There have been no shortage of legal themes this season for Major League Baseball. The payment, or lackthereof, of a bonus in Alex Rodriguez’s contract, a “hacking” scandal of private databases, artificially holding back prospects for service time reasons, and now, a scout suing baseball because he’s underpaid.
First of all, the proper name of the lawsuit is about 300 words long and contains every team and holding corporation in baseball. But, for the purposes of brevity, the suit is Wyckoff v. Office of the Commissioner of Baseball. One name associated with the lawsuit may be familiar to those that follow this sort of thing, Garrett Broshuis is the attorney in the minor league player wage and hour lawsuit that is currently ongoing (Senne).1
There is plenty to look at in this 33-page complaint but it can be distilled down to two main claims: scouts work more than 50-60 hours per week most weeks and get no overtime and are paid about $5.00 an hour (allegedly); and MLB and its owners have artificially deflated the market for scouts and kept their salaries down by making rules that don’t allow them to talk to other teams until their contracts run out (allegedly).2
One thing to note about this lawsuit that was well explained by Fangraphs’ Nathaniel Grow is that they chose to file in the Southern District of New York as opposed to the Northern District of California like Senne. There are likely many reasons for this, but two are chief among them. Senne had some issues acquiring jurisdiction over several MLB teams that weren’t connected well enough to California.3 California was a solid choice because of how many teams are in California to face the four MLB teams based in California and the many minor league teams, but eight got away. In New York, there are still two teams, an AL and NL team, and there is also the Commissioner’s office and MLB’s main office. The strategy is likely hoping to keep more teams in this suit.
The second reason is that New York has very recently shown a favorable view to the employee side of antitrust litigation in umpire and broadcasting contexts, whereas California is more favorable to the employer side.
MLB will certainly assert their antitrust immunity as a defense, but that could be risky, as we’ve seen in their not appealing previous losses on antitrust immunity so that they don’t lose their exemption from a higher, more influential, court. If they lose, it’s another chip in their exemption’s armor. If they win, it could be appealed to a higher court, setting up the ever-possible denial of the antitrust exemption as a whole.
There is a long history to the antitrust exemption and it has been detailed in many places and I won’t rehash it here. The cliffsnotes are that it’s highly questionable from a legal standpoint, almost laughable in some ways, but it sticks because it has for so long. The longer it stands, the stronger the doctrine of stare decisis ((Stare decisis is the phrase that gives the U.S. legal system the idea of precedent setting cases and relying on them for later cases)) becomes.
MLB will also try to assert an exemption from the Fair Labor Standards Act, which is the vehicle that Wyckoff is using to allege he wasn’t paid overtime or minimum wage, through their status as an “amusement.” Section 213 of the FLSA requires that they not operate for more than 7 months of the year and a complicated earnings based second requirement. There are other exemptions that MLB will attempt as well, but that are unlikely.
In the end, it will be up to the judge and we won’t see the end of this lawsuit for quite some time, unless it is settled out of court. The antitrust exemption is vulnerable, especially in New York, but it has been upheld for so long, it is hard to see a court eliminating it, even in a small portion like non-player employees.
8 teams were dismissed for the court lacking jurisdiction because these teams didn’t have enough connections with California (i.e. minor league teams, employees, business) – Atlanta Braves, Chicago White Sox, Tampa Bay Rays, Washington Nationals, Philadelphia Phillies, Boston Red Sox, Baltimore Orioles, and the Cleveland Indians ↩