Who is Joe Cotchett?

Let’s meet Joe Cotchett.

Cotchett, as lawyers are wont to do when filing high profile lawsuits, was full of bluster, using terms like “economic rape and pillage” and “moral outrage” in the first minute of his interview with NBC Bay Area‘s Raj Mathai. By the end of the interview, Cotchett dialed down his rhetoric a tad, admitting that the real goal of the lawsuit was to force a settlement, not a wholesale teardown of MLB’s antitrust exemption. Though if MLB remained recalcitrant, Cotchett would certainly relish the opportunity to tear down AE himself.

While making the media rounds earlier in the week, Cotchett was also on The Game with John Lund and Greg Papa. Apparently Papa wasn’t aware of Cotchett’s role as attorney for the NFL and the Rams when the then-Oakland Raiders forced a move to Los Angeles in 1981. Cotchett’s involvement in pro sports is quite long and varied, though most of it is with the NFL, not MLB.

  • 1981-82 – Cotchett represents NFL & Rams in Al Davis and LA Memorial Coliseum’s antitrust lawsuit against the league. After a mistrial, Davis wins, paving the way for the move.
  • 1994 – Billy Sullivan, who had recently sold the Patriots to Victor Kiam, sues the NFL for not approving a public offering deal that would’ve provided Sullivan with more operating cash. The lawsuit is settled for just over $11 million. Cotchett represented the NFL.
  • 1995 – Cotchett attempts to put together a group to keep Rams in LA. Instead, team owner Georgia Frontiere takes $300 million deal to move Rams to St. Louis.
  • 2004 – This time representing the Raiders, Cotchett successfully defends Davis against a lawsuit by Raiders minority partners attempting to remove Davis as managing partner. Cotchett and the Raiders win using argument that minority partners have no standing.

As you can see, Cotchett has plenty of experience on both sides of the franchise move and antitrust issues, winning and losing some while settling others. While antitrust is Cotchett’s game, he was also successful going up against Charles Keating in the Lincoln Savings & Loan scandal and Bernie Madoff. The State Bar of California named Cotchett their Antitrust Lawyer of the Year in 2011. He’s also made a habit of taking numerous cases on either a pro bono or contingency basis, with attorneys fees to be paid by the losing defendants (as has indicated for the San Jose-vs.-MLB case).

MLB is a different ball of wax, as shown by its still preserved antitrust exemption. Cotchett will argue that MLB is no different from the NFL or any other pro sports league and is subject to the same commerce laws and regulations as the others. Chances are that he won’t get to make that argument given what San Jose and baseball are looking for, but you never know what can happen if/when a trial starts. One thing that can be universally said about the new lawsuit: It’s anything but frivolous.

Dust settles after the big lawsuit filing

I’ve spent much of the last week in transit, as my job requires a lot of travel all over the country. Some of the pictures and posts you’ve seen since the beginning of the season have been a byproduct of little side jaunts taken at the end of business trips or cashed in frequent flyer miles. It’s allowed me to visit a lot of the parks I’ve wanted to see fairly cheaply, though the downside is that it has severely reduced my attendance at A’s home games.

Another byproduct of near-constant travel is that I can’t get into a good writing rhythm. I’m already a rather deliberate writer, and I’m envious of the pros who can toss out 500 words constructed in cogent manner in only 15 minutes. Instead I’ve preferred to shift my writing to ever longer pieces, 1000-1500 words, eliminating many of the peripheral “busy” posts that I used to do.

Yet when the San Jose-vs.-MLB lawsuit was filed on Tuesday, I was left at a loss as to how I was going to cover it. While I get a lot of advice from lawyers and legal experts, I still went through the week uncomfortable about touching the legal issue with any real depth. I wasn’t sure I could do it justice (pun intended). Instead I sat back and read all of the great writing by many lawyers-turned/cum-baseball writers like Jason Wojciechowski, Wendy Thurm, and Craig Calcaterra. ESPN legal analyst Lester Munson covered the lawsuit in the broadest manner possible, but the effect of his piece was greater than most because of the wide audience. And we have plenty of lawyers who read and comment on this site. Judging from the last post, they’ve been waiting for this moment for a long time. I’m glad that they may have a chance to sink their teeth into something juicy like this. As for me, I’m glad that at long last the A’s plight is getting the attention it deserves (and San Jose to a lesser extent). (While I was in Phoenix on Thursday, the local ESPN affiliate did a wide-ranging interview with Tim Kurkjian, and the A’s/San Jose/Sewergate were one of the main topics!)

However, let’s be clear about what we should expect from this potential circus. While many can’t agree on what the outcome will be, let’s understand what’s really at stake.

1. San Jose isn’t really trying to overturn baseball’s antitrust exemption.

Attorney Joe Cotchett’s initial bluster aside, San Jose would be perfectly fine with territorial rights being modified, their basic structure left intact. That could mean sharing Santa Clara County or the Bay Area at large, or something in between. As long as they have the right to host the A’s, they’d be fine with territorial rights maintaining monopolies (or duopolies as the case may be) here and elsewhere.

2. San Jose didn’t decide to do this on a whim.

Mayor Chuck Reed told Lew Wolff last week that the City was planning to sue baseball. Councilman Sam Liccardo had been talking up the lawsuit threat since spring 2012. From what I hear Cotchett has been involved for nearly as long. What they’ve been doing during that time is strategizing the particulars. What they came up with is arguably weak from the standpoint of trying to overturn AE, but if the goal is shake up baseball, there’s a chance it could work. SewerGate became a most serendipitous event PR-wise – as serendipitous as rising floods of sewage can be.

3. MLB is not concerned… yet.

MLB knows San Jose’s strategy, and they will certainly push hard to get the case thrown out for lack of standing. If they succeed, we go back to the status quo and San Jose is at the mercy of baseball. That doesn’t mean that San Jose is done, it just means the City can’t force the issue. All parties, including the A’s, know this. The important thing for MLB is that San Jose remains an option, however slight, because if the only option is Oakland and a scramble for extremely limited public funds, the option is poor. Of course, the City could decide at that point that it would give up the seemingly quixotic quest for a MLB franchise. Knowing how the current mayor and leading mayoral candidates operate, that’s highly unlikely. The lawsuit is costing them nothing and giving the City a ton of press and awareness. None of it is bad except that it annoys Bud Selig, who is supposedly in his lame duck period anyway.

On the other hand, if the federal judge finds that the City does have standing, then MLB has to decide what it’s willing to risk during the pre-trial discovery phase, when pertinent documents are exchanged between the two sides. As we saw in the Stand for San Jose case, one side made the blunder of providing privileged information, which the opposing side tried to use in its case. S4SJ’s attorneys, who didn’t disclose or return the confidential docs until they were caught, then were dressed down by two separate judges and nearly thrown off the case. The Lodge has demonstrated in the past that they are very fearful of any releases of team or league financial data, forced or leaked. I wouldn’t expect them to fold like cheap tents, but if enough pressure is applied, the pendulum could swing in the City’s direction as the owners simply prefer the quickest exit to the fiasco. The quick exit won’t come cheap or easy because the issue is complex, as Selig has said (but never properly articulated).

MLB’s lawyers will argue that there is no contract, hence no standing. The City’s lawyers will argue that there could’ve been a contract if MLB hadn’t dillydallied. It’s not mentioned in the lawsuit, but they could easily point to…

4. The Earthquakes

Lew Wolff and San Jose have a contract in place to build a stadium. In San Jose. On land sold by the City to Lew Wolff that started with an option. While the stadium has been delayed due to financing and general economic problems, it’s getting done. Without tortious interference – the real issue in this case. The bar for some antitrust complaints may be lower in California than the federal standard, thanks to the Cartwright Act. Whether this passes muster is up for a judge to decide.

5. The A’s are a defendant

In suing MLB, San Jose is suing all 30 member clubs in the process. So even though Lew Wolff wants to move the A’s to San Jose, he isn’t joining the lawsuit. Wolff’s public statement indicates, yet again, that he doesn’t want any part of the legal process, fiddle-dee-dee. And it sort of makes sense given that teams are bound by the MLB Constitution not to sue baseball or each other. Except that…

6. MLB’s Constitution expired?

According to Cotchett, the last Major League Constitution expired at the end of 2012. Baseball hasn’t posted a new one, so it appears that they aren’t operating with one. It sounds crazy to think that baseball could operate without a Constitution for even a brief period, as the document lays out all manner of league and team business, in conjunction with the CBA. The most recent version dates back to 2005, as part of the Expos’ move contraction-and-expansion to DC. It outlines everything from banal matters such as the timing of the owners meetings to how the leagues and divisions are constructed, and pertinent to our ongoing discussion, club operating territories. You’d think that the document would at least be amended to include the Astros’ switch to the American League West. Right?

Then again, if the league is operating without a Constitution, does it mean that there’s a loophole? If there is no binding Constitution then are territories no longer assigned? I doubt it, there’s too much at stake. The New York teams aren’t going to allow Stuart Sternberg that kind of loophole to move the Rays. Prior to the gag order, the Giants pointed to the Constitution every chance they got to back up their T-rights claims. You think they’d let the document lapse? Even if there technically isn’t a Constitution, the clubs are certainly operating within the spirit of the legacy document, which is probably good enough for a judge. The Lodge is the Lodge is the Lodge, after all. Now, if MLB intentionally let the document expire so that no one can point to the constraints of T-rights, then we’ve just devolved into anarchy within the Lodge. Which probably isn’t a bad thing.

In all likelihood, MLB does have a new Constitution and simply needs to produce it. Issue rendered moot.

7. Where does Oakland fit into all of this?

Oakland is not a party to the lawsuit. That’s just as well, since there’s a good chance San Jose will fail and the A’s will have no choice but to deal with the East Bay. The “tail-between-legs” scenario is what they’ve been hoping for all along, not that they’re presenting realistic options should that happen (remember Victory Court?). The real problem for Oakland is simple: no one’s fighting over Oakland. The clubs are fighting over San Jose, and they’d fight over San Francisco if it came to that. No one outside of the Oakland-only holdouts and Larry Baer is talking about Oakland as anything more than a short-term solution. Have you heard any other owners talk about Oakland in terms of a permanent home for the A’s? Of course not, because it isn’t even entering their minds. The only thing helping Oakland at the moment is each owner’s self-interest. In this scenario Oakland is the safety school of cities, the girl from work you go out with because she’s accessible. And that’s what really hurts. Whether the neglect is benign (Coliseum deterioration, deprioritizing the A’s) or more “sinister” (ownership motivations), Oakland’s status as a baseball town is at best tentative. If San Jose comes out of this with the A’s, no other existing teams are going to start looking to Oakland as a viable MLB home. Expansion is out of the question. The best Oakland could hope for is a minor league club of some sort, either AAA (Pacific Coast League) or high-A (California League). If Oakland is truly afforded the opportunity to keep the A’s, they’ll be ransomed like many other cities have been. MLB will bring in the consultants (just like Miami) to say that a franchise there isn’t viable without a publicly-financed stadium. Then what?

Other observations:
Exhibit 3 in the filing is the CSL-written economic impact report commissioned by San Jose in 2009. Normally we roll our eyes at how these things are written, because they’re designed to convince mayors and city councils, not judges. The use of such a document against baseball is more than a little ironic.

During the first press conference, Cotchett trotted out the SVLG letter and list of companies as signed-on supporters of the lawsuit. He quickly backtracked on that. The letter is Exhibit 2.

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As I finished this post the plane descended over the Peninsula. I saw the lights on at AT&T Park while Candlestick Park sat silent and lonely. I wanted to get a good look at the Coliseum, but the view across the bay was obscured by a scratched up plane window and the encroaching marine layer. We landed at SJC and the plane was held on the tarmac because a computer malfunction at Southwest Airlines’ headquarters kept all other planes at their respective gates. How appropriate, I thought.

San Jose City Council votes to sue MLB (4 PM Update includes press releases, links)

PDF of the lawsuit filing

It’s on.

More from ABC 7:

So, the city has hired Peninsula attorney Joe Cotchett to file a lawsuit. “This is all about economics. And, you have a city like San Jose, the tenth largest city in the United States, cannot get a baseball club. I can name you other cities that are pulling for San Jose for the same reason. They want the right and the chance to bring a baseball team to their city, their county, whatever it might be,” he said.

A 2009 study found that a new ballpark for the A’s could pump $130 million a year into the San Jose economy. And, San Jose’s mayor has hinted in the past that he’s considered legal action, but the city has always deferred to the principal owner of the A’s — Lew Wolff.

The City has been talking to Cotchett for a while about prepping the lawsuit. I had also heard that Cotchett may be taking this case pro bono, but I can’t confirm that at the moment. Correction: Cotchett is taking the case on a contingency basis. Cotchett has a ton of experience with antitrust suits and sports, representing the Raiders and the NFL at different times.

The Merc’s John Woolfork also has an article with a primer.

And then there’s this.

The podcast of the Cotchett interview is available here.

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San Jose Mayor Chuck Reed’s office put out the lawsuit press release:

For Immediate Release:

June 18, 2013

Contact:

Michelle McGurk, Office of Mayor Reed

(408) 535-4840 or (408) 655-7332 (cell)

 

City Council Unanimously Authorizes Lawsuit to Allow A’s to Move to San Jose

San Jose, Calif. – The City of San Jose has filed legal action in federal court to eliminate the territorial restrictions that Major League Baseball has used to keep the A’s from moving to San Jose. The complaint was authorized by the City Council during closed session this morning.

“For more than four years, the City of San Jose has made an exhaustive effort to work with Major League Baseball to resolve any concerns about our city’s capacity to host a major league ballclub,” Mayor Chuck Reed said. “During that time, it has become abundantly clear that Major League Baseball prefers to use territorial restrictions as an excuse to restrict commerce and prevent the Athletics from relocating to San Jose. This restriction is costing San Jose residents millions of dollars in new annual tax revenues that could go towards funding more police officers, firefighters, libraries, gang prevention efforts, road repairs and other critical city services.”

The Oakland Athletics ownership group has expressed a desire to construct a new privately-financed and privately-operated ballpark in Downtown San Jose. While the City of San Jose has worked with the Athletics to facilitate the construction of a new ballpark, their efforts have been stalled by the San Francisco Giants’ claim of “territorial rights” to Santa Clara County. In 2009, MLB Commissioner Bud Selig appointed a special blue ribbon committee to analyze the Athletics’ options for a new ballpark. But after four years, there still has been no decision on whether the Athletics can relocate to San Jose.

According to an independent economic analysis report conducted by Conventions Sports & Leisure International, a new major league ballpark in Downtown San Jose would generate significant benefits, including:

$5 million per year in new tax revenues to the City and other local governments;
$130 million per year in total net new economic output; and
Nearly 1000 new full and part-time jobs.

San Jose has entered into an option agreement with the Athletics Investment Group, LLC, the California limited partnership that owns and operates the Oakland A’s, to purchase property for a ballpark in Downtown San Jose. According to the suit, Major League Baseball is interfering with this contract by refusing to allow the Oakland A’s Club to locate to the City of San Jose. San Jose seeks to restore competition among and between the clubs and their partners by ending MLB’s collusive agreements. The lawsuit outlines several practices that have resulted in an unreasonable restraint on competition, in violation of federal and California law, and constitute unlawful, unfair, and/or fraudulent business practices under California law, including violation of California’s Unfair Competition Law, Tortious Interference with Contractual Advantage, and Tortious Interference with Prospective Economic Advantage, and for violation of the federal Sherman Act, and violation of California’s Cartwright Act.

The City of San Jose is being represented in this case by attorney Joseph W. Cotchett and the firm of Cotchett, Pitre & McCarthy LLP. The firm is working on contingency.

Additional Resources:

Legal Action filed June 18, 2013: http://www.sanjoseca.gov/DocumentCenter/View/18492.
Economic Impact Analysis: http://www.sjredevelopment.org/ballpark/EI_Report_09022009.pdf
Ballpark archive, including renderings: http://www.sjredevelopment.org/ballpark.htm.

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And now, MLB’s response:

FOR IMMEDIATE RELEASE – June 18, 2013

MAJOR LEAGUE BASEBALL STATEMENT

Major League Baseball Executive Vice President for Economics & League Affairs Rob Manfred issued the following statement in response to the lawsuit filed by the City of San Jose today:

“In considering the issues related to the Oakland Athletics, Major League Baseball has acted in the best interests of our fans, our communities and the league. The lawsuit is an unfounded attack on the fundamental structures of a professional sports league. It is regrettable that the city has resorted to litigation that has no basis in law or in fact.”

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Additional comments from San Jose Councilmembers, who unanimously voted to approve the lawsuit:

Xavier Campos, Councilmember, District Five: “The Mayor and City Council want to send Major League Baseball a clear message that the future home for the Athletics is in San José. The new ballpark will draw more fans and generate additional revenues, and create jobs during the construction phase of the project as well as permanent jobs well into the future. It’s a win for San José and it’s a win for Major League Baseball.”

Kansen Chu, Councilmember, District Four: “I am disappointed Major League Baseball has prevented the A’s from moving to San José. Winning this lawsuit not only will provide a great economic impact for the City of San José but will also benefit Major League Baseball.”

Rose Herrera, Councilmember, District 8: “This is the right step to take on behalf of our residents to get the baseball team that we deserve.”

Ash Kalra, Councilmember, District 2: “Major League Baseball has given the city of San Jose no other option but to turn to the judicial system to have our concerns heard and this matter resolved. The lack of response from Major League Baseball has been extremely disrespectful to the efforts our city and community have made in creating an attractive environment for the Athletics, particularly since the team’s ownership agrees that San Jose, the Capital of Silicon Valley, is the ideal location for their great organization.”

Johnny Khamis, Councilmember, District 10: “I supported filing the lawsuit against Major League Baseball today because San Jose deserves economic justice.”

Sam Liccardo, Councilmember, District 3, “Our Downtown hotels, restaurants, shops, cafes, and clubs and their workers will benefit the tens of thousands of people attending each game at a Major League ballpark,” said Councilmember Sam Liccardo, who represents the Downtown. “Independent experts put the total economic impact at $130 million a year. But the wait staff and cooks at our local restaurants can tell you about the real impact professional sports have on a large-city economy. When the Sharks play, Downtown is packed with patrons. We expect an even bigger impact with baseball.”

Pierluigi Oliverio, Councilmember, District 6: “As the Councilmember representing the majority of the land where a future ballpark would be built, I support taking this action today. San Jose residents need resolution now. We have waited for four painful years, and the area surrounding the future stadium has languished due to years of indecision. In addition to Downtown, surrounding neighborhood business districts like The Alameda and West San Carlos will benefit from the economic revitalization that a major league ballpark will bring to the Diridon Station area.”

Donald Rocha, Councilmember, District 9: “Today’s legal action is hopefully the first step in a process which will bring the City, Major League Baseball, the Giants and the A’s to the table. I firmly believe that there is an opportunity for a positive outcome for all parties, and for too long we’ve all been so focused on our own best interests that we haven’t pursued that conversation.”

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Further reading, if you’re interested:

Commentary later tonight.

SJ Giants CEO forgets that they’re part of S4SJ lawsuit

The Merc’s Internal Affairs folks probably got a chuckle last week when Dan Orum, the San Jose Giants’ CEO since 2012, sent the paper an email criticizing them for their coverage of the Stand for San Jose lawsuit. After Orem’s missive, IA decided to look into the case to confirm Orum’s suggestion that the team was not a plaintiff in the suit. Turns out that the Giants were an original plaintiff in the lawsuit, which has everyone scratching their heads about what Orum’s intent was.

Orum became CEO of the Giants only six weeks after the lawsuit was filed, so unless someone forgot to give him a memo or two, he should be well acquainted with the basics of the case. He was brought in to beef up sponsorships, and he may be running into resistance by local South Bay companies who are rightly confused about the little Giants’ role in the case. If Orum could somehow distance the team from the lawsuit, companies could be less reticent to commit. Of course, the paper had to go and muck that up. The SJ Giants are already in a tough spot trying to get breaks on a lease extension at Municipal Stadium, similar to the A’s current situation in Oakland.

Thankfully the lawsuit will be underway shortly, so there’s hope that much of the confusion (and frankly, obfuscation) will be cleared up through the normal legal process. As the teams and public entities continue talks into the offseason, we’ll see which parties want to be partners and which ones prefer to be adversaries.