Major League Baseball is currently preparing its petition for a writ of certiorari after the 9th U.S. Circuit Court of Appeals established class-action status for minor league baseball players in California, Arizona and Florida.
With a strong track record in Washington, D.C., MLB is once again hopeful they will have a chance to sustain its apprenticeship approach to the minor leagues.
In 2014, current and former minor leaguers filed a class action against MLB, former MLB commissioner Bud Selig and MLB franchises alleging they have violated state labor laws and the Fair Labor Standards Act due to their failure to provide minor leaguers with federal minimum wages as well as overtime pay. Senne v. Kansas City Royals Baseball Corp., 3:14-cv-00608-JCS (N.D. Cal. 2014).
In support of their allegations, the players claim that a majority of minor league players earn between $3,000 to $7,500 for the entire year — despite working 50 to 70 hours a week over a five-month season.
In 2015, the U.S. District Court for the Northern District of California certified this case as a FLSA collective action. MLB subsequently moved to decertify the FLSA collective action, and contemporaneously, the players moved to certify under Rule 23(b)(2) and (3) of the Federal Rules of Civil Procedure.
Initially, the district court decertified the FLSA collective action and refused to certify under Rule 23(b)(2) and (3). On reconsideration, the district court recertified the FLSA collective action and certified a California Rule 23(b)(3) class. However, the district court denied certification for the Arizona and Florida classes. Senne v. Kansas City Royals Baseball Corp., 315 F.R.D. 523 (N.D. Cal. 2016).
On appeal, a 2-1 decision by the 9th Circuit affirmed certification of the FLSA collective action and California Rule 23(b)(3) class. Furthermore, it also reversed the district court’s refusal to certify Arizona and Florida classes. Senne v. Kansas City Royals Baseball, No. 17-16245 (9th Cir. 2019).
Under Federal Rule of Civil Procedure 23(a), a party seeking class certification must satisfy four requirements: numerosity, commonality, typicality and adequacy of representation. If these four requirements are met, the party must also satisfy the requirements of one or more of the three different types of classes in Rule 23(b).
Pursuant Federal Rule 23(b)(2), the party opposing the class must, “have acted or refused to act on grounds that apply generally to the class, so that final injunctive relief or corresponding declaratory relief is appropriate respecting the class as a whole” for certification to be proper.
Regarding Rule 23(b)(3), a class may be certified if questions of law or fact common to class members predominate over any questions affecting only individual members and that a class action is the superior method to properly adjudicate the controversy.
Unlike Federal Rule 23(b) classes, FLSA collective actions solely pertain to labor disputes. In these collective actions, employees are permitted to bring lawsuits on behalf of themselves and other employees that are similarly situated. 29 U.S.C. Section 216(b).
The underlying issue of this class certification is the application of choice-of-law rules. Because the players allege state labor law violations, the district court, 9th Circuit and now potentially the Supreme Court must utilize choice-of-law rules of the forum state, which in this case is California.
Regarding the California class, the 9th Circuit agreed with the district court that although several players in the California league played for teams that were headquartered outside of California, the players performed work in California for “entire days and weeks.”
This extensive California-based work led to the 9th Circuit’s decision that California’s labor laws apply to the California class.
However, the 9th Circuit and district court did not agree on the choice-of-law rules regarding the Florida and Arizona classes. The 9th Circuit determined that Arizona’s labor laws should apply to the work performed in Arizona and Florida’s labor law should be applied to work performed in Florida.
The 9th Circuit refused to apply California law for these classes because under California’s choice-of-law rules, a jurisdiction ordinarily has the predominant interest in regulating conduct within its own borders. The 9th Circuit explained that forcing Arizona and Florida to apply other states’ wage laws would destroy the balance Arizona and Florida have struck between protecting workers and fostering a hospitable business environment within their states.
Because the 9th Circuit found that there was no choice-of-law issue, the district court rejecting certification of Arizona’s and Florida’s Rule 23(b)(2) certification on the grounds that the choice-of-law issues undermined cohesiveness was deemed erroneous. In fact, the court noted that “cohesiveness” is not a requirement for Rule 23(b)(2) classes.
After the 9th Circuit resolved the choice-of-law issues, it subsequently determined that the players could meet the predominance requirement under Rule 23(b)(3). This determination was based on MLB’s uniform pay policy, the team schedules and a survey of minor league players that provided details as to when the players generally arrived and departed from the ballpark or training facilities and how much time they spent eating while at the ballpark.
Consequently, the 9th Circuit held that this evidence demonstrated common aggregation-enabling issues that are more prevalent or important than any non-common, aggregation-defeating, individual issues.
Lastly, the 9th Circuit agreed with the district court that FLSA collective certification is proper because the allegations that the players were not paid for overtime or work performed during spring training demonstrates they were similarly situated.
If the Supreme Court rejects cert, minor leaguers will enjoy a much-needed victory. Generally, class actions settle after certification due to immense litigation costs and the risk of paying out substantial damages. However, MLB likely will seek settlement as a means to avoid its entire minor league payment policy from being scrutinized by the courts.
Nonetheless, the Supreme Court has a history of holding in favor of MLB. In 1922, the Supreme Court granted MLB a special exemption from antitrust laws. Federal Baseball Club v. National League, 259 U.S. 200 (1922). Over the past 98 years, this exemption has been challenged, but has continuously been upheld.
The judicial branch is not the only part of the federal government that has supported MLB’s vision. In 2018, Congress passed H.R. 1625, which included Save America’s Pastime Act. The act exempts minor league players from receiving federal overtime pay and hourly minimum wage.
With the passing of the act, it appears that the legislative branch agrees with MLB on its apprenticeship approach to minor leaguers.
In 2016, MLB released a statement justifying its reasoning for the act. This statement included, “for the overwhelming majority of individuals, being a [m]inor [l]eague [b]aseball player is not a career but a short-term seasonal apprenticeship in which the players either advance for the Major Leagues or pursue another career … it is simply impractical to treat professional athletes as hourly employees whose pay may be determined by such things as how long their games last, when they choose to arrive at the ballpark, how much they practice or condition to stay in shape and how many promotional or charitable appearances they make.”
If the class action does not ultimately result in a victory for the minor league players, there is not much more the minor leaguers can do to overcome this “seasonal apprenticeship approach.”
Generally, when professional athletes have issues with employment terms, their players’ union will fight for them in the collective bargaining process. Unfortunately, minor league players are not a part of the Major League Baseball Players Association, and thus, lack strong representation MLB players enjoy.
This is a serious concern for minor league players at this time. As this lawsuit continues, the Professional Baseball Agreement is set to expire after the 2020 minor league season. The agreement is the agreement that governs the MLB-minor league relationship. Among the proposed terms of the new baseball agreement is the elimination of approximately 40 minor league teams.
The actual allegations in the class action are not what MLB is concerned with. There is no denying the fact that a vast majority of minor leaguers receive a few thousand dollars a year to compete.
The argument is that minor league players are not entitled protection via labor laws because they are not the average American employee.
Although the class certification process is mostly concerned with complex legal arguments, the outcome of this lawsuit will have real consequences for the lives of minor leaguers and the league as a whole.