Update 9/5 10:30 AM – If you haven’t seen it yet, the Merc’s John Woolfork has picked up the story and gotten quotes from San Jose City Attorney John Doyle.
Activity regarding the astroturf group Stand for San Jose‘s lawsuit challenging the A’s Diridon land deal appears to have picked up in the last week, as the respondents, the City of San Jose and the A’s, have submitted a request to depose Stand for San Jose and its members. I’ve uploaded a copy of the motion (6 MB PDF) for your perusal.
The thrust of the City’s argument is that it complied with S4SJ’s numerous information requests, while asserting that it has the right to request information about S4SJ’s inner workings to determine if S4SJ has standing. The motion asks for relevant documents related to the operation of S4SJ, as well as a person to represent the group in a deposition. This maneuver comes after repeated requests made by the City for this information. Through attorney Geoffrey L. Robinson from the A’s-hired firm Perkins Coie, the motion asks for some in-depth information.
The matters on which the deponent will be examined include the following:
- The standing of Stand for San Jose to assert any or all of the claims raised in the First Amended Petition in this case.
- The nature of the beneficial interest held by Stand for San Jose in the subject matter of this litigation and the extent to which those interests differ from those of the general public.
- The origin and formation of Stand for San Jose.
- The organizational purpose, structure, functions and activities of Stand for San Jose.
- The governance, direction, control and/or leadership of Stand for San Jose.
- Taxes paid by Stand for San Jose to the City of San Jose or any other public entity.
- The funding or financing of Stand for San Jose’s activities.
- The legal or financial relationships between Stand for San Jose and its members and/or any persons or entities funding or controlling its activities.
- Any actual or proposed use of this litigation to impose regulatory burdens on the City or Real Party in Interest.
- The “fees and costs, including reasonable attorneys” fees and expert witness costs” (sic)…
Named individuals in the motion include Michelle Brenot, Robert Brown, Karen Shirey, Fred Shirey, Robert Shield, and Eileen Hannan, who initially didn’t know she’d be a plaintiff in the lawsuit. Just in case you’re wondering where her allegiances lie, here’s her Facebook profile picture.
At least we know where Ms. Hannan “stands”
The challenge is a technical one – if the plaintiffs don’t have standing, the suit can be dismissed. S4SJ claims they have standing by the nature of the suit (originally an EIR challenge). The tax issue is interesting, in that the City is arguing that if the plaintiffs aren’t taxpayers in San Jose they have no standing. The motion will be made on September 21 at 9 AM. (Come on people, I’m supposed to be in an iPhone 5 line at that time! You’re killing me.)
Seriously, this is the first real sign that the legal team that the A’s were assembling in the spring is breaking out some weapons to use in could be a lengthy legal battle. Could the lawsuit blow up if it’s found that the Giants were behind the whole thing (snicker)? I guess we’ll find out.
P.S. – I look forward to reading the various lawyers’ assessments of this motion in the comments. Also – I’m not a lawyer or legal reporter, so forgive my butchery of the legalese.
newballpark.org 
So THAT’S the trick for getting girls?
Zie plot thickens
Well, in the past two days we’ve seen that:
* MLB asked San Jose for documents about the ballpark site.
* A’s attorneys and San Jose are getting ready to do battle with S4SJ.
…so, anybody who thought Wolff and/or MLB were about to give up on San Jose, think again.
That’s the trick to get a girl that wears a panda hat. If you want a classy girl you’ll have to work harder.
I am willing to bet that A’s stadium issues will be on the agenda during this years MLB winter meetings. Looks like the A’s are getting their legal sh*t together before than.
re: I am willing to bet that A’s stadium issues will be on the agenda during this years MLB winter meetings.
…Wasn’t on last month’s agenda, or the two owners meetings prior to that. Selig is too terrified to make a decision and still clings to the false hope that the Giants and A’s can work this out, even though the Giants have no incentive to do anything. Let the two franchises battle it out in court since Selig is still shaking under his desk.
I think it’s interesting that the “anti-competitive” nature underlying S4SJ’s lawsuit is raised in the A’s/SJ’s motion to compel discovery. See page 8, line 8 where it briefly mentions “improper motives.” If the Court allows the discovery to proceed, the evidence could be used by SJ and/or the A’s in a future challenge to MLB’s anti-trust exemption. Consider this a salvo in the legal “proxy wars” between the Giants and the A’s. Message to Bug and MLB, resolve this before it gets real ugly.
@pjk,
Only you thought that ;). Remove all the non-news from May onward and things still look very good.
@RM,
As far as the EIR challenge, considering the EIR was thorough and originally put together for a 45k ballpark, where does that stand? (No pun intended)
Aloha…
Mike,
You’re obviously familiar with legal wranglings, which leads me to ask a question of you if you can answer. Stare Decisis nonwithstanding, Justice Blackburn later indicated that he would have changed his vote in Toolson concerning MLB’s exemption, however Flood reaffirmed the decision….or least continued the punt to Congress to change the legislation. Would Blackburn’s musings have any affect on a modern challenge? Also, if the city of SJ were to be complaintant, would that change the nature of the challenge being that they’re a muninciple entity rather than a private party?
This is a garden variety discovery fight between two willfully unreasonable parties. The respondents have noticed many depositions they don’t need to gain discovery on the standing issue. Such tactics are transparently harrassing. (Technically, the PMQ deposition notice is way overbroad, too (some topics in it are clearly designed to set the stage for contention-interrogatory questions at the deposition–which is not allowed). On the other side, however, the petitioners have simply stonewalled, which is a similarly aggressive response. Both parties know they are overreaching.
.
A few contention interrogatories and a few well-aimed document requests should be sufficient to discover the basis, if any, for petitioners’ standing. Maybe–maybe–a very focused PMQ deposition might be justifiable. The judge may force the parties to reach an agreement on such limited discovery.
.
The “motives” argument on p. 8 of the brief seems weak to me. Take a look at p. 169 of the case the respondents cited. S4SJ does not seem akin to a corporation pursuing a writ proceeding for its own anticompetitive benefit. (Moreover, in the case the A’s attorneys cite the Calif. SCt affirmed Plf’s standing.)
.
I’ve seen extensive discovery taken in traditional mandamus actions; not so much in administrative mandamus actions.
.
I’ve never taken this little writ proceeding very seriously. I think it’s mainly interesting for showing that the SF Giants had figured out how to sue the A’s without violating the mlb constitution. (The SF Giants’ quiet purchase of majority interest in the SJ Giants in 2009, just as Bill Neukom was exercising full control over the Giants, set the stage.)
.
@ML: “Could the lawsuit blow up if it’s found that the Giants were behind the whole thing . . . ?
.
No. Everyone knows the Giants are behind the whole thing. The Giants’ primary law firm represents the petitioners; the SJ Giants provide a front for the SF Giants in San Jose, and in the litigation. The real question is whether the SF Giants will continue to use the SJ Giants to sue the A’s after this little spat about the option blows by.
The A’s would not be proceeding with this lawsuit in general against S4SJ unless they knew on some level they are heading to San Jose eventually.
The A’s challenging this leads to believe Wolff has gotten some sort of tacit assurance from MLB that San Jose will be opened up. If not, then why waste $$ on this? It does not make any sense otherwise if the A’s had any doubt San Jose would not be an option.
My other theory is as ML pointed out above the A’s are trying to expose the Giants to MLB in the sense they were behind the lawsuit and funded it. It would make the Giants look awfully bad to a lot of people not just MLB.
In either case, the A’s are proceeding because they feel San Jose will be opened up. Otherwise Wolff would have lost his shit and called for a vote himself or had San Jose sue MLB. Any other owner in his situation would have done it already.
Wolff knows more than we all think, he is playing coy because he knows he will win. No other explanation, any other man would not have this much patience.
Is the Giants suing another team even via proxy allowed? Legally, I’m guessing yes, but I’m wondering if the Commish has any authority to act in the spirit of that rule here. I’m also wondering if this were to go through what, if any, impact two teams in a lawsuit in direct violation of their stated constitution would have on the AT. I can’t imagine it would have any real direct action, per se, but it can’t look good to have that happen which having it called out in court as opposed to basic public acknowledgement, might be helpful.
SJ can dump the little g’s if needed. Fairfield g’s sound good to me.
Actually, I sort of hope the A-ball Giants move to Oakland after the A’s move to San Jose.
.
The A’s are fighting the writ proceeding in state court for the same reason every defendant fights — because they’ve been sued (indirectly, as the money behind the A’s Investment Investment Group, which is the real party in interest for the actually named respondents). Of course, the A’s are spending money on the case. Otherwise, the option could get scuttled and the land deals necessary for the ballpark could be delayed.
.
Again, keep this little writ proceeding in perspective. There’s nothing mysterious about it; if the petitioners turn out to lack standing, it’ll go away. But even if they won, they would only win delay.
@xootsuit – I think the most interesting thing about this is how it’s proceeding. The A’s are paying to have Perkins Coie do the heavy lifting in this case. If ATE were to be challenged the A’s will probably do the same for City using Skadden instead, right?
@ML: I think the A’s have retained a couple of firms. Skadden’s A/T litigation prowess isn’t any more fearsome than many others–including some based in SF or LA. One thing to consider: the A/T bar is fairly deeply divided between plaintiff and defense practices. Corporations who get sued as defendants in A/T suits do not like to see plaintiffs in other, unrelated lawsuits, breaking new ground generally for plaintiffs in the area. They don’t like to see their own lawyers breaking that new ground. As a result, a lot of big firms decline particular types of cases, to avoid offending their largest clients. At this point, it’s not clear how the A/T issues will arise (if at all) between the A’s and Giants. Maybe the A/T exemption is so unique that litigation over it will pose no real threat to the people in the CEO chairs. Perhaps many big firms will be willing to take on whatever litigation comes along. Hard to predict, right now. imo.
@Jeff — Good questions. I could be wrong, but I’m not aware of Justice Blackmun later indicating that he would have changed his vote in Toolson to go with the dissenters. If you could show me what you are referring to, I’d appreciate it. I know that Justice William Douglas stated in his dissent in Flood that he would have changed his majority vote in Toolson to go with the dissenters. Perhaps that is the Justice you are referring to?
To answer your question, dissenting opinions, such as Justice Douglas’s in Flood, are commonly cited when arguments are made to overturn established case precedent. That would certainly be the case in any a future challenge to the MLB antitrust exemption. In fact, I would expect Justice Douglas’s statements would be cited in any challenger’s brief to the Court.
As for your question regarding San Jose’s ability or involvement in a future challenge to the exemption, I am not aware of anything that would prevent a municipality from being able to bring an antitrust lawsuit in this situation. San Jose would have to establish standing like any other plaintiff. San Jose’s arguments establishing its standing to sue MLB and/or the Giants would probably be different than that of a private business entity bringing the lawsuit. That’s the only difference I can see, but I’m sure an antitrust expert could point out a few others.
I’ve discussed San Jose’s antitrust standing and antitrust injury problems at length here. I don’t think San Jose will have standing, or have suffered antitrust injury. Both A/T standing the A/T injury requirement reduce the number of potential plaintiffs in such cases. (Cities, etc., were able to sue Microsoft in Calif. state court in the 90s in large part because they purchased MS products.) I’m certainly willing to listen to any contrary ideas.
@xootsuit — You raise several fair points. I think the strength of the A’s “anticompetitive/improper motive” argument will depend upon whether the evidence establishes that the SF Giants are really behind this EIR lawsuit. You’re right, S4SJ itself has no apparent anticompetitive motive with respect to the A’s or San Jose. However, proving that S4SJ is a proxy for the Giants would expose the anticompetitive motive, which is likely one reason why S4SJ has stonewalled this discovery and why I think the Court should allow discovery in this area. I agree with you though, the Court will likely permit at least some limited form of discovery.
Also, I’m not convinced that the Giants are not already in violation of the MLB Constitution assuming that it can be establish that they are really behind this lawsuit. The language in the MLB Constitution at Article VI, Section 2 is broad in that it prohibits teams from engaging in “any form of litigation” between themselves. Arguably that includes proxy lawsuits by teams that are aimed at the interests of other teams. If proxy lawsuits are not prohibited then nothing is stoping the A’s from pursuing their own proxy lawsuit against the Giants or against Oakland.
@Mike: I think it was publicized back in late 2011, when S4SJ filed its lawsuit, that the SJ Giants were funding the group. Two years earlier, the SF Giants quietly had purchased a controlling interest in the SJ Giants. The Pillsbury firm representing S4SJ in the lawsuit is the outside firm SF Giants have used for a very long time. (Pillsbury filed the dec relief action back in 92 or so that helped establish the new owners’ right to keep the team in SF. Pillsbury was deeply involved in the legal side of planning and building the new SF park at China Basin, etc., etc., etc.) I think it has been apparent from the start that the SF Giants are behind the SJ Giants support of S4SJ. Minor league business operations don’t fall directly under the purview of the mlb constitution. The constitution concerns only mlb entities. SF Giants have pulled off a pretty clever, if not admirable, trick.
.
“Article VI, Sec. 2. The Major League Clubs recognize that it is in the best interests of Baseball . . . that the Clubs not otherwise engage in any form of litigation between or among themselves or with any Major League Baseball entity, but resolve their differences pursuant to the provisions of this Constitution.”
holy crap that’s a lot of lawyer talk going on in those last few comments. I can only say, I hope the need for lawyerly opinions is coming to an end soon (not that i don’t think y’all are awesome for knowing this stuff).
@Jeffrey — I totally agree. I hope the discussion moves on to the engineers. Unfortunately, this is the current direction this situation is heading.
“the A/T injury requirement reduce the number of potential plaintiffs in such cases”
.
The fact that the A/T injury requirement was intended to reduce the number of potential plaintiffs in such cases does not mean San Jose will not be able to meet it. Antitrust injury arose in the context of companies abusing the antitrust laws by bringing lawsuits against competitors for anticompetitive purposes. San Jose may or may not be considered a traditional plaintiff, but it certainly doesn’t fall into the category of plaintiff antitrust injury was intended to forestall.
.
In any event, as I have pointed out previously, San Jose doesn’t necessarily have to bring a direct A/T claim to meet its goals. A tortious interference claim is likely to bring A/T issues into play anyway, and if it doesn’t, so what. San Jose’s objective is not treble damages, it’s a court order paving the way for the project.
…Didn’t Jean Quan say the Giants told her they could tie up an A’s move to San Jose for 10 years? Well, here we are. (And of course, we now know while the Giants were supposedly working with her to keep the A’s in Oakland, they were working to get the Warriors out of Oakland. With friends like that…)
It was so much easier being a baseball fan when I was a kid. Batting average, HRs and RBIs pretty much got you through any conversation for years. Then we all had to go learn a bunch of advanced stats to know what was going on. Now I need a law degree and several years in antitrust litigation to root for my favorite team. Sigh…
@xootsuit — As you know, the fact that the Pillsbury firm is involved is not evidence establishing that the SF Giants are really the controlling party behind this EIR lawsuit. You are speculating; it’s reasonable speculation, but nonetheless speculation and not evidence.
Deposition testimony from one of the named plaintiffs or other discovery could establish evidence, or lead to evidence, showing that the SF Giants are calling the shots here. This is something we all suspect, but until there is evidence establishing it to be true, it is merely speculation.
You and I disagree regarding the impact establishing the SF Giants controlling involvement would have on this case and outside of this case. What you consider a clever and admirable trick by the SF Giants, I consider dangerous to baseball due to the precedent its sets for potential future proxy lawsuits between MLB teams.
Disclaimer: suit doesn’t want the A’s in San Jose. Despite his supposed “legalese”, he’s pro-Giants and TRights. Hence him kissing up to the “cleverness” of the Giants. In the end, none of this will matter: MLB constitution and best interest of baseball…aloha.
I wrote “if not admirable,” I think. If not, I intended to. The provisions of the mlb constitution couldn’t be more clearly limited. On the other hand, the commissioner’s discretion to act in the best interests of baseball is broad.
.
As to the difficulties of bringiing an A/T lawsuit–I was explicating. I see no A/T injury for the City of San Jose. No one has been able to project one. Is San Jose participating in a market? How will it’s ability to compete in that fanciful market be harmed if the A’s do not move to town? Offer up some answers. (And we haven’t even looked at the long list of factors in the Associated Gen. Contractors standing test. . . . .)
.
Enough.
Reclaimer: tony d doesn’t have a clue what my views are.
Pro-Giants lawyer asks: “Is San Jose participating in a market?”
.
This is an odd question for a lawyer to ask. The Supreme Court has ruled that people who grow pot for their own use are participating in a market, so the legal definition of markets and commerce is obviously much broader than the common-sense definition. I’ve noticed that some lawyers will flip between legal and common-sense definitions of terms in order to deceive.
.
On a related note, anyone who thinks the Frisco Giants have are “cleverly” using a loophole in the MLB constitution to frustrate the A’s desire to field a competitive team is deceiving himself. The constitution doesn’t say MLB teams are free to sue each other as long as they use subsidiary corporations and astroturf front groups to file the papers. The veil is so thin it hardly needs to be pierced. Their tactic isn’t clever, it’s ham-handed and pathetic.
I’ve developed respect for this blog. I responded genuinely to a genuine request from ML. google the terms “antitrust injury” and see how it relates to “markets,” defined for A/T purposes. Then thank your luck that mossback doesn’t post here very often.
Thank you Mossback! Here’s a Mai Tai for yah!!
Now there’s two of a kind.
That will be an interesting moment in the court when “Stand for San Jose” explains how it funded its bogust lawsuit. “Stand for San Jose” – more proof the the giants owners are a sleezy, underhanded organization. Go A’s (and go Dodgers – beat that fraud giants team)
If this discovery process is allowed to go forward, MLB will have all the evidence it needs to establish that the Gnats have violated the MLB constitution by suing the A’s. With that fact established, it becomes very easy for the Commissioner to transfer ownership of the Gnats to a group more willing to play by the principles of fair pay and decency that are expected in MLB. No rogue ownership groups with way too many clever lawyers need apply.
xootsuit and all his legalize sound impressive. The fact is that if the A’s need to go to court the defeat the MLB ATE and/or any giants ownership lawsuits – the A’s likely will prevail.
Yes, we need to know where these “plaintiffs” are coming up with the thousands of dollars in legal fees to carry out this lawsuit. Wonder who the deep pockets is? The San Jose plaintiff didn’t even know she was one.
Right after S4SJ filed the lawsuit, stories like this appeared, based on a press release that fully disclosed the funding source (and the fact that the SF Giants outside law firm had filed the case):
.
http://www.huffingtonpost.com/2011/12/03/stand-for-san-jose-sues-city_n_1127229.html
.
From this article: “Stand for San Jose, a group of concerned residents financially backed by the Giants’ Class-A San Jose club, is represented by San Francisco attorney Ronald Van Buskirk. Another portion of the lawsuit deals with complicated redevelopment issues and laws.”
.
Personally, I’m more interested in seeing the details of Mitt’s tax filings for the past decade than I am in seeing discovery responses confirm the obvious in the S4SJ writ proceeding.
Oh, another well-known fact I should have noted: The SF Giants bought a controlling interest in the SJ Giants in late 2009, after it became clear that Wolff intended to try to move to SJ. So everyone knows the SF Giants have been funding the law suit.
Mike,
Of course you are correct as evidenced by my butchery of Blackmum’s name. To answer your question, I read a book some time back entitled, “A Well Paid Slave” documenting Flood’s legal battle with Kuhn. The author (Brad Snyder) provided extensive research into the reasoning of the Justices behind their decisions. I believe it was Douglas who was a sitting Justice when Toolson was argued before the Court. He later stated he regretted his vote to uphold Toolson and would have voted to reverse MLB’s ATE. I will try and dig up the book and quote some of the references. Xoot stated that SJ would have to prove standing to prove they are harmed by the ATE. But doesn’t the fact that they are the only sizable city prohibited by MLB from ever being granted the right to a franchise provide the required standing? Hell, they aren’t even allowed to “play” in the market by MLB’s arbitrary and capricious application of their ATE. Certainly there are valid economic arguements that can be made for being a “major league” city? I’d welcome Xoot’s POV on this also!
xootsuit: I was going to respond with something about wanting to see Obama’s college transcripts, but this is not the place for references to partisan national politics. I think the city of San Jose should slap a surcharge on SJ Giants tickets to pay for whatever this lawsuit is costing the city. I stopped going to SJ Giants games once it became known they were actively fighting San Jose’s efforts to acquire Major League Baseball. How much money are the SJ Giants (and their partners, the Frisco Giants) keeping out of San Jose’s economy by keeping the ballpark from being built?
How many conventions are the Giants keeping out of San Jose, how many vacationers, how many employers, how much in tax revenues is San Jose losing, etc, etc, etc. It’s easy for the city to show that the Giants have caused them economic harm. The Giants themselves proved that San Jose is a viable location for MLB when they went to the voters for stadium welfare in the 90s, so it’s all done but the verdict.
Sorry if the topical reference offended. I could have taken a different tack, I suppose, and written that the funding source behind the lawsuit is as obvious as Joe Biden’s hair plugs.
.
You identify the issue from another angle. San Jose is not “competing,” in the A/T sense, with other cities. Yet by refusing to allow a team that wants to move to SJ to move there, mlb surely is preventing that city from reaping whatever benefit the franchise and the new ballpark would bring. How do you quantify that benefit? The injury is speculative. Not every sports success generates simple profit. The Olympics may be a good example. See http://www.guardian.co.uk/commentisfree/2012/aug/02/rio-2016-santa-claus-olympic-profit When you have only speculative or theoretical injury to complain about, you generally don’t have a lawsuit–in A/T or otherwise.
.
Maybe the A’s should sue the SJ Giants for conspiring with mlb to divide territory in an anticompetitive way and for filing a sham lawsuit to further the conspiracy? Naw. Don’t try to sell that one.
Xoot, not sure the Olympics isn’t an apt comparison. For one, it’s a one time deal instead of a consistent venue used for decades. For another, the city isn’t actually paying for it so it would be easier to show a quantifiable (though possibly still legally speculative) loss. It wouldn’t be an easy case to make, but I suspect very much that they’d see their day in court and get to try their case. That alone would be enough given MLB’s strong desire not to lose their AT. If they get into court, MLB will want to settle.
If I remember correctly, BS and MLB want the lawsuit out of the way first. This stooopid thing has been going on for so long, it is hard to keep track of it.
Yes, Bud Selig wants the lawsuit out of the way but won’t do anything about the Giants, who have every incentive to keep this lawsuit going and going. He’s still under the illusion that lodge members will all put the best interests of baseball ahead of their own self interests.
Suits attempts at pro-Giants legalese aside: one thing that gets lost in this discussion is the challenge to the EIR and land deal itself. The frivolous challenge to the EIR is just that because SJ was thorough in its study of traffic, noise, etc. Again, an EIR for a 45k ballpark and revised one for 36k. Where is Stand for SF’s proof that the EIR’s were inadequate? (Cue sound of crickets) As for the land deals and supposed “discounts,” not a violation of municipal code! Read it and weep. Stand for SF may personally think that such action should be put to a vote, but oh well.
On another note, the real news of the past several months is buried in the Merc article: the continued silence of the Giants/A’s on this matter by order of brother Bud. Add in the callback to SJ from MLB week (Oakland callback anyone?) and we may soon have real news…aloha!
dmoas, there was a spate of books published back in the 90s that purported to debunk the real value of sports franchises to the cities where they played. The authors all had access to the huge number of impact studies that recently had been done on the subject. If nothing else, the analyses definitely called into question the alleged benefits of publicly financing a new stadium or ballpark. Some of the economists came up with interesting stats — I remember conclusions such as (a) essentially the same 250,000 people account for the vast majority of the 2-3 million who attend the baseball games of a popular team in one season, and (b) most of them live nearby, and (c) if they didn’t have sports to spend their leisure money on they’d spend it on something else that would benefit the local economy. I also remember at least one of those books looking at the Olympics for evidence, because the event is easier to evaluate than long-term team impacts. But there were commonalities.
.
I have the feeling some of the others who post here regularly know a lot about these issues.
“San Jose is not “competing,” in the A/T sense, with other cities.”
.
Being a competitor is not a requirement to establish antitrust injury. In fact, it very likely makes the task more difficult.
.
“How do you quantify that benefit? The injury is speculative.”
.
The injury is certainly not speculative. Clearly a $500 million construction project is beneficial to a city. Clearly hosting an MLB team has marketing benefits. Clearly there is ongoing economic impact to a city (though be could debate how much). Then there are the intangibles.
.
That there is injury is undeniable. There may be challenges to assigning a specific value to it, but this is true of many damages calculations. If this were an insurmountable hurdle, tortious interference with contract and/or prospective economic advantage would not be causes of action. And uncertainty of calculating damages is far more likely to be an issue during an eventual damages phase than a prefatory standing determination.
.
There is lots of data SJ could use to quantify its injury. One is simply the amount of public money other cities have invested in baseball stadia. If the average over the last twenty years were $300 million in 2012 dollars and SJ’s proposed investment were $25 million, SJ has arguably been damaged in the amount of $275 million (not even counting other possible elements of damages). Again, this is a routine type of calculation in a tortious interference claim.
Ballparks and other sports venues are frequent anchors of redevelopment projects in California and elsewhere because the stimulus they provide to local economies and the ripple effects they set off in revitalization. Look at the effects that Phone Booth Park is producing for the nice people of Frisco in terms of housing, entertainment, and other employment-related activities. It’s not necessary to have a precise figure in advance, that’s what expert witness economists are for.
When the Raiders and Los Angeles Coliseum sued the NFL in Anti-trust court in the 1980s to relocate the franchise there they won hands down. Why?
The jury ruled by “Rule of Reason” the Raiders should be allowed to relocate to LA despite every owner in the NFL voting against the move.
What is Rule of Reason? In this case the jury ruled that the NFL has the right to geographically disperse its teams the way it sees fit but it must be done against a “Rule of Reason” for any franchise wishing to relocate.
In this case it meant if the Raiders could make more money, get more fans, and broaden their image by moving to LA then that had to be weighed logically and reasonably versus the wishes of the NFL or the other owners. They also ruled the LA Coliseum Authority was a victim of anti-competitive behavior as a result.
In this case, the jury felt it would help the Raiders business to relocate to a much larger market to share with the Rams instead of staying in Oakland and sharing a smaller market with the 49ers. This plus the LA Coliseum being held hostage by the NFL.
The NFL was trying to play by its own rules and was defeated soundly.
Now in the case of the A’s to San Jose. MLB has T-rights and it is still debatable on if the ATE even extends that far.
Even so, the “Rule of Reason” comes into play here. If the A’s can make more money, get more fans, and improve their image then that has to be weighed logically and reasonably against what Bud Selig thinks is right or wrong, a owner vote, or what the Giants think to be theirs.
The LA Coliseum Authority sued the NFL and Al Davis sued separately. In this case San Jose could sue themselves without the A’s and it would still work because of the fact they are not making the revenue they should be making and not creating jobs because of what is simply put “anti-competitive” behavior.
That argument still holds true, it would come up in any ATE lawsuit against MLB regarding the A’s moving to San Jose. I agree it gets messy but San Jose’s case is better than most would think
Pingback: In Dispute Over Territorial Rights, A's Claim 'Astroturfing' | KQED News Fix
great quote: The group’s own website, in addition to including stock photography of a happy young family apparently rejoicing in their city’s lack of a major league ballpark…
xoot, I’ve heard of those studies. But all of those studies assume the city/state/etc. pay a ton of money to build the stadium. The reason they make no money (and/or lose money) is because of the loans they take out to build. Having an essentially “free” one dropped in your lap is a completely different story altogether and removes those costs that kill the profitability margins. SJ will make money off this deal even if they sell the land for below market value and do a little street work (which needs to be done anyway) in order to make it happen. The only questionable thing is just how much money they will make.
The A’s move to SJ will contribute an additional $136 mil. annually to San Jose’s economy, building the ballpark will provide an extra a $450-$500 mil. annual boost, besides the $136 mil. Also Sid is correct, the courts would likely use NFL rulings as precedent in an A’s lawsuit against the ATE.
This is getting tedious again. I was looking at the problem from an angle different than the antitrust injury pov (which is not a “standing” issue, btw; that’s separate in A/T cases under Associated Gen. Contractors, et al.). In any event, harm to competition is the key to antitrust injury. I suppose you could look at it this way: If cities did compete in a market for pro-sports franchises, the leagues’ restrictions on relocating, etc., would injure that competition. It’s pure phantasm, however. There is no such market.
.
“That there is injury is undeniable.” How is a city injured by something that might happen not happening? Does San Jose have an agreement with the A’s to move the franchise to town? What is the specific nature of the existing business relationship between San Jose and the A’s? Without that, you have no state-law tortious interference claim.
.
Finally, the damages calculations you outlline make no sense. The routine tortious interference damage calculation typically concerns what the defendant earned in profit after tortiously taking the business deal away from the plaintiff. I was negotiating with Co. X for a 5 year contract to provide services for $1M per year, but the defendant lied to Co. X about the capacity of my firm and tortiously wrested the client away. Damage calculations start at $5M (then pare down toward actually provable expected profits for the 5 years). Your calculations are ephemeral and speculative by comparison.
re: The A’s move will contribute $136 million annually to San Jose’s economy.
…Yet there are folks ready to do battle over the paltry contribution of discounted land that San Jose would make to the project.
Stand for San Jose’s “in the news” section hasn’t been updated since December 2011. Curious.
Sid: There a generally two types of A/T cases — per se violations of the Sherman Act, and Rule of Reason cases. Territorial division is typically a per se violation. Prove the conspiracy (really, just an agreement) among horizontal competitors (head to head, like sports franchises) and you prove an A/T violation. In professional sports markets, however, the leagues without the benefit of an A/T exemption like mlb’s usually argue that intelligently limiting franchises’ rights to move actually has pro-competitive effect, oveall. Obviously, that’s often true. Often such circumstances convince a court to apply the Rule of Reason analysis rather than the per se hammer.
.
In the Raiders’ cases, the NFL convinced the court to use Rule of Reason analysis. Nonetheless, Alioto et al. were able to prove that the NFL was violating the Sherman Act. If the NFL had an A/T exemption, the NFL would’ve tried to use it to dispose of the case without letting it go to the jury.
.
The L.A. Coliseum’s case first got tossed for lack of standing, but the judge allowed an amended complaint. The NFL was preventing the Coliseum Comission from negotiating with any NFL team to move to L.A. The Coliseum competed commercially with other venues. As I said in an earlier post, I do not believe San Jose has put itself in such a position with the A’s. The San Jose expectation, especially with no ballpark in existence, is a mere velleity.
This could get messy. I told you this thing could drag out in the courts, ML. Granted, there may not be a trial on this if S4SJ has no standing, but the intention is clear: legal posturing has already begun. And if it’s not S4SJ suing San Jose, it’ll be LW suing MLB or somebody suing somebody else. LW, Baer and SJ have been stacking up lawyers for the past, oh…3 years. If you think there will be a peaceful, rapid outcome of this situation then guess again.
At the end of the day, what will LW have gained by moving to San Jose? By the end of this travesty, baseball in Oakland will be essentially anhialated and three of the Bay Area’s most influential cities will be bitter opponents. Not lost in all of this is the utterly contentious nature of what should be a pleasant pasttime.
It is long past time for LW to either pull the trigger and start suing people, or drop it and make up with Oakland. Unfortunately, I don’t think LW will even entertain the idea of staying in Oakland (he’s only said it about 1,000 times) so it looks like he’s going to have to sue the Giants and/or MLB. At that point, nobody wins.
I sincerely doubt the Giants are ever going to give up San Jose. Instead of digging in, LW should realize that this isn’t a lost situation. LW, take the path of least resistance and start marketing to Oakland. We’ll take you back, LW. I, personally, will stand in front of the first live news camera I see and broadcast to the entire world that Oakland is ready to kiss and make up. No more trash talking. No more insulting quotes and sound bites. Enough is enough.
This appears to be a slam dunk case. The SJ giants are majority owned by the SF Giants, this doesn’t take much effort to connect the dots.
Also Lakeshore Oak, you could be guilty of wishful thinking. The ATE is on shaky legal ground, the Giants owners group would be very uncomfortable taking their argument in court and expecting to win. The A’s should eventually beat the ATE in court if it comes to that. Recall that the Tampa Bay owners group pierced the ATE twice ( and were quickly awarded the Rays franchise by Selig) The A’s case appears to be much stronger than the Tampa Bay owners group was. Also, the A’s SJ move is Selig’s decision only – not in the giants owners group’s..
@LakeshoreOAK – “Giants are ever going to give up San Jose”
.
No, they won’t, but that won’t stop MLB from taking it away from them. Best interest of baseball, and all.
The Tampa owners group weren’t owners when they sued. They weren’t bound by the arbitration clause in the mlb constitution. If Wolff/Fisher decide to sue mlb, they’ll have to attack the territorial-rights part of the constitution, and, at least for purposes of the lawsuit, the mandatory arbitration clause, too. Wolff/Fisher in effect would be declaring war on all of the other owners. What’re the chances of that happening?
To bad this thing will never get to lawsuits by the A’s against MLB (where in the hell did that come from?). Poor suit will never see his Giants unleash their mighty legal prowess against the A’s and San Jose. Why? BECAUSE A DEAL WILL BE MADE WAY BEFORE ALL THIS NONSENSE OF LAWSUITS AND ATE CHALLENGES! There’s also this little thing called the MLB Constitution that prohibits legal action between the teams. Again, I suggest all who are new here or getting caught up in the rampant legalese to research the Expos to DC saga to see how this should (or will) all play out…no lawsuits necessary 😉
The giants mgt. knows they have a losing hand – all their rhetoric (which is similiar to xootsuit’s) won’t help them. Perhaps their motive is that they believe they have nothing to lose by opposing the A’s move to SJ, and believe they could obtain a sweeter compensation deal from the A’s by being difficult.
The Tampa Bay owners group did in effect declare war on all the MLB owners by opposing the giants sale to the McGowan group (which the MLB owners approved). Also, the judges’ rulings in both of the ATE piercings stated that the ATE can only applied to baseball matters – not business matters, and that MLB franchise relocation is a business matter.
@duffer,
Love your thinking, but just to be fair, the Giants rhetoric has toned down big time since June. We now have Baer and Slaughter silent on the issue by the order of Selig; Baer himself is now on record as stating this issue is a matter for the commissioner and committee to decide. IMHO, their silence speaks volumes and suggests the status quos days are numbered.
Tony D – . Selig has no incentive to make a ruling – knowing the resulting lawsuits by either the A’s or giants (which Selig obviously fears) would come afterwards. Selig may stall and pass the buck to the next commissioner. The giants owners are no rush for a decision. Also, since the A’s are profitable with the MLB revenue sharing, and the A’s value has more than doubled since Wolff bought the team, the A’s are not in a desperate situation either. The giants owners silence doesn’t mean Selig will be making a decision soon or that Selig will rule in favor of them, they are likely only following Selig’s order.
Wolff won’t have to sue because the SVLG could sue. They’d fund it themselves, and probably be pretty organized. It’d have standing, at least as a suit.
We’ve been over this many times. The courts that have considered the A/T exemption in the past couple of decades are all over the map. Some have found it broadly applicable, others narrowly. It’s not that hard to be accurate. The fact is this: no one can predict how a court will rule on it here, so there’s risk.
.
Also, Selig can’t make a decision about relocation on his own. 3/4 of the owners have to approve any relocation and any change in territorial rights.
.
When Haas, near the end of his life, decided to sell the A’s, he was adamant that the buyer had to agree to keep the team in Oakland. Haas himself had bought the team to keep Charlie Finley from moving the team. (If you’re not familiar with the facts, take a look at this, beginning at about page 188: http://www.archive.org/stream/levistraussco00haasrich/levistraussco00haasrich_djvu.txt )
.
When Wolff/Fisher bought the team, they understood that TRs to San Jose were not part of the deal. They just decided to ignore the rules they accepted, and they decided to screw Oakland in the process. They may pull it all off. If so, ok. (I’m interested in what’s happening, but, except for the possible impact on Oakland, I don’t care much either way.) But trying to blame the Giants alone for the current stalemate is the product of either a very dim brain or one blinded by fanatic zeal.
If you want to go over what Haas said, I think you could argue that the spirit of what he meant was that he didn’t want them leaving the area. At the time, there wasn’t really any other place in the Bay Area that they could have moved to, so out of the area they would have gone.
.
TBH, I never thought of the team as belonging to Oakland. They are my team. And I’ve lived in North, South and East Bay cities.
Xootsuit – Selig is the MLB czar – once he makes a decision, the MLB owners rubberstamp it. Selig won’t approve the A’s move unless he gets the 3/4 vote from the owners.
Also the giants ownership are making the situation ridickulous. This definitely must be truly a first in professional sports – where in a two team fanbase situation, one team opposes the other team further away – and also claim that the other team is intruding into their territory by doing so? – very bizzare.
@Lonestranger – don’t you think Selig would have done that by now – overrule the Giants and give SJ to the A’s? Yeah, I suppose it could still happen but I’m thinking Selig won’t do that. And the Giants aren’t going to do it either, so….
Lakeshore, short answer, no. The long answer is when Selig says the situation is complicated, he’s absolutely correct. Before he can even contemplate putting T-Rights up to a vote he has to be absolutely certain SJ will goes off without a hitch without doing harm to either team. And before he can give a “No” to SJ, he has to be absolutely certain that he’s covered his ass legally and that he can resolve the A’s situation once and for all. And both circumstances have a number of unique variables to navigate through with serious question marks. When you sit down and honestly think about it from all sides, it really shouldn’t surprise anyone that it’s taken over 3 years to set up all the dominoes necessary to make a decision one way or another. Nor should it be surprising if it takes another year or two before we know anything concrete.
Isn’t it interesting how xootsuit’s claims and alleged facts are precisely the same as the giants claims and alleged facts? That’s some eery coincidence considering how many are dead wrong according to the factual facts.
@dmoas – pretty much anybody who is reasonably fit to stand trial has agreed that this process has taken an surprisingly great amount of time. Ask LW. I think he’s been anxious for a decision for a little while now. I’m pretty sure he’d be surprised if it took another year or two before we knew anything concrete.
What dmoas said, exactly.
.
When this whole thing started a few years ago, the number of dominoes that needed to be set up was small and it shouldn’t have taken long before they could be knocked down and the shovel put in the ground in San Jose. When Oakland decided to get back into the game, all of a sudden more ass covering needed to be done, and the number of required dominoes multiplied.
Lake, anyone who’s partisan (myself included) thinks this thing has gone on surprisingly long. Three years ago, I didn’t think it was possible for it to go on this long. A big part of that was the thinking that it was just a rubber stamp process. Another big part of that was there was just so much to discuss and it seemed reasonable from our various perspectives that it should be a simple matter to decide. I’m sure Wolff and Baer both thought that too, from their own perspectives.
.
But remove bias and partisanship from the equation and sit down and see what’s necessary for the best interest of the game and all those involved within MLB and it’s nowhere near as simple. It leans somewhat heavily towards SJ. If it didn’t, odds are it would have been nixed already. However (and it’s a very big however), it only leans that way under very specific circumstances. It can’t hurt the Giants (which despite some folks belief isn’t a simple determination). It can’t hurt other teams either (which is simpler, but not necessarily straightforward). And it can’t open itself up to unexpected and/or unprepared litigation (both reasonable and unreasonable) from any of a number of parties.
.
Whether SJ is approved or not, no one, not even Selig himself possibly, can likely tell you at this point and I wouldn’t take any action or decision to mean too much until an official press release.
@dmoas – I’m actually impressed that you could make something that Bud Selig and a bunch of legal dudes haven’t figured out in three years seem so simple. Silly me. The answer is obvious: SJ is in the best interest of baseball.
SJ is a great market for baseball. At the very least there is plenty of disposable income in SJ, which is always going to be attractive to a real estate investor..er, I mean dedicated MLB ownership group. Maybe the A’s can’t move to SJ because SJ is, in fact, in the best interest of baseball. Only problem for the A’s is: the Giants figured that out a few years ago and are already there. The Silicon Valley marketing efforts they’ve been up to for years are now paying off. Do you honestly think they’re going let the A’s move right into the middle of that market without a pretty good fight? The A’s want SJ for the same reasons the Giants don’t want to let them move there.
Lakeshore OAK – You are buying into the giants b.s., “their army of lawyers” etc., and their false preception as being powerful. The giants do not have the power to prevent the A’s from moving to SJ – they need Selig to refuse the A’s move, otherwise the giants goal will not be possible.
It is not the giants right to fight for the so-called San Jose territory, they have no claim to it, their claim to it is anti-competitive, and even the ATE may not help them. The San Jose mayor Reed also said that what the giants are attempting is very anti-competitive. Despite their “army of lawyers ” (can they really afford that anyhow ? – they are on a limited budget) The giants do not have the leverage you believe they do. The A’s may actually be in a better financial position, and better able to fight legal battles than the giants can. The fact is that the MLB ATE is not very solid, can be be beaten (as mentioned before, the Tampa Bay owners group has done it previously) and the A’s have a good chance of defeating it if they have to. What the giants are attempting and what actually may occur are two different scenarios.
Lake, that’s the sort of bias I was talking about. The A’s moving to SJ *will* have an impact on the Giants, no doubt. If it didn’t, it wouldn’t matter and the A’s would already be there now. One of the (and not the only) reasons holding SJ back is trying to answer the question of just how much of an impact it will have on the Giants. Forget about all the marketing BS, that doesn’t matter that much. They’d still be able to market to them and already have a foot in the door wrt that anyway. Also forget about the Giants’ fighting it. With the MLB constitution, if the other owners approve the shift, the Giants have no legal action they can really take (and *if* it came down to that I don’t think they’d take it any further than a lot of public whining). But you are right in that they’re not going to sit down for it. Hell, they’ve been fighting it for years now and continue to do so. Whether or not SJ is actually in the best interest of MLB is the debatable question and (I’m over simplifying here) the answer lies rather heavily in just how much of an impact it will have on the Giants. There are a lot of variables at play here including whether or not there are viable alternative markets to work with (including Oakland) and/or whether an inferior market *with* keeping the status quo will be a net positive to SJ or a net negative. All of that hinges on the true value of what the Giants actually lose with a move and the scale slides with the various variables in play. Hence: it’s complicated.
@suit,
We’ve been over this many times…
Only one reason why the Giants have “rights” to SJ.
San Jose shouldn’t be banned from obtaining MLB/A’s just because the Giants didn’t exercise those rights in 1992.
Lew Wolff should be commended for trying to get San Jose a MLB franchise, not chastised.
lastly, for the umpteenth time, THE MLB CONSTITUTION PROHIBITS LAWSUITS BETWEEN THE INDIVIDUAL FRANCHISES!! that’s not an opinion, its a fact! Why some continue to ignore this is beyond me.
Oh well, enough from me on this particular thread …
@Xoosuit- Just because the San Jose does not have a ballpark sitting there makes them any different than the LA Coliseum.
San Jose has an agreement to sell land to them via options and let them build on that site with the A’s. Like the LA Coliseum Authority MLB is not allowing San Jose to negotiate with other teams to bring a team to this site regardless if a ballpark sits there or not….that is relative to the argument of anti-competitive behavior and Rule of Reason.
T-rights however are still a big question mark and Tampa Bay proved that years ago and Selig tucked his head between his legs paid them 15M to shut up and awarded them an expansion franchise…..tells you something very distinct. The Curt Flood Act of 1998 still is vague on how far it extends as well in repealing the MLB ATE.
My next argument that LA did not have is the Media Market.
The A’s/Giants share media market wise the entire area. Baltimore-Washington do not as each city has its own nightly news. The fact the entire market is shared media wise helps San Jose’s argument. A team cannot relocate 35 miles away to another city in the same media market becaue of another competing business is 100% anti-competitive behavior….This is so obvious, the ATE would be on a tight rope with this argument.
San Jose people can watch A’s games no problem on TV. Yet they cannot have the team play in their city?
This shows clearly by “Rule of Reason” San Jose has been the victim of anti-competitive behavior in a worse fashion than the LA Coliseum was….The A’s already exist in the same media market. The Giants argument is so flawed from this perspective what lawyer would want to argue their case in any kind of court I ask? Kangaroo Court? LOL!
“This is getting tedious again.”
.
Dude, you’re the one who keeps bringing up “antitrust injury.” I think it’s a technical tangent to a sideshow issue, as I believe San Jose has alternate theories that would keep them in court but that the whole point is moot because they would ultimately lose anyway. OK with me if we talk about something else.
“I was looking at the problem from an angle different than the antitrust injury pov (which is not a “standing” issue, btw; that’s separate in A/T cases under Associated Gen. Contractors, et al.).”
.
It has been called a standing issue by some courts and not called a standing issue by other courts. I believe you yourself referred to it as a standing issue in an earlier thread. In any event, you’re really splitting hairs here. I doubt most readers of this blog care about whether it’s technically a standing issue anymore than they care about the technical difference between a writ and an injunction.
.
“In any event, harm to competition is the key to antitrust injury. I suppose you could look at it this way: If cities did compete in a market for pro-sports franchises, the leagues’ restrictions on relocating, etc., would injure that competition. It’s pure phantasm, however. There is no such market.”
.
Of course cities compete in a market for pro-sports franchises. Has it escaped your notice that San Jose and Oakland are in exactly such a competition right now, notwithstanding the fact that San Jose has to fight with one arm legally tied behind its back?
.
“That there is injury is undeniable.” How is a city injured by something that might happen not happening? Does San Jose have an agreement with the A’s to move the franchise to town? What is the specific nature of the existing business relationship between San Jose and the A’s? Without that, you have no state-law tortious interference claim.
.
As I understand, the A’s and San Jose have a contract for the Diridon land sale, which would be sufficient to support a tortious interference with contract claim. Regardless, a formal agreement is not a requirement to bring a tortious intereference with prospective economic advantage claim. The name of the tort pretty much says it all: It requires “…intentional and improper interference with another’s prospective contractual relation whether by inducing a third person not to enter the relation or preventing the other party from acquiring or continuing the relation.”
.
So to answer your question, yes, the law provides recourse for something that might happen not happening, in certain circumstances.
.
“Finally, the damages calculations you outlline make no sense. The routine tortious interference damage calculation typically concerns what the defendant earned in profit after tortiously taking the business deal away from the plaintiff. I was negotiating with Co. X for a 5 year contract to provide services for $1M per year, but the defendant lied to Co. X about the capacity of my firm and tortiously wrested the client away. Damage calculations start at $5M (then pare down toward actually provable expected profits for the 5 years). Your calculations are ephemeral and speculative by comparison.”
.
Don’t be absurd. The courts have several measures of damages they can employ, and discretion to choose the one which best fits the facts. The right to host an MLB team is extremely valuable, as evidenced by the fact that municipalities regularly spend hundreds of millions of scarce public dollars to do so. You can say there is actually an active market for this rights, with valuations supported by actual transactions involving real money. This type of valuation is actually far less “emphemeral and speculative” than any measure I can think of that the Giants might use to value their territorial rights in a theoretical lawsuit.
have a few more mai tais. You’ll find something else to repeat.
Pingback: Tussle Over Proposed A’s Ballpark in San Jose Heats Up | FanGraphs Baseball