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Oakland A's-San Jose land option agreement invalidated by Santa Clara County court

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San Jose will appeal the ruling, but the invalidity of the agreement places in further jeopardy San Jose's separate appeal to the U.S. Supreme Court seeking to curtail Major League Baseball's antitrust exemption.

Carvings on the United States Supreme Court building.
Carvings on the United States Supreme Court building.
Mark Wilson/Getty Images

The City of San Jose has been handed a further obstacle in their efforts to curtail Major League Baseball's antitrust exemption by a ruling of the Santa Clara County Superior Court, reports San Francisco Chronicle columnists Phillip Matier and Andrew Ross. In a lawsuit filed by "Stand for San Jose -- a citizens group that has close ties to the Giants" -- Judge Joseph Huber ruled invalid the agreement between the Oakland Athletics and San Jose that gives the A's the option to purchase land in downtown San Jose because such an agreement required voter approval.

The San Jose City Council voted to appeal Huber's decision on Tuesday, according to Howard Mintz of the San Jose Mercury News. The requirement for voter approval stems from "a 1988 voter-approved initiative that requires a city vote before any tax dollars are spent in San Jose to build a stadium or sports arena." Neither Matier & Ross nor Mintz makes clear exactly how the option agreement itself violates the law, though it could be said that the option price is below the fair market value of the property and therefore constitutes a stadium subsidy.

According to newballpark.org's Rhamesis Muncada, however, San Jose's plan all along has been to seek voter approval as soon as the A's were permitted to move there. Muncada points out that as far back as 2009, then-mayor Chuck Reed wanted to get voter approval immediately but was asked by MLB to wait for ownership to come to a decision on opening the South Bay to the A's.

How this affects San Jose's appeal to the U.S. Supreme Court

After the United States Court of Appeals for the Ninth Circuit rejected San Jose's pleas to curtail MLB's antitrust exemption, San Jose petitioned the U.S. Supreme Court for a writ of certiorari, which is the typical method to appeal a decision to that court. Present case law holds that the antitrust exemption includes MLB's decisions on where to place franchises, and San Jose is asking the court to reverse the exemption or curtail it so it does not encompass franchise relocations. The Court is not required to accept the appeal, and actually rejects by far the vast majority of petitions for certiorari.

There are many obstacles that might cause the Court to reject San Jose's appeal, and the Santa Clara court's decision adds to one of those obstacles, standing. To even bring a lawsuit, an entity must have suffered some kind of injury, whether pecuniary or personal. Nathaniel Grow writes for Fangraphs on MLB's arguments in opposition to San Jose's petition:

MLB will also likely argue that San Jose lacks standing to sue - the legal requirement that a plaintiff have a personal stake in an actual case or controversy - and therefore urge the Court to decline to hear the case for that reason as well. Lower courts have previously ruled that municipalities lack the standing to challenge a sports league's refusal to allow a team to relocate to their city when the franchise had not definitively committed to moving (rendering the case a hypothetical, rather than actual, controversy).

With Lew Wolff seeming to back away from efforts to move to San Jose, calling it "not worth the nasty battle" to Matier and Ross on April 8, San Jose's right to contest the antitrust exemption seems hazy at best. The Supreme Court might be less inclined to take this case to reconsider its precedents on the antitrust exemption if it appears the lower court should have dismissed it on standing grounds in the first place.

The City of San Jose could have advanced the argument that the continued existence of the option agreement and MLB's refusal to allow the A's to consider a move to San Jose as a sufficient injury, as the A's would not be allowed to execute the option to buy the land near Diridon Station. With that option agreement voided by the Santa Clara County court, that's only more reason for the Supreme Court to allow the Ninth Circuit decision to stand.

In the Supreme Court case, MLB has until May 18 to file its response or request an extension of time, which is usually granted.