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MLBPA looks at agent rule changes
Published August 2, 2010
The MLB Players Association could become the first players union to penalize certified agents who leave their agencies and take players with them in violation of their noncompete and nonsolicitation agreements.
The proposed rule change was part of an e-mail the union sent to agents and players in March asking them for input on an array of possible new agent regulations. Other points deal with issues such as the solicitation of player clients, inducements and how much equipment an agent can provide to a player client.
The MLBPA’s executive board, made up of player reps and alternates, could vote to enact some or all of the proposed regulations or variations of them, or decide not to adopt any of them. If adopted, the proposals would constitute the MLBPA’s first major overhaul of its agent regulations since they were put in place in the late 1980s.
MLBPA Executive Director Michael Weiner declined to comment, so the reason for the proposals is not known, but they are believed to be motivated by the union’s view that players have been harmed by the competition that exists in the agent business.
Players would never be forced to stay with one particular agent, but the union proposed a rule that a player eligible for free agency or salary arbitration after the current season who terminated his agent without cause would owe the former agent 2 percent of his next year’s MLB earnings.
Under the proposed regulations, agent employment contracts may contain a one-year no-solicitation clause and a one-year no-competition clause. If an agent were to violate those clauses and take clients with him, proposed remedies include a 50 percent fee split on the players who leave and the option for the players association to take disciplinary action against the agent.
Currently, state laws apply when an agent leaves an agency and takes along clients, but different states have different laws. For example, Ohio recognizes nonsolicitation and noncompete clauses in employment contracts, but such clauses are unenforceable in California.
The issue came up in current litigation in those states involving a coaches agent who left IMG for CAA (and was later fired by CAA). In that case, the agent, Matthew Baldwin, is fighting to have the case heard in California, while IMG wants the case heard in Ohio.
If the MLBPA were to pass the regulation, it could be enforced in California in situations involving MLBPA-certified agents because the union has the right to establish rules different from state laws for agents it certifies. Under federal labor law, sports unions are the exclusive bargaining representatives of all their members. The North American sports unions have delegated the right to negotiate individual player contracts to agents, but the agents are required to abide by their rules.