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On The A's And San Jose

The Oakland Athletics want to move to San Jose. MLB doesn't want them to. Now there's a potential lawsuit. Where's this all headed?

Jason O. Watson-US PRESSWIRE

In this morning's MLB Bullets, Josh posted this link to the story that the city of San Jose has filed suit against Major League Baseball for preventing the Athletics' proposed move to that city. (Yes, I know it's a bit more complicated than that; I'm trying to provide a quick summary and introduction.)

He also posted this Craig Calcaterra article from Hardball Talk and this Wendy Thurm article from FanGraphs dissecting and discussing the lawsuit. Both Calcaterra and Thurm, in addition to being widely-respected baseball writers, used to be lawyers, and Thurm practiced in California, where the suit has been filed. If you haven't read all of those, please do; as a non-lawyer I defer to both of them for the legal knowledge necessary to analyze the chances of this lawsuit going forward.

This passage from Thurm's piece seems particularly relevant:

California has its own antitrust statute, known as the Cartwright Act. It operates independent of federal antitrust laws; that is, federal law does not preempt the operation of the California statute. And that’s where things get tricky and — frankly — a bit hazy to me. Sure, I practiced law in California for 18 years but handled very few matters involving the Cartwright Act. I just don’t have enough knowledge and experience to say at this point whether this claim carries any weight even if the federal antitrust claims are blocked by baseball’s antitrust exemption.

The Cartwright Act claim is the key to all of the state law claims. San Jose alleges that MLB interfered with its option agreement with the A’s. In November, 2O11, San Jose granted an option to the A’s to purchase a five-acre tract of public land for $6.9 million. The option contains two conditions: (1) no public funds shall be used in the design, construction or operation of the new ballpark; and (2) city voters must still approve the construction of the new ballpark. The option cost the A’s $25,OOO per year.

That sounds pretty nebulous — how can a party interfere with an option to do something in the future? — but California law does allow plaintiffs to sue claiming that another party interfered with an expected contractual interest if the defendant engaged in otherwise illegal contract. In other words, if MLB’s conduct violated the Cartwright Act, that could be a sufficiently wrongful act on which to base a claim for interference with prospective economic advantage.

Again, I don't know enough about these things to say one way or the other whether this part of California law would be enough to get this issue before a court. What I do know is that MLB will go until the ends of the Earth and the end of time defending its antitrust exemption, which in my view is a curious legacy of the Federal League and its aftermath, nearly 100 years old, and not really in any way, legal or common sense, defensible. Yes, it's been upheld twice (in 1953 and 1972), and in 1998, writes Thurm:

Congress specifically overturned the antitrust exemption as it applies to labor relations; by federal statute, major league baseball players have the right to be free of collusive and monopolistic conduct by the owners and the league.

But Congress left the remainder of baseball’s antitrust exemption intact. Or did it?

There’s a good deal of debate about how to interpret what Congress did and didn’t do when it debated and enacted the Curt Flood Act. This law review article analyzes the issues quite well. The question the judge in San Jose v. MLB will have to decide is whether baseball’s federal antitrust exemption as it applies to the location and relocation of franchises survived passage of the Curt Flood Act. If the exemption applies, then the two claims against MLB charging violations of the Sherman Act (one of the federal antitrust statutes) will be dismissed.

Well, that's a very good question, and again, something Major League Baseball certainly doesn't want decided against them.

The questions, then, are:

  • Does San Jose have standing to bring this lawsuit in the first place? and
  • Are they doing this more to bring this issue into the open, get the court of public opinion on their side, and force MLB to let the A's move there?

It would seem the second is more likely to be true. As I have written numerous times, the Giants' claim on San Jose as their "territory", 20-plus years after they asked for it because they were considering moving there themselves and 13 years after they built a new stadium in San Francisco, seems petty and punitive. It would be good for the A's, the Giants and baseball in general if Oakland's team were to be allowed to go ahead and build in San Jose.

While, again, I am no legal expert, I do know this: all the city of San Jose needs is one sympathetic federal judge to rule in its favor and MLB is going to have a giant headache on its hands, one it might just want to settle by letting the A's move, thus keeping their antitrust exemption intact. Because if this thing ever goes to trial, all bets are off. Consider that in 1995, a federal judge ruled in favor of the Players' Association, ending the 1994-95 labor dispute, and, some said, saving the sport. (In case you don't recall, that judge now sits on the United States Supreme Court.) I know we have several lawyers as regular posters here, including at least one who practices in California; if any of you have a lawyer's view of this, feel free to post.

Major League Baseball would be wise to give the city of San Jose and the A's what they want, particularly in light of the shit almost literally hitting the fan last Sunday in Oakland. It's way past time to get this thing done.