Troy Polamalu Lawsuit, NFL Legend Named in $73 Million AAF Class Action—What Happened?
Pro Football Hall of Famer Troy Polamalu was named as a defendant in a federal class action lawsuit filed in April 2019 by former Alliance of American Football (AAF) employees and players after the startup league abruptly collapsed. The lawsuit alleged Polamalu, serving as AAF Head of Player Relations, and other executives violated federal labor laws and committed fraud by concealing the league’s insolvency. The case reached a conditional $73 million settlement in 2022.
The lawsuit shocked football fans who knew Polamalu for his legendary Pittsburgh Steelers career, not for alleged involvement in a failed business venture. But when the AAF suspended operations on April 2, 2019—just eight weeks into its inaugural season—hundreds of players and employees were left stranded without pay, benefits, or answers.
Former Birmingham Iron punter Colton Schmidt and Orlando Apollos linebacker Reggie Northrup filed a lawsuit alleging breach of contract, fraud and false promise, while a separate lawsuit was filed by former AAF employees alleging violations of federal labor law.
What Was the Alliance of American Football?
The AAF launched in February 2019 as an alternative professional football league designed to fill the void between NFL seasons. AAF founder Charlie Ebersol recruited former NFL general manager Bill Polian and former NFL players Troy Polamalu, Hines Ward and Justin Tuck to oversee league operations.
Polamalu was going handle player issues as the AAF’s Head of Player Relations, a leadership role that would later place him at the center of legal scrutiny when the league collapsed.
The eight-team league featured players hoping for NFL opportunities, with each team rostering 50 players. The AAF promised three-year contracts and positioned itself as a developmental league that avoided the mistakes of previous startup football leagues.
That promise lasted less than two months.
Why Did the AAF Collapse?
The AAF’s financial troubles began almost immediately after launch. The league lost a primary investor before its inaugural season started, triggering a scramble for emergency funding. Tom Dundon was brought in, but his actual contributions were misrepresented. He was said to have contributed $250 million, but the truth is that that amount was the ceiling of his contributions to be paid over an undisclosed period of time, and he was free to pull out at virtually any point.
When Dundon declined to provide the reported $20 million needed to complete the season, the league suspended operations on April 2, 2019. Players learned about the shutdown through social media and news reports. Some were hospitalized with injuries, unable to pay medical bills. Others were stranded in unfamiliar cities without the compensation they’d been promised.
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Troy Polamalu Named as Defendant: The Class Action Lawsuits
Two separate class action lawsuits were filed within days of the AAF’s collapse, both targeting league executives—including Troy Polamalu.
The Employee WARN Act Lawsuit
Former Birmingham Iron executive James Roberson Jr., the WARN Act suit filed in California’s Northern District names as defendants the AAF; Legendary Field Exhibitions, LLC; Founders Fund; The Chernin Group; Slow Ventures; MGM Resorts International; Charles King’s M Ventures; Polian; and former NFL players Jared Allen, Troy Polamalu and J.K. McKay.
Their suit charges that the federal Worker Adjustment and Retraining Notification, or WARN, Act required a large business such as the AAF to give at least 60 days’ notice before making mass layoffs. There was no such notice before the AAF’s abrupt suspension.
The WARN Act protects employees at companies with 100+ workers by requiring 60 days’ written notice before mass layoffs or closings. According to the lawsuit, proposed class members are entitled to at least 60 days’ worth of wages, bonuses, accrued holiday pay and accrued vacation, as well as 401(k) contributions and health insurance coverage.
The Players’ Breach of Contract Lawsuit
The second lawsuit came directly from AAF players. The Schmidt-Northrup suit is alleging breach of contract by the AAF, breach of implied good faith and fair dealings, failure to pay wages and fraud and false promises.
The suit alleges the “defendants concealed and suppressed a material fact about their intentions for the long-term viability of the Alliance of American Football” and that the defendants “intended to conceal the fact that the league was insolvent”.
The players claimed AAF executives, including those in leadership positions like Polamalu, knew the league was financially unstable but continued recruiting players with promises of long-term viability. The suit also alleges the defendants “made promises to the plaintiffs and class members regarding the long-term longevity and health of the league. Defendants did not intend to perform the promises made when they made the promises”.
“This is a wholesale destruction of an entire football league,” said Boris Treyzon, one of the attorneys suing on behalf of the players. “Once we started looking at the facts, we saw that this is basically a wholesale betrayal of a group of people”.
What Did Troy Polamalu Do Wrong?
Polamalu’s specific role in the alleged misconduct remains unclear from public court documents. As Head of Player Relations, he was responsible for managing player issues, recruitment, and welfare—placing him in a position where he would have communicated the league’s stability and viability to potential players.
Several of the individual defendants—including Polian, Polamalu and Allen—will probably insist that they are not personally subject to WARN, according to legal analysis at the time. There is unsettled case law on whether directors and officers of a company can be held individually responsible for failing to meet WARN’s requirements.
The lawsuits did not allege Polamalu personally concealed financial information or made fraudulent promises. However, his leadership position and involvement in player recruitment made him a named defendant in claims alleging the league misrepresented its financial health to employees and players.
The $73 Million Settlement: What Players Received
After three years of litigation, the AAF lawsuits reached resolution. Attorneys from ACTS LAW, LLP and Thompson Coburn, LLP who represented hundreds of former players in the Alliance of American Football (AAF) are proud to announce a conditional $73 million settlement in a class action against the estate of now-defunct football league in May 2022.
In the class-action filed on behalf of the league’s former players, represented by Boris Treyzon and Jonathon Farahi, the parties agreed that the Estate of the Alliance of American Football was to pay the remainder of the players’ contract: the final two payments of the 2019 season and the final two years of the three-year contract in full.
The settlement terms included:
- Final two paychecks from the 2019 season
- Full payment for the remaining two years of the three-year contracts players signed
- Conditional payment structure dependent on funds available from the AAF estate
“Many of the players were concerned about being blackballed if they brought litigation against the league. It took a lot of guts…for Mr. Northrup and Mr. Schmidt to put their name on this lawsuit,” They really stood up for the rest of these guys. In speaking to the rest of the class, I know how grateful they are to these two individuals,” said ACTS LAW Of-Counsel Jonathon Farahi.
Who Qualified for the AAF Settlement?
The class action certification meant hundreds of former AAF players and employees could claim settlement benefits. Eligible class members included:
- All AAF players who signed contracts before the April 2, 2019 suspension
- AAF employees laid off without 60 days’ notice
- Coaching staff and front-office personnel
- Anyone who suffered financial losses due to unpaid wages, benefits, or contract violations
The settlement was described as “conditional” because it depended on available funds from the defunct league’s estate. With the AAF essentially bankrupt, recovering the full $73 million remained uncertain.
What Happened to Troy Polamalu After the Lawsuit?
Unlike the AAF’s primary financial backers and founders, Polamalu maintained a relatively low profile throughout the litigation. He was inducted into the Pro Football Hall of Fame in 2020, his first year of eligibility, with the AAF controversy barely mentioned in media coverage of his enshrinement.
The settlement terms did not publicly disclose individual liability amounts for named defendants. It remains unclear whether Polamalu faced personal financial responsibility or if the settlement came entirely from the AAF’s corporate estate and insurance policies.
Polamalu has not publicly commented on the lawsuit or settlement beyond the AAF’s initial statement acknowledging the league’s collapse.
Lessons from the AAF Collapse
The AAF lawsuits highlight critical issues in startup sports leagues and employee protections:
Federal Labor Law Compliance: Even startup ventures must comply with WARN Act requirements when conducting mass layoffs. The 60-day notice requirement exists precisely to prevent situations like the AAF collapse.
Executive Accountability: Leadership positions carry legal responsibilities. Executives who recruit employees or players must ensure representations about company stability are accurate.
Contract Enforcement: Professional athletes deserve the same contract protections as other workers. The settlement established precedent for holding sports leagues accountable for breach of contract.
Financial Transparency: The lawsuit alleged AAF executives concealed insolvency while continuing to recruit players and staff. Companies must disclose material financial information to employees and contractors.
How the AAF Case Compares to Other Sports League Failures
The AAF wasn’t the first alternative football league to fail spectacularly:
The original XFL (2001) folded after one season but avoided major lawsuits because it properly notified employees and honored existing contracts. The United States Football League (1980s) went bankrupt but settled player contracts before dissolution.
The AAF’s abrupt shutdown without notice or final paychecks created the legal exposure that led to the $73 million settlement. The case serves as a cautionary tale for startup sports leagues about the importance of financial planning and legal compliance.
What This Means for Future Alternative Football Leagues
The XFL relaunched in 2020 (suspended due to COVID-19) and again in 2023, with detailed financial planning and transparent communication to avoid AAF-style legal problems. The United States Football League (USFL) revived in 2022 with similar protections.
These leagues learned from the AAF’s mistakes: maintain adequate funding reserves, communicate openly about financial status, comply with federal labor laws, and never make promises about league longevity that can’t be kept.
Frequently Asked Questions About the Troy Polamalu AAF Lawsuit
Was Troy Polamalu personally sued in the AAF lawsuit?
Yes, Troy Polamalu was named as a defendant in his capacity as AAF Head of Player Relations. The lawsuit alleged league executives, including Polamalu, violated federal labor laws and misrepresented the league’s financial stability to players and employees.
Did Troy Polamalu have to pay money in the settlement?
Settlement terms did not publicly disclose individual defendant liability. The $73 million conditional settlement came from the AAF estate. It’s unclear if Polamalu faced personal financial responsibility or if payments came from corporate assets and insurance.
What was Troy Polamalu’s role in the AAF?
Polamalu served as the AAF’s Head of Player Relations, responsible for managing player issues, recruitment, and welfare. His leadership position placed him in direct contact with players regarding the league’s viability and future.
How much did AAF players receive in the settlement?
Players were entitled to their final two paychecks from the 2019 season plus full payment for the remaining two years of their three-year contracts. However, the settlement was conditional based on funds available from the defunct league’s estate.
Why did the Alliance of American Football collapse?
The AAF collapsed due to severe financial mismanagement and insufficient funding. Primary investor Tom Dundon declined to provide additional capital when the league needed $20 million to complete its inaugural season, forcing immediate suspension of operations.
Can former AAF players still file claims?
The settlement was reached in May 2022. Claim filing deadlines have likely passed. Former AAF players or employees should contact the settlement administrators or class action attorneys ACTS LAW, LLP for current claim status.
What is the WARN Act and why did it matter in this case?
The Worker Adjustment and Retraining Notification (WARN) Act requires companies with 100+ employees to provide 60 days’ written notice before mass layoffs. The AAF gave no notice before suspending operations, triggering automatic liability for 60 days of wages and benefits.
Disclaimer: This information is for educational purposes only and does not constitute legal advice. Consult an attorney specializing in employment law or sports law for legal guidance regarding class action participation or similar employment disputes.
For more information about class action lawsuits, employment law violations, and consumer protection litigation, visit AllAboutLawyer.com.
About the Author
Sarah Klein, JD, is a licensed attorney and legal content strategist with over 12 years of experience across civil, criminal, family, and regulatory law. At All About Lawyer, she covers a wide range of legal topics — from high-profile lawsuits and courtroom stories to state traffic laws and everyday legal questions — all with a focus on accuracy, clarity, and public understanding.
Her writing blends real legal insight with plain-English explanations, helping readers stay informed and legally aware.
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