J.D. Martinez’s Former Agent Is Suing Over His Contract

J.D. Martinez is one of the best hitters on the planet. Last year he posted a 170 wRC+ and 43 home runs, which is probably good. This year, he “only” has a 128 wRC+ and an obscenely-low-for-a-power-hitter 17.1% strikeout rate. When a .291/.373/.513 triple-slash means you’re having a “down” year, you’re either ridiculously good or your name is Mike Trout.

Martinez is not without problems, however. As Scott Holland explains for the Cook County Record:

A baseball agent has sued Merrill Lynch for allegedly conspiring to steer a superstar client to a rival agent Scott Boras just before the player landed a huge contract. . . . In a complaint filed May 10 in Cook County Circuit Court, agent Bob Garber, president of RMG Sports Group, sued Merrill Lynch; Pierce Fenner & Smith; and Bruce Lee, a financial adviser in Merrill Lynch’s Chicago office, alleging tortious interference with contractual relations.

Let’s break this down. Bob Garber is Martinez’s former agent. Days before he hit free agency, Martinez fired Garber and hired Scott Boras. Martinez and Boras then went on an offseason-long courtship with baseball before the slugger finally signed a five-year, $110-million contract with three opt-outs.

Now, whether Martinez would’ve been better off with Garber instead of Boras is anyone’s guess. It’s worth noting that Garber isn’t an inexperienced agent; his most notable negotiations include those for erstwhile Astros ace Roy Oswalt a 5-year, $73 million extension in 2006 and a five-year, $77 million deal between free agent southpaw C.J. Wilson and the Angels in 2011. More recently, Garber obtained a three-year, $38 million commitment for Tyler Chatwood from the Cubs. So Garber isn’t a neophyte, is the point, and that gives his lawsuit significantly more credence.

What is his lawsuit about? According to the complaint, which you can read here, Martinez was using a financial adviser at Merrill Lynch named Bruce Lee to manage his money. Garber alleges that he and Lee were friends, and that he referred his clients to Lee because he had personally invested with Lee himself. But, according to Garber, Lee told Martinez to drop Garber and hire Scott Boras, because Lee wanted to obtain a financial benefit from having Boras’ book of superstar clients invest with him. Garber is seeking the 5% commission that he would have received had he negotiated Martinez’s Red Sox contract himself.

The entire complaint is simple – only eight pages long – and alleges two counts with just a single cause of action: tortious interference with contract. We’ve discussed that before, most recently when former agent Brodie Van Wagenen took over the Mets’ front office. As you’ll recall, the law prohibits a third party from inducing a party to a contract into breaching that contract. That’s called “tortious interference with contract.” We also discussed something called “culpable participation.” As a Texas court explained in a case called Rhymes v. Filter Resources Inc., “When a third party knowingly participates in the breach of duty of a fiduciary, such third party becomes a joint tortfeasor with the fiduciary and is liable as such.” This is the majority rule across most jurisdictions.

Here, we’re dealing with Illinois law, which means our discussion will be a little different than it was when we considered Kyler Murray, for example, where we talked about California law. The question is whether, in Illinois, what Lee did induced Martinez to breach his contract with Garber. If you’re interested, there’s a good, in-depth discussion of tortious interference law in Illinois here.

The problem is that, in Illinois, tortious interference claims are often filed and seldom won (I’ve actually handled a few, with one going as far as a petition for leave to appeal to our Supreme Court). And Garber is facing an uphill fight here for a couple of reasons. First, Garber alleges in his complaint that Boras himself put on a full court press to lure the superstar to his agency. Garber alleges that “as the 2017 MLB free agency period approached, agent Scott Boras began to make efforts to lure Martinez into breaking his contract with [Garber].” That’s tricky, because in order for Garber to state a claim for tortious interference with his contract, he must allege that Lee was the proximate (legal) cause of Martinez’s breach. If Boras was already talking to Martinez, proving causation will be difficult. And remember – Garber isn’t suing Boras, though he might have a claim.

Moreover, Garber alleges that Lee “asked his staff to research” Boras upon learning of the superagent’s efforts to lure Martinez away. Garber alleges that conduct to be untoward, but it’s worth noting that, as a financial manager, Lee owed a fiduciary duty to Martinez to manage his money competently, and he may have believed that researching Boras was part of that duty. Garber’s case would be stronger if Lee had approached Boras or Martinez first; instead, the complaint reads like Lee was advising a client about what was in his best interests. Merely advising a client to hire a different agent probably isn’t enough for tortious interference without more.

Why? Because while Illinois law does recognize something called “wrongful persuasion” – the idea that you can commit tortious interference with mere words – there is a subjective intent element as well. In other words, for Garber to even plead his case against Lee and Merrill Lynch, he has to plead facts sufficient to establish that Lee subjectively intended, as his primary goal, to cause the termination of Martinez’s contract with Garber. As the Seventh Circuit Court of Appeals recently explained in a case called Webb v. Frawley, “[t]he essential thing is the intent to cause the result. If the actor does not have this intent, his conduct does not subject him to liability under this rule even if it has the unintended effect of deterring the third person from dealing with the other.” Illinois Appellate Courts have gone even farther; in In Re Estate of Albergo, the Second District Appellate Court said that pleading tortious interference “requires some active persuasion, encouragement, or inciting that goes beyond merely providing information in a passive way.”

Based on this, Garber’s entire case rests on a single allegation in the complaint: paragraph 28, where Garber alleges that Lee told Martinez that “Bob is done,” “Bob is a hack,” and “Bob will sell you short,” among other statements. But I’m not at all sure that’s enough. When considering cases like Webb and Albergo, courts looking at tortious interference pleading want to see specific statements establishing active persuasion beyond mere opinion. This might be enough to get past a motion to dismiss, but proving these claims will be difficult, and if Martinez and Lee both testify those comments were never made, Garber likely will never see a trial.

Now, it’s entirely possible a court sees this differently. At this point, we have only the complaint, which is itself pretty thin. Maybe there’s more here. But this complaint isn’t persuasive, and that’s not a good sign when it’s the only document on file.

We hoped you liked reading J.D. Martinez’s Former Agent Is Suing Over His Contract by Sheryl Ring!

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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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Mike NMN
Member
Mike NMN

Good analysis. I’m wondering why the attorney included Boras’ courtship of Martinez, and apparently didn’t include much in the way of quid pro quos from Boras to Lee. Maybe there wasn’t enough there, which would weaken the case substantially.

goosepoop
Member
goosepoop

ya or why Boras isn’t a defendant