Category Archives: San Jose

05.20.13
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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.

05.15.13
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Hearing schedule for S4SJ vs. City of San Jose

While we’re watching the A’s fight for the division title this summer, we’ll also watch the Giants and A’s duke it out in court. Santa Clara County Superior Court Judge Joseph Huber has released a hearing schedule for the Stand for San Jose-vs.-City of San Jose trial:

  • June 6 – Petitioners Opening Brief
  • July 8 – Respondents & Real Party Opposition
  • July 29 – Petitioners Reply
  • October 4 – Hearing on the Merits

Unless the sides decide to settle out of court, chances are that the case will drag on through the end of the year.

04.25.13
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San Jose’s Motion to Disqualify Denied

The City of San Jose and the A’s received another legal setback this week, as their Motion to Disqualify Counsel, namely Pillsbury Winthrop Shaw Pittman, was denied by Judge Joseph Huber.

I’m out of town right now, so I don’t have the ability to view the judge’s order. When I get back I’ll take a look at it, but honestly, it was easy to read the way the judge was leaning with this ruling and the one from September. Now the City/A’s and Stand for San Jose can move forward with the trial. Lawyers for both sides are in the process of preparing briefs. We’ll be following this one closely. I expect that MLB will too.

04.12.13
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San Jose attempts two Hail Marys, one batted down

San Jose Mayor Chuck Reed’s attempt to get an in-person meeting with MLB Commissioner Bud Selig was rejected this week. Selig preferred that the City continue to work with and make inquiries through his committee, now in its fourth unproductive year.

Reed expressed frustration at Selig’s rejection, vaguely hinting at a ratcheted up legal threat. It’s definitely a defeat on Reed’s part. If Selig’s decision effectively called Reed’s bluff, it’s to Reed to make good on the bluff. Reed’s termed out in 18 months, so if he wanted to bare some teeth, now would be a good time to do so.

Speaking of lawsuits, the Stand for San Jose suit had its Motion to Disqualify Counsel hearing today. Judge Joseph Huber had difficulty understanding the reasoning for the motion, explaining that the privileged documents that are at the center of the debate were already returned by Pillsbury are not part of the record, and will have no bearing on the case. Judge Huber asked Perkins Coie attorney Geoffrey Robinson if he was supposed to guess if and what privileged details made into the S4SJ’s case. Robinson said that the documents could shape the case even if the documents are not part of the record. (Judge Huber took over the case for Judge Patricia Lucas, who was appointed to the 6th District Court of Appeals by Governor Jerry Brown last fall.)

Switching to the other side, Judge Huber quite severely admonished Pillsbury for its previous behavior in the case, Pillsbury’s Ronald Van Buskirk argued that the firm was merely doing its job to make the best case for its client, and that the attorneys were only “exposed” to the documents and shouldn’t be disqualified just for exposure. Of course, they previously made a motion to augment the case using those documents, so that argument may fall on deaf ears.

The big takeaway is that both sides recently agreed upon a schedule for briefs, which means that a trial date is coming soon. The attorneys will have a few weeks to prepare their briefs. A trial date should be set shortly. Van Buskirk indicated that the plaintiff’s case would be solid thanks to questions about airport impacts, which to me sounds flimsy based on what I’ve read and the fact that taller or similar height structures already exist closer to the flight path, such as HP Pavilion.

Judge Huber will make his decision on the motion to disqualify early next week. If Pillsbury is thrown off the case so close to trial, it would be huge blow and force a delay to bring in new counsel and get them up to speed. If Huber throws out the motion, at least we’ll finally get to see this trial move forward, which would clear up at least one major issue that’s probably causing MLB to delay any decision regarding San Jose and territorial rights. I’ve been of the opinion for some time that MLB will not grant San Jose anything until the land deal is locked in and secured. The Giants know this, which explains why they’ve aggressively gone after San Jose in the courts and through the State Controller’s redevelopment clawback efforts. It’s the new Moneyball.

04.03.13
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Good cop, bad cop, legacy (Updated to include Mayor’s letter)

Added 1:00 PM – I’ve taken the liberty of posting the text of Mayor Reed’s letter to Commissioner Selig.

Mr. Bud Selig, Commissioner
Major League Baseball
777 E. Wisconsin Avenue, Ste. 3060
Milwaukee, WI 53202

Dear Commissioner Selig:

When will the A’s be moving to San Jose? That’s the question that is most often asked of me by CEOs of Silicon Valley companies competing to retain and attract global talent, by youngsters excited about competing in little league baseball, and by fans throughout San Jose.

The A’s ownership continues to express its desire to locate the team in San Jose and I strongly endorse that outcome. There should be no doubt of San Jose’s ability to be a great host city for the team and for Major League Baseball. There should also be no doubt that the stadium could have been under construction by now.

We respect your desire to examine fully all aspects of allowing the A’s to move to Northern California’s largest city. In 2011, former MLB President Bob Dupuy, speaking on behalf of your office, asked that our City Council delay approving a public vote to advance a planned stadium project in Downtown San Jose. We abided by that request. Mr. Dupuy also indicated that you would soon make a final decision and, if favorable towards San Jose, the MLB would assist the City with the costs of a future election. Two years have passed since. As you know, we have been contacted many times by the MLB’s Blue Ribbon Panel and we have responded promptly and thoroughly in every instance. Meanwhile, we continue to communicate with leaders in the community and are prepared to advance implementation actions to the City Council following your decision.

Direct communication between us will help resolve any lingering issues about our commitment to having the A’s home plate located in San Jose and could reduce the probability for additional litigation. I’d appreciate an opportunity to discuss this with you and have asked my Chief of Staff, Pete Furman, to contact your office regarding scheduling a meeting with you. I hope you will look favorably upon the request.

Best Wishes,

Chuck Reed
Mayor

c: Lew Wolff

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It’s probably not a coincidence that in the span of two hours, Lew Wolff spoke for the first time this regular season about the stadium situation on Chronicle Live!, followed by San Jose Mayor Chuck Reed asking for a meeting with Bud Selig via a one-page letter sent to  the Commissioner’s office.

Reed is positioning the requested meeting as something that could head off future litigation. Over the last year, San Jose has become more vocal about challenging MLB through the courts. So far MLB hasn’t budged. I can’t imagine that this will work either. Regardless of whether San Jose actually has standing in a case against baseball, the sport still has the lion’s share of leverage. If granted the meeting, maybe Reed will come with a phalanx of high-profile lawyers to shake down Selig. More likely is the idea that Reed will continue to pitch San Jose’s positives (of which there are many) and try to allay any fears that the A’s can be self-sustaining in the long run. Remember, they have to be off revenue sharing in a new Bay Area stadium.

As for Wolff, he was peppered with a lot of questions by ChronLive’s Jim Kozimor. Unfortunately, Wolff refused to talk about any progress on the decision-making front for a stadium location, citing the Selig-imposed gag order on both teams. He was able to comment on other matters. On the prospects of the five year lease Wolff requested last year:

The environment of getting a (lease extension) is very positive.

That’s encouraging. All A’s fans hope that the flying rhetoric stops and the team and the JPA can work out an extension that benefits both sides. That’s not going to be easy with the Raiders asking for more revenue control. We’ll see over the coming months if a proper agreement can be worked out for all sides.

Asked if Wolff and the Fisher family would consider selling the team if Wolff doesn’t get his wish to move the franchise to San Jose:

The answer is no… we want to keep this generational.

Following the 14-minute interview, in-studio guest Mark Purdy further elaborated on the “generational” aspect. Purdy indicated that Lew could cede more of the stadium effort in the coming years, as he approaches 80. Next in line is Lew’s son Keith Wolff, who has been working on plans for Cisco Field and the Earthquakes Stadium, where major site work started happening in the last week. Lew says that the Quakes stadium is on track, but process could slow it down. For now he says that the Quakes stadium should be open for the 2014 MLS season, conceding that there could be delays in completing the project. I figure that once that venue is up and running, Keith Wolff will assume his father’s place as the public face of the stadium effort, if not the franchise itself. With the recent trend of teams acting as investment vehicles and development anchors, this is naturally hard-to-believe. Considering how Wolff views his ownership of the franchise and how he attends games frequently with his grandson, it’s not necessarily that far-fetched. Wolff dismissed Kozimor’s suggestion that the team is just fine collecting revenue sharing checks, responding that he wanted to leave the team and the sport in a better place than he found it. As long as there continues to be an impasse vis-à-vis San Jose, that’s inconceivable.

03.26.13
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HP out in San Jose, SAP in?

All Things D’s Arik Hesseldahl reports today that Valley tech giant HP is in talks to end its naming rights deal at the San Jose Arena. The current deal runs through 2017, with HP pushing to end it as early as this summer. CEO Meg Whitman, who previously helmed another San Jose tech firm, eBay, is apparently reevaluating HP’s marketing efforts, and that means curtains for sports naming rights. It’s too bad that HP is pulling out, though given the company’s struggles the past few years, some restructuring is certainly in order.

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HP Pavilion main entry during last weekend’s NCAA tournament

HP didn’t originally negotiate the current naming rights deal. It was inherited when HP merged with then-rival Compaq of Houston. At the time Compaq already had naming rights to the old Summit arena in Houston, which created the need to distinguish the two venues by locale. Shortly after the merger, the arena took on the seemingly synergistic HP Pavilion name (“Pavilion” is a longstanding name of HP’s consumer desktop PC line), though it’s unclear whether the name association actually helped sales.

SAP may be stepping into the void created by HP’s departure. The enterprise software company already has had its name on the annual ATP tennis tournament held annually at the arena (which is moving to Rio de Janeiro starting next year), and SAP chairman Hasso Plattner just finished acquiring up to 90% of the San Jose Sharks. Plattner may have carte blanche to make the deal as he pleases, but shareholders may be wary of a move considering that SAP lost nearly $4 billion last year. SAP may push for a lower cost naming rights deal since they could be considered San Jose’s “preferred partner”.

I imagine that if the naming rights deal transfers from HP to SAP, the arena will simply be called SAP Arena or SAP Arena at San Jose. Of course, the arena already has its own nicknames, “The Tank” and “Shark Tank”, that locals and hockey fans will continue to use until the arena is eventually replaced.

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P.S. One of SAP’s biggest competitors is Oracle, who has naming rights at the Arena in Oakland. A copyright trial between the two companies is ongoing, as a judge considered a $1.3 billion damages award to victorious Oracle excessive. I doubt that this will make Larry Ellison more or less likely to extend the Oracle Arena naming rights deal – especially if the Warriors leave for San Francisco – but it’ll probably chap Ellison’s hide to know that every time he flies one of his private jets into SJC, he’ll see the SAP logo on the large arena rooftop below. It wasn’t that long ago that rumors had Ellison bringing a NBA franchise such as the Kings or Grizzlies to San Jose. There’s absolutely no chance of an Ellison-helmed NBA team coming to San Jose as long as SAP wields the power at the arena.

P.P.S. – Given Ray Ratto’s repeated butchering of the name “San Jose” to “San Azzay”, I suppose that for Ratto SAP could mean “San Azzay Pavilion”.

03.26.13
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Earthquakes release seating bowl comparison

As the San Jose Earthquakes continue their drive towards a new stadium for the 2014 MLS season, team President David Kaval has been keen to release little bits of information every so often to tease fans about what they’ll soon be getting. Last fall, a brochure was distributed that showed suite options. Suites subsequently sold out. Now it’s cutaway drawings of the unique (for MLS) seating bowl, which also show some architectural elements that should get Quakes fans talking.

Buck Shaw Stadium, the current home of the Quakes, is small, quaint, and old. The intimate setting there creates a nice home field advantage, but it isn’t the best venue in terms of sight lines and comfort. The pitch of the bleachers is not particularly steep, making it hard to see the action over the heads in front of you.

To remedy that problem, and to create a stadium that didn’t look like other MLS venues, the still-unnamed Earthquakes Stadium will have a single seating deck with a 30° angle. To put that in perspective, that’s slightly steeper than the original upper deck at the Coliseum (~28.5°). With a vertical clearance of around 19 inches from one row to the next, seeing the entire field all the way to the touch lines shouldn’t be a problem. The suites and club seats are located at field level, and the bowl sits above them in a horseshoe shape. The steep seating arrangement will make the bowl rise rapidly, so much that it’ll look bigger than it really is. The comparison document emphasizes how close the first row is to the action, though it should be made clear that what they’re referring to is the first row of the suites or club seats along the sidelines. The supporters sections behind the southern goal should also benefit from being very close to the field.

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The Earthquakes’ seating bowl arrangement creates a much smaller footprint stadium, which should be more intimate and less expensive to build.

Other MLS stadia frequently have a 21° pitch, which translates to a 12-inch rise per 33-inch row. That’s steeper than the Coliseum’s very gradually pitched lower deck (11°), and slightly less angled than the plaza level.

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Truss system supporting the seating deck also includes a beam that carries the load for the roof, which should result in a less expensive cantilever.

In the cutaway comparisons, it’s easy to see how much smaller the footprint of the stadium will be compared to others throughout the league. Cleverly, the architects at 360 put together a truss system that supports the seating bowl and the roof. They accomplish this by taking an angled beam and extending it through the top row up to the center of the roof. The roof itself covers the entire bowl, which the Quakes say should help contain noise. There is a gap between the top of the bowl and the roof, but I expect that to be filled in by a press box and perhaps additional suites at some point. I haven’t run the numbers to determine the distances yet, but I figure that sitting in the top row at midfield will be similar to the experience of sitting in row 12 of section 217 at the Coliseum for a Raiders game – still a very good seat. Sure, Buck Shaw’s worst seat is technically closer. Buck Shaw is also barely half the size of the new stadium.

Finally, the truss system also creates a façade that juts out over fans as they enter the stadium. The cover image of the document shows a corner of the stadium, not covered by vinyl signs or cladding. Instead, the treatment used is a series of metal ribs that run horizontally. This is a brise soleil, a façade built to provide sun protection while allowing indirect sunlight in. A similar element was built to control sunlight coming into the San Jose City Hall rotunda, which has a large glass dome. Chances are that something – maybe signs – will go up there to give the stadium more color and a distinct image. Even if it doesn’t, the façade is better than chain link or overdone glass curtainwall. It’s unlikely that many of the elements in use for the Earthquakes Stadium would make it to an A’s ballpark, simply because the viewing angles are less demanding for baseball than for soccer. That’s just as well, because it’ll be good to have a unique look for a stadium that no one else has besides the Quakes.

03.22.13
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San Jose files motion to disqualify in S4SJ lawsuit

Update 3/23 1:30 AM – Pillbury made its own motion in response. They’re aiming to “augment the administrative record; memo of p’s and a’s” (points and authorities), so they’re providing their defense of their behavior in the case. I’ll try to get a copy of the motion ASAP.

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There’s a fairly new term being used in baseball talk on the internet these days: TOOTBLAN. It’s short for Thrown Out On The Bases Like A Nincompoop. It’s very popular on Twitter, and its lineage dates back to some misadventures on the basepaths by Ryan Theriot, who naturally was on the Cubs when the term was coined. When it comes to baserunning, Theriot is the polar opposite of Coco Crisp, whose recent profile by Grantland’s Jonah Keri elevated Coco to ninja-like levels between the bags. Still, Theriot has two World Series rings in the past two years, so who’s the nincompoop now? Well, it’ll forever be Theriot. Sorry dude.

The City of San Jose committed its own TOOTBLAN in the Stand for San Jose lawsuit. During the suit’s discovery period, the City inadvertently released several documents that clearly should have been protected by attorney-client privilege. When City attorneys found out, they asked S4SJ’s attorneys at Pillsbury to return the documents. Instead, Pillsbury held onto the privileged docs and sought to augment their own case with the documents. That forced the City to file a temporary restraining order against Pillsbury, which was granted by a judge in January 2012. Suspecting that Pillsbury lawyers would use the information anyway, last week (3/11) the City filed its own motion to disqualify counsel (read the PDF for the blow-by-blow), saying that Pillsbury’s conduct during discovery should force them off the case. From the motion:

By this motion, respondents and real party in interest seek disqualification of Pillsbury Winthrop Shaw Pittman LLP (“Pillsbury”) from further involvement in this case. Pillsbury attorneys closely examined and attempted to use nine privileged documents inadvertently produced by the City of San Jose. Pillsbury was ethically obligated not to review these documents any more than necessary to determine they were privileged and to immediately notify the City of its possession of the documents. In derogation of these obligations, Pillsbury not only reviewed the privileged documents in their entirety and failed to notify the City that it possessed them, it refused to return the documents after the City discovered the inadvertent production and requested that the documents be returned. Instead, Pillsbury affirmatively sought to incorporate the documents into the administrative record in this case and use the information in them to support petitioners’ claims, threating a motion to augment the record if they were not included. The City was forced to bring a TRO and preliminary injunction proceeding, which resulted in an order requiring Pillsbury to return the privileged documents and all copies. The documents contained highly confidential attorney/client communications and attorney work product bearing directly on the issues in this case. Pillsbury’s possession of this information prejudices the defense of this case, and there is no effective remedy short of disqualification.

I consulted with some folks who have a better grasp of the legal issues here. Apparently the motion to disqualify counsel is not something that is successfully granted often, and any such claims have to pass a fairly stringent test to force such an action. At the same time, the inadvertent release of privileged or confidential information during discovery isn’t all that uncommon, given the reams and boxes of documents that have to be made available for a trial. Still, this is an embarrassing moment for the City and it seems like they want to be rewarded for making a pretty big mistake.

The documents in question include marked up versions of the EIR, analyses and comments from the City Attorney’s office, and to my surprise, a draft of a Disposition and Development Agreement – effectively the lease terms for the ballpark and/or land. Frankly, I want to see this information and the public should have the right to see it. For now, records requests may have to be filed to gain access, and that may not happen until after a trial ends. Regardless, it’ll be interesting to see how Judge Hubner rules on this next month. Just like last fall’s motion to compel, this is a long shot at best, but Pillsbury’s conduct could result in sanctions if not disqualification. If Pillsbury were thrown off the case, S4SJ would be forced to bring in new counsel and prepare a new case, creating considerable delay. Plus the new legal team wouldn’t be the Giants’ own firm. Considering how the Giants may have pressured the Controller’s office to take actions against San Jose in the ballpark land rollback, just about anything’s fair game at this point. The hearing will be at Santa Clara County Superior Court on April 12, 9 AM. I expect to be there for the proceedings.

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Note: I spent a couple of fruitless hours at the Superior Court trying to get a copy of the motion, because it hadn’t been properly filed yet. I strolled a few blocks over to City Hall and went to the City Attorney’s office to request a copy. I received it via e-mail within an hour of the request.

03.21.13
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State rolls back San Jose ballpark land transfer

Update 7:30 PM – Added link to Controller’s report.

Yesterday we got word that the 49ers and Santa Clara prevailed in its lawsuit to reclaim $40 million in redevelopment funds. Today comes the news that the State of California has ruled that land transfers from the City of San Jose to the Diridon Development Authority were ruled illegal.

The Controller’s ruling on the ballpark land seems to hinge entirely on the fact that the City/RDA didn’t enter into a sale agreement with A’s ownership until November 2011, after the June 28, 2011 cutoff when AB 1X 26 took effect.

The RDA made unallowable asset transfers of $29,137,727 to the San Jose Diridon Development Authority (Authority), a joint powers authority made up of the City and the RDA. All of the property transfers occurred during the period of January 1, 2011, through January 31, 2012 and the assets were not contractually committed to a third party prior to June 28, 2011.

The graf above comes from the 12-page report released today, a draft of which was sent to the City on November 15, 2012 to allow for a response. The City argued that “there is no statutory or legal support” for the 6/28/11 cutoff to no avail. The Controller disregarded this argument and directed the land be turned over to County-appointed Successor Agency, whose oversight board will make the final determination of what to do with the land. City has cutely shortened “Successor Agency” to SARA and for good reason. What does SARA stand for?

Successor Agency to the Redevelopment Agency of the City of San Jose

If the Diridon Development Authority is the “son” of revelopment, SARA is the daughter. What does SARA make of this mess?

Ordering the City to return the assets to the Successor Agency only to have the Oversight Board direct that they be returned to the City is simply form over substance and wastes valuable time, energy and resources to arrive at the same result.

Regardless of what happened with the Controller’s decision (which was expected) the City still feels that the land will end up with the A’s. If they had inked the sale agreement in March 2011 instead of November, the transfers would’ve been in the clear. Now they could sue the State the same way the 49ers did, but since that would be even more costly and the City and County are already working on a proper land disposition agreement, that seems like a terrible idea.

What will happen next? My guess is that the land won’t actually be sold. Instead, the parties will work on a lease agreement that would allow the A’s to build on the public portion of the ballpark site while the A’s buy the rest over time. The alternative is to sell the land for “market value”, with a yield large enough to be approved by the Controller. The purpose of this is two-fold: get a sale so that funds can be sent to the state, and ensure that the land is assessed at a value high enough to get adequate proceeds to the state, county, and schools. Mayor Chuck Reed, who is on the SARA oversight board, released a statement in response to the ruling just a few minutes ago.

I am disappointed in the findings made by the State Controller regarding certain properties transferred from the San Jose Redevelopment Agency to the City of San Jose, San Jose Diridon Development Authority, and City Housing Agency.

The properties transferred to the City include assets that serve a civic or government function, and likely will fall under the government use provisions of the new redevelopment dissolution law and my expectation is that the Oversight Board will make the same findings.

With respect to the Diridon Development Authority properties, the State Controller failed to recognize an Option Agreement validly entered into between the JPA and the Athletics Investment Group. Any transfer of these properties to the Successor Agency would be subject to the contractual rights of the Athletics Investment Group as required under state law.

The City Council and County Supervisors have both made their desire to have a ballpark built on the site known through formal resolutions in the past. My expectation is that we will continue to work together to bring the Athletics to San Jose regardless of the ultimate ownership of the JPA properties.

Coincidentally, an oversight board meeting is scheduled for tomorrow morning at City Hall. While this news came too late to make the meeting agenda, I would expect the matter to be discussed. I’ll attend and report back.

03.04.13
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Wolff releases statement on antitrust lawsuit rumors

In case anyone was wondering if Lew Wolff was behind or approves of (tacitly) the recent antitrust lawsuit rumor (via the Chronicle’s John Shea):

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Draw what conclusions you will from that.