For more on the lawsuit, read my interview with Judge Dwyer's associate, Jerry McNaul and reporter, Fred Brack.
How did you first get involved with the lawsuit against the American League?
I was asked by the attorney general, who was Slade Gorton at the time, and by the King County Executive, John Spellman, if I would represent the State and the County in making a legal effort to keep the Seattle Pilots in Seattle. This was, I believe, about the beginning of 1970.
What did you think about the merits of the case when you first looked it over?
I thought it would be a very unusual case. There were two possibilities that presented themselves. One was a claim that a contract had been created between the American League on the one side and the State, County and City on the other—and through them, the public here in Washington state—to the effect that the American League would place a Major League Baseball club in Seattle and keep it here.
 Judge William Dwyer. |
What was the next step?
The trial was postponed several times. The case was filed in 1970 and didn't get to trial until the beginning of 1976—largely because it was continued a number of times to give the League and the County and City and State a further chance to try to reach an agreement. The attorney general and the county executive and I were frequent guests at their winter meetings. There was one in Florida we went to, there was one in New Orleans, and the owners and the commissioner, who at that time was Bowie Kuhn, would meet with us and assure us that with just a little more time, it would all be worked out and there would be a baseball team, but we should drop the suit first and, of course, we wanted to drop the suit second—after a team was in place and nailed down and we had it for sure. Those postponements eventually resulted in a trial date, which I believe was in January of '76, in Everett, where venue had been changed to get it out of King County, before Judge Frank D. Howard and a jury from Snohomish County.
I thought at the time that it was one of the most fascinating trials I'd ever had the good fortune to be in. We picked a jury. The jury, as juries usually are, was composed of working people, homemakers, a great variety of people, some of whom had little or no experience in business—certainly not in professional sports. I thought, as a great believer in the jury system, that they would not only understand the case, but would understand it thoroughly and would enjoy their service.
We started the trial with opening statements on both sides. Both sides were quite thorough in that respect. Plaintiffs go first with the evidence and we started putting on witnesses. We had some witnesses who were on our side of the fence, of course, but we also made it a point to call several of the baseball owners and put them on the stand in our case in chief as early as we could. We had the benefit of having some transcripts of what had gone on at private meetings of the American League, conversations among the owners themselves. Those transcripts formed the basis of some of the questions. As the trial went on for about four weeks, I think all of us on our side thought it was a dramatic, interesting case and that it was going well. During the trial, we continued negotiating a possible settlement. We reached one after four weeks, which resulted in the creation of the Seattle Mariners, with a 20-year, iron-clad lease with specific performance provisions in it, entered into with the general partnership. The general partners were individually on the line with that lease—but even then, we didn't dismiss the case immediately; we provided in the agreement that the trial would be recessed and continued for a little over a year, in time for the opening of the 1977 baseball season, to make sure that team was out there in uniform, playing baseball. That did happen and 15 months or so later, the case was dismissed under the settlement with the Mariners playing actually ball in the Kingdome.
Were some owners more cooperative than others?
Mr. Short was a little nettled at being called to the stand. Personalities differ and some witnesses are happier to be on the stand than others. I do remember something Charles Finley said to me under his breath when he got off the stand for a recess. He walked by me after questioning and said, "you've been doing your homework, haven't you, pal?"
Finley seemed to be one of the more cooperative witnesses.
I'm not sure cooperative is the right word. He was a very outspoken person and I would guess was a difficult person for the lawyers on his side to be able to persuade to be cautious. Caution was not Mr. Finley's nature. He was a very enthusiastic, strong-minded and good-humored entrepeneur who didn't believe in beating around the bush.
Was it helpful that he and Twin City Sportservice were suing each other at about the same time that this was going on?
The Twin City Sportservice case, as I recall, gave us a precedent that provided a little help when we tried to reach a separate agreement with Sportservice to get some cash from them and get them out of the case. We did do that. We settled for something like $200,000 with Sportservice, which helped finance the case. Then we were able to go to trial against the baseball defendents, which is what we wanted to do. But we still had that antitrust claim in the case insofar as it was based on an agreement to restrain the concession industry. That was part of the case that went to trial. The main thrust of the case was the breach of contract.
[Note from Mike: The Twin City case was filed when Charlie Finley moved the A's from Kansas City to Oakland. Twin City Sportservice was the concessionaire in Missouri and sued Finley for breach of contract because their agreement provided that if the team should move, Twin City would be the exclusive concessionaire wherever they landed. The corporation that ran the Oakland Coliseum already had a concessionaire under contract, so Twin City was not able to follow the A's to California and lost a presumably sizeable piece of business as a result. Finley countersued, arguing that the concession agreement, which was signed by the previous owners more than 25 years earlier, violated antitrust laws.
So, the Pilots case bore enough similarities to the Twin City case that I wanted to ask the question. In exchange for helping to finance the team, Sportservice became the Pilots' concessionaire at Sick's Stadium, but local law required that such arrangements go through a bidding procedure for public facilities. Sick's Stadium was privately-owned and not subject to this law but when it was built, the domed stadium would be. This led to Dewey Soriano's famous statement that if Sportservice couldn't go into the domed stadium, the Pilots wouldn't either. This was probably just bluster, but after the Pilots moved, it hinted at a conspiracy. Sportservice, in case you're wondering, followed the team to Milwaukee. At some point, I will publish the depositions of Sportservice executives, Jeremy Jacobs and Jack Zander, which go into all of this in great detail.]
You're talking about a tying arrangement?
Yes. The argument was that Sportservice had entered a series of tying agreements around the country with sports proprietors. Sportservice, of course, was the biggest company in the hot dog, pop and beer business at ballparks. Concessionaires they're called. They had extended credit on favorable terms to a number of sports proprietors in return for exclusive long-term dealing contracts, one of which was in Seattle and by this time had followed the ballclub to Milwaukee. The claim was that the team was removed from here in the course of enforcement of an illegal exclusive dealing arrangement: a tying agreement. That did survive all the pre-trial motions and we were in trial on that claim, along with the breach of contract. The breach of contract claim also was accompanied by a fraud claim.
What was the American League's biggest mistake in the whole affair?
I think in letting the team leave here after those promises had been made. Now, their position was that the right kind of ownership would not step forward. What they were looking for after the first owners decided to bail out was a new owner, or a group, who would be on a for-profit basis, who would be adequately financed, would be experienced business people and so on.
Fred Danz, early in the crisis, came forward, wanted to buy the club, but they determined, as I remember, there was something wrong with his offer. I don't think they thought there was anything wrong with Fred, but his offer, I believe, they thought was too thinly-financed or something like that. So that didn't fly. Then nobody else came along with the wherewithall to do it on a private basis. Then this remarkable civic effort was mounted by Eddie Carlson, Jim Ellis and Jim Douglas. They set out to mobilize the community, raise the capital to buy the Pilots and it was a magnificent effort. They lined up, in a very short time, business leaders, labor leaders, members of the public at large, all kinds of contributors, who would contribute to a non-profit entity which would buy the Pilots at the existing owners' asking price and then run the club on a community benefit basis. They succeeded in raising the money and almost got American League approval, but they fell one or two votes short. Following that, the League allowed the club, through bankruptcy court, to be sold to Milwaukee. The League could have prevented the club moving to Milwaukee simply by voting against it, insisting that the club stay here and if necessary, taking it over with a trusteeship for a period of time until suitable ownership was found. The big mistake the League made was in letting the club move. They could have let it stay here by approving the Carlson/Ellis/Douglas plan. The owners had accepted that offer and were prepared to sell; it was only the League's veto that stopped it. That is, of course, what launched the case and it's a decision, I would guess, the League might want to do over if it had it to do over again.
Why were they so quick to move the team?
They felt that the club was broke and in bankruptcy court and that a major league club has no business being there and that the only way to get it out quickly was to do what they did. In my view, there was another way to get it out quickly.
Did the defense position have merit?
I thought our prospects of winning and having a judgement upheld were very good.
Would you have won if the case hadn't settled?
We felt confident about the outcome. Of course, when you're trying a case, you always want to avoid hubris. The gods tend to strike down those who suffer from hubris and we were always very careful about that. We did feel that the trial was going well and our prospects were bright. It was quite a story after all. As commercial cases go, this is about as dramatic a story as you'll ever find.
I came back from a sabbatical to try that case. My wife and I were on our way around the world with our three young children when the case didn't settle in the fall of '75, I flew back from Lima, Peru to take care of the case, which I thought still maybe we could settle in a couple of weeks. My family kept going. It ended up more like two-and-a-half months I was here because we had to try the case as well. By the time we got it settled and everything was signed, sealed and delivered, my family was in Australia and I jumped on a plane and caught up with them there. A very happy moment of reunion.
Did you have any regrets that it settled?
Like any other case that you settle, you regret it in a way because it would be so much fun to get to that verdict and have it all come out that way. But in terms of benefits to the clients, which is what we're supposed to be working for as trial lawyers, the result that was obtained, we felt and I still think, was optimal: the Seattle Mariners, the 20-year lease and all the rest of it.
Was baseball ever serious about putting another team in here?
We credited them at the time with meaning what they said, but you don't settle a case on that basis. Not on the basis of some vague assertion that they hope to do something or even will do something in the future. Had we dropped the case on that basis, it would have been very easy for a group the size of the major league owners to just forget the whole thing and walk away. That was something that the attorney general and the county executive and I just weren't about to do.
Bob Short said the Carlson Plan was a sham and a deceit. What do you think?
(Laughs) I respectfully disagree.
Why were the owners so reluctant to accept a non-profit corporation?
They would say, and they have said, that a non-profit organization just wouldn't fit because you have to be prepared to take losses and a broad-based public entity would have a hard time doing that. You have to be prepared to make some hard decisions about player signings and non-signings and promotions and all kinds of things like that which are hard for a public entity to handle, et cetera. We pointed to the Green Bay Packers which were owned by a public type of entity. Our argument was that it can work and given the contract we had with Major League Baseball, it had to be given a try. Of course, we argued they had other ways, too, to keep the team here. Letting the Carlson offer be accepted was one way, but it wasn't the only way.
Why did Carlson structure the deal the way he did?
I think perhaps Eddie felt that civic enthusiasm would be heightened if a public, broad-based entity owned the team. But that's just my guess.
Did the owners purposely set the standards for the Carlson group too high?
We did claim at the trial that the owners had engaged in a whole series of acts designed to make sure that the Carlson/Ellis/Douglas offer would go away. One of those steps was to impose unmeetable conditions.
Was baseball trying to damage the Pilots so they could move it more easily?
We just treated that as a step in our arguments to the jury. We just treated that as a step which tended to destroy the team, without imputing the motive that you mention.
Was the $650,000 just an attempt to look good?
That was alleged to be one step of a series which led to the departure of the Pilots. It was a promise which was inadequate in the first place and couldn't possibly work and which wasn't even carried out.
Why didn't the League ask him to put more money into the club?
We claimed that there had been a failure to ask the existing owner to contribute capital, out of a kind of pal-ship among owners where they just didn't want to ask each other this as co-venturers, fellow businessmen, to come up with additional funds. Rather than that, they would accomodate each other by moving a team somewhere else. That was the contention.
Do you remember how much William Daley was worth?
I don't remember, if I ever did know. I do remember having had the impression that Mr. Daley was worth a lot. But he was also a man who was up in years and he lived in the mid-West and probably didn't have much appetite to be tied in with a ballclub that was in any kind of trouble.
Why didn't more people go to the games?
It was an expansion club playing in a small ballpark and like most expansion clubs, it got off to a slow start in terms of attendance. It was not the lowest attendance that year, but it was low. On the other hand, it was just one year and I don't think by anybody's farthest stretch of the imagination could it be deemed a fair trial. It was also a year in which management was not fully mobilized and in fact, they began to talk to each other and to Milwaukee about selling the club in August, while the season was still on. In defense of our attendance, though, you should know, if you look at the history of Major League Baseball and measure the average annual attendance before the team has its first winning season, which is a critical event, Seattle had the highest in the history of the major leagues with the Seattle Mariners. Of course, they also had an unnaturally long run of non-winning seasons, but still, I think it's an impressive statistic.
Was Sick's Stadium really in such bad shape?
We had a photographer go around and take photographs of some of the more ramshackle American League stadiums in the United States, some of which made Sick's Seattle Stadium look very good by comparison. We were ready to put those photographs into evidence to answer this argument about Sick's Stadium. Our argument was that, of course things remained to be done and of course not everything had gone smoothly—it never does But none of that had anything to do with the removal of the Seattle Pilots. We did have some terrific pictures—I wish I still had them—of Cleveland Stadium, of Tiger Stadium in Detroit and various other older ballparks which were doing just fine. Some of them, you couldn't sit down without getting a splinter and the plumbing was nothing to write home about.
There was some talk about moving the Padres here. Did you hear anything about that?
When we met with the baseball owners and the Commissioner, which we did several times, between the time the case was filed and the time it went to trial, they mentioned several times the possibility of moving an existing club to Seattle and at one point, it was the Oakland Athletics that were supposedly going to move and they wanted us to dismiss the case based on the proposition that the Oakland Athletics would move to Seattle…but we gave the same response I told you about: that we'd be willing to talk when there was a specific offer to place a team here on a binding contractual basis. The prayer in the lawsuit was for damages and we had about $7 million worth of damages figured out, but the bigger risk in the lawsuit to the baseball owners would have been the precedent. The main objective to the plaintiffs, of course, the preferred outcome, rather than money damages was a new baseball team with a long-term lease.
How did you negotiate the settlement?
We just talked to the lawyers during the trial, back and forth, back and forth. It was a process that went on outside trial hours. That happens in quite a few cases. This time it was a little more complicated than some because of the subject matter, but we were able to put it together.
Do you remember sending a letter to the opposing counsel, David Wagoner saying things weren't going well for their side?
Yes, I think that did happen. Both sides, of course, expressed negotiating positions. That letter, however it reached the press, was not through me and not through anybody on our side, I don't believe. It wasn't through me or my partner, because settlement letters are not released. The prime objective of the suit from the beginning was to return baseball to Seattle. That was the theme of all our discussions leading up to the trial about settlement.
The City of Seattle didn't want to settle, did they?
I believe some of them in the city government took that position for a while, yes. Once it was explained to them, they had no difficulty seeing the light. They got a lot of money with the team. The presence of the team means a lot of money to the City of Seattle.
What do you remember about the bankruptcy case?
It was quick. We showed up and protested but to no avail, because there wasn't any other bidder in bankruptcy court for the Pilots except the Milwaukee Brewers.
Legally, did the fact that the AL had other remedies have any bearing on the bankruptcy?
Not that cut any great amount of ice. The bankruptcy court, of course, looks to the payment of the creditors and there were creditors here and the one clear way to pay the creditors was to approve the offer of Milwaukee. Our argument in the Superior Court was that it could have been done another way by accepting the Carlson offer or requiring a different offer or having the League stand in—all of which we thought was valid for the purposes of our suit. But in the bankruptcy court, that really didn't make any great difference, because there was one clear, immediate source of funds and that's what did it.
Do you remember much about the Pilots' financial losses?
I do remember that we took the position that the losses were largely paper losses and that the operating bottom line was not at all difficult to maintain and that they could have kept going.
Do you remember what specific instances of mismanagement you alleged?
I do remember that we alleged that good management probably could have eliminated the real operating loss, even in the first year.
The upshot was that we alleged it was a breach of contract to let the team get away from here in the face of earnest efforts and offers to keep it here after only a year of experience and after those promises—the expenditures made in reliance on the promises and everything that had been done—that that was a breach of contract and that it was carried out partly because of an illegal tying arrangement with Sportservice.
During the trial, did you feel it was history in the making?
That's too grandiose a thought for a trial lawyer to have. You just try to do your job and practice your craft as well as you can. There's plenty of thrill just in the day-to-day combat without worrying about history in the making.
