SAN JOSE -- A federal judge Friday struck out San Jose's illegal-monopoly claims against Major League Baseball over a stalled Oakland A's move but still let the city pursue a case involving a ballpark-land deal with the team.
U.S. District Judge Ronald M. Whyte's split decision in a 26-page ruling acknowledged baseball's unique antitrust exemption seems illogical but that it was beyond his authority to change it. The ruling left both sides claiming victory in the dispute over the A's four-plus-year effort to build a new San Jose ballpark over the San Francisco Giants' territorial objections.
"Ninety-nine percent of this case is gone," MLB lawyer John Keker said. "And we're confident that once the rest of the case is developed, the rest of the case will be gone."
But San Jose officials cheered the chance to continue litigation, which they hope will ultimately lead MLB to greenlight the A's move.
"My view is we're going to extra innings," City Attorney Rick Doyle said. Philip Gregory, one of the private lawyers handling the case for San Jose at no cost to the city, called it "excellent" for both the city and the team, which lost a playoff series Thursday against Detroit.
"Clearly, he wants the case to go forward," Gregory said of Whyte's decision. "The A's may have lost last night, but the A's and the city of San Jose won today."
The Oakland Athletics have played in Oakland's O.Co Coliseum since their 1968 move west from Kansas City. It's MLB's fourth-oldest ballpark, the last to remain shared with a football team, and has been plagued with plumbing problems. The A's have sought a move to San Jose since 2009 after efforts to develop a ballpark in Oakland and Fremont faltered.
But San Jose lies in territory MLB gave the San Francisco Giants in the early 1990s. The Giants have steadfastly opposed an A's move to Silicon Valley, arguing it's a key part of the team's fan base needed to support their AT&T Park, which opened on the San Francisco waterfront in 2000. Previous A's owners let the Giants claim that territory when the Giants sought a Silicon Valley ballpark in the 1990s.
Nathaniel Grow, who teaches business law at the University of Georgia's Terry College of Business, said the decision is more favorable to Major League Baseball.
"From a legal perspective, it's a huge win for Major League Baseball," Grow said. "They get rid of the most dangerous claims. The one claim that's left isn't of itself going to get San Jose a baseball team."
But even so, Grow said San Jose's surviving claim under state law could give the city "enough leverage over Major League Baseball to reach a settlement if Major League Baseball doesn't want its decision-making process opened up" in court.
"It's possible that state-law claim could be enough to still motivate Major League Baseball to let the A's move," Grow said. "But it's difficult for anyone outside the MLB boardroom to know how much impact that one state-law claim will have on their decision making."
One other break for San Jose, Grow said, was that the ruling came quickly, just a week after Whyte heard MLB's dismissal motion in court and signaled skepticism about San Jose's claims. That at least puts San Jose on a quicker path toward a trial or appeal.
For now, the suit proceeds to a "case management conference" that will determine a trial schedule. City lawyers suggested a trial as early as March, but MLB lawyers called that unrealistic.
San Jose could potentially ask the 9th U.S. Circuit Court of Appeals to review the ruling against the antitrust claims.
Baseball's exemption from antitrust laws barring anti-competitive monopolies stems from U.S. Supreme Court decisions in 1922, 1957 and 1972.
Though later decisions questioned the logic behind the unique exemption not applied to other sports, judges have argued it's up to Congress and not the courts to change it. San Jose argued that more recent decisions limited baseball's antitrust exemption to a now-extinct "reserve clause" that gave teams exclusive control over their players' careers and not the broader business of baseball.
Quoting from earlier court decisions, Whyte said he "agrees with the other jurists that have found baseball's antitrust exemption to be 'unrealistic, inconsistent, or illogical.' " But he said he "is still bound by the Supreme Court's holdings." Whyte also dismissed the city's antitrust and unfair competition claims under state law.
San Jose's surviving claim involves a 2011 land-purchase option with the A's to buy half the property needed for a proposed downtown ballpark from the city for about $7 million. San Jose argued MLB's failure to make a decision allowing the A's to buy the land hurt the city. Whyte said the absence of a valid antitrust claim "does not necessarily foreclose" San Jose's contract-interference case.
"The court finds that the complaint sufficiently alleges a 'disruption' of the contract because, here, the A's are unable to exercise the option due to MLB's delay in conducting the vote pursuant to the MLB Constitution to approve or deny relocation."
MLB in a statement was "pleased that the court dismissed the heart of San Jose's action and confirmed that MLB has the legal right to make decisions about the relocation of its member clubs."
"The court dismissed all of San Jose's state and federal law claims challenging that right," the statement said. "We are confident that the remaining state law claims, which assert that San Jose's costs associated with the option agreement for the sale of real estate were increased by the timing of MLB's decision-making process, will be decided in MLB's favor, and that San Jose has not suffered any compensable injury."
But San Jose Mayor Chuck Reed still called it "good news for San Jose because the case is going to move forward."