An arbitrator heard arguments from the NBA and the players association on the free agent status of players who have been waived, including New York Knicks' guard Jeremy Lin and Los Angeles Clippers' point guard Chauncey Billups.

With free agency scheduled to begin July 1, the question is whether current teams should be allowed to re-sign players without using salary-cap exceptions.

The Knicks are the team with the most to gain or lose in the decision. If Bird rights aren't granted, the Knicks would have only their $5 million exception available to re-sign Lin and sharp-shooter Steve Novak.

Commissioner David Stern said Tuesday that the NBA supports what he considers "the clear position of the CBA."

If Early Bird Rights aren't granted, Novak is likely to leave as an unrestricted free agent and Lin would use most, perhaps all, of the mid-level exception.