Diamondbacks Get Permission for New Stadium

Judges love it when litigants reach a settlement. Some judges love it so much that they give each side’s lawyer a token of appreciation for finalizing a deal. I’ve been in front of judges who handed out everything from stickers to candy bars. Last week, the Arizona Diamondbacks settled a lawsuit with Maricopa County. They got themselves a baseball stadium for their efforts.

But first, let’s back up a bit. The Diamondbacks have long wanted a new ballpark. Maricopa County, which owns the current park, wouldn’t let the team leave. So the team sued the county last year.

From Rebekah Sanders of the Arizona Republic:

The Diamondbacks’ lease with the county, which owns the stadium, prevents the team from talking with outside groups until 2024, and requires the team to play in its current home until 2028.

The Maricopa County Superior Court lawsuit is the latest twist in a long-running conflict over which party is responsible for as much as $187 million in repairs and upgrades to Chase Field. The team threatened to sue last year after negotiations with the county broke down.

The county argues that a portion of the upgrades are cosmetic and the team’s financial responsibility, and that the county will have enough money over the long term to meet its share of the obligations. The Diamondbacks counter that the county-run stadium district has not set aside enough money for needed upgrades and is risking safety.

The idea of a new stadium for the Snakes might seem, on the surface, to be ridiculous. After all, Chase Field was only just built in 1998. It’s younger than both Ronald Acuna and Gleyber Torres. That being said, the Team and County have been involved in a protracted legal battle, predating even that lawsuit, over the maintenance of the stadium. That’s because the stadium has had its share of maintenance misadventures in recent history, from burst pipes to failed HVAC systems. And each side blamed the other, with the team saying MLB would require them to move unless the county agreed to pay for repairs, while Maricopa County’s attorney, Cameron Artigue, had a more colorful response.

From a more recent piece by Sanders:

“The Diamondbacks are the facility manager. When a pipe breaks, that is a Diamondbacks problem. And that is, in fact, what happened. They got out the mops and they mopped it up, and life goes on. It’s a big facility and sometimes pipes break. So what?”

Artigue may be plainspoken, but legally he’s not wrong. In commercial leases, unlike residential leases, there’s no implied warranty of habitability. The implied warranty of habitability is basically that provision in the law that requires landlords to fix certain things in a dwelling unit. It’s basically a term that the law adds to every residential lease which says that the landlord warrants that the premises is fit for human habitation. But most states haven’t extended the warranty of habitability — or the landlord’s duty to repair — to commercial leases. And that means that, if the Diamondbacks’ stadium lease makes the team responsible for making repairs, it’s the team that’s legally required to make those repairs.

That said, the county conceded that there were structural problems that it was required to fix, and argued in court that while it was making those repairs, the team wanted repairs the county wasn’t legally obligated to provide. Then, last week, that lawsuit settled. You can read the settlement agreement here.

In the meantime, here’s a useful summary from Deadspin:

A judge ordered the county and the team into mediation earlier this year, which is where this week’s agreement came from. In exchange for the right to leave their ballpark in 2022, new powers over booking concerts and other events at the stadium, and an out clause that allows the team to leave Arizona “because of the condition of the stadium,” the team relented on their demand for $187 million in repair money. Still, the county will likely have to pay $20 million for repairs under the terms of the deal, as Hickman pointed out. They will no longer be obligated to pick up a tab they never should have been bound to in the first place, but the remaining runway on their initial agreement with the team has now been cut in half.

The team is currently looking at building its new park on tribal land, which meant a few additional provisions. Here’s Sanders, once again:

Under the preliminary agreement, the Diamondbacks would be allowed to start looking for a new place to play immediately. If the team found a location in Maricopa County, the team could leave Chase Field without penalty in 2022, five years earlier than the team’s current contract. If the new stadium was built on tribal land, the team would pay the same taxes as currently charged at Chase Field.

On the surface, it seems like a reasonable deal: the Diamondbacks get to look for a new park, and the County doesn’t have to pay millions for repairs on top of the $250 million it paid to build the park. But the question then is who will pay for the new stadium, because so far, nobody seems to want that dubious honor.

The Diamondbacks were just 20th in attendance last year, but there’s no guarantee a new ballpark would fix that problem. So far, for example, the Braves have struggled to fill SunTrust Park, although attendance has risen somewhat since they left Turner Field. Still, Atlanta ranks just 12th of 15 National League teams in attendance this year. A new ballpark isn’t a panacea for attendance problems. Further, Maricopa County has already said that it won’t pay for a new ballpark for the team, which could cost over a billion dollars even though it’s expected to be smaller. County officials have instead put the onus on the City of Phoenix to keep the team:

Supervisor Steve Gallardo, D-Phoenix, whose district includes the stadium, encouraged the city of Phoenix to talk to the Diamondbacks about staying in downtown Phoenix.

“I really understand the importance of having Major League Baseball in downtown Phoenix and I hope that’s a goal we continue to have,” said Gallardo, who initially criticized the county’s stadium deal-making as rushed. “This opens the door to allow Phoenix and the Diamondbacks and even the county to have that type of discussion.”

But it’s not at all clear that Phoenix will pony up to pay for a billion-dollar ballpark that critics said wasn’t even necessary. So if the city won’t pay, the county won’t pay, and the team won’t pay, that just leaves a Native American tribe if the team were built on tribal land like the Snakes’ spring-training facility is. Either that, or nobody does, and that means that the team might end up looking out of state. It’s a prospect Maricopa County Chairman Steve Chucri was aware of. Of Churci, Sanders writes that “he did not believe the league would use the clause to move the team out of state because Maricopa County is the fastest-growing county in the nation and other stadiums are in worse shape. He said the county would sue if the league did.”

So this is a deal that’s far from complete. We won’t know who really got the better of this settlement until we find out where the Diamondbacks end up going — and who gets stuck with the bill.

Sheryl Ring is a litigation attorney and General Counsel at Open Communities, a non-profit legal aid agency in the Chicago suburbs. You can reach her on twitter at @Ring_Sheryl. The opinions expressed here are solely the author's. This post is intended for informational purposes only and is not intended as legal advice.

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4 years ago

“The Arizona Diamondbacks settled a lawsuit with Maricopa County”

Typically, you’d think a settlement means that there will be at minimum calm times. However, like Sheryl wrote, this could be merely the beginning. Especially if the Dbacks attempt to leave.