Friday, November 16, 2007


"No battle is ever won. They're not even fought. The Battlefield only reveals to man his own folly and despair and Victory is an illusion of philosophers and fools." --William Faulkner

No one likes lawyers very much; less so, agents.

Scott Boras, however, arouses in fans, reporters, critics, and of course, baseball's owners and GMs, an animosity usually reserved for tyrants, subversives, and crooks. His less than scrupulous tactics explains some of it. His arrogance, presumption, and cynicism certainly doesn't help. However, sheer envy accounts for much of it as well. The resentment testifies to the skill. After all, Boras doesn't disguise his ambition to be the best at what he does. And his adversaries' (and rivals') hostility largely proves that Boras has succeeded. Indeed, the man who dominates his field, as A-Rod does his, should take pride in having earned the unalterable hatred of some of the most competitive, rapacious, and frugal business tycoons in the country-- men who since the days of Charlie Comiskey have lied, stonewalled, and colluded to preserve their stranglehold on the profits Boras has managed to re-distribute among the people most responsible for generating them, his clients.

It's no accident, then, that the sports media has crowned Boras baseball's most influential and notorious agent. However, as he recently revealed in a less than flattering New Yorker profile ("The Extortionist" October 29, 2007), Boras actually considers himself a lawyer, first and foremost. To his mind, the lawyer's mantle fits more aptly with his conception of himself as a learned professional driven, above all, by high-minded purpose.

The media, in contrast, prefers to see Boras through its own narrow and jaundiced prism. Baseball Columnist, Bill Madden, for example, would reduce the man he calls "the Avenging Agent," to some comic-book crusader exacting revenge for a minor-league baseball career derailed by injuries and thwarted by inadequate talent. First of all, the caricature exaggerates Boras' actual modest expectations for his baseball career. From which he wanted little more than a practical way to finance his education, first through a college scholarship and later, a subsidy for his law school tuition. And by this measure, Boras can count his minor-league career a resounding success. Secondly, by evoking the vindicitve malcontent who wishes to bankrupt his former bossess, Madden's caricature trivializes the baseball's ignoble legacy of exploitation, graft, conspiracy, fraud, wage-fixing and labor scabs against which Boras fights.

Anyway, what ultimately motivates Boras's crusade is far less important than how he envisions it and what he intends it to accomplish. Which in the modern era is to right the injustice that has enabled baseball ownership to veil their books in secrecy, to siphon undeclared revenue streams, to skirt anti-trust laws, to trade on political patronage, to beggar minor-league players, to deny amateur's legal representation, and to amass exorbitant profits they neither account for nor confine to their proportionate contribution to the game.

Nonetheless, the dynamic of the crusade also explains how and why Boras' mission could so easily could founder in overzealousness, hubris and miscalculation, as it did this time. Boras bungled the A-Rod negotiations and cost his client at least $21 million, if not more, because the incandescence of his righteousness blinded him. Zeal ensnared him in the missionary lawyer's trap. Cause eclipsed client. Boras lost sight of his paramount duty--to fulfill Alex Rodriguez' personal wishes and to advance his limited self-interest.

You see, the legal advocate often strives to vindicate two interests simultaneously, interests that can converge but often as not conflict-- the interest of his cause and the interest of his client. To illustrate, witness the infamous OJ case. One the one hand, when Johnnie Cochran played the "race card," he did so for the simple reason that appealing to his preponderantly black jury's racial grievance promised his best chance for his client's acquittal. Nonetheless, Cochran's indignation at the LA law enforcement's ignominious record of racism animated him as well. Cochran sought to establish a legal precedent for jury nullification where endemic racism has tainted the criminal investigation. Acquitting OJ, despite the incriminating evidence against him would achieve a farther-reaching objective. It would signal to the City of LA that the racism which pervades their police department, unless eradicated, will forfeit their officer's legal authority, void the legitimacy of the arrests they make, and risk exoneration of the guilty they accuse. Serving OJ served Cochran's cause. Or perhaps, more accurately, Cochran's cause served OJ. In either case, the interests of client and cause intersected.

What does Johnny Cochran have to do with Scott Boras? Well, Boras, a self-styled labor lawyer, confronted a similar dichotomy between client and cause in his representation of A-Rod. Only this time the two goals diverged. And Boras was remiss in not subordinating his larger cause to A-Rod's avowed interest.

We can assume Alex Rodriguez retained Boras for the reason every performer seeks representation from his agent-- to maximize his share of the money others earn from his performance. The actor from the studio. The musician from the record company. The ball player from the owner.

Accordingly, Boras claimed Alex Rodriguez, as the best player in baseball, deserved a 12-year contract in excess of $350 million. The figure wasn't arbitrary. Far from concealing his logic, Boras recounted it to the point of tedium. In 2000, the year the Rangers signed A-Rod to a 10-year, $252 million dollar contract, major league baseball was $3 billion dollar industry. Since then it's nearly doubled, to approximately a $6 billion dollar industry in 2007. From this figure, Boras, as such, extrapolated that Alex Rodriguez was worth almost double his 2000 compensation package or around $400 million. Now there are a number of obvious flaws in Boras' logic. The obvious one being that A-Rod 2000 contract far exceeded what the market could bear, as the Rangers problems in paying it subsequently proved. Moreover, no contract executed over the last seven years even nearing its average annual value, and only Manny Ramirez's breaching the $20 million+ threshold.

Still, distorted math is not what propelled Boras in the end, who probably understood the logical flaws in his economic model anyway. No, what drove Boras to miscalculate was that he allowed his agenda to subsume his client's. Sure, Boras wanted to secure for A-Rod the largest contract and the most money possible, as he does for every player. He counseled A-Rod to void his contract and to declare free-agency because in most instances, the competitive bidding of the marketplace sets value and inflates price. But like Cochran saw in OJ, Boras saw in A-Rod an opportunity to set a precedent. A precedent that would benefit all his clients and consistent, moreover, with Boras' idea of players' just deserts.

That Boras had another agenda was evident to anyone with enough patience to listen to his tedious and pedantic lectures. At every public opportunity to discuss A-Rod's contract, Boras cited, ad nauseam, baseball's continuing exponential revenue growth. Which he traced to all the new revenue streams the owners have tapped over last decade in new stadiums equipped with corporate luxury suites and more recently, through the regional sports networks and alliances with foreign baseball leagues. To say nothing of the tremendous boom in attendance, broadcast revenue, overseas merchandising, and overall profit the owners have reaped as a consequence-- profits, in Boras' estimation, and many others as well, the owners haven't shared with their players.

This explains why Boras devised a term of art to characterize A-Rod's worth: IPN, standing for iconic magnetism, historic performance, and network value. The network value comprising the key of course. Boras persisted in arguing that A-Rod was worth hundreds of millions to one of the 25-odd teams who had not founded regional sports networks to broadcast their games. Presumably, with A-Rod's contract, Boras intended to set the precedent for a player garnering a share of the profit a team's sports' network generates.

(Boras has a valid point here, incidentally. Regional sports' networks founded on broadcasting a local baseball team potentially enable owners to segregate, if not conceal, the revenue they otherwise would have to declare. To illustrate, when MSG paid the Yankees $40 million annually for the right to broadcast Yankee games, the Yankees could not deny that their operating revenues included $40 million above and beyond the gait. Such is not necessarily the case with the YES Network. The Yankees own 36% of YES, but it's a separate legal entity. Who's to say whether YES pays the Yankees a fair-market rate for broadcast rights?)

The problem, of course, is that A-Rod, evidently, didn't want to serve as the self-sactificing martyr in Boras' grand design. He wanted to play for the Yankees, plain and simple, and to extract as much money from them as Boras could. Boras, it seems, persuaded A-Rod that to accomplish as much, he had to opt-out first, enable the bidding process to begin, and then persuade the Yankees to match the offer. Presumably, if some team like the Giants or Angels interested in founding a sports network offered A-Rod some share in its profits, the Yankees would have to respond likewise.

Only it soon became clear the Yankees had other ideas. They weren't bluffing about the consequences A-Rod risked in opting-out. The Front-Office was set to replace him. And once Cashman's pursuit of Miguel Cabrera, Mike Lowell, Miguel Tejada or Scott Rolen accelerated, A-Rod realized his interests and Boras' agenda conflicted. He wasn't going to play somewhere other than the Bronx just so his lawyer could realize his mission to transform baseball's landscape. And who could blame A-Rod for refusing to play the standard-bearer? Who could blame him for refusing the the sacrifice Boras' justice would have exacted? He did that once and he ended up languishing in Texas.

So A-Rod returned to the Yankees and agreed to forfeit the $21 million subsidy his opt-out denied them. While Boras' zeal, perhaps for the first time, cost his client instead of enriching him.

And so this Thanksgiving, we Yankee fans gives thanks that baseball mirrors America, where more often than not, over collective justice, self-interest will prevail.


Stan said...

What do you think about the current contract the Yankees are offering A-Rod given the performance bonuses. Sure, they may just be an artifact of negotiations and devoid of larger implications but how do they play into Boras' game-plan?

Matthew S Schweber said...

Excellent question-- and one impossible to answer.

On the one hand, Boras lost the battle because he's no closer today to a precedent for securing his players a percentage of a team's network revenue and/or share in its network's equity.

On the other hand, through Rodriguez' marketing contract, the Yankees have tacitly acknowledged one of Boras' premises in touting A-Rod's iconic value. Namely, that an "Iconic" player deserves his share of the profit bonanza his pursuit of historic milestones brings the game in general, and his team, in particular.

Only time will tell whether A-Rod's case is sui generis however.

After all, how many other baseball records produce the publicity and furor of the home run crown? And how many future players will rival A-Rod's record-setting pace?

Then again, who knows what future labor agreements may herald? Boras' latest setback should not delude the owners into thinking the Yankees have permanently deflated the agent's mystique. They underestimate the man's shrewdness and resilience at their peril.