Jacoby Ellsbury & MLBPA vs. New York Yankees

This week the MLB Players’ Association filed a grievance against the New York Yankees on behalf of the team’s former center fielder Jacoby Ellsbury in an attempt to recoup the remaining $26 million that he argues is owed to him. After winning the World Series with the Red Sox in 2013, Ellsbury signed a seven year, $153 million contract with the Yankees, however went on to miss a staggering 452 games between 2014-2019. For reference, in that same time frame the Yankees played 972 games (excluding playoffs), meaning the speedy outfielder appeared in just over 53% of those contests. If that wasn’t already hard enough to stomach, according to Fangraphs, Ellsbury registered a wRC+ (explanation below)* of 96 as a New York Yankee, so he was roughly 4% worse than league average.

While it is impossible to understate how disappointing Ellsbury’s tenure in the Big Apple was, his contract, like the vast majority of MLB contracts, was fully guaranteed therefore the $153 million was never contingent upon performance or even playing for that matter. However, the Yankees allege that the former silver slugger violated his contract by receiving unauthorized medical treatment which allowed them to convert his contract to “non-guaranteed” and then subsequently release him.

According to the Yankees, the 36-year-old was treated for an injury by Dr. Viktor Bouquette in Atlanta without the team’s consent, yet Ellsbury argues that the treatment was for a non-baseball-related injury, which does not require permission. The CBA essentially states that as long as the “Non-Work-Related Injury does not affect the Player’s ability to provide services,” then the player is exempt from disclosing treatment procedures. However, seeing as Ellsbury had not played a game since the end of 2017, which coincidentally is around the same time it is alleged that he started seeing Dr. Bouquette, it will be tough for the MLBPA to prove that there is no link between the two.

Though Ellsbury’s medical records are protected under medical privacy, if there is truly no causal connection between his NWR injury and the right oblique strain that was the first of his slew of 2018 injuries, then he and the MLBPA could and should release those medicals to prove that they are wholly unrelated.

There is a lot at stake for both sides in this case that will be heard by arbitrator Mark Irvings, who will be making a significant ruling next month in another dispute between player and club. For the Yankees, after the historic Gerrit Cole signing, their 2020 payroll ballooned to $243 million, which carries a significant luxury tax. The tax threshold (number at which team’s must pay extra for every dollar over) for next season is $208 million. The Yankees will pay 30% on ever dollar between $208 million and $228 million, 42% between $228-$248 million, and 75% beyond $248 million. So, the Yankees would stand to gain substantially if they lower that figure from $243 million, which would represent $12.3 million in taxes, to $217 million, which would only tax them $2.7 million.

As for Ellsbury, he is still rehabbing but is looking more like a liability than an asset so this $26 million could represent the last paycheck of his player career. However, for the MLBPA it goes a bit deeper as this case could set a meaningful precedent. It brings to mind a 2010 dispute between Carlos Beltran and the New York Mets over a similar issue that never reached litigation. In any case, the verdict in this conflict between the MLBPA and the Yankees could either be the final insult for foolish free-agent spenders or a sign to those same regretful investors that there are in fact legal ways to wriggle their way out of those abominable contracts.

*wRC+ means weighted Runs Created adjusted. This statistic is meant take external factors (such as ballpark or era) into account to paint a picture of a player’s overall value to any given MLB team. 100 represents league average, so a player with a wRC+ of 150 means that player is 50% better than league average and vice versa. wRC+ is widely regarded as one of the best indicators of a player’s true value.

The Curious Case of the Slow Offseason

 

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It is now Christmas day and many of the top free agents are still available including names such as Yu Darvish, Eric Hosmer and J.D. Martinez. The sluggish pace of the market is a result of a few factors, the first couple being Shohei Otani’s posting and shortstop new owner Derek Jeter’s dismantling of the Miami Marlins. With the majority of the MLB contending for the services of Otani and/or Giancarlo Stanton, free agents have had to be patient for these dominos to fall before teams turned their attention to their likeness. However, now that these two stars have found new homes with the Angels and Yankees respectively, one would imagine that the market would have picked up pace. Instead, negotiations have continued at a slow clip, with the only notable signings coming in the form of SS Zack Cosart (Angels, 3 years/$38 million) and 1B Carlos Santana (Phillies, 3 years/$60 million).

For comparison, last year at this time, the majority of major free agents had already been signed, but teams are being more patient this time around opting to build their teams through trades and top prospects, while they wait out the demands of players’ agents. This can largely be attributed to last year’s Collective Bargaining Agreement which has discouraged larger market teams from going over the luxury tax line of $197 million by increasing the penalty for consecutive years of spending overage. This modification was put in place with the intention of making the league more competitive, which makes sense, because it is admittedly hard for a team like the Milwaukee Brewers to be considered on the same playing field with a payroll of $63 million when going up against the LA Dodgers with a payroll exceeding $240 million. In turn, these big market teams are curbing their traditional heavy spending methods in an effort to get beneath that 197 million-dollar threshold – and it’s working. Despite six teams (Dodgers, Yankees, Red Sox, Tigers, Cubs, and Giants) paying the luxury tax last year, all but the Red Sox seem positioned to avoid the penalty in 2018.

So what does that mean for this free agent class? Well, for starters, there is less money to go around and that is especially bad news when two of the top free agent hitters, J.D. Martinez and Eric Hosmer, have Scott Boras as their agent. As his reputation affirms, Boras is seeking multi-year deals worth big money for his prized players – seven years and $200 million plus – to be exact. He has dubbed J.D. Martinez the “King Kong of Slug” and Eric Hosmer as the elite talent that will take a team to “Playoffville.” While Boras’ demands are likely farfetched (especially in this year’s market), it is not hard to imagine that he will produce the offseason’s largest contracts in these two players. What will make his job harder this year however, is the new CBA, which is limiting teams’ willingness to get into bidding wars – the very thing that allows him to reel in the crazy contracts his clients dream of.

The reality is that Martinez and Hosmer will likely sign for far less than the 7 year, 200 million dollar benchmark that Boras has established, but even when they do, what’s next for the rest of the free agent crop? The usual suspects that can be counted on to make a least one major splash each year are scrambling to get under the $197 million threshold. Is someone like 3B Mike Moustakas, who is coming off a productive .272/38-homer year, supposed to get a 100 million dollar contract from the Tampa Bay Rays? Or the Oakland Athletics to sign Jake Arietta to a multi-year deal? These are good players that will find new homes one way or another, but as the offseason drags into January they are going to have to temper their expectations as the reality of a new MLB market sets in.

As the calendar flips to 2018, one of either Boras or the teams with which he’s negotiating will have to blink at some point and contracts for the Hosmer/Martinez slugging duo will get done. After a couple months of waiting, this will finally set the market for the offseason and for better or worse, determine the earning capacities of remaining free agents. However, until then, the rest of the league will be waiting and watching as teams and agents alike adapt to the complexities that the new CBA has introduced to the 2017-2018 offseason.

Does David Ortiz Deserve a Contract Extension?

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There has been much news lately of David Ortiz wanting an extension to ensure at least another year in Boston. Ortiz, who is in the second year of a 2 year $26 million contract, has been with the Red Sox since 2003 and it is tough to picture him wearing anything besides a Red Sox uniform. A contract dispute with the Red Sox, such as this one, is not new to Ortiz as he went through many difficulties getting a two year extension from very reluctant management that was much more comfortable only giving him one year. Ortiz has been very frustrated, not as much with the Red Sox as much as he has been with the media saying this earlier in February, “I don’t even know why they’re bitching about me talking about contracts, guys putting up my numbers, they’re making $25, $30 million. I’m not asking for that. I’m asking for half of it. And they’re still bitching about it? (Expletive) them. I’m tired of hearing them talk (expletive) about me when I talk about my contract. Hey, every time I talk about my contract, I earn it, (expletive). So don’t be giving me that (expletive). The Red Sox have come out and said that they are interested in giving Ortiz an extension the only question is who has the leverage in the negotiations.

The argument to be made here for the Red Sox is Ortiz is a designated hitter; he can play first base, but that benefits no one since he defense is subpar and there is no need to add risk of an injury to an aging body. That wipes out the national league leaving fourteen potential suitors, outside of the Red Sox. Also, Ortiz would only be willing to play for a winning team and compete for another World Series ring, so the Astros, White Sox and Twins are unlikely destinations. As Ortiz stated, he is not looking for $25, $30 million, he wants half of that, still teams that are cash-strapped can’t afford to go out and spend on high profile free agents, so low-budget teams, such as the Athletics, Rays and even Mariners would not be able to sign Ortiz. This leaves about eight teams to compete against the Red Sox, that is if they are all interested. Once, you start breaking it down team by team, the roster situations would not allow room for some like Ortiz, who is locked down to the DH spot, unless a corresponding move would be made. For example, Texas already have Mitch Moreland as their DH, who is nothing close to the same player as Ortiz, but comes at a much cheaper price and the Rangers offense is good enough to cover that weakness. Detroit is moving Miguel Cabrera to first base and has Victor Martinez as a full time DH so it would be tough for Ortiz to fit there. Six teams would realistically have a need for Ortiz: Angels, Royals, Indians, Orioles, Blue Jays, and Yankees. Really only five, because it is impossible to think that the beloved Big Papi could ever play in New York. It would be a betrayal so shocking and disgraceful, worse than Damon and Ellsbury combined, it might generate another 86 year curse. Ultimately, this is a good pitch for the Red Sox and they could let Ortiz see what would be out there on the free agent market, but since he is a DH and creeping up on his 40th birthday, Ortiz has a shorter list of suitors that one would expect for someone ,who is coming off an all star season.

The case for Ortiz is much more simple. He is the face of the Red Sox, he was the face that represented the Red Sox after the marathon bombings, he is irreplaceable. Big Papi is the last remaining member of the ’04 championship season and his experience and leadership cannot be overlooked. Rookies that come up during the season or play with Ortiz during Spring Training often praise him on some influence he has had on them. A quote from SS Jose Iglesias expresses this well,”David’s been in the league for a long time and he knows the guys really well. Every time he says something, you know why he’s saying it. I just listen to him, hear his advice and get better.” These are all good reasons why the Red Sox want to keep him around and this is before even talking about his own field success. Ortiz had to prove many people wrong that wrote him off after his injury-plagued 2012 season, where nothing went right for the Red Sox. He responded by playing in 137 games and hit .309 along with 30 home runs in his age 37 season. Then he really took off in the playoffs hitting .353 with 5 home runs in 16 games, including a game changing grand slam in the bottom of the 8th in the ALCS against Detroit, when the Red Sox were losing 5-1. Ortiz was unstoppable in the World Series, hitting .688 and reaching base 19 times. His whole performance in 2013, leading the Red Sox to their 8th World Series title, is enough to have earned another year in Boston and it is hard to think that the Red Sox don’t get a deal done before the end of the season, although it could come much sooner. Ortiz is deserving of a contract for one year somewhere in the neighborhood of $14-$16 million and he will earn it not only for everything he does on the field, but also because of how much Big Papi means to Boston and its fans.