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How qualifying offers sabotaged free agency

Dec 24, 2012, 11:20 AM EST

Michael Bourn AP

Buster Olney has a good post up today about how qualifying offers to free agents — which were designed to compensate teams who lose free agents — are far more effective at harming the market of certain free agents by scaring away teams from signing them. Because not only do they lose a draft pick if they do, they lose money from the amateur signing salary caps too.

The fun part: Scott Boras clients Rafael Soriano, Kyle Lohse and Michael Bourn are being hurt the most by this and, wouldn’t you know it, Boras is exploring a loophole to the draft pick quandary:

Let’s say Seattle was interested in signing Bourn, but without giving up a top draft pick. With Boras working in concert with the Mariners and Indians, Cleveland could be the team that technically signs Bourn — with a prearranged trade to Seattle, who would give the Indians something in return.

In this way, Seattle would get Bourn while keeping the top of its draft intact, and Cleveland would get something in return for giving up its lower draft pick.

Maybe this works, maybe it doesn’t, but it’s hard to shed tears for the free agents. The union gladly threw the amateurs and international signees under the bus by agreeing to a severe spending cap in the draft and in the international free agent market. By limiting how much teams can spend there, they inspired teams to do everything in their power to protect what little they can in that arena. Including, we are seeing, avoiding spending on players who are attached by qualifying offers.

In other news: teams that don’t put qualifying offers on players are pretty silly.

  1. proudlycanadian - Dec 24, 2012 at 11:27 AM

    Since the Indians have lost a second round pick due to Swisher, all they would lose if they sign Bourn would be a third round pick. The Mariners seem to have a surplus at DH, FB and outfielder so they could send a couple of players to Cleveland.

  2. natslady - Dec 24, 2012 at 11:33 AM

    Why Rizzo didn’t put a qualifying offer on Edwin Jackson has a lot of Nats fans puzzled. Maybe Boras put a clause in his contract so they couldn’t. Jackson fired Boras in July and you have to wonder.

    • paul621 - Dec 24, 2012 at 12:58 PM

      If he did have a clause like that, it was certainly beneficial to him, so I’m not sure his firing Boras is a sign of anything here.

    • macjacmccoy - Dec 24, 2012 at 8:04 PM

      Stop being a parrot and come up with an original thought. Dont repeat something a writer said on this website a week ago and try to repackage it as an original thought of yours to other readers of the website. How dumb can you be? Of course were going to notice.

      • macjacmccoy - Dec 24, 2012 at 8:05 PM

        I guess its to be expected from a fan base that is less then a year old.

  3. churchoftheperpetuallyoutraged - Dec 24, 2012 at 11:38 AM

    Boras is exploring a loophole to the draft pick quandary:

    Boras already did it once with Soriano, the year he went to TB. The Braves offered Soriano arbitration, thinking he wouldn’t take it. When he did accept, the Braves were stuck with a $9M closer they didn’t want, so they ended up trading him to TB who wanted to sign him but didn’t want to give up the draft pick.

    Also, is it any shock that the owners would institute something that comes back to bite them in the ass? Not for me…

    • paul621 - Dec 24, 2012 at 12:56 PM

      If he accepted the offer, he wouldn’t have been available for TB to sign anyway, regardless of compensation. A trade was the only option.

  4. jarathen - Dec 24, 2012 at 11:46 AM

    What I find interesting is players who obviously overestimated their value on the market, especially Soriano, who is on the losing end of wiser GM’s who realize that most relievers, even good ones, aren’t worth $15 million a year to pitch 60-70 innings.

    Even without Dave Duncan, it seems common sense not to trust Cardinal pitchers that resurrect careers outside of St. Louis. Joel Pineiro seemed like a good starter at one time, too.

  5. echech88 - Dec 24, 2012 at 11:57 AM

    Can someone confirm that you are not allowed to trade a player that has accepted a qualifying offer?

    Seems like that would be the true loophole so I imagine that is against the rules.

    • paperlions - Dec 24, 2012 at 12:22 PM

      Unless a player has 10/5 no trade rights, if he’s under contract, he can be traded. It’s not really a loophole. Team offer the deals to avoid letting assets go for nothing, there is no implication that a player accepting a qualifying offer won’t be traded.

    • shawndc04 - Dec 24, 2012 at 12:31 PM

      As I read the CBA, he can’t be traded until June 15. From the CBA:

      (5) Miscellaneous
      (a) Any Club signing a contract with a Player under this Section
      B after the expiration of the Quiet Period described in subsection
      2(b) above may not assign his contract until after the next June 15.
      However, notwithstanding the foregoing, such contract may be
      assigned for other Player contracts and/or cash consideration of
      $50,000 or less prior to the next June 16 if the Player gives written
      consent to such transaction.

      • tgthree - Dec 24, 2012 at 3:54 PM

        This. I didn’t think you were allowed to trade newly-signed players until June 15.

      • paperlions - Dec 24, 2012 at 11:11 PM

        Are you sure accepting a qualifying offer falls into this category? If a player accepts an offer, he never becomes a FA.

      • shawndc04 - Dec 25, 2012 at 8:23 AM

        @paperlions:

        The language is vague, but it does say “any club.” Thus I read it as not allowing the trade if the contract is signed after the quiet period even if it is the original team.

  6. anxovies - Dec 24, 2012 at 12:38 PM

    Yoenis Cespedes received a good contract with Oakland based upon some decent stats in the Cuban leagues and a killer video so I don’t know that international players are at that much of a disadvantage from the union deal, and; from recent signings the Japanese players don’t seem to be hurting. At least not the ones with good tools. As for Boras, before he was a sports agent he was a lawyer who defended pharmaceutical companies. It would be disappointing if he couldn’t find some loopholes in an agreement hammered out by ballplayers and club owners. The wonder is that he is having such a hard time finding them.

    • jonrox - Dec 24, 2012 at 4:27 PM

      The new rules started this summer, after Cespedes was already signed. Teams now have a pool of like $3m that they can spend on all international signings together. Cespedes alone would use up an entire team’s yearly international signing budget now, and teams like to sign a lot of prospect guys (16-18 year olds) for 6 or low-7 figures, so they now have to be very careful with international budgets.

  7. Old Gator - Dec 24, 2012 at 1:17 PM

    I can understand the qualifying offer rule. Teams often have years of exploitation and profitability invested in a ballplayer. It’s only natural for them to want to screw him over on the way out the door, or they wouldn’t be capitalists at all, would they?

  8. tashkalucy - Dec 24, 2012 at 1:22 PM

    Great article!

  9. frank433 - Dec 24, 2012 at 1:35 PM

    Why not change the draft pick level.

    Say reliever ( or closers with less than 35 save opportunities) is worth a 4th round pick.
    Closer with over 35 save opportunities is worth a 3rd round pick.
    Position player with less than 100 starts or starters with less than 20 starts is worth a 2nd round pick.
    Position player with over 100 starts or a pitcher with over 20 starts is worth a 1st round pick.
    Of course the pick would lower by 1 round for the first 10 teams drafting like it does now.

    That $13 million gamble wouldn’t look so good if you will only get an extra 3rd or 4th round pick.

  10. dracko19 - Dec 24, 2012 at 3:37 PM

    It might be pretty silly to not make an offer, unless said player isn’t worth the offer. Because if he says “I’ll take it!” You’re strapped with a marginal player with a bad contract.

  11. jonrox - Dec 24, 2012 at 4:30 PM

    I wouldn’t want to give any of those three players the kind of money they’re asking for, let alone throw in the draft pick to their old teams. Bourn is a speed/defense guy, and that tends to disappear quickly with age; Lohse is a recently peaking player in his late 30s for the Cardinals, none of which projects well for the future, and no reliever is worth 15m per year.

    • zzalapski - Dec 24, 2012 at 5:47 PM

      No *human* reliever. And as we all know, Rivera ain’t human, man.

      Flippancy aside, this strikes me as the Law of Unintended Consequences in action. Would the union have agreed to the draft spending cap if they knew it would affect free agency for established major leaguers? I doubt it.

  12. yankeepunk3000 - Dec 24, 2012 at 6:14 PM

    how is offering him a qualifying offer screwing the player out the door? players make millions of dollars and will make millions more with any team they sign with how are they being “screwed” even if a player makes minimum which last 3 years or less that’s still 450,000 dollars or more a year more then either of us probally make so please let me know how the players are geting “screwed”

    • brewcitybummer - Dec 25, 2012 at 3:06 AM

      What you make is completely irrelevant assuming you don’t possess a skill set so valuable and so scarce that companies would pay millions to obtain it and keep it away from their competitors. I feel pretty good about that assumption.

  13. onbucky96 - Dec 24, 2012 at 6:30 PM

    On this Christmas Eve, why do I picture Scott Boras as Mr. Scrooge? Draft pick compensation…Bah, Humbug!

  14. Chris K - Dec 26, 2012 at 12:18 AM

    Doesn’t the NBA do this regularly with sign & trades?

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