Sports agents are rich, powerful, and ethically handicapped by inherent conflicts of interest. The first two qualities so far have insulated them from dealing fairly and openly with the second. This is wrong, and has got to stop. For it to stop, it would help if the players, their unions, the sports leagues and the sports media didn’t either intentionally pretend not to see the obvious, or weren’t too biased and ignorant to realize what’s going on.
Four years ago, I wrote about this problem in a long piece for Hardball Times, a baseball wonk blog of consistent high quality. The specific agent I was writing about was Scott Boras, the king of baseball player agents, but the egregious conflict I flagged isn’t confined to that professional sport; it’s present in all of them. In the article, I argued that Boras, a lawyer, is engaged in the practice of law when serving as an agent and was therefore violating the legal ethics rules, which prohibits having clients whose interests are directly adverse to each other, specifically in the so-called “Zero-Sum Conflict” situation.
A lawyer can’t assist two clients bidding for the same contract, because the better job he does for one, the worse his other client fares. A lawyer can’t sue a defendant for every penny that defendant has on behalf of one client when he or she has another client or two that have grievances against that same defendant—if the lawyer is successful with the first client, he’s just ruined his other clients’ chances of recovery. There is some controversy over whether the legal ethics rules automatically apply to a lawyer-agent like Boras, but never mind—whether he is subject to the legal ethics rules or not when serving as an agent, the conflict of interest he is blithely ignoring still applies, still harms his clients, still puts money in his pockets, and still should not be permitted.
I heard one of the interchangeable out-of-work general managers on the MLB satellite network station go on about how “in most professions, what Boras does would be an illegal conflict of interest, but its not regarded as a conflict in baseball.” Wrong. It may not be illegal, but it is still a conflict of interest, and whether supposed experts like this sacked GM calls it a conflict or not, it still is one.
Just to avoid The Boras Zone for a nonce, let’s look at another player agent, Casey Close. He just closed a huge deal for his star client, Dodger pitching ace and Cy Young Award winner Clayton Kershaw, worth 210 million dollars, making Kershaw the game’s highest paid player. But Close is also the agent for Japanese free agent pitching star Masahiro Tanaka, who has until January 24 to sign with a major league team. Tanaka will go to the highest bidder, and he reportedly wants to play for a West Coast team, which includes Kershaw’s team, the L.A. Dodgers. Did Close’s huge contract deal for Kershaw take Tanaka’s favorite team out of the bidding for his services, by using up their discretionary resources for starting pitchers? If so, Tanaka was the victim of a conflict of interest. If Casey asked the Dodgers for more money for Kershaw, and the team’s GM responded by saying, “Casey, any more than 30 million a year, and we’ll have to drop out of the bidding for Tanaka, and we know, with your cut of his deal, you wouldn’t want that”? If so, Kershaw was the victim of a conflict of interest.
Will other teams, assuming that the Dodgers are tapped out, lower their bidding for Tanaka? Did Dodger brass have a meeting in which they said, “Well, if Close is going to demand that much, we can sign one of these guys, but not both”? There is only one way to avoid these problems for certain, and that is for Close to drop one of his Dodger-routed pitchers as a client , and let let another unconflicted agent serve that client’s needs without being constrained by obligations to other clients.
Now let’s look at one of Scott Boras’s current conflicts (he has over a hundred baseball clients; he most have conflicts all over). He is the agent for Stephen Drew, the Red Sox shortstop in 2013, now a free agent. Drew thought he had a chance at a big contract with one of the teams needing a shortstop, but such a deal hasn’t materialized: it looks like his best shot is to re-sign with Boston, though not for the money and the years he had expected or wanted. Boras also represents Xander Bogaerts, the Red Sox rookie who is slated to replace Drew if he doesn’t come back to the Sox in 2014. Bogaerts’ earning potential as a shortstop is greater than as a third baseman, the position he would likely play if Drew returns. As a shortstop, Bogaerts is considered a front-running candidate for Rookie of the Year; playing at third, probably not.
This is a classic Zero Sum conflict. If Boras persuades the Red Sox to sign Drew, he has cut off his other shortstop client. (Actually, Boras’s conflict is three deep: he also is the agent for Deven Marrero, the Red Sox’s next up-and-coming shortstop, who would also benefit if Drew went elsewhere.) The Sirius-XM “experts” agreed: if Boras could, he would steer Drew to the Mets. Steer him? For the benefit of Bogaerts and, by extension, Boras’s percentage of whatever he made down the line? There could not be a more blatant example of an impermissible conflict of interest. Why is it permitted?
Well, they say, the clients waive the conflict. Baloney. First and foremost, it’s an unwaivable conflict—in law, in common sense. A professional can’t allow himself or herself to work on behalf of two clients when a conflict forces him to trade off the welfare of one client against the other. It is wrong. It’s greedy and it’s indefensible. It is only ethical to ask clients to wave conflicts when you know that they won’t affect your performance of your duties at all and won’t harm the interests of either client. When two clients are competing for the same job, with the same team, or both trying to get a maximum cut of a limited budget, they can’t eliminate the conflicts by acceding to them.
Even if they could waive the conflicts—and they cannot—to do so would require that the conflicting clients fully comprehend what the conflict is so they can give informed consent. I doubt that is possible, and I doubt it is attempted. Do you really think Scott Boras says to Steven Drew, “Steve, I have a conflict, and I may have to tank negotiations with the Red Sox so the kid can get your job like he wants. You understand. OK?” Because if Boras doesn’t, and Drew doesn’t understand that’s the situation with him and Bogaerts, he isn’t giving informed consent. And if he did understand that, he wouldn’t give informed consent. And if he was so stupid that he would give informed consent when it’s obviously against his best interests, that’s exactly why it’s an unwaivable conflict.
If the player agents, who know they are conflicted, are so greedy that they continue to operate as if the conflicts don’t exist, the players unions, or the leagues, or the agents association, or the law, needs to stop them.