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Mike Trout’s Free Agency Fish Fry

January 8, 2017

Links at the bottom if you want to read the original pieces. Short summary followed my my analysis. (If Kim wants to contradict anything, please go ahead.)

–Fan Graphs’ Nathaniel Grow notes that Section 2855 of the California Labor Code allows any worker to opt out of a contract after serving seven calendar years for the same company (here, Mike Trout for the Angels).

–Subsequent case law involving Oscar De La Hoya’s Golden Boy Promotions says that the seven years can be on a single deal, or on re-upped deals (Trout re-upped a couple years ago, but it’s been seven years total).

–So Mike Trout, who has 4 years and $120M left on his re-up, could opt out and become a free agent. As could anyone else with seven years of consecutive service for a California club … in all the hubbub someone went through and found that that’s 1.45% of players on 40-man rosters.

–The Anti-Trust Exemption doesn’t apply. Anti-Trust is a federal set-up, and this is California state law.

So… Deadspin got ahold of Scott Boras who said that yeah he read the Fan Graphs piece but he’d generally advise against his clients pulling such a stunt on a number of counts:

a) Section 2855 is designed to protect non-union employees and may not be applicable

b) Even if Boras thought his client would win, what baseball player wants to spend 3-4 years with the distraction of litigation?

c) You run the risk of becoming a pariah, which means your endorsements go away

d) Putting c) and d) together, you could end up net losing money if your on-field performance eventually suffers and the endorsements are gone… so don’t do it.

e) What if the team just trades you? Who knows what happens then?

f) You run the risk of pissing off the Union, as non-California members feel like second-class citizens if you look like winning.

OK, so my forays into Labour Law are restricted to Canadian Nursing, and no, i haven’t passed the Bar. But here are my thoughts on the matter.

  1. Boras is a straight shooter here. On a risk/reward metric, it doesn’t usually make sense. It makes no sense for Trout, who at $30m AAV is probably getting paid 75% of his free agent value. The exception might be a Jacob DeGrom type who spent many years in the minors (counting toward the seven years), bloomed later, and faces many years left at MLB minimum/arbitration.
  2. The player-pioneers in these labour disputes usually take the worst of it. Curt Flood didn’t personally come out ahead, losing his Supreme Court case 5-3 and declaring bankruptcy. Jean-Marc Bosman, who actually won unrestricted free agency for every European soccer player after every contract, wound up living in a van down by the river.
  3. In a sense, Trout (or anyone else) can declare free agency whenever he wants by retiring from MLB and walking away from his deal. the general contract, however, says that there are 29 other companies (the other teams in MLB) with whom he can’t seek employment. That’s the real legal hurdle here. Maybe the player wins, but it’s a matter for Federal Court and those things take time. In the mean time MLB would seek an injunction to keep the current system in place. Bottom line for the retired player: Japanese lessons.
  4. Suppose the player wins. This puts California teams at an inherent disadvantage and I’d have no idea how MLB/MLBPA address that. Even all-star MLB players tend to develop for 3-4 years in the minors, which means California teams lose their players arbitration years after 3 years at the MLB minimum.

At any rate, with the free agent market so quiet this winter this has been an interesting thought experiment.

The links:

http://www.fangraphs.com/blogs/how-mike-trout-could-legally-become-a-free-agent/

http://deadspin.com/scott-boras-wouldnt-advise-california-players-to-seek-e-1790913579

 

 

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