Article on Baseball Collusion Makes SSRN Top 10 List

Exciting news: My article on the history of collusion in Major League Baseball was recently ranked No. 10 by the Social Science Research Network ("SSRN") in its list of Top 10 papers about collective bargaining.

Baseball Collusion: MLBPA Opens 2010 Season with New Set of Concerns

On Tuesday morning, the Associated Press reported that the Major League Baseball Players Association may file a grievance against Major League Baseball club-owners for allegedly colluding in the market to sign free-agent players during the 2009-2010 off-season. One reason why the MLB players union seems to believe that club-owners have engaged in collusion is because player salaries rose only by 1% last season, even though total league revenues have increased at an annual rate of 7.6% over the past three years .

Another reason why the MLBPA may be concerned about collusion is that MLB club-owners have a long history of colluding in the free-agent player market. For example, in my 2008 Wayne Law Review article, "Moving Past Collusion in Major League Baseball: Healing Old Wounds and Preventing New Ones," I discuss how three arbitration decisions from the 1980s found MLB club-owners to have colluded against players' rights. One esteemed labor arbitrator, George Nicolau, even found Commissioner Bud Selig to have been directly involved in collusion during the 1986-87 off-season (see pages 619-20).

With this week's newest collusion concerns, the MLBPA now has to decide whether to file a formal labor grievance over three separate, outstanding sets of claims:

• First, there are this week's collusion allegations, over which MLBPA leader Michael Weiner has stated "in one fashion or another we will respond."

• Then, there are similar allegations from the 2008-09 off-season, over which the MLBPA, one year after announcing its concerns, still has not filed a grievance.
  

• Finally, there are even allegations of collusion dating back to the 2007-08 season that involve the market for now-retired outfielder Barry Bonds. In October 2008, the MLBPA announced that it had made a preliminary finding of collusion against MLB club-owners in the market for Bonds's services; however, the union thus has neither filed a grievance nor publicly settled this matter with baseball's club-owners.
  

(Cross-Posted on Sports Law Blog)

More Baseball Collusion in '08? Agents Say "Yes," Selig Says "No," MLBPA Not Speaking

With MLB union leader Donald Fehr planning to soon step down from his post, several MLB player agents are encouraging his likely successor, Michael Weiner, to take a more active stance against player collusion.

Unlike most other sports leagues, Major League Baseball has a long and well-documented history of colluding against its players. I provide a detailed account of Baseball's troubling history of collusion in my 2008 Wayne Law Review article, "Moving Past Collusion in Major League Baseball: Healing Old Wounds and Preventing New Ones." This article discusses specifically how Baseball's neutral arbitrator in the late 1980s, George Nicolau, found Commissioner Bud Selig directly involved in collusion. (see pages 619-20).

With respect to the game's newest collusion allegations, concern of such wrongful behavior first surfaced during the 2007-08 off-season when Barry Bonds's agent Jeff Borris announced that he believed the reason why Barry Bonds did not have a single contract offer for this season was collusion.

After reviewing the available evidence, the MLBPA announced in October 2008 that it had made a preliminary finding of collusion. However, rather than file a traditional labor grievance against the MLB club-owners, the union instead attempted to resolve the matter through private negotiation.

Thus far, the MLBPA's attempts to privately negotiate have not proved fruitful. Barry Bonds still has not received a single contract offer -- not even at the league minimum salary of $410,000. In addition, a growing number of veteran players have expressed a similar concern that they too have been collusion victims.

While the MLBPA has broad discretion to determine when, if at all, to file a formal collusion grievance, like any union, it is bound by its duty of fair representation. This means that the MLBPA cannot act in an arbitrary, discriminatory, or bad-faith manner against any of its members. Union membership includes even those who have opted out of joint licensing programs, such as Barry Bonds.

Refusing to file a collusion grievance, even after reaching a informal finding of wrongdoing, might place the MLBPA at some risk of facing a claim from Bonds for breach of the duty of fair representation. This risk, in essence, might eventually pressure the MLBPA to file a collusion grievance, presuming their talks with the MLB club-owners do not reduce union concerns of wrongdoing.

For these reasons, I fully expect the MLBPA to begin more aggressively addressing these recent concerns of collusion. Hopefully, these talks will lead to some candid answers for both those inside Baseball, and the game's fans.

(A similar version of this post previously appeared on Sports Law Blog).

SportsJudge.com Index No. 3184-T: Court Finds No Collusion; Refuses to Remove Deputy Commissioner

SPORTSJUDGE.COM

COURT OF FANTASY BASEBALL

(MATTER REFERRED BY

WWW.ADVANCEDFANTASYBASEBALL.COM)

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -	X	Index No. 3184-T Date: June 2, 2009 League Type: 11-Team, NL Only League Dispute: Collusion Review Judge: Marc Edelman THE COURT FINDS INSUFFICIENT EVIDENCE OF COLLUSION WITH RESPECT TO THE QUESTIONED TRANSACTION THE COURT DENIES THE REQUEST OF COMMISSIONER MIKE D. TO IMMEDIATELY REMOVE JOEL F. AS DEPUTY COMMISSIONER; HOWEVER, THE COURT ORDERS A VOTE ON ALL LEAGUE OFFICERS IMMEDIATELY FOLLOWING THE 2009 SEASON
COMMISSIONER OF KISFBL. Petitioner, - against - SWEATY BASEBALLS & JEW DADDYS Respondent.	: : : : : : : : : :
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -	X

ISSUES PRESENTED

This case arises out of allegations made by Mike D. (commissioner of the KISBFL) that the league’s deputy commissioner (Joel F) engaged in collusion or other improper dealings with a third team in the league. The parties have agreed to allow SportsJudge.com to serve as their neutral arbitrator and resolve conclusively the following two issues:

1. Has Joel F., in his capacity as owner of the Jew Daddys, illegally colluded with the owner of another team, the Sweaty Baseballs?

2. Irrespective of the finding above, may Mike D. require Joel F. to immediately step down from his post as deputy commissioner? (Or, if not, what alternative remedy would be appropriate in terms of changing league officers).

BACKGROUND & FACTS

The KISFBL is an NL-only fantasy baseball league based out of Atlanta, GA. The league is currently in its fifteenth season. Since the league’s inception, Mike D. has served as the league commissioner. For the past few years, Joel F. has served as the league’s deputy commissioner. Both Mike D. and Joel F. are also team owners in the league. Joel F.’s team is known as the Jew Daddys.

Prior to the 2009 season, the KISFBL had an opening for a new team to join. Without a clear owner in mind, Joel F. recommended one of his friends. That friend ultimately became the owner of a new team, the Sweaty Baseballs.

For the first two months of the 2009 season, Mike D. had no concerns about the existing friendship between the owners of the Jew Daddys and the Sweaty Baseballs. Indeed, many owners in the league have longstanding friendships.

However, on May 28, 2009, Mike D became suspicious of these club owners based on a series of seemingly related events. First, at 7:42 P.M. on May 28, the Sweaty Baseballs attempted to drop Atlanta Braves pitcher Kenshin Kawakami from their team and replace him with Florida Marlins pitcher Dan Meyer. Then, moments later, the Sweaty Baseballs realized that this transaction was illegal, so the Sweaty Baseballs reversed their transaction. Thereafter, at 9:00 P.M., the Jew Daddys, who legally had room to make a roster change, added Meyer to their roster. Then, an hour later, the Jew Daddys traded Meyer to the Sweaty Baseballs for Kawakami (the player the Jew Daddys sought to originally drop).

While there was no explicit evidence that the owners of the Jew Daddys and the Sweaty Baseballs were in cahoots, Commissioner Mike D. believed (and continues to believe) this transaction violated of the KISFBL’s league constitution, which includes an anti-collusion rule, which states the following.

“COLLUSION and or UNFAIR TRADE: Will not be tolerated. If 4 teams (Not including the two teams involved with the trade) have a problem with a trade within 24 hours of notification between the 2 teams then the trade is null and void. If 2 teams have a problem with the trade then both sides of the trade will be notified to see if the trade can be rectified so that no one has a problem. If collusion is suspected the league commissioner has the right to call an immediate vote of the remaining managers to call for a solution. Majority rules. Any teams convicted of doing an unfair trade will not be able to do any additional trading for the rest of the season with each other. Should two managers be convicted of an unfair trade, then those two managers will not be allowed to trade with each other the rest of the season.”

Mike D. based his view on circumstantial evidence, including the preexisting relationship between the Jew Daddys and Sweaty Baseballs, as well as his perception of a pattern of Joel F. attempting to exploit loopholes in the league rules—even despite Joel F.’s simultaneous role as deputy commissioner, which requires him to help write and enforce these rules.

Although the formal league process for resolving collusion claims was not followed by Mike D., both Mike D. and Joel F. have agreed to allow this court to make the ultimate judgment on whether there was illegal collusion pursuant to the way that term is defined in their league constitution.

Ultimately, Mike D. wants this court to enter a ruling of collusion against Joel F., as well as to order Joel F. to step down as deputy commissioner. Joel F., meanwhile, consents to allowing this court to pass a judgment on the collusion issue, while at the same time denying any wrongdoing and wishing to avoid stepping down from his post as deputy commissioner.

ANALYSIS & DISCUSSION

I. Is there sufficient evidence to conclude that Joel F. engaged in illegal collusion?

The term "collusion" in its purest sense means nothing more than an agreement, usually secret, made amongst two or more parties. According to the language in your league constitution, however, not all agreements amongst team owners are to be defined as “collusion.” Rather, the language in your league constitution seems to outlaw something far more limited: the situation where two teams reach an agreement with the underlying motivation of at least one team owner to not to act in his own best interest.

This view makes sense in light of the goals of fantasy baseball. Indeed, a similar issue was discussed in the earlier case Team Anadrol v. Vegas Baby & Flathead Yankees, Index No. 955-C (Nov. 4, 2007)

Here, while neither party disputes that there was an agreement between the Sweaty Baseballs and the Jew Daddys, there is simply no compelling evidence to support the claim that the trade amongst these two friends was consummated for any reason other than to make both teams better, in each team owner’s reasonable opinion. Indeed, Sweaty Baseballs ultimately acquired a player on the free agent wire that Sweaty Baseballs was not able to otherwise select due to having no picks remaining for that week. Meanwhile, Jew Daddys acquired from Sweaty Baseballs a player that he claimed to prefer on the waiver wire.

Because the current values of both players--Meyer and Kawakami--are so low, there is insufficient evidence to conclude that the trade represents anything more than the independent decisions of two owners, each trying to maximize their own positioning. In addition, because the values of these players are so close to even, the effect on the league of permitting this trade to be executed seems de minimis.

Of course, no $15 review of any collusion allegations is ever perfect, and it is possible that a full trial on the merits would reveal intents on the merits that simply cannot be captured by the SportsJudge.com review process, which in essence consists of a truncated version of the discovery process. However, given that Mike D.’s allegations of collusion between the Sweaty Baseballs and Jew Daddys seem limited to an isolated set of events involving players of minimal value to either team, it would be improper to impute the intent to collude based on the provided facts alone. Hence, here the court finds insufficient evidence of collusion against Jew Daddys or Sweaty Baseballs to render a finding against them.

II. May Commissioner Mike D. order Joel F. to immediately step down as deputy commissioner?

The next issue for this court to consider is whether, in light of the above findings, Commissioner Mike D. is within his rights to immediately remove Joel F. from his role as deputy commissioner. Once again, this court thinks not.

Even if this Court were to have found collusion between the Sweaty Baseballs and Jew Daddys, it would be questionable, pursuant to this league’s constitution, whether Mike D. could have ordered Joel F. to immediately step down as deputy commissioner. Indeed, according to the league constitution, the league commissioner may impose a series of enumerated punishments against a team owner that is found to have colluded or made an unfair trade. However, amongst these enumerated punishments, removal of a league officer is not amongst them. Luckily, this court does not have to reach that uncomfortable issue based on a hole in the league constitution, as this court did not find sufficient evidence of collusion against Joel F. to render a ruling against him on the collusion claim.

Nevertheless, this court has a high level of concern about how club owners in this league may remove an officer for an ethical breach, given this issue is strangely omitted from the league constitution. Indeed, for a league that has been in existence for fifteen years, the KISFBL surprisingly has never voted over its league officers—thus creating a possibility that a party that most league owners do not want serving in that capacity is doing so.

Given this issue is not explicitly addressed in the KISFBL constitution, the SportsJudge.com Court of Fantasy Baseball will implement default rules based upon its own view of best practices in fantasy sports. One of these default rules is the requirement that a fantasy baseball leagues vote over their officers every reasonable number of years. While no specific term lengths are mandatory, some form of a democratic process is essential.

While it is not for the court to say whether or not Joel F. is a worthy deputy commissioner of the league, it is certainly one that the league owners should, in a democrat way, consider. Hence, this court orders that, while Mike D. may not remove Joel F. from the role of deputy commissioner at this time, the KISFBL must hold a vote on all its officers (including both the commissioner and deputy commissioner posts) at the end of the 2009 season.

This Court also strongly urges the KISFBL to conduct a vote this off-season on new constitutional language that specifically defines term lengths for officers and the conditions for removing a particular officer mid-term from his post.

CONCLUSION

For the foregoing reasons, this Court (1) rejects the finding of collusion against Joel F., owner of the Jew Daddys, and (2) rejects the immediate removal of Joel F. from the post of deputy commissioner, but orders a vote on all league officers at the conclusion of the 2009 season.

Sports and the Law: The Truth About Baseball Collusion

For those interested in the history of baseball collusion and its implications on the game today, here is a link to my newest article -- "Moving Past Collusion in Major League Baseball: Healing Old Wounds and Preventing New Ones."

This article discusses the history of collusion in Baseball, as well as explains how Baseball collusion in the 1980s has led to more recent allegations of collusion (A-Rod, Bonds) and other troubling aspects of Baseball's labor-management relationship (for example, inefficient drug testing).

Here are a few highlights from the piece:

(1) Selig's Documented Role in Collusion: Although MLB Commissioner Bud Selig continues to deny any role in collusion, Arbitrator George Nicolau in his Collusion II ruling cited testimony from Philadelphia Phillies president William Giles that Selig -- in the capacity of Milwaukee Brewers owner -- called him to discourage the Phillies' signing of catcher Lance Parrish (p. 619-20).

(2) George is the Good Guy: Although often maligned for other reasons, Yankees owner George Steinbrenner was probably Baseball's least culpable owner during the Collusion Era. In Arbitrator Thomas Roberts' Collusion I ruling, he cites an offer Steinbrenner made for catcher Carlton Fisk as the only bona fide free agent offering during the 1985-86 season. (p. 615).

(3) The Smallwood Plan: Major League Baseball continues to criticize Barry Bonds's collusion allegations as being unrealistic and fanciful. However, the idea really can't be that off-the-wall. On September 1, 2006 -- long before Bonds was out of baseball -- Philadelphia Daily News reporter John Smallwood wrote an editorial piece explicitly suggesting that clubs collude against his services (p. 630).

(4) The Solution: Want to keep future allegations of collusion out of Baseball? The answer involves four steps: (i) returning the game's oversight to a neutral, outside commissioner; (ii) separating the role of Baseball CEO from Baseball Commissioner; (iii) allowing union lawyer oversight of Major League Baseball's off-season meetings; and (iv) providing full disclosure to players and fans about past collusion (p. 635-639).

(This article is cross-posted at Sports Law Blog).

MLBPA Claims to Have Evidence Baseball Teams Colluded Against Barry Bonds

ESPN recently reported that the Major League Baseball Players Association ("MLBPA") claims to have uncovered evidence that certain Major League Baseball teams colluded against Barry Bonds. This finding is consistent with what I had predicted in an Above the Law article that I had written during Spring Training.

For those of you interested in a more detailed history of Baseball collusion, here is a law review article that I wrote on that topic several years ago for the Loyola of L.A. Entertainment Law Journal.

I am also putting the finishing touches on a new 70-page article on collusion that will appear in the Fall 2008 Wayne Law Review. That article has a full section about Barry Bonds. Advance copies of the article are available upon request.