The Pittsburgh Pirates will have their hands full negotiating with Gerritt Cole.  In 2008, the Pirates had fun dealing with Pedro Alvarez, also a Boras client, who was selected #2 overall.  Initial reports indicated that the Pirates signed Alvarez for a $6 million bonus, but Boras claimed that Alvarez refused to sign the deal with the Pirates until 45 minutes after the signing deadline, which would have made the deal null and void.  The Major League Baseball Players Association looked into the matter and found that the rules were violated by the signing which apparently took place post-deadline.  Later, Alvarez agreed to a 4-year Major League deal with the Pirates that included a $6.355 million bonus.

Stories like this give us an idea of what it must be like to negotiate with Scott Boras, but nothing is as good as hearing it straight from someone who has a past of negotiating with the head of Boras Corp.  A few days ago, Jim Bowden provided everybody with a treat by going there – writing a breakdown of Boras’ negotiating style.  Bowden starts with the pre-draft process.

Boras will talk to all 30 scouting directors, general managers and owners (if they’ll take the phone call). He will give him his expectations for his client list — how he values them (not in terms of specific dollars but against previously signed talent) and reminds clubs that his player could re-enter the draft or go to college. If he’s talking with a small-market club whose history includes not paying over recommended slot, Boras might suggest that they pass on that player because he probably won’t sign with them and then will suggest maybe they draft one of his second-round type players in the first round because they could afford him. He also will look at an organization’s depth chart from the major leagues to the minor leagues. If a team has an All-Star catcher in the major leagues and a top catching prospect at Double-A, he might advise a team not to draft his catcher, realizing it might take his client longer to get to the major league team in that organization, thus delaying arbitration and free agency — where the real money is. He wants clubs to be prepared to pay the price if you draft one of his players.

It sounds like a very strong and effective strategy.  However, Bowden probably did not realize nor intend it when he wrote the piece for ESPN, but stating that Boras has direct communications with all 30 scouting directors, general managers and owners is the same as saying that Boras violates NCAA Bylaw 12.3.2.1 in the advising process for each of his clients.  NCAA Bylaw 12.3.2.1 reads as follows:

12.3.2.1 Presence of a Lawyer at Negotiations. A lawyer may not be present during discussions of a contract offer with a professional organization or have any direct contact (i.e., in person, by telephone or by mail) with a professional sports organization on behalf of the individual. A lawyer’s presence during such discussions is considered representation by an agent.

Boras advised former University of Kentucky baseball player James Paxton, who was suspended after he would not cooperate with NCAA investigators who wanted to question him about Boras supposedly having direct communication with a Blue Jays front office member after Paxton was drafted.  Between the Paxton controversy and Bowden’s piece, I assume the NCAA will be keeping a close eye on Boras Corp. employees.

NCAA Bylaws aside, the Bowden piece is a great read.  It includes Boras’ great leverage game, how he employs his own slotting system, and the record-breaking Boras draft deals he has negotiated.

Jim Bowden Discusses Boras’ Negotiating Power; Disregard For NCAA Rules? from Sports Agent Blog - Sports Business, Sports Law, Sports Negotiations, NCAA Rules

Last week, San Francisco Giants catcher Buster Posey broke a bone in his lower left leg when he was hit by Florida Marlins’ Scott Cousins at home plate.  Posey was blocking the plate in the 12th inning as Cousins reached home, hoping to score the go-ahead run and earn a victory for his team.  In the process, Posey suffered the aforementioned injury, which will likely keep him out of the remainder of the 2011 Major League Baseball season.

Posey’s agent, Jeff Berry of Creative Artists Agency (CAA), was quick to attack MLB rules that allow for such contact.  Following Posey’s injury, Berry stated,

“You leave players way too vulnerable.  I can tell you Major League Baseball is less than it was before [Posey's injury]. It’s stupid.  I don’t know if this ends up leading to a rule change, but it should. The guy [at the plate] is too exposed.

If you go helmet to helmet in the NFL, it’s a $100,000 fine, but in baseball, you have a situation in which runners are [slamming into] fielders.  It’s brutal.  It’s borderline shocking.  It just stinks for baseball.  I’m going to call Major League Baseball and put this on the radar.  Because it’s just wrong.”

We should expect nothing less from someone who advocates on behalf of his clients.  Furthermore, Berry is a former catcher himself, and knows well about the risk that catchers take by placing their body in front of a player coming full speed toward home plate.  Berry caught at the University of North Carolina Charlotte before playing a year in the Boston Red Sox minor league system.  He later earned a law degree at Oklahoma City University, which additionally helps with his ability to negotiate effectively.  With Casey Close’s departure from CAA, Berry became one of the co-head’s of CAA’s large baseball division.

Jeff Berry Wants An MLB Rule Change After Buster Posey Hit from Sports Agent Blog - Sports Business, Sports Law, Sports Negotiations, NCAA Rules

My absolute favorite part of the MLBTradeRumors.com post was the spreadsheet linked at the top of the page, prior to the breakdown by agency.  Not only does the spreadsheet do a great job listing the money earned in this past offseason, but it also has an up-to-date listing of Major League Baseball players along with their current representation.  In fact, it is even updated to show that Jason Heyward is no longer a client of Career Sports Entertainment (CSE), but instead a client of Excel Sports Management, where former CSE baseball agent Victor Menocal has gone to work alongside Casey Close in the development of a new baseball agency at the Excel basketball powerhouse.

Boras Corp. had a remarkable offseason, racking up roughly $444.5 million in contracts for its clients.  More than $100 million behind Boras Corp. stands Legacy Sports Group and its main agent, Greg Genske.  Third on the list is Creative Artists Agency, which will likely not be ranked as high in future years with the departure of Casey Close to Excel Sports.  Dan Lozano sits at #17 on the list, but should be near the top of next year’s rankings.

The spreadsheet discussed above is embedded below.  Enjoy.

Boras Corp. And Legacy Sports Boast Strong 2010/11 Offseasons from Sports Agent Blog - Sports Business, Sports Law, Sports Negotiations, NCAA Rules

For years, the N.F.L. and the N.B.A. have found their players associations to be unwitting partners. Rather than compete in a free market, management has exploited the weaknesses of unions to inhibit competition. By shielding owners from the scrutiny of antitrust laws, the unions have effectively allowed collusion. More often than not, the result has been union retreat — on salary caps, salary scales and taxes.

Something is fundamentally wrong when the only effective weapon in a union’s arsenal is dissolution. The hard-won early victories — health benefits, minimum wage — have been overshadowed by the sacrifices that players are now not just asked, but also expected to make.

Picture a scenario where the NFLPA decides it will remain a trade association instead of re-certifying as a union.  What then?

Have Players Unions Outlived Their Purpose? from Sports Agent Blog - Sports Business, Sports Law, Sports Negotiations, NCAA Rules

Barry Bonds‘ trial has been well publicized and discussed.  From the news stories we hear Bonds’ mistress, Kimberly Bell, testify about his perceived steroid rage and the growing (and shrinking) parts of his body.  We hear Kathy Hoskins, Bonds’ former personal shopper testify that Greg Anderson, Bonds’ longtime trainer, injected Bonds with “a little something for when [Bonds goes] on the road.”  We also hear former Major League Baseball players, specifically the Giambi brothers and Randy Velarde, testify that they also had relationships with Anderson and knew he was giving them steroids.  We hear Michael Murphy, the longtime San Francisco Giants’ clubhouse manager, testify that Bonds’ hat size increased significantly from the time he began with the Giants until he retired.  All of this testimony was widely publicized … so how did they become evidence in this trial?

I hosted a seminar featuring Professor Marc Ginsberg at The John Marshall Law School in Chicago, regarding these issues in evidence. Obviously, the Rules of Evidence are much more complicated, with many more rules and exclusions and exemptions, but this will be a small primer.  What Professor Ginsberg brought to light was that in 2010 in U.S. v. Barry Bonds, the Ninth Circuit paved the way for how the Government was eventually going to try the most recent suit that led to Bonds conviction.  In the 2010 case, the Ninth Circuit ruled that the Government could not introduce into evidence the Bay Area Laboratory Co-Operative (BALCO) laboratory records that presumably linked Bonds, because there were no other reliable witnesses, other than Anderson (who refused to testify, sat in jail, and was considered an unavailable witness) who could lay a proper foundation for the introduction of these important records.  The Government needed to come up with another way to prove Bonds took steroids and lied about it … and it decided to introduce all of the testimony that we eventually saw played out on news stories across the country.

Evidence needs to be relevant in order to be admitted.  This means that if the thing you are trying to admit has any tendency to make the existence of a fact more or less probable, then it can be admitted.  However, some relevant evidence is still inadmissible if the “prejudicial value outweighs the probative value.”  What this means is that if the Judge finds that the piece of evidence helps prove the existence of a fact, then the Judge needs to decide whether that piece of evidence will be prejudicial.  Another important evidentiary issue that presented itself in Bonds’ trial is hearsay.  Hearsay is an out of court statement, in any form, offered in court to “prove the truth of the matter asserted” … unless there is an exception.  The prosecutors in Bonds’ matter were able to use those exceptions in order to get some of the major testimony admitted.

The prosecutors, through all of the testimony, attempted to show there was a deep connection between Bonds and BALCO; Professor Ginsberg ran through some of the evidentiary issues that the prosecutors encountered in order to do so.  Why was the other Major League Baseball players’ testimony relevant?  Because it would allow the jury, by inference, to piece together that Bonds had to be completely naïve if he believed he was not taking steroids supplied by Anderson, even though all of Anderson’s other clients testified they were supplied and took steroids.

What about Kimberly Bell’s, or Michael Murphy’s testimony?  Why would they be able to testify about parts of Bonds’ body and his anger?  As Professor Ginsberg addressed, this was admitted because witnesses can testify as to what they have seen; and Kimberly Bell saw certain body parts of Bonds getting smaller and bigger, and witnessed firsthand his anger.  Michael Murphy did not testify as to what effect steroids have on the size of Bonds’ head; he just testified that Bonds hat size grew.  This testimony does not go into what steroids do to a person’s body or to their personality, so it is not being presented for “the truth of the matter asserted” … but a doctor can (and did) testify as to what steroids do to an ordinary person’s body and personality.  The jury, again, can piece together all of Bonds’ actions with those actions of an ordinary person on steroids.  What about the secret recordings of Anderson, talking about detectability, or Kathy Hoskins’ testimony that Bonds told her his injection was “a little something for when I go on the road.”  Isn’t this hearsay?  Professor Ginsberg pointed out these pieces of evidence were admitted because an exception to the hearsay rule is “admission of party opponent,” and those statements were from Bonds directly, so they were admitted.  The recordings were admissible because Anderson is unavailable as a witness, and the previously recorded statements were against his legal interests because the statements dealt with illegal steroid use at the time of the recording.  Obviously, there were many more issues and much more testimony that was presented at the trial.  But Professor Ginsberg touched on some of the “highlights” of the trial and how this damning evidence was admitted.

Barry Bonds’ case has brought up many issues as it relates to the Rules of Evidence.  It also raises concerns regarding clients and their legal issues, as attorneys are very clever in gathering and admitting evidence.  Just how Bonds’ case plays out in the future (Appeal?  Another trial?) is yet to be seen.

Hard-Hitting Evidence in the Barry Bonds’ Trial: How They Got It In from Sports Agent Blog - Sports Business, Sports Law, Sports Negotiations, NCAA Rules

What: Symposium - Baseball And The Law: America’s National Pastimes

When: Monday, April 11, 2011 (10:30 a.m. to 7:00 p.m)

Where: Albany Law School

Agenda

• 10:00 a.m. (outside room 200) - Continental Breakfast
• 10:30 a.m. (Room 200) - “A Contrarian View of Steroids: What’s Wrong With Being All You Can Be?”
  • Professor Paul Finkelman, President William McKinley Distinguished Professor of Law and Public Policy, Albany Law School
• 11:00 a.m. (Room 200) - “From The Dominican Republic To The United States: An Alumnus’s Perspective On Being An International Sports Agent”
  • Eric Bowman ’90, Founder and Senior Partner, Bowman Law Firm
• 1:00 p.m. (Room 200) – 2011 Edward C. Sobota ’79 Memorial Lecture - “It’s A Wise Child That Knows Its Father: A Search For Baseball’s Origin”
  • John Thorn, Official Baseball Historian, Major League Baseball, and Author,Baseball in the Garden of Eden
• 2:00 p.m. (Room 200) - “From Flood To Free Agency”
  • Henry D. Fetter, Attorney and Author of Taking on the Yankees: Winning and Losing in the Business of Baseball
• 3:00 p.m. (Room 200) - “The Laws and Litigation Safeguarding Intellectual Property Against Infringement and Piracy”
  • Moshe Bonder ’03, Regional General Counsel – Americas, CG Power Solutions USA Inc.
  • Susan E. Farley, Principal, Heslin Rothenberg Farley & Mesiti P.C.
  • Martin Schwimmer, Partner, Leason Ellis LLP
• 4:00 p.m. (Dean Alexander Moot Courtroom) - “If You Build It, They Will Come: A Discussion On Stadium Construction”
  • Joseph Gunn, New York City Corporation Counsel
  • Katherine Baynes, Partner, DLA Piper LLP
  • Michael Klein, Town Attorney, Town of Ramapo
  • Moderator: David Fernandez ’92, Partner, Carter Ledyard & Milburn LLP
• 5:15 p.m. (Outside Dean Alexander Moot Courtroom) - Coffee Break
• 5:45 p.m. (Dean Alexander Moot Courtroom) - “The Legal State Of Our National Pastimes”
  • JR Rickert, President and CEO, National Sports Management
  • Douglas Gladstone, Author, A Bitter Cup of Coffee: How MLB and The Players Association Threw 874 Retirees a Curve
  • David L. Snyder, Professor, Department of Sport Management at the State University of New York College at Cortland
  • Rick Murphy, Vice President, General Manager, Partner, Tri-City Valley Cats
  • Moderator: Hank Domin, Sports Editor, Albany Times Union
• 7:00 p.m. (East Foyer) - Extra Innings Reception with hot dog cart and Cracker Jacks. Book signings by Douglas Gladstone, John Thorn and Henry D. Fetter.

Cost: Free.

Albany Law School Baseball Law Symposium from Sports Agent Blog - Sports Business, Sports Law, Sports Negotiations, NCAA Rules

Major League Baseball stars Andrew Bailey, Dallas Braden, Craig Breslow, Cameron Maybin, Cody Ross, and Dontrelle Willis are expected to be bartending.  American Junkie will donate 10% of all bar revenue for the night, as well as 20% of all pre-booked tables to Strike 3 Foundation.  Additionally, VIP tickets will be available for purchase at the door on the evening of the 23rd for $50 per person.  VIP ticket purchasers are entered into a drawing for four spring training tickets when the A’s take on the Diamondbacks on Thursday the 24th at Salt River Fields.

This looks like a great event that all sports agents who happen to be in Arizona visiting their clients in Spring Training should attend.  Furthermore, agents should encourage their clients in the Cactus League to take part and help raise funds for pediatric cancer research.

MLB Players Bartending To Raise Funds For Pediatric Cancer Research from Sports Agent Blog - Sports Business, Sports Law, Sports Negotiations, NCAA Rules

Over 60 antitrust suits were filed against the NFL between 1966 and 1991.

Section 1 of the Sherman Act states that it is illegal to enter into any contract, combination, or conspiracy in restraint of trade.  If the court cannot rule as to whether a restraint is per se illegal, it will look to see if it is unreasonable under the “rule of reason” test.  Test aside, the NFL has been able to protect itself from a majority of antitrust lawsuits based on the nonstatutory labor exemption.

The nonstatutory labor exemption protects the NFL Collective Bargaining Agreement (CBA) from being in violation of antitrust laws, as long as there exists good-faith bargaining over wages, hours, and working conditions.  It recognizes that some restraints on competition will be a part of collective bargaining, but that these restraints are justified by the benefits of collective bargaining.  With no collective bargaining agreement in place and assuming that union decertification occurs, would the nonstatutory labor exemption survive?  Do the parties want to find out?

In 1989, the NFLPA filed a lawsuit and claimed that once the 1982 CBA expired and negotiations reached an impasse, the nonstatutory labor exemption ceased to exist.  If the parties do not reach an agreement today and there is not another extension for talks to continue, it could certainly be argued that the parties have reached an impasse.  Anyway, in the 1989 case, the infamous Judge Doty held that the impasse did in fact put an end to the nonstatutory labor exemption.  That holding was overturned because it was found that a collective bargaining relationship between the NFL and the NFLPA still existed.  Then the NFLPA decertified and players filed antitrust lawsuits against NFL owners.

No one wants to go down that road again.  Lawsuits cost money.  Appeals cost even more money.  And from what we know about Judge Doty, he tends to lean towards protecting the players, as evidenced by his recent ruling on the NFL’s Lockout Insurance policy and his decision in the aforementioned 1989 lawsuit.  Even if the NFL ends up proving that decertification is merely a ploy to open up the door for sham antitrust lawsuits and convinces a judge that even though the NFLPA “decertified” the entity is still in effect a union, it will take a lot of money, time, and energy to get to that point.  The NFLPA seems ready to go to battle.  Will the NFL fold its hand or fight it out in court?

NFL Labor Battle: To The Courts? from Sports Agent Blog - Sports Business, Sports Law, Sports Negotiations, NCAA Rules

College baseball season officially began this month, which means it is not too early to start talking about who current college baseball players have chosen as their advisors for the upcoming 2011 MLB First-Year Player Draft.

Most MLB Mock Drafts (there are not nearly as many on the internet as what exists for the NFL, followed by the NBA) have the Pittsburgh Pirates selecting Rice University third baseman Anthony Rendon.  Scouts are obsessed with his plate presence more than his skill on defense, although it is not as if he is a below average third baseman.  Rendon has also caught the eye of super-agent Scott Boras, who Rendon has tapped to be his advisor leading up to the 2011 Draft.  If Rendon is selected #1 overall, it will be the third consecutive year that Boras advises the 1st selection of the Draft.

The last time the Pirates negotiated with a top Boras advised MLB Draft pick was in 2008 when the Pirates selected Pedro Alvarez 2nd overall.  Alvarez negotiated (with Boras’ help) a $6 million bonus, but Boras, apparently upset with the deal, notified the MLB Players Association that the $6 million deal was actually signed 45 minutes after the signing deadline, thus violating the rule and voiding the Alvarez contract.  Alvarez ended up sitting out the remainder of his Rookie Ball campaign once the MLBPA filed a grievance against Major League Baseball.  The Pirates folded under pressure and ended up signing Alvarez to a 4-year, major league contract with a $6.355 million bonus.

That incident might be in the back of the Pirates executives minds come draft day.

Scott Boras Is Advising Future Potential #1 Overall Draft Pick, Anthony Rendon from Sports Agent Blog - Sports Business, Sports Law, Sports Negotiations, NCAA Rules

The Chicago White Sox signed their 3 players:

• John Danks signed a 1-year, $6,000,000 deal.
• Tony Pena signed a 1-year, $1,600,000 deal.
• Carlos Quentin signed a 1-year, $5,050,000 deal.

The Florida Marlins signed their 6 players:

• Burke Badenhop signed a 1-year, $750,000 deal.
• Clay Hensley signed a 1-year, $1,400,000 deal.
• Edward Mujica signed a 1-year, $800,000 deal.
• Ricky Nolasco signed a 3-year, $26,500,000 deal.
• Leo Nunez signed a 1-year, $3,650,000 deal.
• Anibal Sanchez signed a 1-year, $3,700,000 deal.

The Tampa Bay Rays signed their 3 players:

• Dan Johnson signed a 1-year, $1,000,000 deal.
• Andy Sonnanstine signed a 1-year, $912,500 deal.
• B.J. Upton signed a 1-year, $4,825,000 deal.

Does this tell us that the file-and-trial strategy is an excellent deterrent to drawn out negotiations between team and player?  There are still plenty of teams and agents who will negotiate right up to the day of players’ scheduled arbitration hearings.  The White Sox, Marlins, and Rays do not have to spend resources and time building up their cases in anticipation of a hearing.  My most recent count tells me that over 30 players are currently headed on the path towards a hearing.  While we know that a majority of these cases will settle, time is money!

My guy to watch = Josh Hamilton.  His salary figure is $12,000,000.  The Texas Rangers submitted a figure of $8,700,000.  Since Major League Baseball uses a final offer arbitration system, should the case go to a hearing, the arbitrators would have to pick one number or the other – no middle ground.

The File-And-Trial Arbitration Teams Sign Their Players from Sports Agent Blog - Sports Business, Sports Law, Sports Negotiations, NCAA Rules