Senne v. MLB: Minor League Players Sue MLB over Wages

I have a new article for SI.com on a federal lawsuit just filed by three former minor league players against baseball over allegedly unpaid minimum wage and overtime.  To be sure, this will be a lawsuit to follow. 

Here's an excerpt:

The lawsuit portrays minor league players as members of the working poor, and that's backed up by data. Most earn between $3,000 and $7,500 for a five-month season. As a point of comparison, fast food workers typically earn between $15,000 and $18,000 a year, or about two or three times what minor league players make. Some minor leaguers, particularly those with families, hold other jobs during the offseason and occasionally during the season. While the minimum salary in Major League Baseball is $500,000, many minor league players earn less than the federal poverty level, which is $11,490 for a single person and $23,550 for a family of four.


To read more, click here.

Sports Law History: Judge Landis and the Federal League Antitrust Suit of 1915

This is the third in a series of posts discussing my research into the history of the 1922 U.S. Supreme Court case of Federal Baseball Club of Baltimore v. National League, culminating in my recently released book, Baseball on Trial: The Origin of Baseball's Antitrust Exemption.  Click here to read the earlier posts in the series.

Aside from the Supreme Court's decision in the Federal Baseball suit itself, perhaps the most famous legal development arising out of the Federal League challenge was the antitrust suit the Federals filed in 1915 against the major leagues in the Chicago federal court of Judge Kenesaw Mountain Landis (pictured).  While many sports law enthusiasts were generally aware of the Federal League's antitrust suit, and Landis's involvement in it, prior to my research little was known about the actual proceedings themselves.  Fortunately, most of the original court papers, as well as a transcript of the four-day hearing held before Judge Landis in January 1915, have been preserved by the National Baseball Hall of Fame Research Library in Cooperstown, New York.  These materials serve as the basis for the fourth chapter in my book, documenting the Federal League's antitrust lawsuit against the two major leagues.

The Federal League filed its suit on January 5, 1915.  The complaint alleged that the American and National Leagues had illegally monopolized the professional baseball industry in violation of both federal and state antitrust law, and had also illegally conspired to destroy the Federal League in violation of state law.  The league asked the court to issue an injunction preventing the major leagues from continuing to coordinate their activities under the so-called National Agreement (the document governing professional baseball at the time) and from continuing to interfere with the Federal League's operations (such as by filing any new lawsuits against Federal League players).

Shortly after the suit was filed, Judge Landis scheduled a hearing in the case for January 20th to decide whether to grant the Federal League a preliminary injunction.  The first day of the hearing was a significant event, as well over a thousand Chicago-based baseball fans reportedly flocked to the courthouse in hopes of snagging a seat to watch the proceedings.  The parties ultimately spent four full days arguing before Judge Landis, with the issue of jurisdiction taking center stage throughout much of the proceedings.  In particular, the major leagues alleged that they were not subject to federal or state antitrust law insofar as they did not consider baseball to be commerce.  Relying on traditional definitions in place at the time limiting the term "commerce" to the production or sale of physical goods, the leagues argued that they did not themselves produce or sell anything tangible, but instead simply staged intangible amusements, beyond the scope of antitrust law.  The Federal League, of course, disputed this characterization, contending that baseball was commerce insofar as the leagues paid to transport both players and equipment across state lines in order to stage their exhibitions.

Although the parties and media anticipated that Judge Landis would issue a ruling in the suit within a few weeks, he ultimately withheld his opinion for over a year.  Landis would later explain his inaction by stating that if had he had issued an order it would have severely damaged both sides of the dispute, and potentially the sport itself, and therefore that he believed deferring his decision was the most prudent course of action.  In the meantime, all three leagues struggled financially throughout the 1915 season, in the face of both an economic recession and the on-set of World War I.  Consequently, both sides agreed to a truce in December 1915.  Under the terms of the agreement, the Federal League agreed to cease its operations in exchange for payments totaling over $450,000 from the major leagues.  In addition, two Federal League owners were allowed to purchase existing major league clubs (the Chicago Cubs and St. Louis Browns).  While the terms of the deal satisfied seven of the eight Federal League teams, the owners of the league's Baltimore Terrapins objected to the agreement on the grounds that they did not receive anything under the deal.  Despite the Terrapins' protests, the settlement was ultimately ratified, and as a result the Baltimore club subsequently pursued its own antitrust litigation, eventually culminating in the Supreme Court's Federal Baseball decision.

Judge Landis, of course, would later become baseball's first commissioner in 1920 in the aftermath of the fixing of the 1919 World Series (i.e., the so-called Black Sox scandal).  Subsequent scholars have been largely critical of Landis's involvement in the Federal League's antitrust suit, believing that the judge was predisposed to side with the major leagues.  For example, these scholars cite abbreviated press reports in which, at one point in the hearing, Landis declared that any "blow at this thing called baseball ... will be regarded by this court as a blow at a National institution."  However, as my research reveals, when the exchange is read in its entirety Landis was actually admonishing major league baseball's attorney by explaining that one's personal affection for the game of baseball was irrelevant to the question of whether the major leagues had violated the law.

Moreover, while it is certainly true that Landis could have issued a ruling much sooner in the case, ultimately the delay appears to have had a relatively insignificant impact on the continued viability of the Federal League.  Indeed, by the end of the four-day hearing the Federals had simplified their request for immediate injunctive relief to simply an order preventing the major leagues from interfering with the Federal League's players or denigrating the league in the press.  With a few minor exceptions, the major leagues largely acceded to these requests throughout 1915 despite the lack of a formal injunction.  Therefore, even if Landis had issued a ruling on a more timely basis it is far from certain whether it would have significantly helped the Federal League.

Thus, despite baseball fans' general awareness of the Federal League's 1915 antitrust suit and Judge Landis's involvement in the litigation, I nevertheless believe my book will uncover a number of important new details about the proceedings.

Richard Sherman, Marcus Smart, and Booby Clark

The following post is written by Joseph Kohm, Jr., an attorney and agent at Diakon Baseball Group in Virginia. Kohm represents, among others, Blue Jays All-Star pitcher Steve Delebar.  Kohm has also taught sports law at Regent University School of Law and in the late 80s played on Syracuse's men's basketball team.  We're pleased to have Joe's contribution.  He also authored the Sports Law Blog posts titled Do Conflict of Interest Rules Prohibit the NFLPA from Representing Both Jonathan Martin and Richie Incognito? last November and What if Rick Pitino Had Been A Woman? in 2009.  -- Mike McCann

 * * *

The controversy surrounding Richard Sherman’s interview with Erin Andrews and Marcus Smart’s suspension for interacting with a fan, harkened me back to my first year Torts class.  While studying the distinction between negligence and recklessness, our reading assignment included the 1977 case Hackbart v. Cincinnati Bengals, Inc. and Charles “Booby” Clark,  435 F. Supp. 352 (1977).  The facts recounted how on an interception during an NFL game, Clark, a running back with the Bengals, elbowed Hackbart, a defensive back for the Broncos, in the back of the head, thereby shortening Hackbart’s career.

What jumped out at me from the opinion was the inclusion of testimony from Broncos Head Coach John Ralston on the level of aggression coaches intentionally cultivate in their players to produce a “controlled rage.”  Ralston testified that, 

The pre-game psychological preparation should be designed to generate an emotion the equivalent to that which would be experienced by a father whose family had been endangered by another driver who had attempted to force the family car off the edge of a mountain road.  The precise pitch of motivation for the players at the beginning of the game should be the feeling of that father when, after overtaking and stopping the offending vehicle, he is about to open the door to take revenge upon the person of the other driver.    

While Hackbart was a civil case regarding liability, the underlying premise remains that high level athletics (the National Football League, Big 12 basketball) is equal parts emotion and physicality.  Thus, when Richard Sherman did his best Clubber Lang impersonation with Erin Andrews, it was just a natural outflow of the “controlled rage” that most in the NFL live on in order to play a sport that is the equivalent of being in an automobile accident on every play.  What Richard Sherman says 30 seconds after a game has to be placed in different context to what he says one hour after a game.

Fast forward to Oklahoma State’s Marcus Smart, who was suspended Sunday by the Big 12 for “inappropriate conduct with a spectator” toward the end of their game with Texas Tech.  The Big 12 must have a pretty loose definition of the term “spectator.”   Much to the mortification of many basketball purists, high level collegiate basketball has become a contact sport, and no matter how often the officiating higher-ups produce “points of emphasis” (see this season’s cause celeb – the hand check), the game will continue in a rectilinear direction towards increasing contact. 

As Marcus Smart tripped over a camera operator, he ended up a few feet from Tech “super-fan” Jeff Orr.  In a two point game with just a few seconds left, Smart had just finished sprinting down court in an attempt to block a Tech layup.  He was called for a foul.  At this point, Marcus Smart’s mental state was probably not much different from that of Richard Sherman’s after Sherman deflected the game winning pass intended for Michael Crabtree. 

While I don’t condone Marcus Smart verbally engaging Jeff Orr, I don’t think the three game suspension was warranted.  A close inspection of the video shows that Orr made a quick upward gesture with his left hand in very close proximity to Smart’s face.  An argument could be made that Jeff Orr’s hand feign constituted an assault placing Smart in apprehension of imminent harm and his push of Orr was self defense.  Is it unrealistic to think that at that split second in time, Marcus Smart’s conduct was an outlier, even if he wasn’t 19 years old?   Unfortunately, it appears Smart’s discipline neglected to factor in “controlled rage” which major college and professional athletics regularly and handsomely cash in on.                

Joseph Kohm, Jr.

Sports Law History: The Federal League as the First Single Entity League

This is the second in a series of posts discussing my research into the history of the 1922 U.S. Supreme Court case of Federal Baseball Club of Baltimore v. National League, culminating in my recently released book, Baseball on Trial: The Origin of Baseball's Antitrust Exemption. Click here to read the earlier posts in the series.

Those who are well familiar with the Supreme Court's decision in the Federal Baseball case know that the lawsuit evolved out of the Federal League challenge to the American and National Leagues in 1914 and 1915.  One potentially interesting aspect of the Federal League's operations that I discovered during the course of my research was that the league was arguably structured as the first single-entity professional sports league.  While much has been made in recent years of the so-called single-entity defense under Section One of the Sherman Act -- ultimately culminating in the Supreme Court's 2010 decision rejecting the theory in American Needle v. National Football League -- the Federal League appears to have been well ahead of its time, structuring its operations in such a manner that may have arguably allowed it to avoid the Section One scrutiny that the existing professional leagues' operations are typically subject to today.

Founded in 1913, the Federal League was organized as a for-profit, Indiana corporation.  More importantly, the league exerted significant control over its member teams.  For instance, under the terms of the league's franchise agreement, the Federal League could seize control of any team if it violated any league rule.  Indeed, the Federal League exercised this authority on at least one occasion, declaring that the Kansas City Packers franchise had been forfeited to the league in February 1915 due to its failure to raise sufficient capital for the upcoming season (the history of the litigation resulting from this seizure is detailed in my forthcoming law review article, Insolvent Professional Sports Teams: A Historical Case Study).  In contrast, the NFL Constitution only allows the league to terminate a franchise in instances where the team (i) files for bankruptcy, (ii) disbands in mid-season, or (iii) permanently goes out of business.  Thus, the central Federal League office possessed greater authority over its individual franchises than is typically the case in professional sports leagues today.

Meanwhile, although each of the Federal League's eight teams owed 1/8th of the league entity's corporate stock, the league required that these shares be assigned back to it in return for the grant of a franchise.  Similarly, the league also required that each franchise assign its stadium lease to the league, so that teams could not unilaterally desert the league to join the major leagues (or if they did, they would at least no longer have anywhere to play).

Admittedly, this structure may not have been enough for a modern day court to hold that the Federal League operated as a single economic actor in the marketplace, and thus was a single-entity beyond the scope of Section One after American Needle.  This is especially true given that each Federal League team was independently owned and operated, and had a direct voice in the league's operation by holding a seat on the league's Board of Directors.  In many respects, the Federal League structure was thus roughly analogous to that originally adopted by Major League Soccer.  Despite initially convincing a federal district court that it was a single-entity, MLS's bid for Section One immunity ultimately failed at the First Circuit Court of Appeals.  Nevertheless, a league adopting the Federal League's structure today would likely be able to stake a stronger claim to single-entity status than can many of our existing professional sports leagues.

Sports Law History: The Federal League Litigation of 1914

This is the first in a series of posts discussing my research into the history of the 1922 U.S. Supreme Court case of Federal Baseball Club of Baltimore v. National League, culminating in my recently released book, Baseball on Trial: The Origin of Baseball's Antitrust Exemption. 

One hundred years ago, professional baseball was in a state of turmoil.  The two major leagues, the American and National, were facing a challenge to their supremacy from the rival Federal League.  After completing its initial season in 1913 employing mostly semi-professional and former pro players, the Federal League announced its intentions to elevate itself to major league status in 1914 by signing major league players away from their current clubs.  The Federal League believed it could do this based on advice from its legal counsel, who had determined that the existing standard major league player contract was legally unenforceable due to two provisions: the reserve clause and the ten-day release provision. The reserve clause assigned each team the automatic right to renew its players' contracts for the following season, effectively tying players to their current teams for the entire length of their careers. Meanwhile, the ten-day release provision allowed teams to release their players for any reason at all simply by providing them with ten days notice.

The Federal League's attorneys believed that these two provisions, taken in combination, rendered the players' contracts legally unenforceable due to a lack of mutuality, insofar as they believed it was unfair to force a player to work for a single team for his entire career when the team itself was bound to the player for no more than ten days at a time.  The Federal League's position was supported by several legal decisions arising out of the so-called Players' League challenge of 1890, in which courts refused to enforce the reserve clause in players' contracts.  See Metropolitan Exhibition Co. v. Ward, 9 N. Y. Supp. 779 (Sup. Ct. 1890); Metropolitan Exhibition Co. v. Ewing, 42 Fed. 198 (C. C. S. D. N. Y. 1890).  Based on this legal theory, the Federal League successfully persuaded approximately 50 major league players to sign with it during the 1913-14 off-season.

The major leagues fought back by aggressively recruiting the defecting players back into their fold, often offering the players significant raises.  Ultimately, thirteen different lawsuits were filed between the two sides in 1914, as the parties sought injunctions to prevent their players from jumping back and forth between the leagues.  While devoted students of baseball legal history may have already been aware of several of these cases, including Cincinnati Exhibition Co. v. Marsans, 216 F. 269 (E.D. Mo. 1914), Weeghman v. Killefer, 215 F. 168 (W.D. Mich. 1914), and American League Baseball Club of Chicago v. Chase, 149 N.Y.S. 6 (Erie County Sup. Ct. 1914), others had been largely forgotten prior to my research.

For example, one of the most significant cases of the year involved pitcher George "Chief" Johnson (pictured), who defected to the Federal League in April 1914 following a dispute with his prior team, the Cincinnati Reds.  The Reds immediately secured a temporary injunction in Illinois state court to prevent Johnson from making his Federal League debut in Chicago during the inaugural game at Weeghman Park, better known today as Wrigley Field.  By the time Cincinnati's attorneys reached the ballpark, however, the game had already begun, so Johnson was served with the court papers when walking off the field after the second inning.

The court eventually held a hearing several weeks later to decide whether to issue a permanent injunction preventing Johnson from playing for his new team.  The Federal League was so confident it would ultimately prevail in the Johnson case that it reportedly arranged for as many as thirty-seven major league players to jump to the new league should it receive a favorable decision from the Chicago court.  Unfortunately for the Federals, however, the state court judge issued a permanent injunction on June 3, 1914, upholding the standard player contract Johnson had signed with the Reds, on the basis that it must have been fair in light of the number of players who had voluntarily agreed its terms.  Although this decision would be overturned on appeal several weeks later -- allowing Johnson to resume his Federal League career -- the damage had been done, as the Federal League's planned raid of the major leagues fell apart following the trial court decision.

While the initial decision by the Johnson court was a significant set-back for the Federal League, the parties ultimately battled to a draw in their 1914 litigation efforts, with both sides winning several important decisions.  Perhaps more significantly, these lawsuits also set the stage for the next major phase of the Federal League's legal challenge to the major leagues, namely the federal antitrust lawsuit it filed with Judge Kenesaw Mountain Landis in 1915 (to be discussed in my next post).

Baseball on Trial: The Origin of Baseball's Antitrust Exemption

I recently spent the better part of a year and a half researching and writing a book documenting the history of the 1922 U.S. Supreme Court case of Federal Baseball Club of Baltimore v. National League, the litigation that gave rise to baseball's antitrust exemption.  I am happy to announce that the book, titled Baseball on Trial: The Origin of Baseball's Antitrust Exemption (from the University of Illinois Press), has been released and is now available for purchase.

Baseball on Trial draws upon a variety of original source materials, including the original court records from the litigation, contemporaneous newspaper accounts, and a recently released collection of attorney correspondence from the case available at the National Baseball Hall of Fame Research Library in Cooperstown, New York.  Not only does the book document the history of the Federal Baseball lawsuit itself, but it also covers the many precursor cases arising out of the Federal League challenge to Major League Baseball in 1914 and 1915, litigation which in many ways set the stage for the Supreme Court proceedings.  Through a series of posts over the next several days, I'll be summarizing some of the more interesting findings from my research.

In the meantime, here is the publisher's official description of the book:

The controversial 1922 Federal Baseball Supreme Court ruling held that the "business of base ball" was not subject to the Sherman Antitrust Act because it did not constitute interstate commerce. In Baseball on Trial, legal scholar Nathaniel Grow defies conventional wisdom to explain why the unanimous Supreme Court opinion authored by Justice Oliver Wendell Holmes, which gave rise to Major League Baseball's exemption from antitrust law, was correct given the circumstances of the time.

Currently a billion dollar enterprise, professional baseball teams crisscross the country while the games are broadcast via radio, television, and internet coast to coast. The sheer scope of this activity would seem to embody the phrase "interstate commerce." Yet baseball is the only professional sport--indeed the sole industry--in the United States that currently benefits from a judicially constructed antitrust immunity. How could this be?

Using recently released documents from the National Baseball Hall of Fame, Grow analyzes how the Supreme Court reached this seemingly peculiar result by tracing the Federal Baseball litigation from its roots in 1914 to its resolution in 1922, in the process uncovering significant new details about the proceedings. Grow observes that while interstate commerce was measured at the time by the exchange of tangible goods, baseball teams in the 1910s merely provided live entertainment to their fans, while radio was a fledgling technology that had little impact on the sport. The book ultimately concludes that, despite the frequent criticism of the opinion, the Supreme Court's decision was consistent with the conditions and legal climate of the early twentieth century.

"[A] thoughtful and provocative analysis of one of the most controversial topics in sports law: Baseball's antitrust exemption. Grow adroitly connects recent disclosures from the Baseball Hall of Fame to advance his argument that the Federal Baseball holding made much more sense ninety years ago than contemporary commentators tend to regard it. As baseball's antitrust exemption continues to face legal challenges--including whether the Oakland A's can move to San Jose--Grow's book will undoubtedly play an influential role." -- Michael McCann, Sports Illustrated legal analyst

"The lawsuits arising from the Federal League's challenge to Major League Baseball and their aftermath defined much of the way baseball has evolved over the past century. Bolstered by original research, Grow explains both the broader picture and the intriguing behind-the-scenes machinations, and he does so in a clear and entertaining fashion." -- Daniel R. Levitt, author of The Battle that Forged Modern Baseball: The Federal League Challenge and Its Legacy

"An outstanding book based on previously unused materials, Baseball on Trial makes a truly significant contribution to the fields of baseball and the law, sports law, antitrust law, and legal history. Anyone discussing the trilogy of Supreme Court cases that created baseball's antitrust exemption needs to read this book." -- Edmund P. Edmonds, co-editor of Baseball and Antitrust: The Legislative History

Supply and Demand on National Signing Day

Wednesday was "National Signing Day" -- a day that has become an unofficial holiday of sorts for college football and its consumers.  The media coverage of the signings of Four and Five-Star recruits on this day just becomes more intensified each year.  Indeed, National Signing Day has all the resemblances of Draft Day in professional sports: The "war rooms," the depth charts, the last minute decisions, the last minute faxes, the high stress, the high fives, and all the uncertainty of which teams are going to get the top players available in the class.


But what I see on this particular day each year is a huge demand for a very small supply of people who possess unique and extraordinary skills and whose performances are necessary for the product of major college football to exist.  Unlike the rest of us in this world, these elite athletes are not fungible (replaceable) and, thus, their market value is increasing each year along with the exponentially increasing revenues generated by the industry.


The current conversation surrounding the threat to "amateurism" is fixated on the legality of NCAA rules and whether the NCAA and its members can prevail in court and, as of two weeks ago, in front of labor relations boards.  But perhaps we are grossly underestimating the leverage possessed by these elite athletes as well as the practicality of their ability to collectively demand and obtain, outside of the boundaries of the legal system, more rights and benefits from their universities in exchange for their willingness to show up and perform for us on Saturdays.  In other words, the biggest threat to "amateurism" is likely going to be basic economic principles of supply and demand.

In conjunction with a symposium last fall at the University of Mississippi School of Law, I wrote a paper discussing these issues and it will be published soon in the Mississippi Sports Law Review.  The paper is titled, "The Battle Outside of the Courtroom: Principles of "Amateurism" vs. Principles of Supply and Demand," and can now be downloaded from the SSRN link here.