Your All-In-One MLB Legal Roundup

Much of my offseason writing on this site focused on the legal proceedings involving Major League Baseball, partly because MLB is embroiled in quite a few lawsuits, and partly because I try to stick to the advice: “Write what you know.” But as spring training kicks in to gear next week, and then the season in late March, I hope (I really, really hope) to spend more time on interesting baseball stories and less time on the intricacies of the Joint Drug Agreement and federal antitrust law.

Call me a dreamer.

In any event, there have been a few recent developments in MLB-related legal matters; perhaps not significant enough to warrant their own post, but important enough to mention as part of this legal roundup. When readers ask me on Twitter, “Hey, what’s happening with such-and-such lawsuit,” I’ll be able to send them a link to this article. At least for a while.

Houston Astros/CSN Houston

In November, I told you about the mess involving the Astros and Comcast SportsNet Houston — the regional sports network owned by the Astros — Comcast and the Houston Rockets. The network launched in late 2012 but has been unable to reach carriage agreements with any cable or satellite operator in the Houston area, other than Comcast. That’s left 60% of television viewers without access to Astros and Rockets game, and left the RSN without the cash to pay the rights fees promised to the teams.

Last September, Comcast filed an involuntary bankruptcy petition against CSN Houston. The Astros countered with state court complaints against Comcast and the Astros’ prior orwner, Drayton McLane, in which the team alleged it was mislead about the new network’s economic and financial viability.

Just yesterday, the bankruptcy judge in Houston placed CSN Houston under Chapter 11 bankruptcy protection. That was the move Comcast and the Rockets sought, and what the Astros opposed. David Barron of the Houston Chronicle reported the bankruptcy court will now oversee a reorganization of CSN Houston that will focus on securing carriage rights agreements between the network and the non-Comcast cable and satellite companies in the area.  The Astros could lose their equity stake in the network, see a diminution in their rights fees or both.

All things Alex Rodriguez

Last we met, baseball arbitrator Frederic Horowitz reduced Alex Rodriguez’s suspension from 211 games to 162 games — plus the 2014 postseason — should the New York Yankees win the American League East or qualify as a wild card team. Rodriguez didn’t take too kindly to that decision and filed a lawsuit in federal court in Manhattan against MLB and the players’ union. In the suit, Rodriguez claimed the proceeding before Mr. Horowitz was unfair, lacked due process and resulted in unfounded punishment. That case is pending before Judge Edgardo Ramos of the U.S. District Court in the Southern District of New York.

Immediately, MLB requested a conference before Judge Ramos to discuss its expected motion to dismiss Rodriguez’s lawsuit. In a letter to the court, MLB argued that judicial review of arbitration decisions is quite limited, and that the arbitrator considered and rejected Rodriguez’s allegations the evidence was insufficient to find he used performance-enhancing substances. MLB also took issue with Rodriguez’s claim that the arbitrator misinterpreted the Joint Drug Agreement and Collective Bargaining Agreement. (I’ve written extensively about these legal issues, and believe the arbitrator did misinterpret the agreements. Nonetheless, the court has very limited authority to review the arbitrator’s interpretation).

MLBPA also wrote the judge and previewed its motion to dismiss. The players’ union argued that courts are highly deferential to how unions carry out their duty of fair representation in an employer-employee arbitration proceeding. It then countered Rodriguez’s factual allegations against the union: That the former union head — the late Michael Weiner — wrongly revealed to the public his view of Rodriguez’s defense; that the union should have stopped MLB’s Florida lawsuit against Biogenesis founder Anthony Bosch; and that the union should have presented a more aggressive defense for Rodriguez in the arbitration.

Judge Ramos ordered Rodriguez to respond to these letters by this Friday. He will hold a preliminary conference in the case on Feb. 14.

There’s been a bit of Rodriguez-related legal wrangling in a different courtroom in the U.S. District Court in Manhattan. You may recall that in October, after the arbitration had commenced, Rodriguez sued MLB in New York state court and charged the league with tortiously interfering with his contact with the Yankees. He complained about much of the same conduct at the heart of his effort to undo the arbitration decision: Essentially that Anthony Bosch is a liar and a fraud, and that MLB bought acted illegally — by buying stolen Biogenesis documents — for the sole purpose of building the case against Rodriguez.

MLB removed the state lawsuit to federal court (a standard legal maneuver when a collective bargaining agreement is involved) and moved to dismiss the complaint as preempted by the CBA. Rodriguez moved to remand the case to state court. The remand motion has been fully briefed. The judge in that case — U.S. District Judge Lorna Schofield — appears ready to decide the motion without argument. If she keeps that case in federal court, she and Ramos will decide whether the two separate lawsuits will be combined before a single judge.

This is all standard legal wrangling that takes place soon after a lawsuit is filed. Still, the most interesting aspect of this whole mess is Rodriguez did not ask the court to enter a preliminary injunction to keep the arbitration decision from going into effect. As such, the suspension is effective and unless overturned by a court, must be served by Rodriguez this season. If the federal court doesn’t dismiss Rodriguez’s complaint to overturn the arbitration decision — and my best guess is that it will dismiss it — the court would then oversee a fact-finding process that may very well take longer than the 2014 season. Under those circumstances, Rodriguez likely will have served his suspension before a court rules on its legality.

City of San Jose vs. MLB

In December, U.S. District Judge Ronald Whyte dismissed the remaining state law claims asserted by the City of San Jose against MLB relating to the city’s effort to become the new home of the Oakland A’s. The judge dismissed the federal antitrust counts several months earlier, on the theory that such claims were barred by MLB’s antitrust exemption. By dismissing the state law claims, the court was able to enter final judgment. That allowed San Jose to proceed with its appeal of the federal claims to Ninth Circuit Court of Appeals, and to re-file its state law claims in state court.

That’s exactly what’s happened. San Jose filed its notice of appeal with the Ninth Circuit, and then immediately asked the court to expedite the matter. San Jose argued that if the court doesn’t resolve the antitrust exemption issues by Nov. 8 — which would be unlikely under the current briefing schedule — the city will lose its opportunity to bring the A’s to San Jose, as that is the date the option agreement expires. It’s an interesting argument, as San Jose is all but conceding that without an active option agreement, it may not have standing to assert antitrust claims against MLB. I’m not persuaded the court will expedite the matter. You can decide for yourself by reading the motion to expedite here.

San Jose did re-file its state law claims in state court — this time in Santa Cruz Superior Court. The complaint reads much like the one the city originally filed against MLB in federal court. If you must, you can find the complaint here. Why Santa Cruz? Well, under California law, a city cannot file a complaint in the county where it’s located. If San Jose wanted to stay close, the other options were San Mateo, San Francisco and Alameda counties. The first two are considered Giants Country and the latter is the home of Oakland. So Santa Cruz it is. A case management conference is scheduled for mid-May.

Antitrust challenge to MLB blackout policy

Last year, around this time, I told you about a lawsuit that had been filed challenging MLB’s policies that result in blackouts of “local” games on MLB Extra Innings and MLB.tv. Local is in quotation marks because many teams claim a TV broadcast territory far beyond the reach of its RSN’s signal.  I showed you this map.

MLBBlackoutMap

That lawsuit has proceeded apace and, in the next few months, may come to some sort of resolution. It appears from the court’s most recent scheduling order (which you can read here) that the parties are at the expert discovery phase — which means each side has obtained documents and sworn testimony from the other side’s key witnesses. For MLB, that includes, at a minimum, Red Sox owner John Henry, who is specifically referenced in the scheduling order.

Each side has retained experts and will now provide the other side with those experts’ reports, after which the experts will be deposed. If MLB wants to resolve the case short of a trial, it must soon file a motion for summary judgment wherein it will argue that the facts are undisputed and/or the law compels that the plaintiffs’ antitrust claims be dismissed.

Like the others, this case is going to be interesting to watch over the next few months.



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Wendy writes about sports and the business of sports. She's been published most recently by Vice Sports, Deadspin and NewYorker.com. You can find her work at wendythurm.pressfolios.com and follow her on Twitter @hangingsliders.


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Johnhavok
Guest
Johnhavok
2 years 6 months ago

Thanks for the updates Wendy.

Hypothetically, can A-Rod ask for an injunction at a later date or would it have to have been filed with the original filing?

tylersnotes
Member
2 years 6 months ago

do any of these challenges have legs to move up the federal court ladder? It seems to me that this current supreme court is about as business friendly as they come, if one of these cases does continue to move is it in MLB’s interest to see it all the way to the supreme court and have their antitrust exemption reinforced by a Roberts court?

Disclaimer: I do not know what I am talking about

Dan Greer
Member
Dan Greer
2 years 6 months ago

IANAL, but it seems pretty obvious to me that MLB would *not* want their anti-trust exemption under examination by the Supreme Court, no matter what.

Llewdor
Guest
Llewdor
2 years 6 months ago

Also keeping in mind that one of today’s Supreme Court Justices famously ruled against MLB in a dispute it had with MLBPA. Justice Sotomayor is the judge who ruled on the MLBPA’s claim that MLB was bargaining in bad faith in 1995, thus ending the 1994/1995 strike.

cass
Guest
cass
2 years 6 months ago

Thank you, Wendy.

One odd question, perhaps: is there any legal avenue for fans to challenge the metal detector mandate? I’m guessing no, but was wondering if there was some glimmer of hope.

Only recourse is boycott, right?

Mike Green
Guest
Mike Green
2 years 6 months ago

Wendy,

Just in case you were wondering about the Toronto Blue Jays and “local”, the answer is “Canada”. Alas, antitrust litigation in Canada is not quite what it is in the States.

Llewdor
Guest
Llewdor
2 years 6 months ago

Which is insane. I am a 2.5 hour drive from Safeco field (even with the border crossing), and yet MLB says I’m in Toronto’s local market.

Toronto is a 6 hour flight from here.

Iron
Guest
Iron
2 years 6 months ago

Your writing about baseball’s legal aspects are something that I just don’t find anywhere else. While I look forward to your writing on other aspects, I can’t say enough good things about these.

byron
Member
byron
2 years 6 months ago

Wendy is phenomenal, but if you have a greater appetite for this than one writer can fulfill, Craig Calcaterra at NBC Sports is a former defense lawyer who also frequently writes about baseball’s legal side.

Earl
Guest
Earl
2 years 6 months ago

calcaterra can never get off his high horse for long enough for me to make it through a whole post

Chris from Bothell
Guest
Chris from Bothell
2 years 6 months ago

Came here to say much the same thing. I don’t pretend to follow many of these sorts of topics, or understand them well when I do, but I know to always start with Wendy’s articles first if I want to know the latest or know more. She’s a unique talent here at FG.

Evan
Guest
Evan
2 years 6 months ago

Is Alex Rodriquez suspended for 162 games or the entire regular season?

Very unlikely, but would he be eligible to play if the Yankees were involved in a game 163 tiebreaker? Conversely if the Yankees were to play fewer than 162 games (increasingly rare with the Selig mandate to play all the games) could his suspension continue into 2015?

Rex Manning Day
Guest
Rex Manning Day
2 years 6 months ago

The ruling suspends A-Rod “for the 2014 season and 2014 postseason.” A number of games isn’t specified, so a shortened or lengthened season won’t affect the length of the suspension.

Sean C
Guest
2 years 6 months ago

I am really hoping something is done about the blackout restrictions for MLB.tv. I don’t get cable tv anymore because, really, mlb.tv, netflix and hulu are more than enough. That said, I am in the blackout area for Yankees games even though I didn’t get YES before I cancelled my cable.

srpst23
Member
srpst23
2 years 6 months ago

Get a VPN, they are about $30/yr. They encrypt your internet traffic and route it through servers in a different location, thus fooling MLB.tv (or NHL Gamecenter Live) into thinking you are somewhere else. NHL Gamecenter has blackout restrictions even more draconian than MLB.tv, so I typically have to route my signal through a server in Iceland to pick up my local team.

byron
Member
byron
2 years 6 months ago

Does the VPN let you stream the playoff games on TBS? What about the hockey playoffs? At this point, I’m paying for cable 75% for sports playoffs and 25% for shows available On Demand that aren’t legally streamable anywhere. (Yes, I know how to steal this stuff, and have probably torrented more GB of tv shows than you’ve watched in your life, but I try to do it right if at all possible.)

srpst23
Guest
srpst23
2 years 6 months ago

Unfortunately not that I know of. I used a friends log in for the playoffs on tbs.

Z S
Guest
Z S
2 years 6 months ago

Yep, totally agreed. So frustrating that they choose to punish people that don’t own TVs or have cable, even if they pay the $100+ for MLB.tv access.

TKDC
Guest
TKDC
2 years 6 months ago

Presumably if Arod wins (fat chance) he’d be paid his full 2014 salary as damages (though from MLB, not the Yankees), even if the season is long over and he never took the field.

Alex
Guest
Alex
2 years 6 months ago

I hope MLB finally solves the Oakland A’s stadium issue by the end of the 2014 season. Still maintain that the A’s will somehow remain in Oakland and build a stadium there. It may be in the interest of the A’ to team up with the Golden State Warriors and work out a “combined” stadium deal in Oakland. As time goes by, it appears unlikely the A’s will ever move to San Jose and the Warriors to San Francisco. Stadium proposals for both teams in their potentially new cities are weak at best; and as the cost projections continue to mount, the odds are not good these stadiums will ever be built.

Wilt Chamberlain's ghost
Guest
Wilt Chamberlain's ghost
2 years 6 months ago

I hear the orange bounces really well on grass.

Mr Punch
Guest
Mr Punch
2 years 6 months ago

Thanks Wendy – informative as always.

Slacker George
Guest
Slacker George
2 years 6 months ago

Seems like territory should be defined to coincide with a certain threshhold of ticket sales. i.e. Tampa gets xx% of their ticket sales from the following counties and that xx% should be consistent across all teams.

Slacker George
Guest
Slacker George
2 years 6 months ago

Or more better: if Team A receives >= XX % of sales from a given county, they can black it out. Beneath that threshhold, they can’t.

Erik
Guest
2 years 6 months ago

These rules are not about ticket sales, but rather about negotiated television right. RSN’s have purchased the rights to air the team’s games in certain areas, even if local cable operators are unwilling to carry their channel there.

Gyre
Guest
Gyre
2 years 6 months ago

Here is an interesting bit

Look at the ‘coverage’ map. Notice that both the A’s and Giants claim exactly the same geographic area. There is not an independent area for the Giants, nor the A’s. Both teams agreed to claim the same fans….except at a stadium

larry young
Guest
larry young
2 years 5 months ago

So if all the claims an counterclaims go on an my math is correct it looks like about august 2014 will see some court action.

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