INDEX NO.

652044/2014

FILED: NEW YORK COUNTY CLERK 01/12/2015 11:57 PM

NYSCEF DOC. NO. 505

RECEIVED NYSCEF: 01/12/2015

SUPREME COURT OF THE STATE OF NEW YORK

COUNTY OF NEW YORK
TCR SPORTS BROADCASTING HOLDING, LLP,
Petitioner,
-againstW N PARTNER, LLC;NINE SPORTS HOLDING, LLC;
W ASHINGTON NATIONALS BASEBALL CLUB, LLC;
THE OFFICE OF COMMISSIONER OF BASEBALL;
and THE COMMISSIONER OF MAJOR LEAGUE
BASEBALL,

IndexNo.652044/2014
(IAS Part 41)

Respondents,
-andTHE BALTIMORE ORIOLES BASEBALL CLUB and
BALTIMORE ORIOLES LIMITED PARTNERSHIP, in
its capacity as managing partner of TCR SPORTS
BROADCASTING HOLDING, LLP,
Nominal Respondents.

REPLY MEMORANDUM OF LAW IN FURTHER SUPPORT OF PETITIONERS

AMENDED PETITION TO VACATE ARBITRATION AWARD
AND IN OPPOSITION TO CROSS-MOTION TO CONFIRM
CHADBOURNE & PARKE LLP
1301Avenue of the Americas
New York, New York 10019
(212)408-5100
Attorneys for Petitioner
Thomas J.Hall
Pamela J.Marple*
Rachel W .Thorn
Benjamin D.Bleiberg
Caroline Pignatelli
Of Counsel
*pro hac vice pending

TABLE OF CONTENTS

PRELIMINARY STATEMENT .....................................................................................................1

ARGUMENT ...................................................................................................................................4
I.

II.

THE AWARD MUST BE VACATED FOR EVIDENT PARTIALITY

BECAUSE OF PROSKAUER'S CONFLICTING REPRESENTATIONS
AND MLB'S $25 MILLION STAKE IN THE AWARD ...................................................4
A.

Proskauer's Ties to MLB Establish Evident Partiality .............................................5

B.

Proskauer's Undisclosed Ties to the Individual Arbitrators

Establishes Evident Partiality. ...............................................................................18

C.

The Award Must Be Vacated Because MLB Had (and Still Has) a Direct
Financial Interest in the Outcome .........................................................................28

THE AWARD MUST BE VACATED FOR MISCONDUCT .........................................32

CONCLUSION ..............................................................................................................................35

TABLE OF AUTHORITIES
Page(s)
Cases
AAOT Foreign Econ. Ass't (VO) Technostroyexport v. Int'l Dev. & Trade Servs., Inc.,
139 F.3d 980 (2d Cir. 1998)...............................................................................................10, 12
ACN Digital Phone Serv., LLC v. Universal Micorelecs Co.,
115 A.D.3d 602, 982 N.Y.S.2d 126 (1st Dep't 2014) ...............................................................3
In re Andros Compania Maratima, S.A.,
579 F.2d 691 (2d Cir. 1978)...............................................................................................24, 27
Applied Indus. Materials Corp. v. Ovalar Makine Ticaret VE Sanayi, A.S.,
492 F.3d 132 (2d Cir. 2007)............................................................................................. passim
Astoria Med. Grp. v. Health Ins. Plan of Greater New York,
11 N.Y.2d 128, 182 N.E.2d 85, 227 N.Y.S.2d 401 (1962) .......................................................3
Commonwealth Coatings Corp. v. Cont'l Cas. Co.,
393 U.S. 145 (1968) ...........................................................................................................20, 24
Conley v. Ambach,
93 A.D.2d 902, 461 N.Y.S.2d 929 (3d Dep't 1983), aff'd as modified,
61 N.Y.2d 685, 460 N.E.2d 1083 (1984) ...........................................................................21, 22
Coty Inc. v. Anchor Constr., Inc.,
7 A.D.3d 438, 776 N.Y.S.2d 795 (1st Dep't 2004) ..................................................................29
DeCamp v. Good Samaritan Hosp.,
66 A.D.2d 766, 410 N.Y.S.2d 671 (2d Dep't 1978)...........................................................18, 27
Demov, Morris, Levin & Shein v. Glantz,
53 N.Y.2d 553, 428 N.E.2d 387, 444 N.Y.S.2d 55 (1981) ......................................................15
Petition of Dover Steamship Co.,
143 F. Supp. 738 (S.D.N.Y. 1956) ..........................................................................................12
Ecoline, Inc. v. Local Union No. 12,
271 F.Appx. 70 (2d Cir. 2008) .................................................................................................24
First Interregional Equity Corp. v. Haughton,
842 F. Supp. 105 (S.D.N.Y. 1994) ..........................................................................................24
Matter of Goldfinger v. Lisker,
68 N.Y.2d 225, 500 N.E.2d 857, 508 N.Y.S.2d 159 (1986) ..........................................3, 22, 24

Matter of J. P. Stevens & Co. (Rytex Corp.),

34 N.Y.2d 123, 312 N.E.2d 466, 356 N.Y.S.2d 278 (1974) ............................................ passim
Kalyanaram v. N.Y. Instit. of Tech.,
91 A.D.3d 532, 936 N.Y.S.2d 543 (1st Dep't 2012) ................................................................21
Matter of Kern (303 E. 57th St. Corp. Excelsior 57th St.),
204 A.D.2d 152, 611 N.Y.S.2d 547 (1st Dep't 1994) ..........................................................3, 20
LLT Int'l, Inc. v. MCI Tel. Corp.,
69 F. Supp. 2d 510 (S.D.N.Y. 1999)........................................................................................21
Lucent Technologies Inc. v. Tatung Co.,
379 F.3d 24 (2d Cir. 2004).......................................................................................................20
Merrill Lynch, Pierce, Fenner & Smith, Inc. v. Benjamin,
1 A.D.3d 39, 766 N.Y.S.2d 1 (1st Dep't 2003) ........................................................................11
In re Miller,
260 A.D. 444, 23 N.Y.S.2d 120 (1st Dep't 1940) (per curiam)...............................................32
Milliken Woolens, Inc. v. Weber Knit Sportswear, Inc.,
11 A.D.2d 166, 202 N.Y.S.2d 431 (1st Dep't 1960), aff'd, 9 N.Y.2d 878,
175 N.E.2d 826 (1961).............................................................................................................23
Mobil Oil Indonesia v. Asamera Oil (Indonesia),
43 N.Y.2d 276, 372 N.E.2d 21, 401 N.Y.S.2d 186 (1977) ......................................................12
Morelite Constr. Corp. v. N.Y. City Dist. Council Carpenters Ben. Funds,
748 F.2d 79 (2d Cir. 1984).......................................................................................................23
Matter of Namdar (Mirzoeff),
161 A.D.2d 348, 555 N.Y.S.2d 101 (1st Dep't 1990) ..............................................................10
People v. Suazo,
120 A.D.3d 1270, 992 N.Y.S.2d 138 (2d Dep't 2014).............................................................16
Pitta v. Hotel Ass'n of New York City, Inc.,
806 F.2d 419 (2d Cir. 1986).....................................................................................................28
Salvano v. Merrill Lynch, Pierce, Fenner & Smith, Inc.
85 N.Y.2d 173, 647 N.E.2d 1298, 623 N.Y.S.2d 790 (1995) ...................................................3
Sanko S.S. Co., Ltd. v. Cook Indus.,
495 F.2d 1260 (2d. Cir. 1973)..............................................................................................3, 15
Scandinavian Reins. Co. v. Saint Paul Fire & Marine Ins. Co.,
668 F.3d 60 (2d Cir. 2012)............................................................................................... passim
ii

Schmitt v. Kantor,
83 A.D.2d 862, 442 N.Y.S.2d 65 (2d Dep't 1981)...................................................................15
Seligman v. Allstate Ins. Co.,
195 Misc. 2d 553, 756 N.Y.S.2d 403 (Nassau Co. 2003)................................................ passim
Soma Partners, LLC v. Northwest Biotherapeutics, Inc.,
41 A.D.3d 257, 838 N.Y.S.2d 519 (1st Dep't 2007) ................................................3, 19, 20, 25
State Wide Ins. Co. v. Klein,
106 A.D.2d 390, 482 N.Y.S.2d 307 (2d Dep't 1984) ................................................................3
Tekni-Plex, Inc. v. Meyner & Landis,
89 N.Y.2d 123, 674 N.E.2d 663, 651 N.Y.S.2d 954 (1996) ....................................................11
Toroyan v. Barrett,
495 F. Supp. 2d 346 (S.D.N.Y. 2007)......................................................................................27
U.S. Elecs., Inc. v. Sirius Satellite Radio, Inc.,
17 N.Y.3d 912, 958 N.E.2d 891, 934 N.Y.S.2d 763 (2011) ....................................................23
Statutes and Rules
9 U.S.C. 10 ..................................................................................................................................34
9 U.S.C. 10(a)(2) ...........................................................................................................................4
CPLR 7511..................................................................................................................................34
Other Authorities
AAA Commercial Arbitration Rules and Mediation Procedures, Rule 17(a) (2013) ...................20
AAA Code of Ethics for Arbitrators in Commercial Disputes, Cannon II (2004) .......................20
JAMS Comprehensive Arbitration Rules and Procedures, Rule 15(h) (2014) .............................20
Uniform Arbitration Act 12 (2000) ............................................................................................20
1 Domke on Comm. Arb. 18:1 (3d ed. 2014) ............................................................................21

iii

Petitioner TCR Sports Broadcasting Holding, LLP (TCR), d/

b/
a Mid-Atlantic Sports
Network (MASN), respectfully submits this reply memorandum of law in further support of its
Amended Petition to Vacate (Petitionor Pet.
)the Arbitration Award issued on June 30, 2014
(the Award)by the Revenue Sharing Definitions Committee (the RSDC)of Maj
or League
Baseball (MLB), and in opposition to the cross-motion of Respondent W ashington Nationals
1
Baseball Club, LLC (the Nationals)to confirm the Award.

PRELIMINARY STATEMENT
Respondentsopposition papers are most striking for their treatment of critical, damning
facts that they cannot rebut and do not deny.
Respondents do not deny that Proskauer Rose LLPrepresented MLB along with
its current Commissioner and its future Commissioner, Robert J.Manfred in
1

Capitalized terms not otherwise defined herein shall have the meaning ascribed to them in the Petition or in the
Memorandum of Law in Support of Petitioners Amended Petition to Vacate Arbitration Award (MASN Br.
)
(Dkt.No.282).
The Thomas J.Hall Reply Affirmation in Support of Amended Petition to Vacate and in Opposition to CrossMotion to Confirm, dated January 12, 2015 (Hall Reply Aff.
)and the Reply Affidavit of Alan M.Rifkin in
Further Support of Amended Verified Petition to Vacate and in Opposition to Cross-Motion to Confirm Arbitration
Award, sworn to January 12, 2015(Rifkin Reply Aff.
)are submitted in support of this reply memorandum of law
and are referred to herein.For the convenience of the Court, the following documents previously filed in this action
have been re-attached as exhibits to the Hall Reply Aff.and are referred to herein as follows:Ex.14, Affirmation of
Robert D.Manfred, Jr.
, dated November 19, 2014 (Manfred Disc.Aff.
)(Dkt.No.445);Ex.15, Affidavit of
Michael J.Haley, sworn to November 6, 2014(Haley Disc.Aff.
)(Dkt.No.398);Ex.16, Affidavit of John P.
Angelos, sworn to November 3, 2014 (J.Angelos Disc.Aff.
)(Dkt.No.399);Ex.17, Affidavit of Alan B.
Sternstein, sworn to November 3, 2014 (Sternstein Disc.Aff.
)(Dkt.No.400);Ex.18, Affidavit of Alan M.
Rifkin, sworn to November 7, 2014(Rifkin Disc.Aff.
)(Dkt.No.402);Ex.19;Reply Affidavit of Alan M.Rifkin,
sworn to November 25, 2014(Rifkin Reply Disc.Aff.
)(Dkt.No.453).
The following additional documents are referred to herein as follows:Respondent the Office of the Commissioner of
Baseballs Memorandum of Law in Opposition to Petitioners Amended Petition to Vacate Arbitration Award
(MLB Opp.
)(Dkt.No.285);Affirmation of Robert D.Manfred, Jr.
, dated October 20, 2014(Manfred Aff.
)
(Dkt.No.286);Affirmation of Thomas J.Ostertag, dated October 20, 2014 (Ostertag Aff.
)(Dkt.No.297);
Affirmation of Steven P.Gonzalez, dated October 17, 2014(GonzalezAff.
)(Dkt.No.313);Affidavit of Francis
X.Coonelly, sworn to October 20, 2014(Coonelly Aff.
)(Dkt.No.310);Affidavit of Stuart L.Sternberg, sworn to
October 20, 2014 (Sternberg Aff.
)(Dkt.No.311);Affidavit of Jeffrey S.W ilpon, sworn to October 20, 2014
(W ilpon Aff.
)(Dkt.No.312);Respondent W ashington Nationals Baseball Club, LLCs Memorandum in Support
of Cross-Motion to Confirm the Arbitration Award and in Opposition to the Amended Petition to Vacate the
Arbitration Award (Nationals Opp.
)(Dkt.No.327);Affirmation of Bradley I.Ruskin, dated October 20, 2014
(Ruskin Aff.
)(Dkt.No.357);Affidavit of Ed Cohen, sworn to October 20, 2014(Cohen Aff.
)(Dkt.No.328);
Respondent the Office of the Commissioner of Baseballs Memorandum of Law in Opposition to Petitioners
Motion for Leave to Conduct Discovery (MLB Disc.Opp.
)(Dkt.No.439).

dozens of matters, most of which were concurrent with its representation of the
Nationals in the Arbitration.
They do not deny that Proskauer represented at least one of the Arbitrators, a
family partnershipof one of the Arbitrators, the father of one of the Arbitrators
and the Clubs that each of the three Arbitrators represented.
They do not deny that Mr.Manfred and other MLB officials played the central
role in the Arbitration, and even go so far as to assert that Mr.Manfred and other
MLB employees participated in the Arbitrators deliberative process, served as
the Arbitrators legal advisers and drafted the Award.
And, they do not deny that MLB concluded a formal agreement with the
Nationals without involving MASN or BOLP in its negotiation or execution,
and without disclosing to MASN or BOLP any of its material terms under
which MLB paid $25million to the Nationals that would be repaid through the
proceeds on an award issued in the Nationalsfavor.
Respondents offer no case in which a court has ever upheld an arbitration award issued in the
face of any single one of these improprieties let alone all of them at once.
Unable to offer a substantive response to these points, Respondents primarily argue
waiver.W ith respect to Proskauer, they argue, with no legal support whatsoever, that MASN did
not make its obj
ections the right way, and erred further by documenting their objections in
footnotes to written submissions (which none of the Arbitrators allegedly read), and by objecting
orally to the Arbitrators at the hearing (which the Arbitrators allegedly now do not recall).Yet,
Respondents cannot refute because at least eighteen separate documented objections and
countless more made verbally prove its truth that MASN vigorously and consistently obj
ected
to Proskauers representation of the Nationals in the Arbitration.
In reply to MLBs extraordinary decision to pay $25 million to the Nationals with the
Award or the possible sale of MASN as the sole means of recoupment, MLB insists that the
Orioles endorsed and encouraged the deal. But the contemporaneous documents give the lie to
this claim as well. They show MLB concealed the real sum at issue, concealed that MLB
expected to be repaid through the additional proceeds of an award in the Nationalsfavor if
2

MASN was not sold, and concealed that MLB would block the sale of MASN unless MASN
repaid MLBs $25million.
The larger point, which MLB and the Nationals have virtually ignored, is that the
Arbitrators and MLB (because of its role in the Arbitration)owed an unwavering duty to disclose
2
any relationship that might create an impression of bias.
Soma Partners, LLC v. Northwest

Biotherapeutics, Inc., 41 A.
D.
3d 257, 258, 838 N.
Y.
S.
2d 519, 521 (1st Dept 2007)(internal
quotations and citations omitted);Matter ofKern (303E. 57th St. Corp. Excelsior 57th St.), 204
A.
D.
2d 152, 153, 611N.
Y.
S.
2d 547, 549(1st Dept 1994);Applied Indus. Materials Corp. v.
Ovalar Makine Ticaret VE Sanayi, A.S., 492F.
3d 132, 138(2d Cir.2007);Sanko S.S. Co., Ltd. v.
Cook Indus., 495F.
2d 1260, 1263(2d.Cir.1973).The law imposes that stringent duty because
(as Respondents elsewhere emphasize), courts conduct only a limited review of arbitral decisions
before reducing them to judgment.Preciselyfor that reason, it is imperative that the integrity
of the process, as opposed to the correctness of the individual decision, be zealously
safeguarded.
Matter ofGoldf
inger v. Lisker, 68 N.
Y.
2d 225, 230, 500 N.
E.
2d 857, 860, 508
3
N.
Y.
S.
2d 159, 162(1986).

Because this case easily meets the standard for vacatur under both the Federal Arbitration Act (FAA), 9
U.
S.
C.
1, et. seq. and Article 75of the New York Civil Practice Law and Rules (CPLR), the interplay between
the FAA and the CPLR on this issue has no bearing on the outcome.There is no contention here that the parties
intended to displace the FAA or to confer the Court with the power to order relief that is not otherwise available
under the FAA, as was the question before the Court of Appeals in Salvano v. Merrill Lynch, Pierce, Fenner &
Smith, Inc. 85N.
Y.
2d 173, 647N.
E.
2d 1298, 623N.
Y.
S.
2d 790(1995), the case cited by Respondents. Nationals
Opp.at 9. To the extent it is consistent with the FAA, New York law applies.See MASN Br.at 5-6;see also ACN
Digital Phone Serv., LLC v. Universal Micorelecs Co., 115A.
D.
3d 602, 603, 982N.
Y.
S.
2d 126, 127(1st Dept
2014)([E]ven [where]the FAA governs, this Court may apply state grounds for vacatur, where they are consistent
with the FAAs terms and purposes.
).Indeed, the Salvano court analyzed vacatur under both the New York and
federal statutes.85N.
Y.
2d at 183, 647N.
E.
2d at 1303, 623N.
Y.
S.
2d at 795.The Nationals also incorrectly argue
that the CPLR does not apply because the Arbitrators were not appointed as neutrals.
Nationals Opp.at 15. The
CPLR is addressing a situation where there are party-appointed arbitrators and a neutral chair.Astoria Med. Grp. V.
Health Ins. Plan ofGreater New York, 11N.
Y.
2d 128, 133-24, 182N.
E.
2d 85, 87-88, 227N.
Y.
S.
2d 401, 404-405
(1962);State Wide Ins. Co. v. Klein, 106A.
D.
2d 390, 390-91, 482N.
Y.
S.
2d 307, 308(2d Dept 1984).None of the
Arbitrators were appointed by the parties;all were supposed to be neutral.
3

Emphasis is added throughout this submission unless otherwise indicated.

In keeping with that duty, the FAA further directs that an award must be vacated if the
circumstances would lead a reasonable person to believe that the arbitrators were not impartial.
See 9U.
S.
C.10(a)(2);U.S. Elecs., Inc. v. Sirius Satellite Radio, Inc., 17N.
Y.
3d 912, 914, 958
N.
E.
2d 891, 893, 934N.
Y.
S.
2d 763, 764-65(2011)(adopting the Second Circuits reasonable
person standardfor evident partiality claims arising under the FAA). To meet this standard,
[p]roof of actual bias is not required.
Scandinavian Reins. Co. v. Saint Paul Fire & Marine
Ins. Co.
, 668F.
3d 60, 72(2d Cir.2012);U.S. Elecs., 17N.
Y.
3d at 914, 958N.
E.
2d at 893, 934
N.
Y.
S.
2d at 764. Rather, [a]conclusion of partiality can be inferred from obj
ective facts
inconsistent with impartiality,such as the failure to disclose a material relationshipwith a party
or its counsel.Scandinavian Reins. Co., 668F.
3d at 72(internal citation and quotation omitted);
Seligman v. Allstate Ins. Co.
, 195Misc.2d 553, 557, 756N.
Y.
S.
2d 403, 406(Nassau Co.2003);
see also MASN Br.at 7-8.
Measured against that standard, and against the startling documentary record in this case,
this arbitration Award cannot be defended and cannot be confirmed. For the reasons stated
below and in the reply brief filed by the Nominal Respondents, MASNs petition to vacate the
Award should instead be granted and the dispute remanded to a panel of new arbitrators outside
of MLBs influence and control.
ARGUMENT
I.

THE AWARD MUST BE VACATED FOR EVIDENT PARTIALITY BECAUSE

OF PROSKAUERS CONFLICTING REPRESENTATIONS AND MLBS $25
MILLION STAKE IN THE AWARD
Two basic, undisputed facts establish evident partiality. First, despite vigorous repeated

obj
ections, Proskauer represented everyone in the Arbitration except for MASN and BOLP.
Proskauer represented the Nationals. Proskauer represented MLB, the outgoing Commissioner
(Mr.Allan BudSelig)and the Commissioner-elect (Mr.Manfred). In addition, Proskauer
4

represented an Arbitrator, each of the ArbitratorsClubs, and an Arbitrators father and family
business.Second, MLB, which controlled the Arbitration from start to finish, took a direct $25
million stake in the outcome. These essentially uncontested facts plainly require vacatur of the
Award.
A.

Proskauers Ties to MLB Establish Evident Partiality

Discovery has revealed that Proskauer was even more deeply intertwined with MLB than

MASN and BOLP (and the Court)previously knew. The sheer number of matters and their
import demonstrate the level of MLBs trust and confidence in the firm and the intimacy of their
relationship. MLB was running (and controlling)an arbitration in which its own long-time
counsel represented one of the parties. Despite MASNs and BOLPs numerous obj
ections to
Proskauers involvement, MLB made no effort at all to discharge its obligation to investigate and
disclose the extent of the conflict, let alone properly resolve it. Both are grounds for vacatur.
W ith no answer to these facts, MLB and the Nationals fall back to the unsupportable claim that
MASN and BOLP somehow waived their obj
ections to Proskauers involvement. Both the
record and controlling case law squarely contradict that position.
1.

Proskauer Is Even More Intertwined with MLB Than Was

Previously Revealed

The Court has already heard that Proskauer represented MLB and various MLB officials,
including Mr.Manfred, both before and during the Arbitration.Pet.76-116.Now, discovery
has revealed the full extent of Proskauers decade-long trusted relationshipwith MLB. During
the period covered by the request (January 1, 2005to June 30, 2014(the date of the Award)),
Proskauer has represented MLB-related entities in 74 separate engagements, including
employment, labor, and litigation matters, involving approximately 350 different timekeepers.
Hall Reply Aff.4, Ex.1. Forty-nine of these engagements occurred during the Arbitration.

The Proskauer attorneys who represented the Nationals in the RSDC Arbitration (Messrs.
Ruskin, Forbes, and Leccese and Ms.Scullion (e.g., Coonelly Aff.22))represented MLB
entities in 32different matters, 27of which occurred during the Arbitration.Hall Reply Aff.4,
Ex.1.
If the number of representations were not enough, even a cursory review of the types of
representations drives home the depth of the MLB-Proskauer relationshipand how inappropriate
it was for Proskauer to represent a litigant before an MLB committee.Mr.Ruskin admits that he
and his firm, advise MLBs Executive Council, the leagues highest governing body (Ruskin Aff.
70), and the record shows Proskauer regularly represents MLB in high-stakes, significant
litigation. Contrary to MLBs claim (MLB Opp.at 2, 14-15), at least two of these matters
involve issues related to the Arbitration.In the Dodgers Bankruptcy matter, for instance, MLB,
represented by Mr.Ruskin and Ms.Scullion (along with other Proskauer attorneys), challenged
whether telecast rights fees in the Dodgerstelecast rights agreement were at fair market value
and in the Best Interests of Baseball.Rifkin Aff.59-61, Ex.16;Hall Aff.6. In Garber, et
al. v. Of
f
ice ofthe Commissioner ofBaseball, et al.
,12-cv-03704(S.
D.
N.
Y), Mr.Ruskin and Ms.
Scullion (along with other Proskauer attorneys)is defending MLB and Arbitrator Coonellys
Club, the Pittsburgh Pirates, in a class action challenging whether MLBs distribution of out-ofmarket, live game telecasts is exempt from antitrust laws.See Ruskin Aff.62;Hall Aff.6,
9, Ex.10;Rifkin Reply Aff.35, Ex.14.
And even if unrelated, Proskauers other representations are no less significant because
they show the close connection between the Nationalscounsel in the Arbitration and the MLB
officials controlling the arbitral process. For instance, while the Arbitration was ongoing,
Proskauer (including Mr. Ruskin) represented MLB in connection with the Biogenesis

investigation, the grievance that led to Alexander Rodriguezs year-long suspension and
defended MLB in the subsequent lawsuit. Hall Reply Aff. 11, Ex.1. Mr.Manfred
spearheaded the investigation and was one of MLBs main witnesses.Hall Reply Aff.11, Exs.
1, 11. Some have credited his successful handling of the matter as a factor in his accession to
4
Commissioner.Hall Reply Aff.11, Ex.11.

Remarkably, it has only recently been disclosed that one day before MASN and BOLP
filed their obj
ections to Proskauers involvement in the Arbitration (Rifkin Aff.Ex.11),
Proskauer represented and advised Commissioner Selig on the extension of his $22million-peryear employment contract with MLB.See Hall Reply Aff.Ex.1(PROSK000168);Ex.5(Selig
Article). Two days later, Mr.Manfred denied those obj
ections at the Arbitrations prehearing
conference. Notably, Mr. Ruskin omits any mention of his firms representation of
Commissioner Selig in the two lengthy and detailed affirmations that he submitted to this Court.
(Dkt.Nos.91, 357) Nor was MLB forthcoming in the numerous affidavits and affirmations that
it has submitted in this litigation. But for Proskauers December 4, 2014document production,
5
this representation might never have surfaced at all.

Proskauer also represented Mr.Manfred in the action Phillips, et al. v. Selig, et al., No.1966EDA 2007(Pa.
Super.Ct.
), which lasted from 2001to 2009.Hall Aff.7.
5

Former Proskauer partner Dan Halem (now MLBs Executive Vice President of Labor Relations)also had a
significant role in the Arbitration.MLB asserts an attorney-client or arbitral decision making privilege with respect
to documents shared with Mr.Halem.Hall Reply Aff.Ex.4. Mr.Halem attended meetings at which arbitral
deliberations allegedly occurred (Hall Reply Aff.Ex. 3 (MLB00200, 201-04, 205))and appears to have helped
draft the Award. Hall Reply Aff.Ex.3(MLB00024). W hile MASN was aware of Mr.Halems connections to
Proskauer and that he had an administrative role in the Arbitration, this relationship takes on significantly more
meaning now that MLB has admitted it served as the Arbitratorslegal advisors and law clerk and wrote the Award.

2.

MASN Plainly Preserved Its Objection to Proskauers

Involvement

Even though MASN and BOLP did not know nearly the full extent of Proskauers
6
entanglements with MLB, they knew enough to be extremely concerned.
Accordingly, they

promptly and repeatedly obj

ected to Proskauers involvement, citing the patent unfairness of
having a law firm (and even the same lawyers)simultaneously represent both a decision-making
body and a party appearing before that body. On February 13, 2012, Mr.Manfred confirmed
the fact that the Orioles have not waived their objection to Proskauers participationin the
Arbitration. Rifkin Reply Aff.Ex.9. Nineteen months later, on September 2, 2013, Mr.
Manfred reaffirmed that fact, stating: We would never assert that you [the Orioles] have
waived your objection to [P]roskauers involvement.
Rifkin Reply Aff.Ex.15.Yet, today,
MLB now stands before this Court taking the opposite position one that is pure fantasy, a volte
f
ace and reflects nothing more than MLBs desperation to mount some defense of the Award.
MLB Opp.at 10-13.
MASN and BOLP raised at least eighteen different obj
ections to Proskauers
involvement in the Arbitration.They presented their objections before the Arbitration began, by
letters to Proskauer and to Mr.Manfred;in person and in writing at the prehearing conference
over which Mr.Manfred presided, when he granted them a continuing obj
ection in their

Before seeking Proskauers withdrawal or disqualification, counsel for BOLP wrote to MLBs general counsel,
Mr.Ostertag, to confirm BOLPs understanding about Proskauers relationships with MLB and to make further
inquiry about Proskauers relationshipwith MLB and MLB Clubs. Rifkin Aff.Ex.3. At that time MASN and
BOLPwere generally aware that Proskauer provided advice to MLB on labor relations and ADA matters but did not
know the extent of the representations.Rifkin Reply Aff.15.In response, Mr.Ostertag stated that Proskauer was
MLBs principal outside counsel in the labor area, was providing legal services in connection with the LA Dodgers
bankruptcy, and had held a small numberof seminars for the Clubs on various ADA and DOJenforcement issues
over the last few years.
Rifkin Aff.Ex.3.Based on this (materially incomplete)information, MASN and BOLP
objected immediately to Proskauers involvement.Rifkin Aff.Exs.4, 7, 8, 10, 11.

submission statements to the Arbitrators;in person at the April 3, 2012 merits hearing;and
countless more times verbally. A full list of the eighteen documented obj
ections, and MLBs
acknowledgments of those objections, is presented in an Appendixto this memorandum.
In response to MASNs and BOLPs vociferous complaints, Mr.Manfred granted a
continuing objection to Proskauers involvement, a fact that Respondents now studiously
ignore. Rifkin Aff.Exs.12-16;Rifkin Reply Aff.Ex.9 (Feb.13, 2012 Email from Mr.
Manfred). Indeed, during discussions regarding a possible j
oint submission agreement that
would describe various aspects of the Arbitration, Mr.Manfred advised that his draft did not deal
with the Proskauer obj
ection, and instructed MASN and BOLP to document their obj
ection by
means of letters to [him].
Rifkin Reply Aff.Ex.9(Feb.13, 2012Email from Mr.Manfred).In
reply, MASN and BOLPexplicitly told Mr.Manfred that they understood that the issue is fully
preserved,and asked:Is it your suggestion that the Orioles and TCR need to provide you with
anything more? Rifkin Aff.Ex.18 at 7;see also Rifkin Aff.Exs.13, 14, 17 (restating
obj
ections).
On February 16, 2012, BOLPwrote to Mr.Manfred to ensure the record was clear and to
reiterate MASN and BOLPs obj
ection:
The Orioles and TCR have an absolute right to a fair and objective hearing not tainted
by the shadow of MLBs lawyers, who, among other things, also represent a party in
this proceeding. We have expressed that objection orally and in writing. To reiterate,
what we agreed to when we met in New York on February [2], 2012, and what has been
consistently stated in our discussions and all correspondence, is that since the RSDC
would not or believed it did not have the authority to preclude Proskauer as we had
requested, the RSDC would grant and, in fact, granted the Orioles and TCR a
continuing objection to Proskauers representation of the Nationals and that all of the
Orioles and TCRs objections, reservations, rights, privileges, claims and actions
related to Proskauers participation in these proceedings would be preserved for all
purposes, without any waiver of any kind, including by virtue of the Orioles and
TCRs continued participation in this RSDC proceeding.
Rifkin Aff.Ex.14

Prior to these proceedings, Mr.Manfred never disputed the accuracy of this summation.
Nor did he ever suggest MASN or BOLP should do anything further. Rifkin Reply Aff.30.
MASN therefore understood that there was no question (if there ever had been)that its position
had been preserved.
Having no credible response to the mountain of evidence documenting these obj
ections,
the Nationals and MLB offer a series of absurd formalisms.They first argue that MASN waived
its right to challenge the Award for evident partiality because the objection was directed towards
disqualifying Proskauer, rather than challenging the Arbitrators.MLB Opp.at 11;Nationals
Opp.at 19-20. However, no legal authority imposes a magic incantation that must be followed
when a party obj
ects to the fairness of arbitral proceedings.
The two cases cited by Respondents simply hold that a petitioner with knowledge of facts
indicating bias may not stay silent until after an adverse award issued.See AAOT Foreign Econ.
Asst (VO)Technostroyexport v. Intl Dev. & Trade Servs., Inc.
, 139 F.
3d 980, 982 (2d Cir.
1998)(party waived obj
ection when it had knowledge of concrete factsindicating potential
corruption before the arbitration began, but for three years did not communicate its concerns to
its counterparty, the arbitral tribunal or the body under whose auspices the arbitration was
conducted until after it lost);Matter ofNamdar (Mirzoef
f), 161A.
D.
2d 348, 349, 555N.
Y.
S.
2d
101, 102 (1st Dept 1990)(finding waiver where the party had knowledge of the arbitrators
alleged bias during the arbitral proceeding, but failed to raise any objection until well after the
award was rendered).
These cases are completely inapposite because, as Respondents well know, MASN and
BOLP did not stay silent they objected again and again to Proskauers participation. Nor do

10

Respondents contend that they were confused in any way about the nature of the obj
ection raised
in the February 1, 2012letter and in differing formulations many times thereafter:
Proskauers longstanding representations of litigant, ultimate decision-maker and
participating RSDC member Club(s)raise, at a minimum, serious questions of
partiality, prejudice, and misuse of confidential and proprietary information
and Proskauers continued participation would be procedurally and
substantively inappropriate and compromise the integrity of [the RSDC
proceeding].
Rifkin Aff.Ex.11;

The Orioles and [MASN]have an absolute right to a fair and objective hearing
not tainted by the shadow of MLBs lawyers, who, among other things, also
represent a party in this proceeding.
Rifkin Aff.Ex.14;

MASN and the Orioles expressly reserve all rights, waiving none, to challenge
the record of the proceedings, as well as the regularity of its procedures and the
constitution of its panel, in the appropriate forum, should that become
necessary.
Rifkin Aff.Ex.17.

Respondentsnext waiver argument is even more strained.They suggest that MASN has
forfeited any right to relief because it did not run to court in the middle of the Arbitration to
seek redress for Proskauers involvement in the Arbitration.If this sounds odd, it should.In the
June 30, 2014letter enclosing the Award, Commissioner Selig declared that [l]itigation in the
courts is expressly prohibitedby the MLB Constitution, and threatened if any party initiates
any lawsuitto impose the strongest sanctions available.
Hall Aff.Ex.21;see also Hall Aff.
Exs.22, 23, 24, 25(8/
7/
14Tr.at 41:
7-19). It is therefore rather remarkable to hear MLB now
argue that the problem with MASNs grounds for vacatur is that it waited too long to seek
j
udicial relief.MLB Opp.at 13;accord Nationals Opp.at 20.
The cases on which Respondents rely do not say a word about the waiver rule they have
invented.At most, these authorities establish that arbitrators generally lack power to disqualify a
partys counsel under the rules of professional ethics.See, e.g., Merrill Lynch, Pierce, Fenner &
Smith, Inc. v. Benjamin, 1A.
D.
3d 39, 44, 766N.
Y.
S.
2d 1, 5(1st Dept 2003);Tekni-Plex, Inc. v.

11

Meyner & Landis, 89N.

Y.
2d 123, 130-36, 674N.
E.
2d 663, 666-70, 651N.
Y.
S.
2d 954, 957-961
7
(1996).
These cases certainly do not say that a party who timely obj
ects to a conflict of interest

is barred from seeking vacatur if the other parties nevertheless chose to proceed with the
arbitration without resolving the conflict as they usually do by hiring new counsel. And they
should not be gratuitously read to conflict with the many cases that say the opposite, i.e., that
because MASN and BOLP notif[ied]opposing counsel of their objections, along with the
forum and the Arbitrators themselves, and because MLB and the Nationals insisted in the face
of [those]charges on proceeding with the arbitration as arranged,MASN has preserved its
8
obj
ections and [is]free to raise themnow.
See AAOT, 139F.
3d at 981.

3.

Proskauers Relationship with MLB Requires Vacatur

Respondents next argue that MLBs conflict of interest is simply irrelevantbecause

Proskauers representation[s]concerned unrelated matters,and MLB did not control or direct
the RSDC Decision.
MLB Opp.at 2.But discovery has now revealed how far from the truth
that is: MLB actually controlled and directed every aspect of the RSDC process, even drafting
the Award itself. For that reason, MLBs relationshipwith Proskauer is plainly disqualifying.
And for the same reason, MLB had an independent duty to investigate and disclose the full
extent of that relationship, which it utterly failed to satisfy.Accordingly, vacatur is required.

In relying on Tekni-Plex, the Nationals appear to argue that there was no reason to disqualify Proskauer because
Proskauer did not have a prior relationshipwith MASN.Nationals Opp.at 20n.
17.However, Tekni-Plex concerns
a different kind of conflict of interest:a former client and opposing counsel. In contrast, this case is about the
decision-makers (all of them)and opposing counsel and concurrent representations.
8

It is also well established that a court cannot entertain an attack upon the ...partiality of arbitrators until after the
conclusion of an award.
Petition ofDover Steamship Co., 143 F.Supp.738, 742 (S.
D.
N.
Y.1956);Mobil Oil
Indonesia v. Asamera Oil (Indonesia), 43N.
Y.
2d 276, 281-82, 372N.
E.
2d 21, 23, 401N.
Y.
S.
2d 186, 188(1977)
([F]or the court to entertain review of intermediary arbitration decisions involving procedure or any other
interlocutory matter, would disj
oint and unduly delay the proceedings, thereby thwarting the very purpose of
conservation.
).

12

MLBs opposition papers are replete with pronouncements of the RSDC panels
independence and claims that MLB did not control, dictate or direct the Award.MLB Opp.at 12, 14-15;Manfred Aff.6, 8, 11;see also Coonelly Aff.10;Sternberg Aff.9, W ilpon Aff.
9. MLB vaguely describes Mr.Manfred as having played a limited support role,in which he
merely attendedthe Arbitrations merits hearing.Manfred Aff.6, 9, 21.Mr.Manfred says
that his staff simply provide[d]administrative and other support for the RSDC.
Manfred Aff.
6.Sticking perfectly to MLBs story, all three Arbitrators attest, in identical language, that he
decided the matter independently and neither the Commissioner, nor Mr.Manfred, nor
anyone else in the Commissioners Office attempted to or did dictate the result of the RSDC
Proceeding.
Coonelly Aff. 10;accord Sternberg Aff. 9 (verbatim);W ilpon Aff. 9
(verbatim).
All of these claims have now been thoroughly discredited. Indeed, when tested in
discovery, MLB recanted and recast its role. The support and administrative roles
supposedly played by Mr.Manfred morphed into a full-fledged attorney-client relationshipwith
the RSDC, as MLB asserted that Mr.Manfred and his staff served as the Arbitratorslegal
advisors, resolved procedural issues, participated in the hearing, acted as the RSDCs law
clerks,and actually drafted the Award. Manfred Disc.Aff.5, 8-9, 18, 21, 26;see also J.
Angelos Disc.Aff.8-9;Sternstein Disc.Aff.4-5;Haley Disc.Aff.6;Rifkin Disc.Aff.
15, 17-19.
Further, MLBs document production and privilege log have made it even more apparent
that MLB and Mr.Manfred maintained almost complete control over the Arbitration and Award.
Indeed, while Mr.Manfred concedes that MLB staff had prepared a draft decision for the
RSDCs review(Manfred Disc.Aff.26), discovery has revealed that only Arbitrators W ilpon

13

and Connelly made written comments on the draftprepared by MLB, and these were to correct
typographical errors. Hall Reply Aff. Ex. 3(MLB000250, MLB000248). It does not appear
that Arbitrator Sternberg made any comments at all.
Likewise, despite MLBs assertion that no one at MLB agreed to play postman for
MASN or the Orioles(MLB Disc.Opp.at 24), MLBs document production shows that Mr.
Manfred and his staff acted as the postmaster general but only when it suited their purposes.
All communications went through Mr.Manfred or his office, and they used their position to
selectively decide what to pass on to the Arbitrators.Indeed, it is the absence of the transmission
of materials relevant to the Arbitration from MLB to the Arbitrators that most clearly reveals
MLBs near-total control over the process. Purportedly acting on behalf of the RSDC, Mr.
Manfred propounded requests for information to MASN and directed MASN to provide that
information to him.Manfred Disc.Aff.20(g);Haley Disc.Aff.7;Sternstein Disc.Aff.5.
But documents produced by MLB establish that the vast majority of the information MASN
9
provided in response was never sent to the Arbitrators.

For example, on February 7, 2012, March 2, 2012 and March 29, 2012, Mr.Manfred
asked MASN to provide information and materials relevant to the proceedings.Rifkin Disc.Aff.
11(f), Exs.16-18. He also asked for supplemental information on June 19, 2012. Rifkin Disc.
Aff.11(f), Ex.22. MASN provided those materials on February 13, 2012, March 12, 2012,
March 30, 2012 and June 22, 2012. Rifkin Disc.Aff. 11(f), Exs.19-21, 23. Yet, the
documents produced by MLB demonstrate that MLB never transmitted these materials to the

MLBs document production reveals only that MLB sent more detailed information from MASN on the length of
existing affiliate agreements and associated affiliated feesto the Arbitrators on April 2, 2012. Hall Reply Aff.Ex.
3(MLB00003).

14

Arbitrators.It did not do so for one obvious reason: the Arbitrators had little, if no, role in the
decision-making process and, thus, no need for the materials.
Mr.Manfreds implementation of several standstill agreements further highlights the
utter lack of participation that the Arbitrators had in the proceedings. Rifkin Disc.Aff.12(c);
Sternstein Disc.Aff.5;Manfred Disc.Aff.20(h).After negotiating and documenting these
agreements with the Nationals, MASN and BOLP, Mr.Manfred never communicated to the
Arbitrators that he had done so.
Given the degree of control MLB exercised over the entire proceeding, there is no doubt
that its relationshipwith Proskauer was disqualifying.The attorney-client relationshipis one of
the most sensitive and confidential relationships in our society.
Demov, Morris, Levin & Shein
v. Glantz, 53 N.
Y.
2d 553, 556, 428 N.
E.
2d 387, 389, 444 N.
Y.
S.
2d 55, 57 (1981). For that
reason, it is clear that an arbitrators existing or past attorney-client relationshipcan give rise
to a finding of evident partiality. Seligman, 195Misc.2d at 557, 756N.
Y.
S.
2d at 406;see also
Scandinavian Reins. Co., 668F.
3d at 74(identifying an ongoing relationshipwith a party or its
law firm as a material relationship);Sanko, 495 F.
2d at 1263-64 (granting an evidentiary
hearing to determine the full extent and nature of an alleged attorney-client relationship
between an arbitrator and a partys counsel).
MLBs counsel concedes as much:
THE COURT: what if I am an arbitrator and you represent me, you are my
lawyer, and there is an arbitration proceeding before me[?]

MR.BUCKLEY:The question you put to me, was could you, as an arbitrator,

instead, say, I voluntarily recuse myself, because I think I have a conflict. Since
Mr. Buckley is my counsel, I cant sit as an arbitrator in the matter in which he
represents a party.You can do that, certainly.Now, the question here is
THE COURT:Not only could I do that, but I should do that.

15

MR.BUCKLEY:You should.Absolutely you should do that, no question.

Hall Reply Aff.Ex.2(12/
15/14Tr.at 66:
25-68:4).
Precisely because of the intimate nature of the attorney-client relationship, it is irrelevant
whether the attorney represents (or represented)the arbitrator in a related or unrelated matter.
See, e.g., Schmitt v. Kantor, 83A.
D.
2d 862, 862, 442N.
Y.
S.
2d 65, 66(2d Dept 1981)(Since
there is no way of knowing to what extent, if any, the fact that the panel doctor was being
represented in an unrelated malpractice action by the same law firm as one of the codefendants
influenced his handling of the case, the findings of the panel must be vacated in their entirety);
Seligman, 195 Misc.2d at 557, 756 N.
Y.
S.
2d at 406 (arbitrators long-term attorney-client
relationshipwith a party required vacatur, even though twenty-five years had passed). MLBs
assertion that Proskauers numerous representations were unrelated is simply beside the
10
point.

In light of MLBs control over the process, it is also irrelevant that the Arbitrators rather
than MLB nominally decided the dispute.

See MLB Opp.at 2. MLBs denial of MASN and

BOLPs objections to Proskauers involvement are a case in point. Discovery reveals that Mr.
Manfred not only denied the obj
ections himself, but also never even told the Arbitrators that the
11
obj
ections had been made, let alone that he had rejected them.
This is exactly why the

Proskauer conflict is so problematic: MASNs and BOLPs challenge to Proskauer, which was
based on Proskauers close ties to MLB, was decided by MLB with no input from the Arbitrators
themselves.
10

It is also wrong as a factual matter as discussed above.

11

This is all the more surprising because Mr.Manfred sent the RSDC a memorandum describing the Arbitration
timeline agreed to at the February 2, 2012conference (Hall Reply Aff. Ex. 3(MLB00016)), but did not tell the
Arbitrators that, at the very same meeting, MASN and BOLPhad objected to Proskauer and specifically requested
that the arbitrators be so advised (Rifkin Reply Aff.24-26;Haley Disc.Aff.3-5;J.Angelos Disc.Aff.3-6).

16

In keeping with MLBs law clerkanalogy, this is akin to a clerk receiving a recusal
motion from a party based on the clerks ties to one of the parties, deciding that there is no
problem, and tossing the letter in the trash without telling the j
udge. The clerk then goes on,
without the j
udges knowledge or approval, to draft the opinion resolving the case in favor of the
party to whom she has ties. No one could seriously suggest that such conduct would be
permissible. See People v. Suazo, 120A.
D.
3d 1270, 1272, 992N.
Y.
S.
2d 138, 139(2d Dept
2014)(A law clerk is probably the one participant in the j
udicial process whose duties and
responsibilities are most intimately connected with the j
udges own exercise of the j
udicial
function.
)(internal quotation and citation omitted).Thus, whether Mr.Manfred and MLB were
the RSDCs law clerks(as MLB itself says)or were in effect serving as a fourth, superarbitrator (as the record strongly suggests), MLBs intimate relationship with the Nationals
counsel plainly requires vacatur.
Separately, MLB breached its independent obligation to investigate and disclose
nontrivial conflicts.MLB had this duty both because it acted as the arbitral forum (see Matter of
Seligman, 195Misc.at 557, 756N.
Y.
S.
2d at 406(finding that both the arbitrator and AAA had
a duty to disclose any facts within [its]knowledge which might in any way support an inference
of bias)), and because of its pervasive involvement in and control over the RSDC process. At
the latest, this duty was triggered in late January-early February 2012when MASN inquired to
MLB about Proskauers relationships with MLB and the Arbitrators and formally lodged its
12
obj
ection to Proskauer to Mr.Manfred. Rifkin Aff.Exs.3, 6, 11.
MLB should then have

investigated the full extent of the potential conflict and disclosed the relevant information to the

12

Given its role in the Arbitration and that its knowledge of MASNs objections, MLBs duty to investigate and
disclose was not limited to its own relationships with Proskauer;it also included the Arbitratorsrelationshipwith
Proskauer.There is no evidence MLB conducted any investigation at all.

17

parties so they could make a fully informed decision about how to proceed.See Applied Indus.
Materials Corp. v. Ovalar Makine Ticaret VE Sanayi, A.S., 492F.
3d 132, 138(2d Cir.2007);
Matter ofJ. P. Stevens & Co. (Rytex Corp.), 34 N.
Y.
2d 123, 129, 312N.
E.
2d 466, 469, 356
N.
Y.
S.
2d 278, 282 (1974)([T]he arbitrator is in a far better position than the parties to
determine and reveal those facts that might give rise to an inference of bias.
).
Instead, MLB never made any disclosures whatsoever beyond Mr.Ostertags informal,
one-paragraph email on January 23, 2012and Mr.Manfreds belief that Proskauer does salary
arbitration for Tampa.See Rifkin Aff.30, Exs.3, 6.Indeed, MLB has never suggested that it
undertook any investigation in response to MASNs and BOLPs obj
ections.That is a textbook
example of evident partiality, warranting vacatur. See Applied Indus., 492F.
3d at 139(finding
evident partiality where the arbitrator disclosed only some facts bearing on the relationshipand
failed to investigate [the relationship]or disclose that he would make no further inquiries);cf
.
DeCamp v. Good Samaritan Hosp., 66A.
D.
2d 766, 767, 410N.
Y.
S.
2d 671, 673(2d Dept 1978)
(the undisclosed relationship between [a panel member]and [a partys]attorney was not a
casual or informal one;rather, it was the confidential relationshipof client and attorney.Thus, it
was incumbent upon the physician panelist to disclose such relationship.
).
B.

Proskauers Undisclosed Ties

Establishes Evident Partiality

to

the

Individual

Arbitrators

Separately, Proskauers significant undisclosed relationships with the Arbitrators, their

families and their Clubs establish evident partiality. MASN and BOLP knew almost nothing
about these relationships;accordingly, they requested additional information, only to be rebuffed
by MLB. Rifkin Aff.Ex.6. Respondentsclaims that the Arbitrators never knew there was a
potential conflict only highlight the problem described in the prior section: MLB itself diverted
the written obj
ections initially made by MASN and BOLP, failed to disclose what it knew, and

18

evidently failed to even investigate the issue. Nonetheless, MASN and BOLP did manage to
communicate their obj
ections directly to the Arbitrators on multiple occasions.See, e.g., Rifkin
Aff.Ex.15;Rifkin Aff.Ex.16;J.Angelos Disc.Aff.9.The corresponding failure of the
Arbitrators to investigate and disclose these relationships establishes evident partiality and
provides an additional ground for vacatur.
Discovery has now revealed the full extent of Proskauers relationships with the
Arbitrators, their families and their Clubs, including some that previously were unknown:
Proskauer represented Arbitrator W ilpons family partnershipand father in
the action Goldweber v. Sterling Equities Associates, No.10-cv-5786
(S.
D.
N.
Y.
)which was ongoing during the RSDC Arbitration (Pet.112;
Hall Aff.12, Ex.13);13
Proskauer represented Arbitrator Sternbergs Club in four separate salary
arbitrations (two unknown until Proskauers document production), one of
which occurred during the RSDC Arbitration (Pet.112;Hall Aff.Exs.
11, 12, Haley Aff.27;Hall Reply Aff.2, Ex.1(PROSK000178-185);
Proskauer provided Americans with Disability Act (ADA)advice for
Arbitrator Coonellys Club prior to the Arbitration (unknown until
Proskauers document production) (Hall Reply Aff. 2, Ex. 1
(PROSK000170);
Proskauer represented Arbitrator Coonellys Club in Garber while the
Arbitration was pending (Pet.112;Hall Aff.9, Ex.9;Raskas Aff.
14
21(b);Haley Second Aff.11(C);Haley Aff.27);
Proskauer represented the Clubs of all three Arbitrators prior to the
Arbitration in Moran v. Selig, No.2:
03-cv-07424(C.
D.Cal.Filed Oct.16,
2003) and during the Arbitration in Senne, et al. v. Off
ice of the
13

Counsel for MLB initially represented to the Court that the General Counsel of Sterling Equities was unaware of
any representation of Sterling Equities by Proskauer.Hall Aff.Ex.7(8/
18/
14Tr.at 83:
3-19).However, Proskauers
document production has demonstrated that this statement is false;the engagement letter for the Goldweber case
was signed by Sterling Equitiesgeneral counsel.Hall Reply Aff.Ex.1.(PROSK000174-176).
14

MLB argues that MASN has been aware of Proskauers representation of the Pirates in Garber since 2012and did
not object until after the Award.MLB Opp.at 9, 11.That is not true.MASN did learn of the Garber litigation in
November 2012through a telephone call with Mr.Ostertag, but immediately objected to Proskauers representation.
Pet.110n.18; Rifkin Aff.64. Mr.Ostertag has not denied the conversation took place. Ostertag Aff.19
(discussing phone calls with Mr.Rifkin about the Garber case).Moreover, Mr.Rifkin reiterated MASNs objection
on March 21, 2013.Rifkin Reply Aff. 35, Ex.14.

19

Commissioner ofBaseball, et al.

, 3:
14-cv-00608 (N .
D.Calif.
)15 (Pet.
16
112;Hall Aff.6, 15, Ex.18;Haley Aff.27;MLB Opp.at 9).
The Arbitrators were obligated to investigate and disclose all of these relationships.The
FAA requires arbitrators to ensure that the parties are not misled into believing that no
nontrivial conflict exists.
Applied Indus., 492F.
3d at 138. The Court of Appeals, in turn, has
expressed a policy of maximum prehearing disclosure(see Rytex Corp., 34N.
Y.
2d at 128, 312
N.
E.
2d at 469, 356 N.
Y.
S.
2d at 282;SOMA Partners, LLC v. Nw. Biotherapeutics, Inc., 41
A.
D.
3d 257, 258, 838N.
Y.
S.
2d 519, 521(1st Dept 2007))which means that an arbitrator who
has reason to believe that a nontrivial conflict might existmust (1)investigate the conf
lict
or (2) disclose his reasons for believing there might a conflict and his intention not to
investigate.
Applied Indus., 492F.
3d at 138. Any other course constitutes evident partiality.
Id.
Under these standards, a current or past relationshipwith a partys attorneys essentially
always requires disclosure. See Seligman, 195Misc.2d at 557, 756N.
Y.
S.
2d at 407. As the
cases cited by the Nationals recognize, non-disclosure of a material relationship such as a
family connection or ongoing business arrangement with a party or its law f
irmis grounds for
vacatur because a reasonable person could reasonably infer a connection between the
undisclosed outside relationshipand the possibility of bias.
Scandinavian Reins. Co., 668F.
3d
17
at 74.
Indeed, the materiality of the attorney-client relationshipis so basic that many arbitral

15

MASN has never claimed that it was unaware of the Senne litigation.Pet.112n.
19(MASN became aware of
this case because the Orioles are a defendant in the action and are represented by Rifkin, W einer, Livingston,
Levitan & Silver, LLC.
);MLB Opp.at 9, 11;GonzalezAff.6-12, Ex.1-4. The Orioles refused to consent to
Proskauer representing MLB and the Clubs in this matter.GonzalezAff.Ex.4.That MLB would retain Proskauer
in the middle of the Arbitration only underscores Proskauers tight-knit fiduciary relationshipwith MLB.
16

Proskauer also represented Arbitrator Coonelly in the action Phillips, et al. v. Selig, et al., No.1966EDA 2007
(Pa.Super.Ct.
), which spanned from 2001-2009. Hall Aff.7, Exs.4-5.
17

Lucent Technologies Inc. v. Tatung Co., 379F.

3d 24(2d Cir.2004), on which the Nationals also rely, is not a
non-disclosure case at all. Nationals Opp.at 17. There, the arbitrator properly complied with his obligation to

20

and ethical rules compel arbitrators to disclose any past or present relationships with the parties
18
attorneys.

Here, it is undisputed that the Arbitrators never conducted any investigation or made any
disclosure regarding their relationships with Proskauer, even after MASN and BOLP raised the
issue. Faced with these facts, Respondents try to wave away these relationships as immaterial,
and then offer a blizzard of excuses for the Arbitratorsabject failure to meet their clear
obligations.These efforts are unavailing.
1.

The Arbitrators Were Required to Disclose Their Proskauer

Relationships

Respondents first contend that Proskauers representations were irrelevant because none
was concurrent with the RSDC Arbitration at least under the extremely creative (and
conflicting)reasoning they use to define when the Arbitration started and ended.MLB Opp.at
89, 11 (March 7, 2012 to June 30, 2014);Nationals Opp.at 17 (March 7, 2012 until April
2012).The short answer is that it does not matter whether the representations were concurrent:
past relationships must also be disclosed, and there is no bright line rule as to the number of
years since [the relationship ended]beyond which disclosure is not required.
Seligman, 195
Misc.2d at 557, 756N.
Y.
S.
2d at 407;see also Applied Indus., 492F.
3d at 138;Rytex Corp., 34

disclose his relationshipwith a party but the AAA failed to forward his disclosure form to the parties. In those
obviously distinguishable circumstances, the court held that vacatur was not required because the inadvertent
nondisclosure did not create an appearance of bias since the fault lay with the AAA, not the arbitrator.379F.
3d at
28-29.
18

For example, Rule 17(a)of the AAA Commercial Rules mandates:Any person appointed or to be appointed as
an arbitrator, as well as the parties and their representatives, shall disclose . . . or any past or present relationship
with the parties or their representatives.Such obligation shall remain in effect throughout the arbitration.
AAA
Commercial Arbitration Rules and Mediation Procedures (2013);accord AAA Code of Ethics for Arbitrators in
Commercial Disputes, Cannon II (2004);JAMS Comprehensive Arbitration Rules and Procedures, Rule 15(h)
(2014);Uniform Arbitration Act 12(2000) (requiring prospective arbitrators after making a reasonable inquiry
to disclose any existing or past relationshipwith any of the parties ...their counsel or representatives).Although
these rules are not binding here they are evidence of custom and usage in arbitration proceedings.
Commonwealth
Coatings Corp. v. Contl Cas. Co., 393 U.
S.145, 149 (1968)(describing the AAA disclosure rules as highly
significant).

21

N.
Y.
2d at 128-29, 312N.
E.
2d at 469, 356N.
Y.
S.
2d at 282-83;Conley v. Ambach, 93A.
D.
2d
902, 903, 461N.
Y.
S.
2d 929, 931(3d Dept 1983), aff
d as modified, 61N.
Y.
2d 685, 460N.
E.
2d
1083(1984).A relationshipthat predates the arbitration by a few months or a year, let alone a
few weeks, does not become trivial merely because it is not concurrent.

Furthermore, an arbitration commences when it is noticed, see 1Domke on Comm.Arb.

18:
1(3d ed.2014), and concludes when an award is issued, see, e.g., LLT Intl, Inc. v. MCITel.
Corp., 69F.Supp.2d 510, 514-15(S.
D.
N.
Y.1999)(an arbitrators authority is not exhausted
until publication of a final award);Kalyanaram v. N.Y. Instit. ofTech., 91A.
D.
3d 532, 532, 936
N.
Y.
S.
2d 543, 543(1st Dept 2012)(same). Here, then, the Arbitration ran from when it was
noticed on January 5, 2012 to when the Award was issued on June 30, 2014. Thus, MLB is
simply wrong that the Arbitration did not begin until the parties filed their opening briefs on
March 7, 2012. MLB Opp.at 8-9, 11. (The start date is not accidental: it is part of MLBs
effort to take Proskauers representation of Tampa Bay in connection with a players salary
arbitration case off the board.
)
The Nationalsstill more aggressive claim is that the relevant period runs only two
months from March 7, 2012, when the parties filed their opening briefs, to April 2012, when
the case was submitted. Nationals Opp.at 17. This time period which even MLB does not
accept overlooks two entire years during which the Arbitration was still pending. Yet, even
within the Nationalsartificially narrow window, Proskauer represented Arbitrator W ilpons
father, and his family company in significant litigation involving the Madoff Ponzi scheme. Pet.
112;Hall Aff.12, Ex.13.
Respondentsefforts to minimize the significance of Proskauers relationships with the
Arbitrators also do not succeed.In response to the undisputed (and previously undisclosed)fact

22

that Proskauer represented Arbitrator Coonelly in litigation that spanned eight years, MLB and
the Nationals observe that Mr.Coonelly did not sign an engagement letter and was indemnified
by MLB. MLB Opp.at 8, Coonelly Aff.24, Nationals Opp.at 16. But those facts did not
obviate Mr.Coonellys clear obligation to disclose his prior attorney-client relationshipwith the
Nationalscounsel. See Conley, 93A.
D.
2d at 903, 461N.
Y.
S.
2d at 931;Seligman, 195Misc.
2d at 557, 756N.
Y.
S.
2d at 407.
Similarly, MLB argues that Proskauers representations of the ArbitratorsClubs can be
ignored because the RSDC members were not sitting on the Committee to represent the
interests of their respective Clubs.
MLB Opp.at 14.But no arbitrator sits on an arbitral panel
as a representative of some outside interest;their charge is always to faithfully and fairlyhear
the controversy.
Matter ofGoldf
inger, 68N.
Y.
2d at 231, 500N.
E.
2d at 860, 508N.
Y.
S.
2d at
162. That does not mean an arbitrators existing or past financial, business, family or social
relationshipsuddenly become irrelevant. Rather, precisely because such relationships can give
rise to partiality whether they are direct or indirect,(see Rytex Corp., 34N.
Y.
2d at 128, 312
N.
E.
2d at 469, 356 N.
Y.
S.
2d at 283), arbitrators must disclose them so long as they are not
trivial,see Applied Indus., 492F.
3d at 138.
MLB next suggests that MASNs evident partiality claim fails because MASN failed to
demonstrate any actual bias on the part of the RSDC members,MLB Opp.at 17.That is not the
applicable legal standard. See U.S. Elecs., Inc. v. Sirius Satellite Radio, Inc., 17N.
Y.
3d 912,
914, 958N.
E.
2d 891, 893, 934N.
Y.
S.
2d 763, 764-65(2011) An award is subject to vacatur for
evident partiality based on undisclosed relationships, even if the petitioner makes no attempt to
prove actual partiality.
Milliken Woolens, Inc. v. Weber Knit Sportswear, Inc., 11A.
D.
2d 166,
168, 202N.
Y.
S.
2d 431, 433(1st Dept 1960), aff
d, 9N.
Y.
2d 878, 175N.
E.
2d 826 (1961);see

23

also Scandinavian Reins. Co., 668F.

3d at 72(Proof of actual bias is not required);Morelite
Constr. Corp. v. N.Y. City Dist. Council Carpenters Ben. Funds, 748F.
2d 79, 84(2d Cir.1984)
(same);MASN Br.at 7-8. Instead, [a]conclusion of partiality can be inferred from objective
facts inconsistent with impartiality,(Scandinavian Reins. Co., 668F.
3d at 72(internal quotation
and citation omitted)), including, as here a failure of an arbitrator to disclose a nontrivial
relationship.See Applied Indus., 492F.
3d at 138-39.
Finally, MLB and the Nationals argue that there can be no evident partiality because
MASN agreed to an inside baseballarbitration and it accordingly was to be expectedthe
arbitrators [would] have had experience with the firms that represent the parties to the
arbitration.
Nationals Opp.at 15-17;MLB Opp.at 16-17. But what happened in this case
went far beyond what anyone could have expected when the parties executed the Settlement
Agreement. And the cases on which the respondents rely are entirely inapposite. The
unremarkable fact that, within a small industry, arbitrators have often had previous experience
with the partiescounsel, see First Interregional Equity Corp. v. Haughton, 842F.Supp.105,
109(S.
D.
N.
Y.1994), hardly j
ustifies the conclusion that multiple attorney-client relationships
some of them overlapping can go entirely undisclosed. The law is squarely to the contrary.
See Commonwealth Coatings, 393 U.
S.at 150 (W hite, J.
, concurring)(arbitrators are not
automatically disqualified by a business relationshipwith the parties before them ifboth parties
are informed ofthe relationship in advance, or if they are unaware of the facts but the
19
relationshipis trivial);see also supra.

19

Even further afield are In re Andros Compania Maritima, S.A., 579F.

2d 691, 701(2d Cir.1978), where a party
challenged the award because one of the arbitrators regularly sat on arbitral panels with the president of a company
that owned a vessel involved in the case, and Ecoline, Inc. v. Local Union No. 12, 271F.
Appx.70, 72(2d Cir.
2008), where [t]he allegations of partiality in this case are based solely on the [arbitrators]business dealings.

W hile the dividing line between innocuous and suspect relationships is not always easy to draw,Andros, 579F.
2d
at 701, Proskauers relationships lie comfortably on the latter side of the line.

24

More fundamentally, when MASN agreed to an arbitration before the RSDC, it did not
give upits right to a proceeding that comported with the due process and fairness required of all
arbitrations. See Goldf
inger, 68 N.
Y.
2d at 231, 500 N.
E.
2d at 860, 508 N.
Y.
S.
2d at 162
(arbitrators ...are expected to faithfully and fairlyhear the controversy over which they have
been chosen to preside ...and ought to conduct themselves in such a manner as to safeguard the
integrity of the arbitration process).
And it is precisely this point that BOLPmade in its January 27, 2012letter to Proskauer,
asking it to withdraw voluntarily from the Arbitration:
While the parties agreed under Section 2.J.3 to submit this dispute to the RSDC, the
parties did not also agree to envelop that dispute resolution process with the kind of
corruptive taint that arises from your firms multi-faceted concurrent representations
of litigant and ultimate decision-maker . . . BOLP reserves the right to raise these
matters with the RSDC when that forum is convened or in such other forums, as
appropriate.Rifkin Aff.35, Ex.7.
Respondents cannot duck the evident partiality standard on this basis.
2.

There Was No Excuse for the ArbitratorsFailure to Disclose

Respondents attempt in four ways to justify the Arbitratorsinexcusable failure to make

the disclosures required by law. First, the Nationals suggest the Arbitrators had no duty to
investigate or to disclose their relationships with Proskauer because MASN never asked the
Arbitrators themselvesto do so. Nationals Opp.at 18(emphasis in original). That argument
fails because the Arbitrators had a duty to investigate and disclose any nontrivial conflict of
interest,regardless of whether any party asked them to do so, (see Applied Indus., 492F.
3d at
138;MASN Br.at 10), because they are in a far better position than the parties to determine and
reveal those facts that might give rise to an inference of bias.
Rytex Corp.
, 34N.
Y.
2d at 129,
312N.
E.
2d at 469, 356N.
Y.
S.
2d at 282;SOMA Partners, 41A.
D.
3d at 258, 838N.
Y.
S.
2d at
521.

25

MLB agrees:
THE COURT: Should arbitrators have to disclose conflicts themselves? They
have to be asked to disclose them, or they, if they have conflicts, are they
obligated to disclose them, themselves?
MR.BUCKLEY:If they have conflicts that are not particularly those that are
known, yes they should disclose.
Hall Reply Aff.Ex.2(12/
15/14Tr.at 56:
15-21).
Second, because MASN did ask the Arbitrators to disclose, MLB and the Nationals cannot
now fault MASN for failing to request disclosure.To be sure, they contend that MASN did not
complain to the Arbitrators themselves.
But that supposed lapse owes entirely to MLBs
conduct, because it was MLB that deliberately prevented MASNs prehearing obj
ections from
reaching the Arbitrators.In their written and oral submissions to Mr.Manfred on February 1and
2, 2012, MASN and BOLP explained additional disclosure was needed, both with respect to
MLB and the ArbitratorsClubs.Rifkin Aff.44, Ex.11;Haley Disc.Aff.5;J.Angelos Disc.
Aff.4;Rifkin Reply Aff.25. After denying their objections, however, Mr.Manfred also
denied MASNs and BOLPs request to communicate directly with the Arbitrators on this
20
topic.
Rifkin Aff.46;J.Angelos Disc.Aff.5;Haley Disc.Aff.5;Rifkin Reply Aff.25.

Third, MASN did ultimately succeed in raising its objection directly with the Arbitrators
in its submission statements, which were undisputedly provided to the panel. See Hall Reply
Aff.Ex.3 (MLB00009-12 (BOLP), MLB00014 (MASN), MLB00005 (BOLP)) (showing
transmittal of submission statements and BOLP reply submission statement to the Arbitrators).
The very first page of each Submission Statement includes a footnote reiterating MASNs and
BOLPs objections to Proskauers representation of the Nationals. Rifkin Aff.Ex.15. BOLP
20

W hile Mr.Manfred and Mr.Cohen claim they do not recall this conversation (Manfred Aff.43;Cohen Aff.
42), Mr.Rifkins recollection is corroborated by MASNs and BOLPs contemporaneous February 1, 2012letter,
which called attention to the limited disclosure.

26

again raised the obj

ection in its Reply Submission Statement. Rifkin Aff.Ex.16. Finally,
during the April 3, 2012merits hearing, BOLPs counsel orally reiterated MASNs and BOLPs
obj
ections regarding Proskauer directly to the panel.J.Angelos Disc.Aff.9;Rifkin Aff.53.
Thus, the Arbitrators directly received at least four different communications reflecting the
obj
ection to Proskauer, any one of which should have prompted them to investigate their
relationships and their Clubsrelationships with Proskauer.They did not investigate, and in fact
did not even ask the parties or MLB for more information about the underlying objection, which
further underscores that the RSDC Arbitrators played little or no role in the decision. That
21
failure amounts to evident partiality.See Applied Indus.
, 492F.
3d at 138.

Fourth, and finally, the Nationals argue that MASN could and should have launched its
own investigation and discovered Proskauers representations through public record searches.

Nationals Opp.at 18. But, the cases that the Nationals cite stand only for the unremarkable
proposition that a party cannot sit idly back, wait to see if it wins or loses the arbitration and then
raise a conflict that it could have discovered just as easily during the arbitration. See Andros,
579F.
2d at 702;Toroyan v. Barrett, 495F.Supp.2d 346, 352(S.
D.
N.
Y.2007).They do not in
any way suggest that a party that has raised the issue by appropriate means must become its own
investigative bureau, and dig upthe facts that the arbitrators are duty-bound to disclose.Applied
Indus., 492F.
3d at 139n.
2(Although it is true that a disgruntled party cannot obj
ect after an
award has been made, this rule applies only where the party has actual knowledge of the facts
that form the basis of the obj
ection.
)(citation omitted);see also Rytex Corp., 34N.
Y.
2d at 129,
21

The Nationalscontention that one of the Arbitrators was not aware that his Club had retained Proskauer is no
answer.Nationals Opp.at 18.The Applied Industries court was clear:W hile the presence of actual knowledge of
a conflict can be dispositive of the evident partiality test, the absence of actual knowledge is not. 492F.
3d at 138.
Rather, where an arbitrator has reason to believe a nontrivial conflict might exist, he or she has a duty to investigate.
Id. Had the Arbitrator investigated, he would have become aware of the representation and been obliged to disclose
it. Separately, it seems unlikely that Mr.Coonelly could have forgotten Proskauers representation of him in the
Phillips case, since he was deposed in that action.

27

312 N.
E.
2d at 469, 356 N.
Y.
S.
2d at 282 (while parties may not sit idly back and rely
exclusively upon the arbitrators disclosure the major burden of disclosure properly falls upon
the arbitrator);DeCamp, 66A.
D.
2d at 767, 410N.
Y.
S.
2d at 672-73(the trial court erred in
holding that [a party]had a burden of ferreting out the existence of bias or conflict of interest
prior to the commencement of [a malpractice panel]proceeding).That is all the more true here,
where the facts plainly demonstrate that MLB and the Nationals had assessed the situation and
made their call: Proskauer would stay and the arbitration would continue. There is simply no
hint that they would have relented if MASN had done the work required of MLB and the RSDC
and found all of the Proskauer engagements now revealed by inquiry and discovery.
C.

The Award Must Be Vacated Because MLB Had (and Still Has) a
Direct Financial Interest in the Outcome

On August 26, 2013 almost a year before the RSDC Award was issued MLB
concluded a side agreement with the Nationals pursuant to which MLB secretly paid the
Nationals almost $25 million to be recouped through the proceeds of an RSDC Award in the
Nationalsfavor. Hall Reply Aff.Ex.13. MLB thereby acquired a direct pecuniary interest,
expressly agreeing with the Nationals that if the RSDC issues a decision that covers 2012
and/or 2013, any payments from MASN otherwise due to the Nationals will be made first and
foremost to the Commissioners Office to coverthe amounts MLB paid to the Nationals under
22
the agreement, plus accrued interest.
Hall Reply Aff.Ex.13.

The Nationals, as MLB admitted during the December 15, 2014discovery hearing will
never have to repay these fundsto MLB.Hall Reply Aff.Ex.2(12/15/
2014Tr.at 84:
720);
see also Cohen Aff.Ex.19(1/
15/
14Email from MLB to Nationals Accountant);Cohen Aff.
22

The other possibility was that MLB would recover the funds from the proceeds of a sale of MASN to Comcast,
but that contemplated deal never came to fruition. If the transaction with Comcast were consummated, the
agreement provided MLB would not approve the transactions telecast rights fees (and would therefore block the
transaction)unless MASN, the Orioles or Comcast agreed to repay the money.Hall Reply Aff.Ex.13at 4.

28

63. If MASN was not sold, MLB agreed that the only way for it to recover the $25 million
would be for the RSDC panel to issue an Award in the Nationalsfavor setting telecast rights
fees high enough to cover the amount it gave to the Nationals, as MLBs counsel has also
conceded:
[H]ypothetically, if the award had changed, well, then, the Nationals would not be
required to refund any of the money, because the advance was made on a non-recourse
basis.So, Major League Baseball would have been out the money.
Hall Reply Aff.Ex.2(12/
15/2014Tr.at 84:25-85:
5).
It is difficult to imagine a more obvious or pernicious form of evident partiality. See,
e.g., Pitta v. Hotel Assn ofNew York City, Inc., 806 F.
2d 419, 423 (2d Cir.1986)(It is
axiomatic that a neutral decision-maker may not decide disputes in which he or she has a
personal stake.
);Coty Inc. v. Anchor Constr., Inc., 7A.
D.
3d 438, 439, 776N.
Y.
S.
2d 795, 795
(1st Dept 2004)(affirming vacatur based on arbitratorsdirect financial interestin the matter).
If the fact of the $25 million payment alone were not enough, the secret nature of the
agreement and the manner in which MLB expected be repaid provide a clear and obj
ective
demonstration of MLBs partiality which is no doubt why MLB persists in arguing that MASN
and BOLP knew about and embraced a secret side-deal that was obviously prejudicial to them.
MLB Opp.at 7, 16n.
14;Manfred Aff.33.(The Nationals apparently having been misled by
MLB on this point likewise argue that MASN and BOLP knew about and supported the
payment.Nationals Opp.at 8, 22n.
18.
)But MLBs contentions are demonstrably false.
The truth is that at times during the arbitral process, and in the context of settlement
discussions, Mr.Manfred requested that BOLP and/or MASN consider making additional,
voluntary, non-prejudicial and non-contract-based telecast rights fees payments to the Nationals.
Rifkin Reply Aff. 40. One such request was made on July 26, 2013, when Mr.Manfred

29

requested a $7.
5 million payment only to be swiftly rebuffed by MASN and BOLP. Rifkin
Reply Aff. 40. Then, on August 25, 2013, Mr.Manfred wrote that he had resolvedthe
situation, and that MLB would fund the entire cost of the resolution.

I believe that I have resolved 2012and 13in a way that allow [us]to move ahead.
We [MLB] will fund the entire cost of the resolution. I will not ask Peter
[Angelos] for the [$] 7.5 million previously discussed.
Rifkin Reply Aff.41, Ex.17(8/
25-Email Exchange).
This statement concealed the real terms of its agreement with the Nationals.On August
26, 2013 one day after Mr.Manfred told the Orioles and BOLP that he had found a way to
move ahead with the Nationals and that MLB would fund the entire cost MLB made its side
deal with the Nationals. Under the terms of the agreement, MLB agreed to pay the Nationals
nearly $25million, not the $7.
5million it previously discussed with the Orioles and BOLP(Hall
Reply Aff.Ex.131, 2);and instead of fund[ing]the entire costitself, MLB would recoup
the monies with interest from either (i)payments due from MASN if the Award issued;or (ii)
from MASN, the Orioles, or Comcast if a larger transaction were consummated (id. 3,4).
MASN and BOLP did not learn that MLB planned to recoupits payment from MASN
until March 2014. Rifkin Reply Aff.48, Ex.18. W riting to Mr.Rifkin on March 31, 2014,
Mr.Manfred admitted for the first time that:
Under our deal with the Nationals, we had two routes to recovering our 25
million:payment out of sale proceeds and payment out of additional MASN
payments due to the issuance of an RSDC opinion.
Rifkin Reply Aff.Ex.18(3/
31/14Email from Mr.Manfred to Mr.Rifkin).The response from
BOLP and MASN was swift:they rej
ected any notion that the Nationals were due additional
telecast rights fees and made clear that tying recovery of the money to the RSDC Award further
corrupted the integrity of the arbitral process.Rifkin Reply Aff.49-52, Ex19.

30

The first time anyone representing the Orioles, BOLPor MASN saw the August 26, 2013
letter agreement between MLB and the Nationals was on June 17, 2014, shortly before the
RSDC issued the Award. Rifkin Reply Aff. 53. Despite MASNs prior request for the
document MASN did not obtain a copy of this agreement until November 2014 in the course of
23
discovery in this case.
Hall Reply Aff.Ex.12. And of course, MASN was not a party to the

agreement.MLBs unsubstantiated assertions that MASN knew about the agreement, and
somehow chose to endorse it, are refuted at every stepby the contemporaneous documents on
record.
Respondentsother attempts to duck the obvious implications of MLBs $25 million
payment are even weaker. The Nationals say that the RSDCs decision was reached a year
priorto the payment, so the Award could not have been engineered to ensure repayment.

Nationals Opp.at 22n.

18.This argument conspicuously overlooks the fact that the Award was
not issued until mid-2014, almost a year after the payment. Until that point, it was merely in
draft form and subject to revision at any time.A judge obviously may not j
ustify buying stock in
one of the parties to a case before him on the ground that he had already decided who was going
to win.And even if the amount of the decision did not change, MLB had a powerful pecuniary
incentive to anticipate and attempt to blunt any attacks against the validity of the Award when
MLB drafted it.One need look no further than MLBs aggressive efforts to prevent MASN from
challenging the Award (see, e.g., Hall Aff.Exs.21, 22, 23, 24)and its tenacious opposition to
vacatur to understand the stake that MLB has taken.

23

Notably, while Respondents address the $25million payment in their opposition papers, neither exhibit the
August 26, 2013agreement itself or provide a full and fair description of its terms.MLB Opp.at 7, 16n.
14;
Nationals Opp.at 8, 22See Cohen Aff.63;Cohen Aff.19.

31

Likewise, MLBs plea that its $25million payment is irrelevantbecause MLB and
the Commissionerwere not the decision-makers,MLB Opp.at 16n.
14, is refuted by the fact
that MLB entirely controlled the arbitration. See supra. It makes no difference whether MLB
nominally decides the outcome, or does so in practice.As the body that administers the RSDC,
picks its members, and guides the arbitration process from start to finish, MLB cannot have a
direct financial stake in the outcome.Because it does the Award must be vacated.
II.

THE AWARD MUST BE VACATED FOR MISCONDUCT

MASNs previous submissions described various forms of procedural misconduct that

prej
udiced its rights during the Arbitration, including the denial of:(1)MASNs request for
discovery from MLB, (2)additional briefing relevant to the Arbitration, and (3)crossexamination of the partiesexpert witnesses. MLBs and the Nationalsanswer is that these
were matters within the Arbitratorsdiscretion.See MLB Opp.at 2123;Nationals Opp.at 23
24.But, as discovery has now revealed, the Arbitrators did not make the decisions at all MLB
did, without so much as consulting or informing the Arbitrators. See supra. Even if the
Arbitrators themselves could have legitimately reached these decisions, it was unquestionably
improper for MLB to do so on their behalf, without informing them, and without telling the
parties that it was doing so.
The most fundamental misconduct that the record now reveals is that MLB essentially
decided the Arbitration in the RSDCs stead.The parties agreed, via the Settlement Agreement,
to have the Telecast Rights Fees determined by the Revenue Sharing Definitions Committee,
not by MLB or the Commissioner or Mr.Manfred.Hall Aff.Ex.1at 2.
J.
3.But, it is now clear
that Mr.Manfred and his team wrote the Award. Hall Reply Aff. Ex.3 (MLB000250,
MLB000248). Indeed, MLB never allowed the Arbitrators to see many of the materials that
MLB sought from the parties as relevant to the Arbitration. And this misconduct was plainly
32

prej
udicial, since it resulted in an illegitimate Award that corrupted the established methodology
(as BOLPs Reply brief explains), which MLB then used as a cudgel to try to force BOLP to
restructure MASNs partnershipin the Nationalsfavor.It is difficult to imagine a clearer form
of misconduct than controlling and corrupting the arbitration process and guiding it to a desired
result.That impropriety is compounded when the puppeteer has, as MLB does, a direct financial
interest in the dispute, to the tune of $25million. See supra. Even without the payment to the
Nationals, MLBs subversion of the process would be prej
udicial misconduct. As it is, MLB
passed judgment upon [its]own claim,which always requires vacatur. See In re Miller, 260
A.
D.444, 444, 23N.
Y.
S.
2d 120, 121(1st Dept 1940)(per curiam).
The misconduct did not stopthere.Mr.Manfred and his staff acted as the clearinghouse
for all information flowing to and from the RSDC, but, without telling the parties, did not send it
all to the panel members.See supra.In addition, MLB also controlled the flow of information
to MASN. MLB rej
ected MASNs request to produce data and RSDC Rulings regarding other
Clubstelecast rights fees.Rifkin Aff.69, Ex.22.MLB then sent MASN telecast rights data
for only four Clubs, ostensibly as an accommodation.
Manfred Aff.15, Rifkin Aff.Ex.22.
But the Award which MLB drafted dismissed that very data as irrelevant, chastising MASN
for its apparent disinclination to rely on current data.
Hall Aff.Ex.2at 17;see generally id. at
6-7(relying upon factors disclosed in the Reports of the RSDC that were unavailable to MASN).
In other words, MLB perversely faulted MASN for relying on the only data which MLB had
24
permitted it to see.

24

Respondents incorrectly assert that MASN waived its objection to the denial of discovery.The objection was
preserved both in MASNs Submission Statement and in correspondence with Mr.Manfred.Rifkin Reply Aff.Exs.
12, 21and 22at p.
14.

33

There is no merit to MLBs claim that MASN waived any right to challenge these
procedural improprieties because MASN knew or should have known this was the RSDCs
standard procedure when it signed the contract in 2005.
MLB Opp.at 22.The RSDC had no
standard procedurefor contested arbitrations, because it had never conducted one before.See
Hall Aff.Ex.2, at 2n.
2;see also Rifkin Disc.Reply Aff.13. (Nor does it have a standard
proceduremore generally, in the sense of any written rules that the parties can consult.
)MASN
therefore had every reason to expect that the RSDCs arbitration procedures would accord with
basic principles of due process and impartial adj
udication. And, of course, no one could have
anticipated in 2005 that MLB would take control of the entire RSDC process, allow its own
lawyers to represent the Nationals, dictate what information did and did not go to the Arbitrators,
draft the Award, take a financial stake in the outcome, and then decide when and how to issue
the decision.But, that is what MLB has chosen to do, and the Award must therefore be vacated.

34

CONCLUSION
For the reasons set forth herein and in the Petition and MASNs opening brief, and in the
affirmations and affidavits and exhibits annexed thereto, Petitioner respectfully requests that this
Court enter an order:
(a)

Vacating the Award pursuant to 9U.

S.
C.10and CPLR 7511and denying the
Nationalscross-motion to confirm;

(b)

Directing a new hearing be held before an impartial panel who will abide by all
relevant rules, faithfully apply the mandate set forth in the arbitration clause in
Section 2.
J.
3 of the Settlement Agreement, and act within the bounds of its
prescribed powers;

(c)

Awarding Petitioner its costs and fees to the full extent provided by law;and

(d)

Granting such other and further relief as the Court may deem just and proper.

Dated:January 12, 2015

Respectfully submitted,
CHADBOURNE & PARKE LLP

By

s/Thomas J. Hall
Thomas J.Hall
Pamela J.Marple*
Rachel W .Thorn
Benjamin D.Bleiberg
Caroline Pignatelli
1301Avenue of the Americas
New York, New York 10019
(212)408-5100
thall@ chadbourne.
com

Attorneys f
or Petitioner

35

APPENDIX
For the Courts convenience, this appendixlists each of the eighteen obj
ections made by MASN,
BOLP, and/
or the Orioles to Proskauers participation in the RSDC Arbitration, and MLBs
acknowledgements of the objections:
January 23, 2012, Letter from BOLP to Proskauer:[Proskauers]representation of
MLB and various MLB Clubs also raises questions of impartiality, prejudice, and
unfair advantage before an MLB tribunal.That conflict cannot be cured absent
Proskauers immediate withdrawal from these proceedings.It is axiomatic that a lawyer
cannot represent a client before a tribunal wherein the lawyer also represents the judge
and jury.
Rifkin Aff.31, Ex.4.
January 27, 2012, Letter from BOLP to Proskauer:W hile the parties agreed under
Section 2.J.3 to submit this dispute to the RSDC, the parties did not also agree to
envelop that dispute resolution process with the kind of corruptive taint that arises
from your firms multi-faceted concurrent representations of litigant and ultimate
decision-maker . . . BOLP reserves the right to raise these matters with the RSDC when
that forum is convened or in such other forums, as appropriate.
Rifkin Aff.35, Ex.7.
January 27, 2012, Letter from MASN to Proskauer:In particular, we share the
concerns raised by BOLP regarding your firms attempt to represent W N Partners, LLC
(W N Partners)in light of your longstanding representation of MLB itself, MLBs
Labor Relations Committee (which is tightly linked with the RSDC) and at least one of
the three Clubs that are voting members of the RSDC.We do not believe it is
appropriate for a firm that represents the decision-maker in the instant dispute also to
represent a litigant before that decision-maker.
Rifkin Aff.37, Ex.8.
February 1, 2012, Letter from BOLP to Proskauer:"While the Orioles had sincerely
hoped that Proskauer would recognize the significant implications of its past and
current representations as to these proceedings and the implications of its unilateral
termination of its legal representation of the Orioles, in the midst of a time-sensitive
engagement, that appears to be unlikely.Regrettably, you have left the Orioles with no
alternative but to raise the matters relating to these proceedings directly with the
Revenue Sharing Definitions Committee.
" Rifkin Aff.Ex.10.
February 1, 2012, Letter from MASN and BOLP to Mr. Manfred:Proskauers
longstanding representations of litigant, ultimate decision-maker and participating
RSDC member Club(s) raise, at a minimum, serious questions of partiality, prejudice,
and misuse of confidential and proprietary information ...Under these circumstances,
therefore, and in view of recognized principles of fairness and due process, the Orioles
and TCR respectfully request that the RSDC preclude Proskauer from participating in
this proceeding.Anything less would be procedurally and substantively inappropriate
and compromise the integrity of this appeal.
Rifkin Aff.Ex.11.
February 2, 2012, Prehearing Conference Convened and Overseen by Mr. Manfred:
MASN and BOLPdistributed hardcopies of their the February 1, 2012letter of obj
ection
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and exhibits, provided sets to be transmitted to the Arbitrators by Mr.Manfred and made
oral arguments on their obj
ection to Proskauers involvement in the Arbitration.Mr.
Manfred refused to remove Proskauer, but granted a continuing obj
ection to MASN and
BOLPat the meeting.Rifkin Aff.42-45;Rifkin Reply Aff.Ex.7[Agenda];Haley
Second Aff.5-6, 8-9;Haley Disc.Aff.3-5;J.Angelos Disc.Aff.3-5;see
Manfred Aff.40.
February 6, 2012, Email from MASN to Mr. Manfred:On behalf of the Baltimore
Orioles Limited Partnershipand TCR Sports Broadcasting Holding, LLP, we respectfully
again note our objections and reserve all rights, claims, privileges, and remedies in light
of Proskauer Rose, LLPs continuing participation on behalf of the W ashington
Nationals entity in this proceeding.Please treat this as a continuing objection to the one
we lodged in our initial meeting with you last week and for all purposes throughout
this proceeding.
Rifkin Aff.48, Ex.12.
February 13, 2012, Email from Mr. Manfred to MASN, BOLP and Nationals:Mr.
Manfred noted that the draft j
oint submission agreement does not deal with the fact that
the Orioles have not waived their objection to Proskauers participation.
Rifkin Reply
Aff.Ex.9.
February 14, 2012, Attachment to Email from MASN to Mr. Manfred:In replying to
Mr.Manfreds proposed joint submission statement, MASN noted:As to Proskauer,
TCR and the Orioles have already reserved all rights, claims, privileges and remedies,
including by way of email to you dated February 6, 2012 . . . It would seem to us that
the issue is fully preserved,and again attached a copy of the February 6, 2012email
which memorialized the objection.Rikin Aff.Ex.18at 7;Rifkin Reply Aff.10.
February 15, 2012, Email from BOLP to Proskauer:By no means have the Orioles
and TCR consented to Proskauers representation of the Nationals in these proceedings,
which we believe is highly inappropriate and improper, or any appeal or any case arising
from or related thereto.In fact, the Orioles and TCR have a continuing objection and
have preserved and reserve all rights, claims, causes of actions and privileges, and
expressly waive none.
Rifkin Aff.49, Ex.13.
February 16, 2012, Email from BOLP to Mr. Manfred:[N]either the Orioles nor
TCR have consented to Proskauers participation on behalf of the Nationals in this
proceeding and continue to object to that participation.The Orioles and TCR have an
absolute right to a fair and objective hearing not tainted by the shadow of MLBs
lawyers, who, among other things, also represent a party in this proceeding. We have
expressed that objection orally and in writing. To reiterate, what we agreed to when we
met in New York on February [2], 2012, and what has been consistently stated in our
discussions and all correspondence, is that since the RSDC would not or believed it did
not have the authority to preclude Proskauer as we had requested, the RSDC would
grant and, in fact, granted the Orioles and TCR a continuing objection to Proskauers
representation of the Nationals and that all of the Orioles and TCRs objections,
reservations, rights, privileges, claims and actions related to Proskauers participation
in these proceedings would be preserved for all purposes, without any waiver of any
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CPAM:7312255

kind, including by virtue of the Orioles and TCRs continued participation in this
RSDC proceeding.
Rifkin Aff.50-51, Ex.14.
February 17, 2012, Email from BOLP to Proskauer:Neither the Orioles nor TCR
have ever consented to [Proskauers]participation.The Orioles and TCR sought and
obtained from Mr. Manfred, on behalf of the RSDC a continuing objection and the
Orioles and TCR have reserved and preserved all rights . . . waiving none, as to these
matters and any cases or claims arising from or related thereto.
Hall Reply Aff.Ex.
20.
March 7, 2012, MASNs Submission Statement in the Arbitration:MASN reserves
and preserves its objection to the role played by the Washington Nationals outside
counsel, Proskauer Rose, which conflicts with its representation of MLB and other MLB
teams, including the Orioles.
Rifkin Aff.Ex.15.
March 7, 2012, BOLPs Submission Statement in the Arbitration:[T]he Orioles
expressly reserve and preserve all rights, claims, causes of actions and privileges,
waiving none, arising from or related to Proskauer Rose LLPs participation in these
proceedings on behalf of the Nationals.The Orioles have a continuing objection with
the RSDC as to these matters, and the Oriolesparticipation in these proceedings is
expressly conditioned on the continuation of those obj
ections, preservations, and
reservations.
Rifkin Aff.Ex.15.
March 23, 2012, BOLPs Reply Submission Statement:Proskauer Roses
participation in these proceedings on behalf of the Nationals, while concurrently
representing MLB, including as to matters relating to the value of the Dodgerstelecast
rights and other MLB Clubs, including at least one Club represented on this RSDC, is
improper and highly prejudicial and taints these proceedings.The Orioles have expressly
reserved and preserved all rights, claims, causes of actions and privileges, waiving
none, arising from or related to Proskauer Rose LLPs participation in the proceedings
on behalf of the Nationals.The Orioles have a continuing objection with the RSDC as
to these matters.
Rifkin Aff.60, Ex.16.
April 3, 2012, Arbitration Hearing:At the beginning of the Arbitration Hearing,
BOLPs counsel reiterated BOLPs and MASNs continuing obj
ection to Proskauers
conflicts of interest and concurrent representations.Speaking on behalf of BOLPand
MASN, he stated in words or to the effect that Proskauers and MLBs many conflicts of
interest tainted the RSDC proceedings and renewed MASNs and BOLPs obj
ections.
Haley Second Aff.13;Rifkin Aff.53;J.Angelos Disc.Aff.9.
April 7, 2012, Email from MASN to Mr. Manfred and Proskauer:MASN and the
Orioles have raised serious concerns and obj
ections about Proskauers participation in
these proceedings and the manner in which Proskauer appears to have certain insider
access and advantages, all of which are prejudicial to the process and our clients
interests ...Accordingly, MASN and the Orioles expressly reserve all rights, waiving
none, to challenge the record of the proceedings, as well as the regularity of its

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procedures and the constitution of its panel, in the appropriate forum, should that
become necessary.
Rifkin Aff.54, Ex.17.
April 13, 2012, Email from MASN to Mr. Manfred and Proskauer:We continue
our objection to Proskauers participation and conduct in this proceeding ....
Rifkin
Disc.Aff.Ex.28.
November 2012, Phone Call between BOLP and MLB:During a phone call between
BOLPs counsel and MLBs General Counsel, Tom Ostertag, Mr.Ostertag informed
BOLPthat Proskauer, including Mr.Ruskin, had been retained by MLB in a major
antitrust dispute.BOLPs counsel obj
ected, stating this was a blatant conflict of interest,
but Mr.Ostertag gave no response.Rifkin Aff.64;see Ostertag Aff.20-21(account
not denied by Mr.Ostertag).
March 21, 2013, Email from BOLP to Mr. Ostertag: Proskauers concurrent
representations of MLB and the Nationals continue to be of serious concern to the
Orioles. As Imentioned, we raised and repeatedly objected to Proskauers actual and
potential conflicts before, during and after the RSDC proceeding and continue to
object.At that time, we were unaware of Proskauers representation of MLB in the
Garber case, as well as certain MLB Entities, affiliates and related business enterprises,
other Clubs (including the Pirates, an RSDC member), and other RSNs.That case, which,
as you know, involves telecast and distribution matters, emphasizes the implications of
the aforementioned conflicts, especially since the same Proskauer lawyers, Brad Ruskin
and Jennifer Scullion, are counsel of record in both Garber and on behalf of the Nationals
in the RSDC dispute.
Rifkin Reply Aff.Ex.14.
September 2, 2013, Email Exchange Between BOLP and Mr. Manfred:In the context
of settlement discussions, Mr.Rifkin requested MLBs full acknowledgement that our
obj
ections to Proskauers concurrent representations . . . are treated as continuing . . .
and are not waived in any form or fashion Mr.Manfred responded:We would never
assert that you have waived your objection to [P]roskauers involvement. Rifkin
Reply Aff.Ex.15.

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