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The San Jose lawsuit against Major League Baseball should be thrown out of court

Jun 18, 2013, 4:32 PM EST

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So I’ve read over the lawsuit filed by San Jose against Major League Baseball. Initial reaction: it’s more full of crap than Bob Melvin’s office was on Sunday afternoon.

The essence of the suit: Major League Baseball is a monopoly. It should be an unlawful monopoly. This would-be unlawful monopoly is preventing the Athletics from moving to San Jose and that has caused San Jose all manner of financial harm.

Which, yes, sounds reasonable. Major League Baseball is anti-competitive and does have a monopoly that should go the way of the dodo and vaudeville for the simple reason that it serves no purpose as noble and grand as either the dodo or vaudeville did.  But the suit is not anything that should pass legal muster here, and I believe it will go down in flames.

As I said in the earlier post, courts do not entertain lawsuits from parties without standing to sue and the city of San Jose hasn’t asserted anything in this complaint that persuades me that they have standing. Or that they have been damaged in any way that a court will consider worthy of redress. Broadly speaking, they have claimed that (a) they have a contract with the owners of the Oakland A’s with which Major League Baseball’s actions have interfered; and (b) that the city has incurred or will incur — note the “will” — financial damages as a result of the A’s not moving to San Jose. Let’s break those down:

The tortious interference with a contract claim:  The contract claim is baed on an option agreement entered into in 2011 between the A’s owners and San Jose for the purchase of some land on which a ballpark would be built. The A’s paid San Jose $50,000 for the option. It expires this fall. If they want to keep the option open for another year it’s another $25,000. If the A’s owners were to buy the land, they can do it for between $6 million and $7 million. Nothing in the option agreement, however, promises that the A’s will actually move. It doesn’t even promise that they’ll buy the land. Just that they have the option to do so.

San Jose, however, seems to be attempting to bootstrap this option into a promise that the A’s would actually move there and that MLB’s rules preventing the A’s from moving have thus interfered with that expectation. That’s a bridge too far. A bridge longer than the Dumbarton, actually. The only guarantee San Jose gets out of that contract is $50-75K. The only thing it’s giving up is the right to sell that land for the period of the option. Major League Baseball has not stopped the A’s from paying their $50-75K.

San Jose’s insistence that more has been lost here is based on an assertion that the A’s have indicated a willingness to move to San Jose. Well, yes, they have. But they haven’t done anything to act on it yet because they know they can’t. At the minimum, I would think a court would need to have evidence that the A’s actually took a concrete step to pay San Jose $7 million for that land, to actually move to San Jose only to have had Major League Baseball stop that from happening. There is no suggestion, however, that any such evidence exists.

The financial damages: It’s all future tense. San Jose would have gotten increased tax revenue, would have gotten good paying stadium construction jobs, would have seen economic development and would have had a more healthy municipal budget had the A’s moved. Those are all speculative, prospective damages* not actual damages, and courts are not in the business of providing redress for speculative, prospective damages. Tomorrow Lew Wolff could say “you know what? I always wanted to move the A’s to Bakersfield. We’re moving to Bakersfield.” If he did that, San Jose would have no recourse. So they certainly have no recourse against Major League Baseball for preventing a speculative A’s-to-San Jose move.

*Probably also worth noting that the complaint spends a lot of time talking about all the economic benefits of ballpark development. These benefits have been largely debunked. I sorta hope this suit goes far, however, so that MLB would find itself in the odd position of having to explain how such damages are illusory, contrary to their tack for the past 25 years or so.

I think Major League Baseball’s antitrust exemption is abhorrent. I wish it were gone and think, in the right lawsuit, it could be defeated. If the A’s had filed this suit, for example, claiming that MLB is preventing them from moving and that MLB’s insistence that they stay in Oakland has caused them financial damages, I think it would have a puncher’s chance. And I’d be shaking my pompoms, cheering it on. But they didn’t file it. San Jose did. And San Jose has no legal rights that seem remotely impinged upon here.

Which, it should be worth noting, may be the idea. It’s quite possible that this suit is more a political document than a legal one, with San Jose’s mayor trying to focus attention on the languishing A’s-to-San Jose thing and to get public opinion on the side of the A’s and the city.  Maybe this will do that, maybe it won’t. I’d have to know the political dynamics of the Bay Area better than I do to have an idea.

But I do think that for it to have any practical use in creating leverage it has to at least present a legal threat, and this doesn’t do that. Indeed, I think Major League Baseball is way more worried about losing its antitrust exemption than any bad PR that can come out of Oakland, so they’re likely to fight this suit until it’s dead.

Which should be quickly. Because the suit is no better than the stuff bubbling up through the Oakland Coliseum’s pipes and should be thrown out.

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