votes

{quoted}

But you gotta realize that Andy Started from the bottom and from there he built up TSM to what it is now....

Well it's possible, as others have mentioned, that maybe management was just crooked.

TrollFan01May 9, 20162 votes

Wow gist RNG and TDK and now this. I hope they all get paid and better team owners next time.

hotarseMay 9, 20161 votes

Correct me if I'm wrong, but doesn't Riot pay the salaries of these players? How the hell can a team screw up what Riot is mandated to do?

EleshakaiMay 9, 20162 votes

AFAIK, Riot pays the organizations money per player to be used to supplement their salaries. The organizations are supposed to give that money to the players.

I might be wrong, but I'm pretty sure Riot doesn't directly pay players.

SpeerhausenMay 10, 20161 votes

They don't directly pay the players. As mentioned in one of the statements released by lolesports, it is the responsibility of the team to make sure that the players are paid(though TIP may not have done so for 2015 and 2016. There is no proof either way... and that's the second thing they're in trouble for.)

Offtopic, but: It took me a few minutes to figure out what "AFAIK" means. Please tell me I'm not so far behind in the parlance of today... I don't want to be that old(though if I'm just absentminded, I can deal with it.)

ElemenoMay 9, 20161 votes

Maybe I'm not understanding fully, but why were the owners of REN and TDK punished, but not the owners of TIP? It would makes sense to also punish TIP's owners as well.

SpeerhausenMay 9, 20162 votes

Different infractions require different penalties.

pyroHedgeMay 10, 20161 votes

I wish Riot would be more honest as to "Why not give the slot to the TIP players." They say "legally the slot belongs to the TIP organization" but just above AND below they mention that the TIP slot will be forfeit in 10 days, making it clear that there's no legal issue at play here. Riot can, and has stated that it will, strip TIP of its slot. The fact is, there are a lot of logistics required to manage an LCS team, from W2s to travel, as well as issues related to team expenses (what if the Riot provided money runs out and they can't pay rent?) and sponsorships. So it makes sense for Riot to be looking for stable management. So why not just tell us that rather than give us some total legal BS. This is Spectate Faker all over again. Riot wasn't wrong in asking Spectate Faker to cease, but their rational was bogus. What else is Riot lying to us about?

ShibuyaXTechmoMay 10, 20161 votes

Who knows Kobe Bryant might pick up TIP

SpeerhausenMay 10, 20161 votes

Have you heard rumors of such? You've piqued my interest.

AdderTudeMay 11, 20161 votes

The cookie-cutter answers to the Q&A are amusing. After reading the verdicts on both cases for all three teams, they just cut and paste the same response and simply changed names when referring to the different teams. Puh-lease at least word the response differently while delivering the same message. It just looks lazy by going the "Ctrl+C, Ctrl+V" route.