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This case is a journalist's account (published in Sports Illustrated) of negotiations surrounding a professional baseball player in the U.S. named Ken Griffey, Jr. that took place during the winter of 2000. I realize that you may know little or nothing about Griffey or about the sport of baseball or the nature of U.S. major league baseball teams, contracts, and negotiations. This brief introductory note is intended to bring you up to speed on some basic details that will help you sort through the article on the Griffey negotiations. You do not need to be particularly knowledgeable about baseball to understand and analyze what went on, but it does help to know a little bit about the context in which Griffey's contract was up for grabs. So read this document first before you read the case article itself.
Who is Ken Griffey, Jr.? Griffey (also known as "Junior") is generally regarded as one of the premier professional baseball players in the two North American leagues collectively known as "Major League Baseball." Consequently, many other teams covet his talents and would like to get him. For those who care to know the baseball-related details, he is an outfielder who has proven to be both an excellent hitter and a superb fielder over a career of several years. But despite his experience, he is only 30 years old in a game where players can be very successful into (and occasionally beyond) their late 30s.
What was going on at the time of the case? As the negotiations open, Griffey plays for the a team called the Seattle Mariners. His contract with Seattle will end following the 2000 season (which starts in April and ends in October 2000). If Griffey stays in Seattle for the 2000 season and lets his contract run out, he becomes a free agent who can sell his talents and services to any other team in baseball, and the Seattle ballclub gets nothing if Griffey signs with another team. But if the Seattle team can trade him now (at the time of the case -- during the winter preceeding the season), they can get something for him. Because Griffey is such a first-rate talent, a trade would presumably bring Seattle several very good players in return.
Can't Seattle keep Griffey? They can try to sign him to a new contract, either before or after his existing contract runs out. But it is widely known that Griffey is unhappy in Seattle for a variety of reasons (some of which are mentioned in the case). It also says in the case that Seattle offered Griffy a new eight-year, $138 million dollar contract in July 1999, which Griffey met "with indifference." As a result, it is in Seattle's interest to try to trade him now, rather than waiting, which brings the risk that they will lose him with no compensation if his contract runs out at the end of the 2000 season and he becomes a free agent and signs with another team.
What control does Griffey have over his fate? In most cases, a player can be traded without his consent. Teams trade players for all kinds of reasons: to get rid of an expensive player with declining skills; to attract talent at some other position; bad "fit" in team chemistry, etc. Griffey, however, meets a league threshold -- 10 years playing, and the past 5 with his current team -- that gives a player the right to veto any trade. Of course, even for players who do not have this veto, trading them near the end of their contract means the new team will soon have to sign them to a new contact. The player might not have the contractual right to formally veto a trade, but he can signal his preferences by indicating which teams will would find him more or less cooperative in agreeing to a new contract.
Does the league or the other teams that are not bidding for Griffey care what happens? Yes, at least to an extent, because of the growing disparity between "rich" and "poor" among team owners. Let me explain. An ongoing problem in baseball (and some other popular sports) is that some teams are "richer" (in both money and talent) than other teams. This can be a result of the deep pockets of one team owner vs. another, but the bigger factor is media market size. A team that plays in, say, New York or Los Angeles gets a lot more revenue from its TV/radio rights than a team from a smaller market such as Milwaukee or Kansas City. In baseball, this revenue is not shared - each team gets to keep its own revenue - so teams in bigger markets tend to have bigger payrolls and (often but not always) better players. As the salary demands of top players have gone up, the smaller market teams have been placed at an even greater disadvantage. (The New York Yankees, for example, have a total player payroll that is probably three times larger than the Milwaukee Brewers!) So the league as a whole, and small-market team owners in particular, would like to keep salaries under control in order to maintain parity across teams. When a marquis player like Griffey becomes available on the open market, there is the concern that his new contract will set a precedent driving the payscale even higher into the financial stratosphere.
Who are the key players in the negotiation? The negotiations between teams over the rights to Griffey involve several players, and it is helpful as you read the case itself to keep them clear in your mind. Here's a guide:
FOLLOWUP: How did the players involved in the trade perform subsequently?
THEN and NOW
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