The advent of the poison pill was first introduced to the public by 49ers President Carmen Policy in 1996. The 49ers intended to sign Giants running back Rodney Hampton to an offer sheet with a poison pill that stated Hampton would be "on the field for 70% of the offensive plays over the next 2 seasons." The Giants had drafted Tyrone Wheatley with their first round pick in 1995 but he was largely ineffective in his first season. Since he played the same position as Hampton, the Giants had planned to ease him into the offense with Hampton on the back end of his career. For the Giants to match the 6 year deal, they would be forced to play Hampton in 70% of the plays, thus making the previous year's draft pick of Wheatley a loss. The 49ers later decided to not include the clause, as they felt the NFL would never approve the terms. Their assumption would be proven incorrect following the 2005 season, with the historic offer sheet Steve Hutchinson signed with the Minnesota Vikings.
The transition tag is currently at the center of a controversy regarding its potential usefulness in light of the contract offered by the Minnesota Vikings to Steve Hutchinson, an offensive guard who had received the transition tag following the 2005 season from the Seattle Seahawks. The contract was for $49 million over seven years, $16 million of which was guaranteed. However, the Vikings added a "poison pill": The entire $49 million contract was guaranteed if Hutchinson were not the highest paid offensive linemen on the team he signed with. Since Hutchinson's salary was less than that of the Seahawks' Walter Jones, an offensive tackle, his contract would have been guaranteed by the Seahawks, while the Vikings, having no offensive linemen averaging more than Hutchinson's proposed salary, would only be obligated to pay the guaranteed $16 million. The Seahawks filed a grievance with the NFL league office, claiming that the poison pill was illegal under the collective bargaining agreement in that the Seahawks would have to pay significantly more than the Vikings despite matching with exactly the same contract. An arbitrator ruled in favor of the Vikings, and the Seahawks were essentially unable to match and received no compensation.
In an act of apparent revenge, the Seattle Seahawks included their own "poison pills" when signing restricted free agent wide receiver Nate Burleson. The total contract was seven years and $49 million - not coincidentally the exact amount of the contract Hutchinson received from the Vikings. The first poison pill stipulated that the entire contract would be guaranteed if Burleson played five or more games in the state of Minnesota during any year of the contract. This of course would be impossible as a member of the Seahawks, but an inevitability as a member of the Vikings, who play their home games in the Hubert H. Humphrey Metrodome in Minnesota. The second provision would guarantee the full contract if Burleson is paid more on average per year than all of his team's running backs combined. At the time of his signing, the averages of the Vikings' tailbacks fell well shy of the $7 million average of the Burleson offer sheet. However in Seattle, running back Shaun Alexander alone made an average of over $7 million per year.
In 2011, the NFL and NFLPA ratified a new collective bargaining agreement. In this agreement, poison pill clauses were eliminated from offer sheets issued to players under the transition tag. The specific language in the CBA states:
"No Offer Sheet may contain a Principal Term that would create rights or obligations for the Old Club that differ in any way (including but not limited to the amount of compensation that would be paid, the circumstances in which compensation would be guaranteed, or the circumstances in which other contractual rights would or would not vest) from the rights or obligations that such Principal Term would create for the Club extending the Offer Sheet (i.e., no 'poison pills')."
The effect of this additional language has resulted in the transition tag being useful to teams again. In 2014, the Pittsburgh Steelers applied the transition tag to Jason Worilds and the Cleveland Browns applied the transition tag to Alex Mack. Worilds signed his transition tag, while Mack accepted an offer sheet from Jacksonville. Cleveland later matched to the offer sheet, thus keeping Mack as a Brown.
