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Thursday, May 23, 2024 | Back issues
Courthouse News Service Courthouse News Service

San Jose Appeals & Re-Sues Baseball

SANTA CRUZ, Calif. (CN) - San Jose sued Major League Baseball for interfering with its attempt to lure the Oakland A's to town, and simultaneously appealed a federal judge's dismissal of antitrust claims against the Big Leagues.

The twin filings came after U.S. District Judge Ronald Whyte cited Major League Baseball's antitrust exemption in dismissing federal antitrust claims in October 2013, then dismissed state law claims two months later with leave to refile in state court.

That cleared the docket in the federal case and allowed San Jose to appeal the federal claims to the 9th Circuit.

Phil Gregory, attorney for San Jose, lauded the judge's ruling at the time.

"We believe this is an excellent result for the city because it allows the case to move forward on the antitrust claims to the next level and allows the case for interference with the option agreement to move forward in state court," Gregory, of Cotchett, Pitre & McCarthy in Burlingame.

Gregory told Courthouse News Tuesday: "The city is clearly moving forward with its claims that baseball and Commissioner Selig are preventing the relocation of the A's to San Jose due to the option agreement."

San Jose argued that the Major League Baseball Relocation Committee's delay for more than 4 years of whether to approve the A's move "caused a disruption of the A's ability to execute an option agreement and disrupted any future negotiation of a purchase agreement, presumably causing damage to the city."

The city also delayed a public vote, at Commissioner Bud Selig's request, on whether the A's could buy land and build a stadium.

In the October ruling, Whyte wrote that "it is reasonable to infer that the A's and the city entered into an option agreement with the understanding that MLB would return a relocation decision within the two-year term of the contract."

The "court finds that the complaint sufficiently alleges a 'disruption' of the contract because, here, the A's are unable to exercise the option due to MLB's delay in conducting the vote pursuant to the MLB constitution to approve or deny relocation," Whyte added. "By asking the city to delay a public vote on the stadium, the city was justified in assuming that MLB would make a decision within a reasonable time, which it has not."

The new lawsuit, in Santa Cruz County Court, accuses Selig of denying the A's request to move to San Jose, in a letter to A's managing partner Lew Wolff.

"The City has not seen this purportedly secret denial and MLB refuses to release the contents of the letter to the City or the public," the complaint states.

Gregory added: "This supposed denial of the A's request to move to San Jose did not prevent the A's from extending the option agreement. On Sept. 26, 2013, the A's extended the option agreement's exercise period through Nov. 8, 2014 by paying the extension fee of $25,000 to the City," Gregory said.

In citing baseball's antitrust exemption in his October ruling, Whyte said the exemption gives the league control over broadcast rights, apparel, stadium vendors, team locations and other aspects of the cash cow that is professional baseball.

The exemption, which the U.S. Supreme Court upheld in 1922, found, ingeniously, that baseball games are local affairs - not interstate commerce.

(The nation was baseball-crazy in 1922. Babe Ruth had set a Major League record by hitting 59 home runs in 1921 - a mark he would eclipse in 1927.)

Whyte, while agreeing that the exemption is "unrealistic, inconsistent, or illogical," noted that he is "still bound by the Supreme Court holdings."

Bradley Ruskin, a partner with Proskauer Rose in New York, who represents Major League Baseball and Commissioner Selig, did not immediately return a request for comment.

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