Stadiums May Be Closed But Sign Stealing Is Still Up for Debate

(Bloomberg) -- Two great American pastimes, baseball and fantasy sports, were at the center of a court battle Friday even as ballparks across the country stood silent and empty amid the pandemic.

Arguing over a suit that was filed as players were about to report for spring training, lawyers for Major League Baseball and two teams urged a federal judge to toss out a claim by fantasy sports participants that they were defrauded by MLB’s sign-stealing scandal.

An attorney for the DraftKings participants said fantasy baseball is marketed as based entirely on performance statistics and they wouldn’t have entered the tournaments had they known of the scam.

“Major League Baseball has shouted to the world that it’s maintaining the honesty and the integrity of the game for decades,” plaintiffs’ lawyer David Golub told U.S. District Judge Jed Rakoff. “You couldn’t have a fair game of skill if you knew what pitch was coming.”

Stadiums May Be Closed But Sign Stealing Is Still Up for Debate

MLB concluded in January that during the 2017 and 2018 seasons the Houston Astros illegally used cameras to steal signs from the opponents’ catcher. The Boston Red Sox are under investigation for allegations of similar conduct during the 2018 season. Sign stealing is allowed unless it’s aided by technology.

But Major League Baseball and the teams argue that “disgruntled fans” don’t have a legal right to sue over rules violations and that the lawsuit fails to spell out a fraud on fantasy sports participants.

During the hearing by phone on Friday, Rakoff -- a baseball fan who often peppers his commentary from the bench with analogies and jokes about the game -- expressed skepticism of that argument.

“If someone has invested money on the basis of a representation and by hypothetical ‘We absolutely assure you, the person investing money with us, we absolutely assure you we are not engaged in sign stealing,’ when in fact they are, it seems to me it’s common-law fraud,” the judge said.

Lauren Moskowitz, an attorney for the Red Sox, noted that teams are allowed to use legitimate methods to decode their opponents’ signs.

“There’s all sorts of rules, and interference, too,” she told Rakoff. “These are all rules that are routinely part of the game, and where do you draw the line?” She said the court “is not a place to enforce those rules.”

Rakoff asked if she admitted, then, that the team had broken the rules.

“We do not,” she said.

“Well, that’s interesting,” Rakoff said. “So the commissioner of baseball was just off base, in your view?”

Moskowitz said the club acknowledged an electronic device was used but that “they’re certainly allowed to disagree there was activity at the club level.”

Rakoff said he would decide the case by April 15. He did manage to slide in a joke after an attorney for MLB noted that Golub was “not the next left fielder for the Yankees” and that the only skill he would employ as a DraftKings player was to pick a lineup.

“He is not the next left fielder for the Yankees,” Rakoff said, “and I am so disappointed that I am not either.”

The cases are Olson v. Major League Baseball, 20-cv-632, and Clifford v. Major League Baseball, 20-cv-1000, U.S. District Court, Southern District of New York (Manhattan).

©2020 Bloomberg L.P.

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