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MLB arbitration hearings are high stakes arguments over a player's value

Last week I, and dozens of other law school students, went to Tulane University to participate in a competition simulating Major League Baseball arbitration hearings. The experience was eye-opening.

The Colorado Rockies have some interesting arbitration cases.
The Colorado Rockies have some interesting arbitration cases.
Chris Humphreys-USA TODAY Sports

"And so Mr. Arbitrator, while the Club appreciates everything Mr. LeMahieu has contributed to the Rockies in the past four years, we humbly request you award him a salary below the midpoint at issue here today. Thank you."

With that, I gathered up my notes, descended from the podium, and sat next to my teammates at the conference table. They gave me the thumbs up. I had just spent the past fifteen minutes outlining various reasons why DJ LeMahieu, Rockies second baseman, should be compensated $2.3 million for the 2016 season. The law students sitting across from us--LeMahieu's putative representatives--huddled together and conferred. Their goal was to convince the arbitrator to award LeMahieu a salary of $3.6 million. The midpoint between the two numbers was $2.95 million. If the arbitrator judged that LeMahieu was worth one cent more than that, he would get his requested $3.6 million. If he felt LeMahieu was worth just a smidgen less, then he would get $2.3 million.

And I would win.

One of the students across from us stood up to deliver his rebuttal.

★ ★ ★

Of course this was all fake. The baseball players are real, but salary figures are estimated and the proceedings are not identical to real salary arbitration. This was a simulation--a way for law school students to practice their advocacy and oral argument skills, but in the MLB arena. I was part of one of forty teams from law schools across America to descend on New Orleans to take part in the Tulane Sports Law Society National Baseball Arbitration Competition.

Back in the fall, I got an email from the Georgetown Law Alternative Dispute Resolution team asking if I wanted to take part in the competition. Of course I said yes. I had spent three years arguing about whether baseball players were any good when I wrote here on Purple Row. When I stopped writing here, I assumed those days were done. This competition was right up my alley, so I decided to give it a try.

I and two other Georgetown students were instructed to prepare four briefs for arbitration eligible players: One advocating for the Angels against Cole Kalhoun; another advocating for Nathan Eovaldi against the Yankees; and two advocating both for and against Colorado's DJ LeMahieu. We decided to take a divide and conquer approach. Each team member would be the "expert" on one player, with only minimal assistance from the others. Naturally I chose LeMahieu, since he's my hometown boy.

The briefs were a maximum of ten pages long, and they had to focus on whether--excuse the legalese--the player is awesome or whether he sucks. Since we had to argue both sides for LeMahieu, I wrote briefs both for and against him.

In my pro-LeMahieu brief I wrote that he should receive his requested salary figure because:

  • 2015 (his "platform" year; that's what they call the season before the arbitration hearing) was a breakout offensive season for LeMahieu, ranking him among the top second basemen in the game;
  • His increased usage of the opposite field signals an increased offensive talent level;
  • He is a top defender at second base; and
  • His durability and consistency are excellent.

There were various strategies I employed. First of all, I relied heavily on batting average, on base percentage, and stolen bases, since those were LeMahieu's best categories in 2015, and he ranked highly among all MLB second basemen in those departments.

Second, I predicted that the opposing side would bring up Coors Field (I would), so I pointed out that LeMahieu's numbers dropped on the road far less than the average Rockies hitter (LeMahieu's home/road BA: .321/.281; the average Rockies player: .301/.228).

Finally, I made sure to highlight LeMahieu's career defensive performance while failing to mention that his defensive statistics all declined in 2015. If anyone pushed me on this, I would argue that one year of defensive statistics are not enough to judge a player and that at least three years are required to judge true talent level.

I think my most innovative argument was that LeMahieu raised his usage of the opposite field in three straight seasons. By 2015 he was going the other way 39% of the time, the most of any player in baseball. When LeMahieu hits to the opposite field he has always had a batting average over .400 (compared to the .250-.350 range to center or to left field). Since he kept increasing his oppo rate, I argue that he knew this was an advantage for him and adjusted his approach accordingly.

The last half of the brief consisted of player comparisons. I compared LeMahieu favorably to Brandon Crawford, Gordon Beckham, and Darwin Barney. They got decent settlements in their first arb years, and LeMahieu was better than them, so he should get a salary above the midpoint. Or so the argument goes.

My pro-Colorado brief was more difficult to write. Getting the tone of these briefs (and eventually oral arguments) right is tricky. It's necessary to argue that the player isn't really any good, and that he deserves less money--while he's in the same room. "No offense bud, but your game is full of holes. You lack many desirable traits. See you in Spring Training, it's gonna be a great season." You can see why so many players and clubs choose to settle rather than go to arbitration.

My pro-Rockies arguments were as follows:

  • Despite LeMahieu's career season in 2015, he was still a below average offensive second baseman;
  • His offensive statistics are boosted by playing at Coors Field, and he had an anomalous Batting Average on Balls in Play; and
  • His normally strong defense declined to about average in 2015, a troubling trend.

In this brief I relied heavily on advanced stats: Weighted Runs Created Plus (wRC+, FanGraphs' offensive statistic) and Wins Above Replacement (WAR). Since those stats adjust for home ballpark, they make LeMahieu look much worse than unadjusted stats like batting average and OBP, as well as counting stats like runs and RBIs. The problem with that is that arbitrators are not typically "baseball men."* Using advanced statistics requires wasting precious space explaining them and why they matter. Not only that, but doing so runs the risk of the arbitrator not comprehending them or not buying them at all. At which point the argument is toast.

*Almost everyone at this competition was male; I didn't see a single female arbitrator and maybe 10% of the competitors were female.

The comparisons I drew were to Dee Gordon, Daniel Murphy, and (again) Darwin Barney, each of whom earned below the Colorado/LeMahieu midpoint.

My teammates and I filed our briefs. Next, we had to create exhibit books. These were the binders we would take to the competition and hand to the arbitrators and opposing counsel. They were filled with charts, tables, graphs, and pictures. As we gave our arguments, we would cite statistics, and the arbitrators would follow along by reading the exhibit book. If there was any inaccuracy in the exhibit book, it was the opposing counsel's obligation to object.

★ ★ ★

My teammates and I flew down to New Orleans on January 19th; our first hearing was bright and early at 8:30 am on the 20th. We stayed up late polishing our presentations, then set our alarms for 6 a.m. and collapsed into bed.

We arrived at the Tulane campus 30 minutes early and had some coffee and bagels. A bunch of nervous law students wearing suits were milling around the main conference area. At 8:20, we headed to the conference room where we would have our first hearing.

We introduced ourselves to opposing counsel and the arbitrator; he was a senior executive in a top player agency. This first hearing was for Kole Calhoun; our team was on the side of Anaheim. The format was like this: the player's counsel got fifteen minutes to lay out their initial arguments and player comparisons. Then the team's counsel would get fifteen minutes for their presentation. Next, the player's counsel would get 7.5 minutes for rebuttal of the team's presentation; and finally, the team's counsel would get 7.5 minutes for their rebuttal. In real MLB arbitration, each side gets an hour to present and 30 minutes for rebuttal, but they slimmed it down for the law students.

Opposing counsel were solid in their opening. They highlighted Calhoun's 26 home runs and Gold Glove defense in right field. However, they blew through their player comparisons so fast that the arbitrator was completely bewildered. Practice prepares and settles, but at the real thing, it can be difficult to keep the nerves down. Nervousness cause one to start talking faster and faster until the person that needs to be convinced has totally lost the argument's progression. I think that's what happened here. They finished with about three to four minutes still remaining; it's never a good policy to leave minutes on the table when you can still fire some more ammunition.

My teammate, who specialized on Calhoun, was up next. He did a good job highlighting Calhoun's offensive decline in the "triple slash" categories in three consecutive seasons and also noting that his counting stats were bolstered by playing in a lineup with Mike Trout and Albert Pujols. Unfortunately, there were a couple typos in our exhibit book that opposing counsel took great relish in pointing out. However, this backfired for them once: one of our comparisons was Gregor Blanco, who received a salary below the midpoint at issue here. They objected that Blanco was in his second year of arbitration, not his first, and thus he would be a bad comparison. My teammate, quick on his feet, noted in his rebuttal that this was even greater evidence that Calhoun should be compensated less; since Blanco was in his second year of arb, and he should have gotten even more money. Opposing counsel didn't have a response to that.

After we concluded our rebuttal, the arbitrator asked both teams to step outside while he filled out the score sheet. We huddled outside the conference room and shook hands with our competitors. We made small talk, discussing the arguments we thought were solid, and which ones we thought were weak. Then the bailiff called us back in. The arbitrator gave us some feedback about went well and what didn't, but we wouldn't know who won until the evening.

Next up was the LeMahieu hearing--my hearing. We settled into a different conference room with a different arbitrator and opposing counsel from a different school. The arbitrator was an executive from the Brewers' front office. I took this as a good sign; given his position, he would already be familiar with the advanced statistics that I would be relying upon.

Opposing counsel went first (since they were representing LeMahieu, and I was representing the Rockies). They were in trouble from the start. The main presenter's pace of speaking was halting, with no rhythm or flow. I remembered the many objections we received in the first hearing, so I tried one out myself when opposing counsel misstated a comparable player's batting average (even though the misstatement was pretty minor). His rhythm was destroyed. He spent a full fifteen to twenty seconds trying to remember where he was in his presentation. Most inexcusably, the presentation ended after only six and a half minutes; he left over eight minutes of time on the clock.

"While the club appreciates the contributions that Mr. LeMahieu has provided for the team, we believe he should be compensated below that midpoint for the following reasons."

I was up next.

"Good morning. My name is Jay Tymkovich and I, along with my co-counsel, will be representing the Colorado Rockies in these arbitration proceedings with DJ LeMahieu to determine his 2016 salary. Mr. LeMahieu has requested $3.6 million while the club has suggested $2.3 million, resulting in a midpoint of $2.95 million. While the club appreciates the contributions that Mr. LeMahieu has provided for the team, we believe he should be compensated below that midpoint for the following reasons."

I then launched into the arguments I laid out above. LeMahieu is a singles hitter with no power; his defense declined in 2015; his numbers were goosed by playing at Coors Field and having a high BABIP. I had to spend significant time explaining WAR, wRC+, UZR and DRS, but those stats were integral to my argument. I ran through my player comparables: Dee Gordon, Gordon Beckham, and Chase Headley, all of whom received less than the midpoint at issue here. At all times I tried to be conscious of my pace and that the arbitrator was following along. I ended up running more than a minute over the 15 minute cutoff, but opposing counsel didn't object, so the arbitrator let me conclude.

Opposing counsel's rebuttal focused on how LeMahieu had a higher batting average than all my comparables. I thought this would not be convincing. In my rebuttal, I noted how their comparables--Neil Walker, Gordon Beckham, and Danny Espinosa--were power hitters. It was like comparing apples and oranges. The arbitrator seemed to approve of that line of reasoning, and he said it was a good point when he gave us our feedback.

We came out of that hearing feeling pretty comfortable that we had won it. One more to go.

The final hearing was for Nathan Eovaldi, and this time we were on the player's side. The arbitrator was the General Counsel of the MLB Players Association; a pretty big deal. He had been involved in a number of real arbitration hearings, so he knew this process intimately.

Opposing counsel for this hearing were clearly the most polished of any team we had played so far. Their exhibit book was laminated, easy to follow, and synced up with their argument well (side note: my teammates and I had no idea what we were getting into with this competition; we had no coaching and had to rely on the website's instructions on how to prepare. It turns out that having a good exhibit book is 75% of the battle. The arbitrator has to easily follow along, see the stats you're citing, and see why they are important. Our books could have been greatly simplified, better organized, and better presented. If we go back next year, I'll be sure the exhibit books are perfect).

However, we thought they made some critical errors. When doing their player comparables they, only examined the players' platform seasons. They never brought up career performance. One of their comps was Jake Arrieta; he had a phenomenal platform year, but was a complete bust in every year prior--same with Tyson Ross. We thought for sure the arbitrator would sniff out this flagrant cherry-picking.

Additionally, we thought they did a poor job in the rebuttal phase. We had highlighted that Eovaldi had developed a split-finger in 2015, and that his results had markedly improved since the debut of that pitch. In the rebuttal, they rambled for several minutes about how this was actually a bad thing, and that he had stopped throwing the cutter, and that he needed to have a five pitch mix to be effective (which is absurd). In reality, Eovaldi junked the cutter because it got crushed. Unfortunately, they had the final rebuttal, so we couldn't point out these facts. We had to rely on the arbitrator not being convinced.

When the arbitrator called us back in for feedback, he said that we were two of the better teams that he had seen so far that day. One concerning piece of feedback: It turns out that when a player is arb-eligible for the second time, career contributions are far less important. Platform season performance becomes a much more pivotal factor. The theory is that the player is rewarded for his career contributions in his first year of arbitration; in the second and third years they reward what he did most recently. My teammates and I didn't know that, but that meant that what we thought was the biggest flaw in the opposition's presentation was actually not that big of a flaw. Uh oh.

That was it for the day. Semi-finalists would be selected that evening; 8 out of 40 teams would advance.

★ ★ ★

Next step: head to Bourbon Street for a beer.

After that we went to the reception room at a nearby hotel for announcement of the results. Disappointment: Georgetown would not be moving on. We won two out of three hearings while two other teams in our bracket went 3-0. Our one loss came in the Eovaldi hearing by a narrow margin (the opposing team would move on to the finals). Since we won our first two arguments by large margins, we were among the top eight in total points, but because MLour bracket had two undefeated teams, we still couldn't advance (grumble grumble).

We flew home the next day, narrowly beating Winter Storm Jonas to Reagan National Airport.

This was a fun experience. Next year, I fully intend to take home the trophy. I was a little bummed out that I didn't have the opportunity to argue the pro-LeMahieu side; that's what we would have done in the semi-finals. This experience gave me a greater appreciation for how much work goes into salary arbitration. It took the three of us several days to prepare four 10 page briefs and 30 page exhibits for 15 minute arguments; real teams have to prepare for hour long arguments with 30 minute rebuttals, and they potentially have to do it for multiple players. Millions of dollars are on the line. There's a lot at stake for the players, teams, and the lawyers.

I hope LeMahieu goes to arbitration; I want to see who wins. The real salary requests are $3.9 million by LeMahieu and $2.7 million by the club, leaving a midpoint of $3.3 million. That's pretty significantly above what the competition estimated. Will the club use similar arguments to the ones I used? Will the arbitrators buy the advanced statistics or fall in love with LeMahieu's shiny .301 batting average? Time will tell.