San Jose sues Major League Baseball, challenging its monopoly power

26 Comments

The City of San Jose has sued Major League Baseball in an effort to get the Oakland A’s to relocate to San Jose, to challenge the Giants claim to rights over the territory and to challenge Major League Baseball’s long-standing monopoly power.

The lawsuit, a copy of which can be seen here, and which is analyzed in-depth here, alleges that Major League Baseball has caused San Jose to lose prospective financial benefits and deals by virtue of the A’s moving there and violations of state and federal antitrust laws.

This will get big headlines, but until I see the lawsuit or have someone tell me otherwise, I can’t see how the City of San Jose would have a leg to stand on. Literally: I think legal standing is a big, big problem here.

Standing, for purposes of a lawsuit, is the idea that focuses on whether a plaintiff in a lawsuit can show that he or she some personal legal interest that has been damaged by the defendant. It is not enough that the plaintiff has an interest of sorts or a prospective interest. It has to be a concrete personal stake in the outcome of the suit. You may be very interested in a big real estate deal going down, but you can’t sue the people involved for not letting you into the deal on the idea that, “man, I would’ve made a ton of money!”  You have to be in the deal already and have your rights violated.

I don’t see how San Jose has that standing here. Yes, they would benefit greatly from the A’s moving to San Jose and yes MLB’s monopoly rules which control where franchises can and cannot be are preventing it. But they are not party to those rules. They have no hard and fast deal with the Oakland A’s yet. There have been statements of principles and plans announced pending MLB approval of an A’s move, but nothing hard and in stone. Indeed, if the A’s had committed to San Jose in such a way already, the Giants and/or Major League Baseball likely would have sued them by now.

I hate baseball’s monopoly power. I think it makes watching games on TV difficult and I think it makes the game less competitive by keeping teams from doing everything they can to compete. But that doesn’t give me the right to sue Major League Baseball over it. The A’s in San Jose would make San Jose’s life way better too, many would argue. But just because they’re not doesn’t give San Jose the right to sue either. What would make this different is if Lew Wolff and the A’s were involved. And I find it almost impossible to believe that they would be.

UPDATE: How about more than impossible the A’s would be involved here. From Michael McCann’s column about Frank McCourt back in 2011 in Sports Illustrated:

MLB could also highlight the “waiver of recourse” clause found in the MLB constitution. This clause prevents clubs from engaging in litigation against the commissioner, the league or other owners. Indeed, by virtue of becoming a franchise owner, an owner waives away the right to seek remedies that would normally be available through the legal system. The clause also compels owners to resolve their differences internally and to accept the commissioner’s judgment as binding.

This would prevent the A’s from joining in.  I’m told the San Jose complaint, however, alleges that the MLB Constitution is expired now. Which would be odd, but that’s the claim. Likely asserted so that the A’s could later join the suit if it gets further down the road.

Eric Hosmer’s eight-year, $144 million contract isn’t that bad

Ed Zurga/Getty Images
9 Comments

Late Saturday night, Kevin Acee of the San Diego Union-Tribune reported that the Padres and first baseman Eric Hosmer agreed to an eight-year, $144 million contract, the new largest contract in club history. According to Bob Nightengale of USA TODAY Sports, the contract includes an opt-out after the fifth year. Further, Hosmer will average $21 million per year for those first five years and $13 million for the final three years, so it’s severely front-loaded.

Hosmer, 28, had a career year last season, playing in all 162 games while batting .318/.385/.498 with 25 home runs, 94 RBI, and 98 runs scored in 671 plate appearances. Per Baseball Reference, Hosmer accrued 4.0 Wins Above Replacement, only one of six first basemen to do so. At No. 6, he was 0.4 WAR behind Anthony Rizzo and 0.4 WAR ahead of Logan Morrison.

Wil Myers had previously told the Padres he would accept a position change if the club were to sign Hosmer. He will be moving to the outfield as a result. The Padres now have a logjam in the outfield, so Jose Pirela could move moved to the infield. How the Padres plan to handle that situation remains to be seen.

The general consensus about the Hosmer signing once news broke was that it is laughably bad. Back in November, Dave Cameron — ironically now in the Padres’ front office — called Hosmer a “free agent landmine.” That thought hasn’t really changed among many writers. For example, using restraint, Dennis Lin of The Athletic calls the deal “a big gamble.” MLB Network’s Brian Kenny said Hosmer has at least three “red flags.”

FanGraphs projects the Padres to finish 71-91, so adding Hosmer isn’t likely to transform the club into a contender on his own. That being said, the Padres’ payroll was only at $70 million prior to the Hosmer signing, so the contract won’t hamstring them going forward. If the young nucleus of players — including Manuel Margot and Hunter Renfroe — perform as expected, the Padres could be a threat in the NL West relatively soon with plenty of cheap, cost-controlled players and having some experienced veterans like Hosmer and Myers could be useful for their intangibles — pennant race/playoff experience, clubhouse presence, leadership, etc.

Hosmer has had three seasons of 3.5 WAR or more, according to Baseball Reference. He’s had four between -0.5 and 1.0. Now entering his age-28 season, it’s hardly a guarantee he’ll be an All-Star-caliber player in 2018, let alone in 2022 when he is 32 years old. From a strict dollars-to-WAR standpoint in a complete vacuum, one could’ve done better than Hosmer at eight years, $144 million.

The Padres, however, aren’t a small market team; they just operate like one. Forbes valued the club at $1.125 billion last April. The Padres don’t have the financial muscle of the Dodgers or Yankees, but paying Eric Hosmer $18 million on average for the first five years of his contract won’t come close to hurting the organization in any way, shape, or form. More importantly, signing Hosmer shows the rest of the team and the fans a commitment to being legitimate, bumping the payroll up towards $90 million. That now dwarfs teams like the large-market Phillies, who opened up spring training with just over $60 million in player obligations.

In the grand scheme of things, the Hosmer signing is also a good sign given the standstill in the free agent market. Many veteran players — even reliever Fernando Abad, who posted a 3.30 ERA last season — had to settle for minor league contracts instead of guaranteed major league deals. Many others, including the likes of Jake Arrieta and J.D. Martinez, remain unsigned. The rumor that Hosmer wanted more than seven years and close to $150 million was laughed at last month. Agent Scott Boras was still able to get his client the deal he wanted, which could bode well for those still teamless. Martinez’s patience may yet be rewarded like Hosmer’s was; money may once again start flowing in the free agent economy.

In summation, the Eric Hosmer contract is good if: you are Eric Hosmer, related to or a friend of Eric Hosmer, a teammate of Hosmer’s, Scott Boras, a current or soon-to-be free agent, a Padres fan, and a baseball fan in general. The Hosmer contract is bad if: you are a penny-pinching owner of a Major League Baseball team, or someone who cares more about $/WAR than an actual good product being put on the field.