Judge rejects San Jose antitrust claims vs. MLB

SAN FRANCISCO — The city of San Jose’s antitrust claims against Major League Baseball were dismissed Friday by a federal judge, who allowed the city to pursue allegations of contract interference in connection with the Oakland Athletics’ stalled relocation plans.

U.S. District Judge Ronald M. Whyte in San Jose ruled that MLB’s antitrust exemption, created by the U.S. Supreme Court in 1922, barred most of the claims in San Jose’s lawsuit. The city filed the lawsuit in June, accusing MLB of conspiring to stop the team’s proposal to move to a planned ballpark in downtown San Jose.

MLB defines San Jose and its suburbs in Santa Clara County as the exclusive territory of the San Francisco Giants.

Whyte rejected San Jose’s contention that the antitrust exemption was limited to the player reserve system and ruled it includes MLB’s “business interests,” such as relocation issues.

The Supreme Court last upheld the exemption in the 1972 Curt Flood case, when the court said it was up to Congress to change the exemption. Whyte said the fact that Congress altered the exemption in the 1998 Curt Flood Act only with respect to the employment of major league players was evidence that Congress did not wish to alter it for baseball’s other business.

“The court holds that MLB’s alleged interference with the A’s relocation to San Jose is exempt from antitrust regulation,” the judge wrote.

San Jose’s outsider lawyer, Joe Cotchett, said he plans to appeal the decision to the 9th U.S. Circuit Court of Appeals.

“I find it hard to believe Major League Baseball is not subject to the same antitrust rules that apply to all other sports,” Cotchett said.

The judge did allow San Jose to pursue claims MLB interfered with the city’s contract with the A’s, which involves an option to purchase downtown land for a new ballpark.

Baseball Commissioner Bud Selig established a committee in March 2009 to study the issue and says the group remains at work.

“The city was justified in assuming that MLB would make a decision within a reasonable time, which it has not,” Whyte wrote. “Regardless of whether MLB ultimately approves or denies the relocation request — and the court has concluded that it is within MLB’s authority to decide either way — the A’s were recently forced by MLB’s delay to extend the Option Agreement for another year, or lose the option. As a result of MLB’s delay, the A’s incurred an additional $25,000 expense to renew the option, and the city is left waiting another year to sell the land set aside for the stadium in question.”

MLB, in a statement, said it was pleased by Whyte’s ruling “that MLB has the legal right to make decisions about the relocation of its member clubs.” It also said it was confident that San Jose didn’t suffer any “compensable injury” because of MLB’s action and that it ultimately would prevail on the contract claims.

The A’s play in the O.co Coliseum, originally the Oakland-Alameda County Coliseum, which opened in 1966, and it is the only facility shared by MLB and the NFL, whose Oakland Raiders are based there. A sewage problem forced the A’s and Seattle Mariners to use the same locker room after a game this summer.

The pipes backed up on the lower levels of the stadium, creating a stink of raw sewage and pools of water in the clubhouses used by both teams and the umpires.

The A’s were not a party to the lawsuit, but owner Lew Wolff said the team remained committed finding a new home.

“No matter what the outcome of any legal action, the A’s have and will continue to follow the process available to all MLB ownerships in our desire to have a modern and exciting state of the art baseball only venue,” Wolff said in statement.

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