Archive for Business

Jose Reyes Has Been Honored for His Off-Field Behavior

Known primarily for his work as the former executive director of the MLBPA, Marvin Miller was an NYU-educated economist by training. His efforts as union head eventually led to the elimination of the reserve clause and start of free agency for MLB players. It was Miller who negotiated the players’ very first collective bargaining agreement, brought arbitration to professional sports, and did all of this despite contending with anti-semitism from the team owners on the other side of the bargaining table and a disability leaving him with limited use of his right arm. Miller was called by Hank Aaron “as important to the history of baseball as Jackie Robinson.”

In light of Miller’s relevance to the livelihoods of its members, it’s not surprising that the MLBPA makes some effort not only to preserve his legacy but also to honor those who continue it. To that end, the union gives an award every year for off-field service and community leadership. The Marvin Miller Man of the Year Award, started in 1997 and rebooted in 2000, is considered “one of baseball’s top honors[.]” The award is based on popular vote by the players, with the recipient being the teammate whom the voters “most respect based on his leadership on the field and in the community.” Each team has its own top vote-getter honored by the MLBPA.

In 2017, the list of top vote-getters contained an impressive collection of players notable not just for their exploits on the field, but for their charity work off of it, as well.

Among [2017]’s nominees are players involved in providing clean water and other necessities to poverty-stricken villages in remote parts of the world, supporting the needs of servicemen and women and their families, building schools, ensuring clothing and meals for inner-city poor,  raising funds for research and respite to cancer victims and their families,  rescuing abandoned and mistreated animals,  and sending truckloads of emergency supplies to victims of natural disasters.

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The Yankees Have a Lot of Payroll to Use

The Yankees’ 2018 campaign came to a disappointing end on Tuesday. After a 100-win regular season that, under normal circumstances, would have won them the division, they were forced to face the A’s in the American League’s Wild Card game. And while they managed to get past Oakland, New York ran into trouble against a Boston club that produced 108 victories, losing the final two games due, in part, to rookie manager Aaron Boone’s reluctance to utilize his bullpen.

Now the focus for the Yankees moves to 2019, when the team will be forced to compete not only with the Red Sox but also the lofty standards set by the club’s 2018 season.

In a sense, 2018 was a transition year for the New York. On the one hand, yes, they began the season by trading for the National League MVP and ended it with 100 wins. On the other, though, rookies — most notably Miguel Andujar and Gleyber Torres — accounted for 1,528 of the club’s plate appearances, the highest total for the franchise since 1969, when Bobby Murcer became a full-time starter. The club’s 5.7 WAR from rookie position players is the third-highest total in the past 30 years behind only last season (due solely to Aaron Judge) and 1989 (when Alvaro Espinoza, Bob Geren, and Roberto Kelly were rookies).

As part of their “transition,” the team finally reduced their payroll by a sufficient amount to avoid the competitive-balance tax and reset the penalties associated with it. From 2014 to -17, the Yankees spend an average of $256 million per year in payroll and penalties combined, per Cot’s Contracts. This season, they are likely to end up around $195 million. The Yankees, in other words, just cut payroll by $60 million. And not only that: because they drew 300,000 more fans than last season and also face a more modest revenue-sharing burden under the new CBA, New York likely ended up with $100 million more in 2018 than previous seasons. In light of that, it’s unsurprising to find that the organization is reportedly planning to buy back the YES Network from Disney when the latter sells it off to acquire part of FOX’s assets. The Yankees are awash in cash, and they shouldn’t have any limitations in free-agent spending this offseason.

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The Law of Tanking, Part One

Early this year, Dallas Mavericks owner and perpetually frustrated baseball-team-owner-of-the-future Mark Cuban, during a team dinner, said this:

“I’m probably not supposed to say this, but, like, I just had dinner with a bunch of our guys the other night, and here we are, you know, we weren’t competing for the playoffs. I was like, ‘Look, losing is our best option. [Commissioner] Adam [Silver] would hate hearing that, but I at least sat down and I explained it to them. And I explained what our plans were going to be this summer, that we’re not going to tank again. This was, like, a year-and-a-half tanking, and that was too brutal for me. But being transparent, I think that’s the key to being kind of a players owner and having stability.”

The National Basketball Association was, shall we say, peeved at Cuban, fining him $600,000. Why? Because of the implication that the Mavericks were intentionally losing games.

“Yes, it’s not what you want to hear as commissioner,” Silver told reporters at a news conference following a league meeting. “I will say that Mark has a long track record of being provocative, and… I think he acknowledged it was a poor choice of words.

“When we looked at what was actually happening on the floor, which is most important to me, there was no indication whatsoever that his players were intentionally losing games. And so we were satisfied with that, and again, and we moved on.”

Despite the resolution of that particular incident, tanking continues. In fact, the league’s fine of Cuban more or less confirmed that, while intentionally losing games is forbidden, intentionally losing seasons is acceptable — as long as no one talks about it. And while, for years, we talked about tanking as a uniquely NBA problem, that’s not the case anymore. In Major League Baseball, the tank is on.

That raises some interesting questions: under the MLB rules, is tanking legal? Is tanking legal under the law? And if it isn’t, what’s the redress? Believe it or not, these are not at all simple questions. And so we’ll start by asking a simpler question — namely, what is tanking, anyway? Royals Review gives this definition, which seems good for our purposes.

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A Viable Path for Vlad Jr. to Fight Service-Time Manipulation

Yes, this is yet another piece addressing the problem of service-time manipulation, an issue which has been discussed at some length both in these pages and others. In 2018, Ronald AcunaPeter AlonsoVladimir Guerrero Jr.Eloy Jimenez, Gleyber Torres, and even Byron Buxton have all spent extra time in the minor leagues this year, in whole or part to gain their teams an extra year of contractual control.

The MLBPA has weighed in against the practice, but with grievances — like the one filed by Kris Bryant in his rookie year — essentially having stalled out, there doesn’t seem to be a resolution on the horizon. Because minor leaguers (that is, players not on a major-league 40-man roster) aren’t members of the union, the issue of service-time manipulation hasn’t necessarily represented a priority.

Here’s the Blue Jays’ 40-man roster. Vladimir Guerrero Jr. isn’t on it. He almost certainly will be next year. As of right now, though, he isn’t — which means he also isn’t a member of the Major League Baseball Players’ Association. Somewhat surprisingly, there’s a way that might actually represent an advantage for him. Specifically, it might give him the opening he needs to challenge the practice of service-time manipulation in court… and win.*

*For our purposes, let’s assume that Toronto is subject to American law. As you’ll see, the argument below can be applied really to any minor leaguer. We’re just using Vlad as an example.

Few teams admit to manipulating service time. It is not surprising, therefore, to find that the Blue Jays have also been reluctant to invoke service time when justifying the absence of Vlad Jr. from the major-league roster. Here is how Blue Jays president Mark Shapiro explained it back in July on SiriusXM Fantasy Sports Radio:

We want to make sure from the teenage perspective, leadership perspective, defensive perspective, routines, nutrition, all the little things, that we have this guy with as good a foundation as possible.

Most of the traits invoked here are sufficiently dependent on the opinion of baseball professionals that the prospect of performing any kind of analysis on it, from the outside, is basically impossible. Leadership and routine: both are surely required, in some volume, to flourish in the majors. The people most well positioned to evaluate those qualities are all probably employed by the Blue Jays, however. To that degree, all one can do is take Shapiro at his word, even if those words seem quite convenient for Toronto’s bottom line.

Shapiro mentions another “perspective,” however, that is less frequently invoked by front-office personnel and which also seems more suited to some kind of objective assessment — namely, nutrition. Nor is this the only occasion on which it has been cited by Toronto as one of the reasons for leaving Vlad Jr.’s potent bat in the minors. So let’s consider nutrition for a moment.

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Michael Schwimer on Francisco Mejia and the Future for Big League Advance

Back in April, I wrote about the lawsuit former Indians uberprospect and current Padres backstop Francisco Mejia had filed against Big League Advance. As I wrote earlier this week, that case is now over. Michael Schwimer, the CEO of Big League Advance, who was good enough to talk to me after my initial post on the case, spent some time this week answering my questions about how the case ended. Once again, Schwimer was forthcoming about his company, the Mejia suit, and the future for himself and his business.

I first asked Schwimer what happened at the end of the case. Schwimer told me that Mejia dismissed his case voluntarily, without providing a specific reason. That said, Schwimer suspects “peer pressure [on Mejia] from players” might have had something to do with it. “[We got] overwhelming support from minor-league players,” Schwimer said regarding the suit, adding that BLA clients were largely supportive of the company through the litigation. Schwimer also corrected one assumption I’d made in my previous article — that no discovery had been performed. BLA, at least, had responded to document requests propounded by Mejia’s attorneys. Schwimer thought that response had something to do with Mejia’s decision to dismiss his case, as well. “We had proof to back up literally everything,” Schwimer told me.

Among Mejia’s allegations was that BLA purportedly hired a lawyer for him — and paid that attorney to advise him — solely with a view to including language in the contract that he’d had the benefit of counsel. But Schwimer told me that BLA had correspondence with Mejia’s private attorneys refuting the claim. “We had the emails with Francisco’s lawyer, where [the lawyer] redlined the contract for Francisco’s benefit,” Schwimer said. “He reduced the endorsement from 6% to 2.5%, and made other changes that helped Mejia.”

As I noted in my postmortem on the case following its dismissal, apologies in lawsuits are incredibly rare, and I was curious to know how this one came about. “We did ask him to apologize, no doubt,” Schwimer said. In this case, the apology was part of a settlement, but not of Mejia’s claim. Instead, Schwimer explained that Mejia voluntarily dismissed his claim and settled BLA’s counterclaim. The apology was part of that settlement.

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How LeBron James’ Tattoos Could Affect Baseball

Although FanGraphs is very much a baseball site, we’ve occasionally paid homage to arguably the greatest basketball player of all time, Lebron James. (My favorite was this piece by the inimitable Jeff Sullivan trying to design a 23-WAR baseball player.) Every so often, LeBron does something which forces us to ask questions — questions that might also be relevant to baseball — and then we have to cover it. Something like that is happening now, in a lawsuit about tattoos and video games.

LeBron has some awesome ink. It’s a part of his brand, and so back in 2015, those tattoos were included in the computerized depiction of LeBron created for the NBA2K video game. The game also included tattoos on the bodies of Eric Bledsoe, Kobe Bryant, DeAndre Jordan, and Kenyon Martin (among others). Ordinarily that wouldn’t have been a big deal, except that it led to a lawsuit being filed by Solid Oak Sketches, LLC, against the video-game makers, for copyright infringement. Solid Oak Sketches has an exclusive licensing agreement with the tattoo artists, which means that Solid Oak owns the exclusive right to market, sell, and otherwise control the copyrights to the tattoos in question. In the summary judgment briefing in Solid Oak’s case, LeBron provided an affidavit which saidinter alia, this:

In the fifteen years since I’ve been playing professional basketball, this case is the first time that anyone has suggested to me that I can’t license my likeness without getting the permission of the tattooists who inked my tattoos. No tattooist has ever told me I needed their permission to be shown with my tattoos, even when it was clear I was a public basketball player.

You can already recognize how this might have some relevance to major leaguers. Javier Baez, Matt Kemp, Jose Ramirez, Ryan Roberts, and Gary Sanchez (among many others) have all been known, at one time or another, for their tattoos. If a baseball video game includes them in its depictions of the players, is that copyright infringement? Is showing them on a nationally televised baseball game copyright infringement?

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The Battle Between Payroll and Parity

Over the All-Star break, MLB Commissioner Rob Manfred addressed the Oakland A’s, their quest for a new ballpark, and their remarkably low payroll. With regard to the last of those items, Manfred exhibited little concern, suggesting there was almost no correlation between a club’s capacity to spend money and its ability to win games. John Shea reproduced and retransmitted the following comments, care of Manfred, at the San Francisco Chronicle.

“I categorically reject the notion that payroll should be the measure of whether somebody is trying to win in our game today. I reject that not because I prefer low payrolls to high payrolls. I reject that because I know that the correlation between payroll and winning in baseball is extraordinarily weak.

“You do not guarantee yourself wins by having a high payroll, and as the Oakland A’s have showed, you can win with a low payroll. So I really reject the premise of that question. Those are the economic facts.

“Falling into this notion that payroll is a measure of whether an owner is trying to win is literally sophistry.”

I’ve got good news and bad news for the Commissioner. The good news is that, in six out of the last seven individual seasons, the correlation between wins and payroll hasn’t been very strong, as the graph below suggests.

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How an Agent with Multiple Players Avoids Conflict of Interest

Last week, I wrote about fiduciary relationships in the context of Scott Boras and Jayson Werth, citing the seminal case of Detroit Lions v. Argovitz as a model to better understand an agent’s responsibilities to his client. (If you didn’t read that piece, you should, because it’s the prerequisite for everything which follows.)

Anyway, a number of commenters asked me to look at a slightly different configuration of the sports-agent fiduciary problem: what happens when an agent potentially has a conflict of interest which results from representing more than one player?

Before we answer, a few caveats. First, we are not analyzing actual situations here. This is not a guide on how to avoid disciplinary action by your state’s bar or your league’s player union. Second, this is a bird’s-eye view from about 50,000 feet, which is to say that we are oversimplifying things greatly. There is a lot more to it than what you see here, but submitting 20,000 words to my editor on conflicts of interest in fiduciary relationships (which is surprisingly possible) would likely draw his ire. Third, this is a broad overview based on American law. This is actually an international issue, which means that Canada and Australia, for example, have different rules. Finally, please don’t start a sports agency based on what you see here.

Now, moving on. There’s a couple of different ways to analyze the question posed above. On the surface, it may seem that having a multiple clients is not, in and of itself, a conflict of interest. And while that’s frequently the case, remember that a fiduciary owes a duty of loyalty to the beneficiary — to the exclusion of everyone else. As attorney Robert Kutcher explains,

Whenever one party places trust and confidence in a second person with that second person’s knowledge, it is possible that a fiduciary relationship is created. Such a relationship imposes on the fiduciary the duty to act in the best interest of the person who has placed his or her trust and confidence in the fiduciary. As a result, the fiduciary may not simply deal with that party at arm’s length, guided only by the morals of the marketplace.

It’s also possible to go to the other extreme. Since sports agents are fiduciaries, you could also argue that taking on more than one client is an inherent conflict of interest, because every minute dedicated to one player’s case is a minute not dedicated to another’s, to whom a fiduciary duty is owed. But that can’t be right either, because Scott Boras, for instance, has lots of clients. Most agents have multiple clients.

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Jayson Werth, Scott Boras, and Fiduciary Relationships

Newly retired outfielder Jayson Werth was honored by the Phillies in early August for his contributions to the 2008 World Champions. He made news that weekend for comments that derided “super nerds” as “killing the game.” (It’s worth noting, of course, that Werth was a sabermetric darling back in the day, standing out for his plate discipline.) Of more interest to me, however, was this statement he made on the Howard Eskin podcast:

“I had offers in November, and I was advised by my former agent to wait; ill-advised, I guess.”

***

“Some guys were surprised to hear from me – they didn’t know that I wanted to play. Which was surprising, because I wanted to play. I let my agent know I wanted to play. And they said they either hadn’t heard from him, hadn’t heard from me, just didn’t know that I was available. So that’s one of the reasons why I’m no longer with that agent.”

That raises eyebrows for two reasons. First, because Werth is essentially accusing his agent of a breach of contract, and potentially a breach of fiduciary duty as well. (Keep that term in mind – it’ll be important later.) And second, because the agent in question is Scott Boras, who has been recognized by Forbes as the industry’s most powerful and who, thanks to Eric Hosmer, has now negotiated no fewer than 15 deals of $100 million or more. Accusing Scott Boras of not doing his job is a bit like accusing Clarence Darrow of malpractice: it gets your attention.

Now, Boras, for his part, denies any wrongdoing. His company, the Boras Corporation, gave the Washington Post‘s Chelsea Janes this statement:

Unfortunately, it appears someone has misled Jayson. We contacted all 30 teams numerous times during the offseason on his behalf, and we have phone logs, emails, and other records to back it up. We received no offers for Jayson in November, or otherwise. We are always prepared to support our work against inaccuracies spread by third parties. We understand the frustration and disappointment players can face and wish Jayson all the best.

What’s perhaps more interesting is this excerpt from Janes’ story (emphasis mine):

The Boras Corporation sends out a list of its free agents to every team at the start of free agency each November. Werth’s name was on that list. Boras Corp. provided that list for verification, as well as date-stamped phone logs that documented dozens of phone calls and emails made to executives on Werth’s behalf. Boras keeps detailed records of every offer and conversation, documentation that protects them against allegations of malpractice — and any litigation that could accompany them.

The reference to litigation isn’t accidental; I’d even wager that it was provided to Janes by the Boras Corporation itself. Boras is a lawyer and, believe it or not, lawyers are very deliberate in how and when they raise the spectre of litigation. This was a shot across Werth’s bow — a warning, if you will, not to pursue the matter further.

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How the Mariners’ Request for Public Funding Is Different

Back in May, the Mariners agreed to a lease deal that would keep them in Safeco Field for another 25 years. At the time, I wrote that the Mariners appeared to be bucking a trend by foregoing public money for a new stadium in favor of staying where they were.

Then, last week, things seemed to change.

Predictably, this was not well received.

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Local TV Ratings Are Good But Also Can’t Get Better

In recent years, Major League Baseball has taken steps to make its product available by means of multiple platforms. A daily broadcast, for example, is offered both on ESPN+ and MLB.TV. A weekly one is carried by Facebook. MLB Network is accessible as part of basic packages available through streaming providers like DirecTVNow, Playstation Vue, and YoutubeTV, while the league broadcasts national games on its own network, at ESPN, FOX, FS1, and TBS. The game is out there for consumers who are interested.

That said, there is still a transition to be made before baseball can fully introduce itself to a younger generation of fans. The presence of Regional Sports Networks (RSNs), however, remains an impediment to evolution. RSNs generate massive revenues for MLB teams, either through contracts or ownership, but also require exclusivity. The reason for that arrangement is pretty clear when examining the viewership numbers and ratings (recently published at Forbes) for all teams except the Blue Jays. The graph below shows the average household numbers (HH) per team.

The numbers look how you might except, with New York, Boston, and Chicago (Cubs) drawing the most viewers, while smaller markets and bad teams occupy the lower ranks. The Dodgers’ audience should hypothetically be a lot larger, but the club still hasn’t been able to reach an agreement to get on DirecTV in Los Angeles. Despite that, more than two million people are watching baseball on an almost daily basis for six months out of the year. That’s incredibly valuable.

For networks, those loyal customers help RSNs secure large carriage deals with cable providers and to appear among standard cable packages, charging several dollars per subscriber. Advertising is nice, but RSNs make a vast majority of their money from per-subscriber fees. In turn, the networks dole out large guarantees to teams. The continued high ratings tend to justify these deals. The graph below shows the ratings, which are based on viewers within a market, as opposed to the total household figures.

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MLB, Twitter, and Baseball’s Looming Age Problem

If you’re like me, you use Twitter. Twitter’s awesome! It gives you breaking news, reports on the latest trades, and also whatever this is:

And without Twitter, we wouldn’t have unfettered access to Brandon McCarthy’s observations of the world, which are worthwhile…

Twitter can be good, in other words.

As anyone familiar with that particular platform knows, however, it’s not always. As MLB learned this week, sometimes tweeting can become a pretty risky exercise. Not only have three young players been forced to contend with the ugly sentiments of their younger selves, but the league’s main account has also found itself in the middle of something, as well.

It started with this:

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SCOTUS Rejects Appeals in MLB Antitrust Cases

In April, I discussed two then-pending cases before the U.S. Supreme Court challenging Major League Baseball’s long-standing exemption from antitrust law. Since that time, the Court had had the two appeals scheduled for consideration on three occasions, only to reschedule its deliberation each time. Although it wasn’t immediately clear why the Court was repeatedly postponing its consideration of the two appeals, this rather unusual delay raised the possibility that several of the justices were potentially interested in reconsidering baseball’s controversial antitrust exemption.

Despite any possible behind-the-scenes maneuvering, the delay ultimately proved to be for naught, as the Court announced on Monday that it was declining to hear either appeal, effectively ending the two cases. This means that MLB will continue to operate largely outside the scope of federal antitrust law for the foreseeable future.

As is normally the case, the Court did not explain on Monday why it was denying the two appeals. The Court did reveal one piece of potentially relevant information this morning, however, noting that Chief Justice Roberts recused himself from any consideration of the appeal in the Wyckoff v. Office of the Commissioner of Baseball case. It’s not at all clear why Chief Justice Roberts opted not to participate in the Court’s deliberation of the case.

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The Supreme Court, Sports Betting, and the Future

Back in March, I wrote about a pending case before the U.S. Supreme Court concerning the Professional and Amateur Sports Protection Act of 1992 (“PASPA”). PASPA is a federal law which makes sports betting illegal — or, more precisely, requires states to make sports betting illegal. The Supreme Court weighed in on Monday, and we have an answer.

From Justice Alito’s opinion:

The PASPA provision at issue here—prohibiting state authorization of sports gambling—violates the anticommandeering rule. That provision unequivocally dictates what a state legislature may and may not do. And this is true under either our interpretation or that advocated by respondents and the United States. In either event, state legislatures are put under the direct control of Congress. It is as if federal officers were installed in state legislative chambers and were armed with the authority to stop legislators from voting on any offending proposals. A more direct affront to state sovereignty is not easy to imagine.

This “anticommandeering” rule is what I mostly addressed back in March. Remember that the United States is, basically, 50 separate sovereign entities (the states) which ceded power to a unifying government (the federal government) for important matters — things like a military, a common currency, social-welfare programs. But the federal government has (in theory, anyway) limits on its power: it can only do what the Constitution says it can do. And the Constitution says that the federal government can’t order the states to pass, or not pass, laws. To the Supreme Court, telling the states they couldn’t legalize sports gambling was a bridge too far.

Perhaps most importantly, however, the Supreme Court went one step farther:

[W]e hold that no provision of PASPA is severable from the provision directly at issue in these cases.

Let me explain that. When the court declares a law unconstitutional, it is, in essence, nullifying that law. That’s a principle that goes back to a 19th-century case called Marbury v. Madison. But nullifying statutes is something courts typically do very reluctantly — and so they try, whenever possible, to separate the acceptable parts of laws from unconstitutional ones. In other words, a law with both a constitutional provision and unconstitutional provision would be split in two, with the unconstitutional part nullified and the other part remaining in effect. That’s called “severing” the law. But by saying PASPA wasn’t severable, the Court decided that all of PASPA is unconstitutional, and so all of PASPA is void. That’s actually a really big deal, because part of PASPA concerned prohibiting the advertising of sports gambling, and now that prohibition is gone.

Naturally, this has caused a variety of reactions.

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Mike Clevinger, Ben Zobrist, and When Shoes Aren’t Just Shoes

Mike Clevinger is a pretty great pitcher. He throws 94 mph. He’s cut his walk rate in half since last year. He’s been the best starter so far this season in one of the league’s best rotations.

Mike Clevinger also has pretty great shoes. They’re designed by by artist Jonathan Hrusovsky. Look at these things.

Ben Zobrist is a pretty great player himself. In his age-37 season, he’s recorded a batting line about 15% better than league average. He still plays multiple positions well. He’s the eighth-best player by WAR over the last decade.

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You Can’t Blame Tanking for the Lack of Competitive Teams

Tanking is a problem. Professional sports like baseball are built on the assumption that both sides are trying to win. Organizations putting forth less than their best efforts hurts the integrity of the sport and provides fans with little reason to engage. That said, the perception of tanking might have overtaken the reality of late. Competitive imbalance is not the same as tanking. Sometimes teams are just bad, even if they are trying not to be.

Tanking concerns are not new. Two years ago, just after the Astros and Cubs had turned their teams around, the Phillies were attempting to dismantle their roster by trading Cole Hamels. The Braves had traded multiple players away from a team that had been competitive. The Brewers, who traded away Carlos Gomez, would soon do the same with Jonathan Lucroy after he rebuilt his trade value.

The Braves, Brewers, and Phillies all sold off whatever assets they could. Two years later, though, those clubs aren’t mired in last place. Rather, they’re a combined 54-37 and projected to win around 80 games each this season in what figures to be a competitive year for each. While the Braves and Phillies could and/or should have done more this offseason to improve their rosters, neither resorted to an extreme level of failure, and the teams are better today than they would have been had they not rebuilt. While accusations of tanking dogged each, none of those clubs descended as far as either the Astros or Cubs. None came close to the NBA-style tank jobs many feared.

One might suspect that I’ve cherry-picked the three clubs mentioned above, purposely selecting teams with surprising early-season success to prop up a point about the relatively innocuous effects of tanking. That’s not what I’ve done, though. Rather, I’ve highlighted the three teams Buster Olney cited by name two years ago — and which Dave Cameron also addressed — in a piece on tanking.

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A Former Yankees Prospect on the Athletics Is Suing the White Sox

Lots of things went right last year in the Yankees’ run to the American League Championship Series.

This wasn’t one of them.

The player you see here is Dustin Fowler, who was making his major-league debut for the Yankees. Fowler, in a haunting echo of Moonlight Graham, never got to bat in that game; he had been due up in the top half of the second. Fowler suffered an open rupture of his patellar tendon on the play and required emergency surgery.

During his recovery, he was traded to the Athletics in the Sonny Gray deal.

How Fowler is expected to develop as a player in the wake of his injury is a worthy line of inquiry; however, it’s not the one I’ll pursue here. Rather, my interest is in the lawsuit that Fowler filed against the White Sox in the wake of his injury — a lawsuit that remains pending.

Fowler’s suit, on the surface, is pretty simple. Fowler has sued two parties — both Chicago White Sox, Ltd. (the limited partnership that owns the White Sox) and the Illinois Sports Facilities Authority (the Illinois government agency that actually owns Guaranteed Rate Field, where the White Sox play). The complaint alleges two counts, one against each Defendant, and sounds in both simple negligence and a peculiar creation of Illinois law known as “willful and wanton conduct.” Essentially, Fowler alleges that, although the wall into which he crashed was padded, an electrical box located there wasn’t.

Here’s the relevant passage:

Let’s start with the obvious question: whither the electrical box? It’s hard to tell from the video. A still image from the above provides some sense, but it’s also easy enough not to notice.

In fact, the Chicago Tribune reported after the game that video seemed to show Fowler missing the exposed electrical box, which is there to provide wifi to fans. Based on that video, the Tribune reported in the same story that no changes would be made to the stadium.

The Tribune, however, appears to have been a bit premature in their reporting. Later image seemed to suggest Fowler did make contact with the electrical box. (You can see the best ones via Newsday here.) The fact that the box is so hard to see — it’s designed to blend in with the wall — is actually part of Fowler’s lawsuit.

So we know the box is there, and that — it appears, at least — Fowler’s knee did impact it. So that leads to the second question: are the White Sox and the ISFA legally responsible?

Last year, Nathaniel Grow took an excellent look at workers’ compensation for professional athletes. Like in many states, Illinois has a law which says that, for the most part, you can’t sue your employer for an injury you suffer on the job. That’s the reason workers’ compensation exists. In Fowler’s case, though, while he is suing for an injury that occurred on the job, he is not suing his employer. As a result, this isn’t a workers’ compensation issue, and Fowler’s negligence claim isn’t barred on that basis.

Michael McCann did a nice run-through of Fowler’s suit back when it was first filed, and I encourage you to read it in full. But negligence law in torts is a lot more complicated than it might seem, and since I’m an Illinois lawyer, I figured I might examine this from a more local perspective. To establish negligence, a plaintiff generally has to plead and prove all of the following:

  1. The existence of a legal duty owed by the defendant to the plaintiff;
  2. The breach of that legal duty by the defendant;
  3. That the breach by the defendant caused an injury to the defendant; and
  4. That the injury is a real and cognizable harm.

Lawyers generally turn these elements into the shorthand of DBCH, which is short for duty, breach, causation, and harm. Illinois follows the traditional negligence standard, with those same four elements: “To state a cause of action for negligence, a plaintiff must plead the existence of a duty owed by the defendant to the plaintiff, a breach of that duty, an injury proximately caused by the breach, and damages.”

The tricky thing with negligence suits is twofold, though. First, you are basically punishing a defendant for what it did or didn’t do even though those actions weren’t intentional. That means that, every time you find for a plaintiff, you are necessarily saying the defendants have to undertake an obligation to protect people that otherwise wouldn’t exist. That, of course, has real social and economic costs, so courts tend to be wary of pushing the creation and application of legal duties too far. Second, because we’re talking about unintentional conduct here, there are a lot of defenses to negligence that don’t apply anywhere else in the law. These are things like contributory or comparative negligence (sometimes called comparative fault), assumption of the risk, and others which vary by state.

The first question, then, is whether the White Sox and ISFA owed a legal duty towards Fowler. In this case, there are two types of possible duties. (Actually, there are more, but we have limited space here.) There could be a “duty to warn.” That would mean anything from a sign down the right-field line saying “beware of box,” to actually telling Fowler about the box’s existence before the game, to just painting the box a bright shade of yellow so it stands out. On the other hand, there could be a “duty to protect” Fowler, with things like padding on the box or just the complete relocation of the box to somewhere outside the field of play.

Obviously, all of these points relate to the defendants, because the defendants are the ones with control over the box. That doesn’t always happen in negligence cases. What that means, though, is that a court will have to decide whether the law imposes a duty on ISFA and the White Sox either to warn players or protect them from hidden on-field hazards and — if so — how far that duty goes. Many states have accepted what’s called the “Learned Hand Rule” as the gold standard for whether to impose a duty on a defendant. Named for Judge Learned Hand (yes, that really was his name), the Learned Hand Rule uses what’s called “law and economics” to determine whether a duty should be imposed on a defendant. I personally think of the Learned Hand Rule as the “FanGraphs Method” of Negligence. Professor Doug Holden explains why:

This formula lists three factors:

1. Probability of harm (or likelihood of injury) and = P
2. Gravity of harm (or seriousness of injury) as weighed against = L (loss or liability)
3. Burden on defendant (or injury sacrificed) to take adequate precautions = B.

Therefore, if B < P x L, then you have unreasonable behavior. If you have unreasonable behavior, then there is a breach of duty.

This is a useful little algorithm for identifying breach of duty. In practice, however, judges don’t like to sit and calculate such variables like Learned Hand did. So somewhere along the line, the Learned Hand rule went from functioning as a mathematical calculation to serving as a guidepost to then becoming the rule that a party has a duty to all persons who could suffer a “reasonably foreseeable” harm as a result of the former’s actions.

Illinois follows that “reasonably foreseeable” standard. So, in this case, the question is whether it was reasonably foreseeable that a player like Fowler would injure himself on the electrical box. Given that much of the rest of the wall is padded, it’s clearly foreseeable that a player could be injured by colliding with an unpadded wall. By extension, it seems reasonably foreseeable that an unpadded box could also cause harm. Therefore a duty does exist to take adequate precaution. And theoretically, since the burden on the defendant is minimal — like spray-painting the box yellow or a few feet of padding — the Hand formula weighs in favor of Fowler, too.

Next is whether the ISFA and White Sox breached their legal duty to Fowler. To that point, we know they didn’t pad the box. We also have no reason to believe they warned Fowler, either. Of some relevance here perhaps is a doctrine in the law called “res ipsa loquitur.” Res ipsa loquitur basically means that if a defendant exercises exclusive control over an object — like an electrical box — and the object harms someone, the law presumes the defendant was negligent even in the absence of evidence of negligence. Here, I think there is that evidence of negligence, though: the existence of the padding elsewhere. Remember when we discussed protective netting that I explained the “voluntary undertaking doctrine”?

Here’s a refresher:

The Illinois Supreme Court, for example, explained in Nelson v. Union Wire Rope Corp. that, where a company voluntarily does something it wasn’t legally obligated to do, that company is liable for failing to do so reasonably. In some states (like Illinois, for instance), this is known as the voluntary undertaking doctrine.

If the ISFA and White Sox voluntarily undertook to protect fielders by padding the wall but didn’t pad the box, that’s negligence because they failed to complete the job reasonably.

Next are causation and harm. Did the box cause Fowler’s injuries? Well, the impact is what tore his knee open. I could talk about proximate cause and cause-in-fact, but we don’t really need to here. Because the injury was foreseeable and a direct result of an impact with the box, causation’s probably satisfied.

So what defenses do the ISFA and White Sox have? Their primary argument is probably going to be that they didn’t owe Fowler any duty. But in an Illinois court, that’s unlikely to hold water simply because Illinois courts have adopted the reasonable foreseeability standard. And they could argue that Fowler assumed the risk of being injured, but it’s hard to argue that running into things is part of baseball the way being hit by a pitch is. And they can’t argue that Fowler wasn’t injured, because even though he’s back and playing, his injury was very real, which in and of itself entitles him to damages under Illinois law.

So they tried something else. Shortly after Fowler filed his lawsuit, the ISFA and White Sox removed the case to federal court. The White Sox then moved to dismiss the case, arguing that it was preempted by the CBA. The White Sox invoked the Labor Management Relations Act (“LMRA”), a federal law stating (in Section 301) that federal courts, and federal law, govern all employment disputes where the rights of the parties have been collectively bargained. As the White Sox argue, “Plaintiff alleges that he was injured as a result of an incident that took place only because he was employed as a Major League Baseball Player pursuant to a highly regulated contractual employment relationship that specified all of the rights and duties of the respective parties – including with respect to Players health and safety.” Here, the White Sox point to Article XIII of the CBA, which governs players’ safety and health.

Here we return to the issue of “willful and wanton conduct” cited at the outset of this piece. In Illinois, under a case called Ziarko v. Soo Line Railroad, willful and wanton conduct represents something more severe than just negligence, but not so severe as intentional conduct. It’s akin to recklessness. And generally, in Illinois, you can’t disclaim willful and wanton conduct by contract. Moreover, Fowler argues, the CBA doesn’t actually cover situations like this, which means the CBA doesn’t preempt Fowler’s claims.

On that basis, Fowler wants the case sent back to state court.

This is one case where both sides appear to have strong arguments, and there’s ample case law going both ways. I tend to think Fowler has the better of the argument, but I don’t see this as being a clear-cut issue, particularly given the unusual set of facts. Many of the cases cited by both sides, like Stringer v. NFL, concerned situations where the player was injured by or on his own team’s facilities or lack of care. And even there, courts often split the proverbial baby, allowing some claims through and not others. The issue is currently being briefed, and Judge Gary Feinerman will rule sometime in June or July.

Meanwhile, Dustin Fowler hasn’t yet exhibited the form that made him a top prospect when he debuted last June. After a 138 wRC+ last year at Triple-A, he has just a 84 wRC+ for Oakland’s highest affiliate this year through 97 plate appearances. On the plus side, he’s already stolen five bases.


The Supreme Court Might Reconsider MLB’s Antitrust Exemption

Successfully suing Major League Baseball under federal antitrust law is no easy task. Not only does the league typically hire the best legal representation money can buy, but it is also the beneficiary of a unique, judicially-created antitrust exemption generally shielding it from liability under the Sherman Antitrust Act.

Nevertheless, an enterprising plaintiff every so often decides to try his or her luck at convincing a court to set aside baseball’s exemption and hold MLB liable for various, allegedly anticompetitive practices.

These challengers typically hope to overcome baseball’s antitrust exemption in either of two ways. Initially, the plaintiffs usually try to persuade the trial court that the exemption does not apply to whichever of MLB’s business practices is at issue in the case, asserting that the league’s legal protection should instead be narrowly construed.

And — as is the case more often than not — when that strategy fails to work, the plaintiff’s fallback plan is to hope to be able to convince the U.S. Supreme Court to overturn its prior decisions affirming the exemption and instead hold that MLB is no longer immune from legal challenge under the Sherman Act.

Two such cases contesting MLB’s antitrust exemption are currently before the Supreme Court, both of which have been covered here previously at FanGraphs during their earlier stages of litigation.

In the first case, Wyckoff v. Office of the Commissioner, two former scouts have accused MLB teams of illegally colluding to depress the market for the services of professional and amateur scouts. Meanwhile, the second case — Right Field Rooftops v. Chicago Cubs — involves a claim that the Cubs have unlawfully attempted to monopolize the market for watching their games in-person by purchasing a number of the formerly competing rooftop businesses operating across the street from Wrigley Field and also blocking the view of some of the remaining rooftops by installing new, expanded scoreboards.

In each case, the plaintiffs failed to convince the trial court to construe the league’s antitrust immunity narrowly, and now they must hope they can convince the Supreme Court to reconsider the nearly century-old exemption it first created back in 1922.

Unlike most previous challenges to the antitrust exemption, however, the Wyckoff and Rooftop plaintiffs are not necessarily asking the Supreme Court to directly overrule its prior decisions and strip MLB of its antitrust immunity. Instead, the parties are primarily urging the Court to take their respective cases to clarify just how broadly baseball’s exemption ought to apply.

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Would MLB Lose That Much Money in a 154-Game Season?

In 1961, the American League added two teams. To ensure that the 10 teams played an equal number of games against each other, the league moved from 154 games to 162, while the National League stayed put at 154. The following season, the National League followed suit, expanding both the number of teams and the number of games on the schedule. With the exception of strike seasons, the MLB schedule has remained at 162 games. The current setup has teams play 19 games against teams in their own division, with 66 games of the remaining games coming against the rest of the league, and 20 against interleague opponents. This year, more off days pushed up the start of baseball season. That early start coupled with horrendous weather has caused a large number of postponements, which has led to calls for a 154-game season. While I personally prefer the current schedule, a reduction in games is pretty doable.

First, let’s talk about a reason that shouldn’t be used as a justification to shorten the regular season: this year’s postponements. While postponements are drawing a lot of attention, we are likely dealing with a set of unique circumstances that won’t affect future seasons. The season did start a few days earlier than we’ve typically seen, but the biggest factor in all of these postponements isn’t the early start; it’s the bad weather. The number of postponements and cold weather games this season compared to past seasons suggests that this year’s weather is an anomaly unlikely to cause similar disruptions in future seasons. Cutting eight games from the schedule after more than 50 years because of somewhat unusual weather in one year seems unnecessary. If the goal is to move the season back to early April, a half-dozen Saturday day-night doubleheaders later in the summer would accomplish the same thing.

Players certainly seem like they would be willing to drop down to a 154-game schedule, as getting a few extra days off was an important negotiating point in the last round of collective bargaining with the owners. Removing eight games from the schedule would allow players the same number of days off they just bargained for and allow the league to start the season in early April instead of late March. From a pure feasibility standpoint, there is some merit to it, and it doesn’t seem like it would make a ton of difference to fans. The season would be about as long as it used to be; the handful of extra off days spread out over the course of six months wouldn’t make its presence deeply felt. The feel of a baseball season would hardly be impacted. The impediment, seemingly, would be money.

Over at The Athletic, Jayson Stark did some excellent reporting discussing the potential for a 154-game season. Particularly illuminating to me was the nugget that a vast majority of teams would be happy to drop down to an 154-game schedule. Stark did indicate that the minority of teams who would object to a shorter season would have very loud objections.

Stark estimated that a team like the Yankees might lose more than $10 million in gate and concession revenue. Losing four home dates, assuming a couple are less desirable weekday games in April plus a couple Monday games in the summer probably, might have a slightly smaller affect than that as the number of tickets sold for those games is likely to be somewhat lower than average. I am skeptical that teams could raise prices enough to recoup all of that money lost. I would be surprised if teams aren’t already doing whatever they can to maximize ticket and concession revenue. They may be able to get some of that money back, however, particularly from season ticket holders. They could, for example, provide 5% less inventory by taking away four games, but only drop season ticket prices by 3%, thus getting back some of the lost money while still providing a discount compared to what season ticket holders previously paid.

In his piece, Stark discussed the potential problems that might emerge with teams’ contracts with regional sports networks. Contractually, it is possible teams promised a certain number of games, making a change in the schedule challenging. But in terms of revenue, the money lost would be fairly insignificant. The lost revenue for regional television partners would be pretty minimal as the vast majority of that income derives from cable subscriber fees rather than advertising. Nationally, baseball would have little trouble fulfilling any of their deals, as the number of national games seems unlikely to change.

If the Yankees’ lost revenues are somewhere around $10 million, we might be able to roughly estimate the total losses to be somewhere in the $100 million to $150 million range before considering mitigation through some minor price increases. While MLB owners haven’t ever easily given up that much money, we are probably looking at something in the range of 1% or less of total MLB revenues. There might be talk of the players having to sacrifice pay, but these small decreases in overall revenue shouldn’t significantly alter the player-owner split as it is currently structured, and would be the subject of bargaining. Players get the off days they crave, the season starts in April, and the revenue split for the players and owners would likely remain roughly the same.

Financially, dropping eight games from the schedule is probably a lot more feasible than one might think. Of course, making the situation financially feasible doesn’t necessarily make it a great idea. I realize this makes me a bit of a curmudgeon, but I’m used to records and performances based on a 162-game schedule. And the baseball season is long. That’s a feature, not a bug. While 154 games might not feel that different, as someone who consumes baseball in a near-constant fashion all of the months of the year, I would rather have those 120 meaningful regular season games than not have them. The grind of the season with relatively few of the teams qualifying for the playoffs helps make the regular season more special than that of the other major sports.

These reasons aren’t necessarily compelling enough to keep the schedule the way it is. Perhaps someone else can come up with better ones. But it certainly doesn’t seem like finances should be a major impediment.


How the Angels Could Get Out of Paying Albert Pujols

Albert Pujols is signed through 2021 on a 10-year, $240-million deal that is widely considered the worst contract in baseball. In 2011, his last season with St. Louis, Pujols posted a then-career-worst 4.0 WAR. He’s yet to best three-and-a-half wins with the Angels and, last year, was worth negative 1.9 WAR. There’s no doubt the Angels would get out from under this onerous deal if they could.

Yesterday, Meg Rowley held a chat. In said chat, a commenter named Yo-Yo asked this question.

Yo-yo was referring to this article from Baseball Prospectus in which Matthew Trueblood speculates that Albert Pujols is actually 40 and not 38, and thus two years older than he claims. Per Trueblood:

To anyone who followed baseball closely around the time of Pujols’ explosion onto the scene in 2001, this will come as no great surprise. Four of Pujols’ first six player comments in Baseball Prospectus Annuals make reference to the rumored discrepancy between his listed and real ages. Pujols’ age became a topic of some discussion in the run-up to his hitting free agency in 2011, and a panel of experts that included industry-leading writers and front office members alike formed a near consensus that he was older than listed. It’s been several years since the issue has been treated or talked about seriously, but my recent Twitter poll asking respondents how old they think Pujols is (noting that he’s listed at 38) found just 35 percent believed the party line.

Now, Trueblood doesn’t really present anything close to what would be considered real evidence of Pujols having falsified his age, let alone conclusive proof. But the idea of baseball players, particularly from the Dominican, being older than listed isn’t a new phenomenon. Miguel Tejada might be the most famous case, but Hall of Famer Vladimir Guerrero, and lesser known players like Octavio Dotel and Wandy Rodriguez, among others, were, too. Again, that doesn’t mean that Pujols is guilty of doing the same thing, but it does, perhaps, help to explain why those pesky rumors just won’t go away. And, as Trueblood explains, it’s an understandable thing to do for young Dominican players.

Firstly, let’s make sure to say this: I am not accusing Pujols of what I would consider unethical or truly fraudulent behavior. Pujols’ background and early life story are unique, involving living in the Dominican Republic until mid-adolescence, then immigrating to the United States. He and his family were in a difficult position, when they came here in 1996: Pujols would not be eligible to attend American high school, at least in a normal setting, if he were 17 or older. That didn’t just put his baseball future at risk; it threatened his chance to pursue opportunities of all kinds on even footing with his peers.

But Yo-Yo presents a fascinating question. If Pujols were, in fact, two years older than the Angels thought when they signed him, could they use that to get out of their contract with him?

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