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Saturday, November 23, 2013
 
Update on the San Jose v. MLB Lawsuit

Following the release of the district court's opinion in the San Jose v. Major League Baseball lawsuit last month, many assumed that the city would seek an immediate, interlocutory appeal.  (For earlier Sports Law Blog coverage of San Jose's suit and the ongoing dispute regarding the proposed relocation of the Oakland A's, click here.)  As Howard Wasserman noted at the time, though, it was unclear whether San Jose could in fact immediately appeal the decision.  Because the court's opinion was largely premised on baseball's well-established antitrust exemption, Judge Whyte's decision did not present a "substantial ground for difference of opinion" as required under 28 U.S.C. 1292(b), and as a result it did not appear that San Jose could immediately pursue an interlocutory appeal in the case.  Indeed, nearly than a month and a half later the lawsuit is still pending in the Northern District of California.

However, Judge Whyte has signaled that he may be willing to allow the city to appeal the decision shortly.  In a hearing scheduled for December 13th, the judge has asked the parties to be prepared to discuss two primary issues: (1) whether the court should retain supplemental jurisdiction of the remaining state law claims in light of the fact that the federal claim in the case was dismissed, and (2) whether a final judgment should be entered with regards to the previously dismissed claims pursuant to Federal Rule of Civil Procedure 54(b), a provision that allows courts to enter final judgment in a case once some, but not all, of the claims in the suit have been resolved.  Under Rule 54(b), the court must determine that there is "no just reason for delay" in entering final judgment for the dismissed claims. 

Presumably, San Jose will seek to persuade the court to retain jurisdiction over the remaining state law claims -- so that it can begin to pursue discovery in the case in an attempt to obtain some leverage over MLB -- while at the same time urging Judge Whyte to enter a final judgment on the dismissed claims so that the city can appeal them to the Ninth Circuit Court of Appeals.  Meanwhile, MLB will likely contend that the court should not retain supplemental jurisdiction over the remaining state law claims, but instead dismiss them outright.  However, should the court opt to retain jurisdiction over the state law claims, I would expect MLB to argue that it should then refrain from issuing a final judgment under Rule 54(b), in hopes of avoiding the prospect of simultaneously litigating the case on two separate tracks.

Assuming the court decides to enter a final judgment -- either under Rule 54(b), or following the dismissal of the remaining state law claims -- San Jose's immediate prospects on appeal do not appear to be particularly strong, given that the Ninth Circuit has previously affirmed the dismissal of a suit raising similar franchise location issues under baseball's antitrust immunity.  Portland Baseball Club, Inc. v. Kuhn, 491 F.2d 1101 (9th Cir. 1974).  Nevertheless, a pending appeal would continue to give the city some leverage over MLB in any negotiations regarding the A's proposed move to San Jose.  Perhaps more importantly, pursuing an immediate appeal would also expedite the city's timetable for a potential Supreme Court appeal.  The prospect of the Supreme Court reconsidering baseball's prized antitrust immunity would undoubtedly be a significant cause for concern for MLB, and could finally convince the league to approve the A's relocation.





2 Comments:

I think MLB also could ask Judge Whyte to stay the state-law claims litigation pending the appeal of a judgment on the A/T-based claims. A stay would defuse the discovery threat.

Anonymous Anonymous -- 11/23/2013 2:19 PM  


Good point. If Judge Whyte indicates that he is inclined to retain jurisdiction over the state law claims, MLB will have an interesting choice to make. On the one hand, the league could try to stay the state law claims to avoid any potential discovery, but have to defend the antitrust exemption before the Ninth Circuit (and potentially the Supreme Court). Alternatively, the league could push to move forward with discovery on the state law claims while deferring any additional litigation regarding the antitrust exemption. It will be interesting to see what they choose, should they have to pick.

Blogger Nathaniel Grow -- 11/25/2013 7:47 PM  


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