Double-A Team to Host Frivilous Lawsuit Night...Seriously

The Altoona Curve, a Double-A Pirates affiliate, will host a "Frivilous Lawsuit" night on July 2. The team's press release is here. Hat tips to the Journal's Law Blog and Overlawyered.

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Marquette to Host Labor & Employment Scholarship Mini-Conference

Marquette's law school will host a Colloquium on Current Scholarship in Labor and Employment Law on Friday, October 27, 2006. The conference web site and call for paper presenters is here. Given the overlap between sports law and labor / employment law, hopefully some of our readers and contributors will submit papers and be represented in October. Conference co-organizer Scott Moss explains the genesis of the conference (and makes a dubious prediction about the Brewers' World Series prospects) here.

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What's in a Number? Apparently Tax and Contract Issues

Twelve days ago, I discussed Reggie Bush's challenge to a long-standing NFL rule requiring running backs to wear a number in the 20-49 range. Yesterday, the NFL's competition committee -- not surprisingly -- rejected his request that he be permitted to wear No. 5. A release by The Associated Press (reprinted in USA Today) noted that, since 1973, the only major change to the NFL rule was made last year, when receivers were given permission to wear numbers in the teens because teams were running out of numbers in the 80s due in large part to an increase in receivers and tight ends on rosters.

Interestingly, as noted in the press release, a player will often change a number to accommodate another player, often selling the rights. For example, New York Giants punter Jeff Feagles traded No. 10 to Eli Manning in 2004 in exchange for a family vacation, and then also traded No. 17 to Plaxico Burress last year in exchange for an outdoor kitchen addition on Feagles' home. Clinton Portis bought No. 26 for $40,000 from safety Ifeanyi Ohalete when he joined the Redskins. Portis paid $20,000 up front but declined to pay the rest after Ohalete was cut by the Redskins and picked up by Arizona. Ohalete then sued Portis for the balance and they ended up settling the matter for $18,000.

This is what I love about sports law -- something that seems so innocent, like one player simply permitting another to wear a jersey number, amounts to some complex legal issues. For example, what are the tax consequences on the exchange? In order to determine the taxable gain on the sale, the seller's basis needs to be determined. What's the selling player's basis in his number? Is it a cost basis? - which, presumably would be zero in which case the entire benefit received would be taxable. Or could the selling player argue that this transaction is nothing more than a non-taxable gift from the purchasing player (i.e. the payment was made out of "detached and disinterested generosity")?

Also, there are some interesting contract and property issues involved here. Why does a player even have the legal right to sell a jersey number to another player in the first place? Does the club own the rights to the numbers, and have the continuing exclusive authority to grant and condition the use of the numbers by the players? Is this a sub-license arrangement in which maybe the selling player (the licensee) needs to first get permission from the club (the licensor)? Assuming a player even has a property right in his number that he can sell, why would Ohalete have any further rights to his number with the Redskins after he was cut by them?

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Chief Justice of the Sports Metaphor

In Brigham City v. Stuart, released earlier this week, the Supreme Court held that police officers may enter a home without a warrant if they have an objective basis to believe an occupant is seriously injured or imminently threatened with such injury. Writing for the majority, Chief Justice Roberts explained, "The role of a peace officer includes preventing violence and restoring order, not simply rendering first aid to casualties; an officer is not like a boxing (or hockey) referee, poised to stop a bout only if it becomes too one-sided.”

Apparently, we can expect many more sports metaphors from Chief Justice Roberts, the man who gave us "Judges are like umpires. Umpires don't make the rules; they apply them. The role of an umpire and a judge is critical. They make sure everybody plays by the rules. But it is a limited role. Nobody ever went to a ball game to see the umpire."

Hat tip to the Journal's Law Blog.

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Does the NFL Have the Best IP Cops?

At the Freakonomics blog, Steven J. Dubner wonders at the absence of Washington Redskins memorabilia in a gift store into which he wandered in Washington, DC. Here's his story: "Today, I went to a huge souvenir store in D.C. . . . There was a great variety of very very cheap shirts and hats sporting the logos of the F.B.I., the C.I.A. . . . etc. But there didn’t seem to be a single item of Washington Redskins paraphernalia. I asked at the counter . . . did the clerk think that, perhaps, I was from the N.F.L.’s licensing division and was trying to find out if she had any unlicensed Redskins stuff? It didn’t seem to make sense that the store wouldn’t carry any Redskins paraphernalia—they had everything else you could imagine, including shirts for the Washington Nationals and the Georgetown Hoyas. . . . is it possible that stores like this (and/or their suppliers) are not afraid of selling knockoff U.S. Government merchandise or knockoff MLB merchandise but that they are afraid of selling knockoff NFL merchandise? Is it possible that the N.F.L. is more feared, even in Washington, than the U.S. Government?"

The Wonkette thinks the store may have just found the name "Redskins" offensive.

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Study Indicates Losing Soccer Games Hurts Economies

A new economic study has demontrated that "losses in soccer matches have an economically and statistically significant negative effect on the losing country’s stock market." Here's the paper's abstract: "This paper investigates the stock market reaction to sudden changes in investor mood. Motivated by psychological evidence of a strong link between soccer outcomes and mood, we use international soccer results as our primary mood variable. We find a significant market decline after soccer losses. . . . This loss effect is stronger in small stocks and in more important games . . . . We also document a loss effect after international cricket, rugby, and basketball games."

Now that's what I call moneyball.

Hat tip to Conglomerate.

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Mark Teixeira Blasts Boston Red Sox: Legality of Pre-Draft Negotiations between MLB Teams and Amateur Players

With the Major League Baseball amateur draft to be held in two weeks (June 6-7), Alan Schwarz of Baseball America has a very interesting interview with Texas Rangers first baseman Mark Teixeira. In the interview, Teixeira recalls when the Boston Red Sox drafted him in the 9th round of the 1998 MLB Draft, as well as communications between the Sox and Teixeira prior to the draft. Like many of the draft's best prospects, Teixeria, then 18, was represented by super-agent Scott Boras. After a very contentious negotiation with then-Red Sox GM Dan Duquette, Teixeria declined to sign, feeling low-balled by Duquette's offer of a $1.5 million signing bonus, and instead chose to attend Georgia Tech. Three years later, the Texas Rangers selected him in the 1st Round (5th overall) of the 2001 MLB Draft, signed him to a $10.5 million contract (including a $9.5 million bonus), and he has gone on to become a big league star.

In the interview, Teixeira suggests that the Red Sox sabotaged his draft status by (1) engaging in what he calls "illegal" pre-draft negotiations with his agent; (2) slandering him, albeit privately; and (3) drafting him relatively late (in the 9th round) in order to diminish his superstar prospect reputation. Here is the relevant portion of the interview (with my italics):

Alan Schwarz: The Red Sox offered you $1.5 million before the draft, which was pretty darned fair in 1998.

Mark Teixeira: They said take it or leave it. It was a decent bonus, but it wasn't what we were looking for, and we didn't want to cap our negotiation before the draft even happened. It's unfair and illegal to go to a kid and say, "We haven't drafted you yet, we may or may not draft you, but if you don't take 1.5 we're not going to draft you." What would you say? There's 29 other teams out there--why would I ever cap myself before the draft even happens? It doesn't make any sense. It's unfair to those kids. Say, "Draft me and I'll let you know."

I have a very cynical approach toward the draft. I was naive. It was my first realization to the business in baseball. The Red Sox told everybody that I wouldn't sign, and when it got to a late enough round, they said, "Let's take a flier on him." So they spoiled me for everyone else--the only one that would draft me was them.

First off, I'm not feeling much sympathy for Mr. Teixeira. Any player, of any age, who hires Scott Boras to represent him is clearly not "naive" about baseball "being a business."

Second, I don't buy that the pre-draft negotiations between Boras and the Sox were in any way "illegal" or inappropriate. It's not entirely clear what laws Teixeira thinks the Red Sox broke, but he might be suggesting that the Sox, by telling other teams that Teixeira wouldn't sign for $1.5 million, tortiously interfered with his prospective relationships with those teams. Or perhaps he believes that the Sox slandered him when talking to other teams, or even that it libeled him by drafting him so late. Even more quixotically, he might think that the Sox bargained in bad-faith by threatening to not draft him unless he acquiesced to a $1.5 signing bonus (oh the horror!) or even--bear with me--that the Sox extorted him (something to the effect of, "Mark, if you don't agree to $1.5 million, we'll make sure that other teams find out about that . . . and we'll do that because we are so evil!"). Alternatively, if Teixeira simply believes that the mere act of pre-draft negotiations by the Sox was illegal, then why was his agent engaged in those same negotiations on his behalf?

The reality is that pre-draft negotiations are common with marquee players. In theory, such negotiations violate MLB tampering rules, but those rules are not enforced for good reason: they enable players to better assess whether they should pack for freshman year or pack for life as a minor-leaguer, and they enable teams to better assess whether it is in their baseball and financial interests to draft a particular player. And to the extent Teixeria or any player is hurt by these pre-draft negotiations, they should blame their agent, not the team that didn't assent to their asking price.

Having said all that, if there is evidence that a team has willfully damaged a player's reputation, either by published words (libel) or spoken words (slander), then a player would have legal recourse. But I suspect that most players don't have that evidence, and are instead just embittered that big league teams didn't think as highly of them as they did of themselves.

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