You get the point.  It is a long process before an agent ever earns anything substantial from his baseball client.  The first instance where the agent expects a nice payday is when his client becomes eligible for arbitration, which is after the player’s third year of Major League service, or after his second year if he happens to have qualified as a Super Two.  So it hurts a lot when that client leaves his agent right before he finally becomes arbitration eligible.  For my football guys, equate it to representing an athlete through training for the draft, signing his first contract, and then losing him right before he signs his second NFL contract, which finally would net you decent money through your 3% commission.

The reason for this long winded explanation is that Jeff Niemann of the Tampa Bay Rays has switched from Creative Artists Agency (CAA) to Hendricks Sports.  Niemann is a 6’9 260lbs pitcher who played at Rice University prior to being drafted as the fourth overall pick in the 2004 MLB Draft.  He is not off to a great start this season, but the season is young, and if he manages to turn things around, the Hendricks brothers will hope to generate some nice new revenue from Niemann in the offseason.

Update (12:20 a.m. 4/18/11): I received note that Niemann actually switched agents quite a while ago, even though MLBTradeRumors.com reported that it was a recent change. Thus, the arbitration eligibility discussion regarding Niemann does not apply; however, these types of switches right before players become arbitration eligible do exist.

On To The Next One: Jeff Niemann from Sports Agent Blog - Sports Business, Sports Law, Sports Negotiations, NCAA Rules

Another tactic that the Rays use to avoid spending time and money on arbitration is to lock up young pre-arbitration eligible players into long-term contracts, effectively buying itself out of the arbitration process itself.  Whether you think it was a good idea or not, the team used this tactic to sign James Shields to a 4-year, $11.25 million contract in 2008, when he was only 26-years-old and had less than 2 full seasons of MLB service.  The deal included 3 separate team options, which allows the Rays to extend that 4-year deal to up to a 7-year deal, paying Shields over $25 million more over those 3 extra years.

Rays executive vice president of baseball operations Andrew Friedman has decided to put that tactic to test again by signing unproven Wade Davis to a very similar deal that Shields signed 3 years prior.  Davis will make $12.6 million over 4 years, but the Rays also have 3 separate team options to extend the deal to a total of 7 years.  Interestingly, using the 3 extensions would pay David a little less than $25 million more over those 3 extra years.  Shields got better teams regarding the options.

Davis is a 25-year-old pitcher, and had 35 starts going into the 2011 season.  Signing this kind of deal is a great strategy for a player who is more conservative about his finances.  $12.6 million is no small chunk of change, and if invested properly, could be enough money for Davis to live on for quite some time.  He and his agent may be leaving money on the table by signing the deal now, but they could also be protecting Davis in case of poor performance, an injury, or some other event that would limit his earning potential.  Signing this type of deal at this stage of one’s career is a personal decision, and is not right for everyone.  That’s why it is important for an agent to understand his clients and give them advice on a case-by-case basis.

I am sure that Davis’ agent, B.B. Abbott of Jet Sports Management knows his client quite well and advised him accordingly.  He recently stated, “I don’t think anyone can definitively tell you that it’s the wrong deal or a bad deal or a good deal. It was just the right deal for Wade and the right deal for the team.” It was a good deal for Davis, which could have been a wrong deal for a similarly situated player with a different mindset and circumstances.

Wade Davis’ $12.6 Million Pre-Arbitration Contract With The Tampa Bay Rays 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

The MLB postseason is truly one of the best, because unlike football and basketball where the best team usually wins, time and time again we see instances of a wild card or underdog team making a run to the World Series (’08 Rays, ’07 Rockies, ’03 Marlins). There is not a more exciting moment in baseball than the bottom of the 9th inning of an elimination game, where the true character of a team is tested.

• Outdoor October baseball in Minnesota.
• The core 4 Yanks (Rivera, Jeter, Pettite & Posada) going for rings on a second hand.
• The Phillies attempting to make the World Series for the 3rd consecutive year.
• Bobby Cox’s final post-season.

So many great story lines and so much baseball left to play. And with that, I give all you SAB followers a taste of what’s to come this October:

Here are my rankings of the Postseason 8:

1. Philadelphia Phillies – Halladay, Hamels and Oswalt aka H2O (the first release of this new nickname) – A match-up problem for anyone they face. The Phillies have both experience and depth, and have a great chance to repeat as champions of the National League.
2. Tampa Bay Rays – You know the pitching will be there, but this team will go as far as their bats take them. The Rays have played consistently throughout the season despite the lack of support from the hometown fans. Look for Carl Crawford, BJ Upton and Evan Longoria to step up this October.
3. New York Yankees – Struggling as of late, but October in the Bronx is a magical place. The veterans must continue to lead and use their experience as they face an unfamiliar situation as the American League Wild Card team. Jeter batted a career low .270 this season, but it’s not how you start, it’s how you finish. We all know what the captain is capable of in October.
4. San Francisco Giants – This team has the 2nd best pitching staff in the playoffs, and has been playing great in the last month of the season. Jonathan Sanchez may be the key for this team, as he has delivered time and time again for the Giants in big games. I’m curious to see how rookie Buster Posey reacts to his first postseason.
5. Minnesota Twins – The Twins are a different team with Justin Morneau. Minnesota has had the central locked up for a while now, so it will be interesting to see how they come out in game 1 tonight; especially with the recent struggles of Francisco Liriano. New Target Field should be electric tonight.
6. Cincinnati Reds – This could be the sleeper of all postseason teams. The Reds, after not making the playoffs in over a decade, have been leading their division for virtually the entire season. Not much playoff experience on this roster, but look for Scott Rolen to take the responsibility of clubhouse leader.
7. Texas Rangers – With Josh Hamilton’s injury, Cliff Lee is the only thing keeping Rangers fans optimistic. Lee has the ability to win 2 games in a 5 game series, but how they get that other win over a great Rays team remains a big question mark.
8. Atlanta Braves – With yet another playoff berth, Bobby Cox has cemented himself as one of baseball’s greatest managers. Nobody picked the young Braves prior to the season, but they proved doubters wrong. With Martin Prado and Chipper Jones out, though, there is just not enough power at the plate to find success.

Predictions:

Division Series
Phillies over Reds in 4
Giants over Braves in 5

Rays over Rangers in 4
Yankees over Twins in 4

Championship Series
Giants over Phillies in 7
Yankees over Rays in 6

World Series
Giants over Yankees in 7

Your MLB Playoffs Preview from Sports Agent Blog - Sports Business, Sports Law, Sports Negotiations, NCAA Rules

1. Bryce Harper (Washington Nationals) – Boras Corp. – Interesting to note that Bud Selig referred to Harper as an outfielder even though he has played mostly catcher his entire life.  Get this kid on the fast track through the Minors.
2. Jameson Tallion (Pittsburgh Pirates) – Hendricks Sports Management – Big high school arm clocked as high as 99 mph.
3. Manny Machado (Baltimore Orioles) – Boras Corp. - Hard to see Machado passing up signing to go play at Florida International University.  Interesting that FIU is his college commitment.
4. Christian Colon (Kansas City Royals) – Boras Corp. – Yesterday, I had reported that the Royals wanted to sign Yasmani Grandal.  Perhaps his price tag was too high.
5. Drew Pomeranz (Cleveland Indians) - Beverly Hills Sports Council – He was drafted in the 12th round out of high school.
6. Barret Loux (Arizona Diamondbacks) – SFX – Jumped up boards a lot recently.
7. Matt Harvey (New York Mets) – Boras Corp. – 4th Boras client selected in the top 7 picks.
8. Delino Deshields Jr. (Houston Astros) – Wasserman Media Group
9. Karsten Whitson (San Diego Padres) - SFX – Committed to my alma mater, the University of Florida.
10. Michael Choice (Oakland Athletics) – Franklin-Frye Sports – Went undrafted out of high school.
11. Deck McGuire (Toronto Blue Jays) – SFX – Also undrafted out of high school.
12. Yasmani Grandal (Cincinnati Reds) – Legacy Sports Group – Slipped because of signability issues.
13. Chris Sale (Chicago White Sox) – Jet Sports Management – Didn’t play at a major school (Florida Gulf Coast University), but put up great numbers there and played very well in Cape Cod last summer.
14. Dylan Covey (Milwaukee Brewers) – Wasserman Media Group
15. Jake Skole (Texas Rangers) – Unknown – Won’t be compensated if they don’t sign this pick (most likely why Skole was taken here).
16. Hayden Simpson (Chicago Cubs) - Hendricks Sports Management – Great numbers this past year in Division II baseball.
17. Josh Sale (Tampa Bay Rays) – Creative Artists Agency – Don’t worry, different advisors than the people at CAA who have to worry about where LeBron will play.
18. Kaleb Cowart (Los Angeles Angels of Anaheim) – SFX – Boras Corp. has higher drafted clients, but at this point of the draft, SFX and Boras tied in number of players picked.
19. Michael Foltynewicz (Houston Astros) – Octagon
20. Kolbrin Vitek (Boston Red Sox) – Pro Star Management - Joe Bick also represents Kevin Youkilis, one of my favorite players.
21. Alex Wimmers (Minnesota Twins) – ACES – Undrafted out of high school.
22. Kellin Deglan (Texas Rangers) – Double Diamond Sports Management – Canadian catcher committed to Florida International University with Manny Machado.
23. Christian Yelich (Florida Marlins) – Creative Artists Agency – Committed to the University of Miami, so he will be in the state of Florida no matter what.
24. Gary Brown (San Francisco Giants) – Boras Corp. – And Boras re-gains the lead in clients selected with a total of 5 at this point.
25. Zack Cox (St. Louis Cardinals) – SFX – A draft-eligible sophomore.
26. Kyle Parker (Colorado Rockies) – Career Sports Entertainment – Also the quarterback for Clemson.  Will be a tough sign.
27. Jesse Biddle (Philadelphia Phillies) – Sosnick & Cobbe – Matt Sosnick represents some big time pitchers; add this stud to the list.
28. Zach Lee (Los Angeles Dodgers) – Unknown – Committed to play football at LSU. Queue the signability discussion.
29. Cam Bedrosian (Los Angeles Angels of Anaheim) – ACES
30. Chevez Clarke (Los Angeles Angels of Anaheim) – ACES – 2 ACES clients drafted in a row, and a total of 3 ACES clients taken in the first round.
31. Justin O’Connor (Tampa Bay Rays) – SFX – Committed to Arkansas.
32. Cito Culver (New York Yankees) – SFX

Comp Round A

1. Mike Kvasnicka (Houston Astros) – Sterling Sports Management
2. Aaron Sanchez (Toronto Blue Jays) – West Coast Sports
3. Matthew Lipka (Atlanta Braves) – Franklin-Frye Sports
4. Bryce Brentz (Boston Red Sox) – Jet Sports Management
5. Taylor Lindsey (Los Angeles Angels of Anaheim) – Unknown
6. Noah Syndergaard (Toronto Blue Jays) – Xclusive Sports Management
7. Anthony Ranaudo (Boston Red Sox) – Boras Corp.
8. Ryan Bolden (Los Angeles Angels of Anaheim) – ACES
9. Asher Wojciechowski (Toronto Blue Jays) - SFX
10. Drew Vettleson (Tampa Bay Rays) – Creative Artists Agency
11. Taijuan Walker (Seattle Mariners) – Reynolds Sports Management
12. Nick Castellanos (Detroit Tigers) – SportsMeter
13. Luke Jackson (Texas Rangers) – Unknown
14. Seth Blair (St. Louis Cardinals) – Boras Corp.
15. Peter Tago (Colorado Rockies) – Wasserman Media Group
16. Chance Ruffin (Detroit Tigers) – Unknown
17. Mike Olt (Texas Rangers) – Wasserman Media Group
18. Tyrell Jenkins (St. Louis Cardinals) – Select Sports Group

The MLB Draft Day 1 Broken Down from Sports Agent Blog - Sports Business, Sports Law, Sports Negotiations, NCAA Rules

B.J. Upton is the 2nd player to reach an arbitration hearing this February.  Corey Hart was the first, and in his case, the panel of arbitrators handed Hart the victory, and $4.8 million (compared to the Brewers’ offer of $4.15 million).  Upton’s has already had his hearing yesterday, and one of the 3 panelists (Elizabeth Neumeier) also sat in on Hart’s hearing.

Upton earned $435,000 in 2009.  Before reaching arbitration, the Tampa Bay Rays offered $3 million.  Upton countered with a $3.3 million proposal.  The relatively small gap of $300,000 was enough of an incentive for the parties to pay their attorneys to prepare for and execute an arbitration hearing.

An announced decision is expected later today.  Tampa Bay has never lost an arbitration hearing (4-0 record), but that really doesn’t mean anything.  With Tim Lincecum coming to an agreement with the San Francisco Giants prior to his hearing, Upton is now the focus of the baseball world (at least for the next few hours).

Here is how the guys at FanGraphs project Upton in 2010.

Next On The Agenda: B.J. Upton from Sports Agent Blog - Sports Business, Sports Law, Sports Negotiations, NCAA Rules

Pat Burrell

The 32-year old Burrell is likely to be the Rays’ designated hitter. Last year with the Phils, Burrell hit .250 with 33 home runs, 86 RBIs and 102 walks in 157 games.

Burrell had hoped to sign back with the Phillies this year but those dreams were shattered after they signed outfielder Raul Ibanez.

Pat “The Bat” Signed by Rays from Sports Agent Blog - Sports Business, Sports Law, Sports Negotiations, NCAA Rules

“With (Carl) Crawford and (Evan) Longoria going down simultaneously, I thought I’d make one last vain attempt to reach out to Tampa Bay, and to no avail,” Borris told FOXSports.com.

And then Borris returned to his normal shpiel…that of collusion.

“That’s because Major League Baseball has been successful in their pursuit in blackballing Barry out of the game.”

In the midst of all of this, Borris may be burning bridges with Tampa Bay execs by going public about his text message campaign.

“I’m not sure what Jeff Borris is trying to accomplish by saying he sent me a text message,” Friedman said. “But our longstanding practice is not to comment on anything speculative.”

At Least You Can’t Say That Borris Isn’t Trying from Sports Agent Blog - Sports Business, Sports Law, Sports Negotiations, NCAA Rules

Follow-up on Alvin Fall & Carl Crawford from Sports Agent Blog - Sports Business, Sports Law, Sports Negotiations, NCAA Rules

When beginning my search I noticed that Sports Law Blog did a similar comparison with salaries and success, but I could not find other comparisons after 2006.  I will attempt to continue their analysis for the first half of the 2008 season.

To start, I will analyze the top salaries, which includes 2/3 of the top AL East teams, the Red Sox and the struggling Yanks.  As many of you know, the Yanks are the most expensive team in baseball, spending a total of $209, 081,577 on their 2008 roster according to USA Today.  The next team on the list is the other New York team, the Mets, spending $71,288,201 less than the Yanks with a total of $137,793,376.  The Red Sox are fourth on the list spending $133,390,035 on their roster after winning the World Series last season.

The surprising Rays are second to last on the list, spending a mere $43,820,597 on their total roster this year.  That roster has earned them the best record in baseball. The Rays are 53-32 so far and are currently in first place by 3 games over the Red Sox, proving to the league that a low salary does not mean low quality players. Evan Langoria is having a Rookie of the Year type season, but no other Rays are really having a breakout year. This is a scary thought for the rest of the MLB with the second half of the season on the horizon. The Rays play as a team, with the heart and patience to hang in games and come back late in a match if they need to, unlike that of the Yanks so far and many other high paid rosters.

Another surprise team so far this season has been the other Florida squad, the Florida Marlins.  I remember hearing on opening day that the ENTIRE Marlins salary for 2008 was less than the salary of Alex Rodriguez alone this year.  The Marlins management has spent the least in the MLB, paying their players $21,811,500 to start opening day.  After A-Rod and his agent, Scott Boras, worked out a new contract with New York last season, A-Rod was guaranteed $28,000,000 for 2008.  I only analyzed and discussed a couple of teams.  If you want to view the entire list with all 30 MLB teams and their salaries click here.

Using the USA Today data and the results from the past several regular seasons and playoffs, I can conclude that a high payroll does not guarantee success. I have learned after watching March Madness, the NBA, MLB, NHL and just about every sport, that earnings and prior statistics that commentators and gamblers use to handicap games really mean nothing. It is all about the desire, dedication, training regimen, persistence, a little coaching and the overall mindset of the team that wins games.

Look at the NY Giants Super Bowl run and success last season. They came out of nowhere to prove everyone wrong and beat the heavily favored Patriots. Going by all the stats in the NFL, the G-men had no shot at beating Brady and the undefeated Patriots. The only thing they had on their side was the confidence from the great run they were on during the playoffs.

Since baseball does not have a salary cap, teams in New York can spend whatever they want on big name players. However, the only thing that matters at the end of the day is getting wins. Baseball is a team sport and as we can see from the Yankees past 6 seasons, big names (and paychecks) don’t always forge together to win big games. All a team needs to do is get into the playoffs and then anything can happen.

Although the MLB season is only almost half over, it still pays to point out that money does not correlate with success.  Darren looked at how this may eventually affect MLBPA agents in a post that he made back in 2006: Will The Yankees Success Hurt Agents?

It’s NOT All About the Money from Sports Agent Blog - Sports Business, Sports Law, Sports Negotiations, NCAA Rules