In 2009, the City of Miami and County of Miami-Dade agreed to pay for 75% of a new stadium for Jeffrey Loria’s Miami Marlins. The projected stadium cost was $645 million, so Miami and Miami-Dade — or, more technically, Miami and Miami-Dade taxpayers — agreed to cover up to $480 million of stadium-building costs, largely from from hotel taxes. (According to some reports, Miami and Miami-Dade ended up paying about $347 million.) Miami and Miami-Dade also agreed not to receive any of the money from the stadium at all. No money from ticket sales, no money for concessions or naming rights. All Miami and Miami-Dade got in return was a guarantee that, if Jeffrey Loria sold the team, they would get a percentage of the net sale proceeds.

In October 2017, Jeffrey Loria did sell the Miami Marlins — for $1.2 billion. Under the terms of that stadium deal, Miami and Miami-Dade are entitled to 5% of the net sale proceeds. So good news for Miami and Miami-Dade, right? Well, not this time: Loria has told them he actually lost money on the sale of the team. So despite that gaudy list price, Miami and Miami-Dade stand to get nothing at all.

On the surface, Loria’s claim seems pretty implausible. After all, he bought the then-Florida Marlins in 2002 for $158 million, $38 million of which was a loan from Major League Baseball. Even after accounting for paying back the loan, that’s still a difference of over a billion dollars. Remember, though, that according to the stadium deal, Miami and Miami Dade agreed to receive 5% of the net proceeds (i.e. profits), not gross proceeds (i.e. the sale price), in the event of a sale.

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This represents the first post by new contributor Sheryl Ring. An attorney in the Chicago area, Ring will cover legal matters for FanGraphs. We’re excited to have her!

Until this week, Juan Carlos Nunez was most famous for having made a website for a fake company selling a fake product, in an attempt to convince the world that Melky Cabrera’s flunked drug test in 2012 wasn’t really Melky’s fault. Since those revelations, Nunez has been barred from baseball permanently and also spent a few months in prison for his involvement with Biogenesis. You would have been forgiven for thinking it would be the last you’d hear of Juan Carlos Nunez.

But if baseball is done with Nunez, it seems as though Nunez isn’t quite done with baseball. This week, Nunez filed a 30-page lawsuit against his former employer, Athletes’ Careers Enhanced and Secured, Inc. (ACES, for short), demanding $3 million in damages. ACES is one of the largest and most well known baseball agencies.  According to MLBTradeRumors’ Agency Database, ACES is the current representation for stars like Charlie Blackmon, Carlos Carrasco, and Dustin Pedroia among more than 50 other notable major leaguers. And in 2012, ACES represented Cabrera, as well. You might also have heard of ACES’ two most high-profile names, Sam and Seth Levinson, who are also named as defendants in Nunez’s lawsuit. Sam is the President of ACES; Seth is its CEO.

Nunez contends in the Complaint that the Levinsons knew about Nunez arranging for players to receive performance enhancing drugs like HGH from Anthony Bosch and Biogenesis and actually instructed Nunez to distribute those PEDs to players. Nunez says that better performance meant better numbers and bigger paychecks for players — and bigger commissions for the Levinsons and ACES. According to the Complaint, the Levinsons wanted Nunez to make Biogenesis a selling point in his pitch to get new players to sign with ACES. Nunez even namechecks a couple of stars in his Complaint, alleging that he personally, with the Levinsons’ knowledge and approval, arranged for Nelson Cruz to receive HGH in the early 2012 to help him recover from an infection. And Nunez also says that the whole fake-website debacle was the Levinsons’ idea. As you can imagine, there is a lot to unpack here.

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Over the last couple weeks, I have taken a look at the unenviable position in which the Major League Baseball Players Association currently finds itself. Although the glacial pace of free-agent signings this offseason has helped to highlight the extent to which the sport’s existing economic model increasingly favors ownership, the union is relatively powerless to change its trajectory.

Indeed, because there is currently not much of value that the players can offer the owners in collective bargaining, the union has comparatively little leverage over the owners, and thus presently would appear to have relatively little hope of substantially improving its position in the next round of CBA negotiations in 2021 (although much can, of course, change between now and then).

That does not necessarily mean the union’s position is hopeless; however, securing the sort of modifications to the game’s economic structure that will be necessary to substantially improve the players’ financial position may require the MLBPA to engage in some outside-the-box thinking, at least as compared to its recent operating procedure. And as Buster Olney recently observed, it’s never too early for the union to develop a long-term strategy ahead of the 2021 CBA negotiations.

So what can the union do? Realistically, because the owners are unlikely to voluntarily agree to substantially better the players’ financial position, the MLBPA will probably have to adopt a more adversarial negotiating posture in 2021 than it has in recent years if it wishes to substantially change the current economic structure of the sport. That would mean that players should be ready to head into the 2021 CBA talks anticipating a work stoppage, potentially a rather lengthy one.

And it also means that the union should at least consider preparing to do what for many would have long been  unthinkable: disband the MLBPA. While certainly a drastic step, dissolving the union could help provide the players with additional leverage of the sort needed to secure some real concessions from ownership, concessions of the sort that could meaningfully improve the players’ financial position.

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Last week, I took a look at the unenviable position in which the Major League Baseball Players Association currently finds itself — and, in particular, the relative lack of leverage it is likely to have over ownership during the next round of collective bargaining in 2021.

In addition to noting that there are few substantive concessions the union could offer ownership, my post last week also briefly discounted the extent to which the threat of a work stoppage would benefit the players. The point probably merited further discussion, however, so this post is intended to more comprehensively explain my thinking in that regard.

How a Work Stoppage Would Most Likely Arise

To begin, it’s important to understand how a work stoppage would likely unfold during the next round of collective bargaining. As I previously explained back in 2016, any labor stoppage in Major League Baseball would — at least for the foreseeable future — most likely come in the form of a lockout by ownership rather than a strike by the players.

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The story of the offseason thus far has been the lack of activity on the free-agent market. As has been thoroughly covered elsewhere, this offseason is the slowest in recent memory, with seven of FanGraphs’ top-10 free agents still unsigned halfway through January.

Not only has this lack of activity generated considerable speculation regarding the cause of the offseason’s glacial pace (with theories ranging from a subpar group of free agents and a lack of competitive races to outright collusion), but it has also triggered talk about what the Major League Baseball Players Association should do in response.

Indeed, as I noted back in 2015, major-league players have seen their share of MLB’s overall league revenue plummet in recent years, with player payroll as a share of league revenues falling from a high of 56% in 2002 to just 38% in 2015. So while this offseason’s lack of activity may be unprecedented, in some respects it is simply the culmination of a trend dating back 15 years.

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Largely overlooked amidst the hoopla surrounding last weekend’s Super Bowl, DeMaurice Smith, the executive director of the National Football League Players Association, weighed in on an obscure bill currently working its way through the Illinois state legislature. If enacted into law, the proposed legislation — presently dubbed Illinois Senate Bill 12 — would amend the state’s workers’ compensation laws to decrease the benefits provided to professional athletes who sustain career-ending injuries on the playing field.

This possibility led Smith to threaten that, if Senate Bill 12 were to be signed into law, the NFLPA would officially encourage players to steer clear of signing with the Chicago Bears. As Smith stated over the weekend, “If you’re a free-agent player and you have an opportunity to go play somewhere else… isn’t a smarter financial decision to go to a team where a bill like this hasn’t passed?”

The fact that the NFLPA would take such a public stance against the proposed Illinois legislation raises the question of what potential impact Senate Bill 12 would have on Major League Baseball players, and, more generally, how workers’ compensation laws affect MLB in the first place.

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Currently, more than 75% of major-league teams — 23 out of 30, to be exact — play their home games in stadiums publicly owned by a local government entity. Each of these relationships between the franchise and its host municipality is, in turn, governed by a contract specifying the terms under which the government has leased its stadium to the MLB team.

As one might expect, disagreements between the franchises and their local communities occasionally arise under these lease agreements. Recently, two such disputes — one involving the Atlanta Braves and the other involving the Arizona Diamondbacks — progressed to the point that the team or local municipality opted to file a lawsuit against the other in state court.

S.M.P. Community Fund v. Atlanta Braves

In late December, the Atlanta Braves were sued in local state court by the S.M.P. Community Fund, an entity formed by the City of Atlanta to distribute funds generated by the Braves’ former stadium — Turner Field — throughout the local community. Under the terms of the Braves’ lease agreement, the team was obligated to contribute 8.25% of the parking revenue it generated at Turner Field, along with 25% of the net revenue generated from any special events held at the stadium, to the Fund. The Fund would then use these proceeds to benefit the neighborhoods immediately surrounding Turner Field.

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What type of contract would Mike Trout have commanded this offseason had he been a free agent? Coming off an MVP-award-winning campaign in which he compiled 9.4 WAR and about to enter just his age-25 season, Trout would have easily been one of the most sought after players ever to hit the open market. And given the state of this year’s historically weak free-agent class, the bidding for Trout may very likely have ended up in the $400-500 million range over eight to ten years.

Considering that Trout signed a six-year, $144.5 million contract extension back in 2014 – an agreement that runs through 2020 – this is just an interesting, but hypothetical, thought experiment, right?

Not necessarily. A relatively obscure provision under California law — specifically, Section 2855 of the California Labor Code — limits all personal services contracts (i.e., employment contracts) in the state to a maximum length of seven years. In other words, this means that if an individual were to sign an employment contract in California lasting eight or more years, then at the conclusion of the seventh year the employee would be free to choose to either continue to honor the agreement, or else opt out and seek employment elsewhere.

Although the California legislature has previously considered eliminating this protection for certain professional athletes – including Major League Baseball players – no such amendment has passed to date. Consequently, Section 2855 would presumptively apply to any player employed by one of the five major-league teams residing in California.

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After nearly a year’s worth of negotiation sessions, and with little more than three hours remaining before the deadline, Major League Baseball’s owners and players came to terms on a new collective bargaining agreement Wednesday evening. Not only does this agreement avert a possible work stoppage, but it also means that teams will head into next week’s Winter Meetings with a better sense of the economic ground rules under which they’ll be operating in the coming seasons.

It will be at least a few weeks, if not a couple months, before the final written version of the new CBA is released publicly. Indeed, while the owners and players reached a consensus on the core components of the deal last night, many of those verbal agreements must still be reduced to writing, a process that will take some time.

Still, many of the core components of the deal have already been reported in the press. Here’s what we know so far about the new CBA:

Duration of the New CBA

To begin, the new agreement will last for five years, covering the 2017-2021 seasons. This means that by the time the next CBA expires, MLB will have enjoyed an unprecedented 26 years of uninterrupted labor peace. Considering the state of the sport’s labor relations following the 1994-95 players’ strike, that is quite an impressive accomplishment for the game.

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This post is being republished after appearing at FanGraphs earlier this month — as it seems particularly relevant given the lack of a new CBA ahead of the December 1 expiration of the current one.

In two weeks time, on December 1st, the existing collective bargaining agreement (CBA) between Major League Baseball and the Major League Baseball Players Association is set to expire. While the two sides have been working for the better part of a year on negotiating a new agreement, to date they have not yet been able to come to terms on a new CBA.

Based on existing media reports, it appears that the hold-up over the new agreement centers around two primary issues: raising the luxury-tax threshold and creating an international draft. Both topics were expected to be among the most important — and thus potentially contentious — issues discussed during the CBA negotiations. So the fact that the parties have not yet reached an agreement on either point is not particularly surprising.

Still, with only two weeks left until the old CBA expires, some are beginning to speculate about whether a potential work stoppage could be looming on the horizon. That, in turn, raises questions regarding the potential legal ramifications of the two sides failing to agree to a new CBA before December 1st.

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