Stella Case No. 026, Originally Published: 4 December 2002
The Chicago Cubs baseball team is upset with the owners of bars around Wrigley Field, the park where the team plays home games. They say the several businesses surrounding the stadium “unjustly enrich themselves” by letting customers sit on their private property.
Ummmm… huh? Team management says by letting people watch the games over the stadium walls from private buildings surrounding the park, the bars are stealing the team’s “product” by violating its copyright on the games.
“You have [something] that has evolved from Weber grills and lawn chairs into a multimillion dollar business by pirating our product,” claims Cubs President Andy MacPhail. The team has filed a lawsuit in U.S. District Court against a group of bars after talks with the bar owners broke down. “They do nothing to contribute to our efforts to put a winning team on the field,” he said. “The free ride is over.”
The suit says the bars, which charge as much as $100-200 to watch a game from their rooftops, represent themselves as “small-time friends of the common fan … [but] are in fact free-riders who profiteer on plaintiff’s enormous annual expenditures on, and historical investment in, the Chicago Cubs baseball team and Wrigley Field.”
What do “enormous annual expenditures” have to do with anything? “During the 2002 season, the Cubs spent nearly $80 million on the salaries of the players on its major league roster,” the suit says. “The Cubs pay millions of additional dollars annually to operate and maintain Wrigley Field, incur the team’s travel and road trip costs and pay all of the other expenses of operating a team in Major League Baseball.” Thus, the team contends, it has a right to control the view. To bolster the copyright claim, the club contends the rooftop seating areas illegally provide TV sets so the far-away viewers can look at game broadcasts.
Well which is it? Are the bars violating copyright by letting people look over the wall, or by letting them watch TV because the park is too far away?
Whatever. The suit seeks unspecified monetary damages and a court order prohibiting anyone with a private view of Wrigley Field from charging admission to view games at the park. The lawsuit came after the team rejected an offer from the bars to pay the Cubs $14 per patron, but only if it was called a “marketing fee” and not a license to watch the games.
In the old days, baseball was known as “America’s Pastime.” How fitting it’s so intimately involved with America’s new Pastime: dragging every silly argument into court.
- “Cubs Sue Owners of Rooftop Bars Overlooking Wrigley,” Associated Press, 17 December 2002
- “Cubs Hurl Federal Suit at Rooftop Owners,” Chicago Tribune, 17 December 2002
The bars settled the claim by agreeing to pay the baseball club $15-25 for each patron. The Cubs claimed that as many as 1,700 patrons were watching the games from bar rooftops, so the settlement is expected to net the team $1.2-1.7 million a year. This phase took over a year.
Three of the bar owners, however, refused to participate in the settlement agreement. “We are completely confident in our position,” said their lawyer, Chris Gair. “The Cubs don’t own the view from our buildings. We own the view from our buildings.” The team played hardball, however: it moved to block the view from the three holdouts. Those three eventually settled, the last throwing in the towel in April 2004. But there was a later development….
But Wait: There’s More!
All settled doesn’t always mean all settled. In 2009, the were Cubs sold to a new owner, the Ricketts family, led by Tom, the son of the founder of TD Ameritrade. To raise the caliber of the team, the family decided to renovate Wrigley Field, including the installation of a giant new scoreboard. Two of the rooftop owners (presumably the two that would have their view blocked by the scoreboard) sued the Cubs in 2015: the scoreboard would block their views — views they were paying for! The case was dismissed.
Also in 2015, one of those two plaintiffs, R. Marc Hamid, owner of Skybox on Sheffield, was indicted on federal charges of fraud — and tax evasion. Hamid, then 46, concealed part of his revenues, prosecutors said, and thus fraudulently deprived the team of payments set up in the settlement. What really seemed to fire up investigators was Hamid allegedly hid those extra revenues from local and federal tax authorities. He faced up to 20 years in prison.
Again, attorney Chris Gair defended. “My client didn’t do anything wrong,” he declared, “and we are going to prove that in court.” The gist of the defense: any irregularities were simply sloppy accounting.
The defense didn’t go so well: police officer Richard Zasiebida, who had a side job working for Hamid, admitted that he helped Hamid with the fraud — and, Zasiebida admitted, he himself didn’t declare $160,000 he made on the scheme on his taxes. But Hamid’s own accountant dealt the death blow: Joseph Gurdak said he helped Hamid hide the money — and oh by the way, Gurdak admitted, he also embezzled $358,000 from another client (pregnant pause…) a cancer patient (Ohhhhhh, that’ll get the jury going!).
“That’s not bad judgment,” declared Assistant U.S. Attorney Sean Driscoll in his closing arguments, “That’s the perfect cast of characters.” Hamid, by then 48, pleaded guilty to four counts of mail fraud, and five counts of illegally structuring bank transactions. Driscoll calculated that Hamid netted around $550,000 in the scheme, including about $245,000 hidden from the Cubs. “While he did not set out in business to defraud the Cubs or the authorities,” Gair told the court, “that is exactly what he ended up doing.” So much for “My client didn’t do anything wrong”! Gair suggested the judge order “straight probation” rather than prison time. Prosecutor Driscoll asked for 8 years.
Hamid went all in for sympathy and contrition. He told the court that Wrigley Field is a “special, unique place” that helped to grow his business — and meet his wife. But “I repaid the Cubs for that opportunity by defrauding them.” He paid $275,000 toward restitution, and turned over his interest in Skybox to his business partners, who apparently weren’t in on the scheme. “This trial has made it blindingly clear to me how many poor decisions I made,” he told the court.
In January 2017, U.S. District Judge Thomas M. Durkin ordered Hamid to prison for 18 months, plus $391,896 in restitution to the team, the state, the county, and the city.
- “Skybox on Sheffield Owner Charged with Trying to Defraud Chicago Cubs”, Associated Press, March 27, 2015
- “Jury Ponders Fate of Ex-Owner of Wrigley Field Rooftop”, Chicago Sun-Times, July 22, 2016
- “Ex-Rooftop Owner Admits He Scammed Cubs, Gets 18 Months in Prison”, Chicago Sun-Times, January 9, 2017
Peter in the UK: “I love the Stella awards. Thank you for starting this up. I can’t help wondering, though: do you not feel the teeniest bit of despair when you read some of these accounts, and wonder how far society can go down the road of ‘Everybody needs somebody to BLAME’? Where are these people’s sense of responsibility?”
Yes, I do feel a bit discouraged at times, but there’s great power in doing something rather than just sitting here saying “ain’t it awful?” to myself. A feeling that, over time, I hope more and more of you have as I identify various ways for you to “do something about it” yourselves.
Michael in the UK: “It’s not that I hate lawyers so much, its just that they do not add any value. Most of us work in ‘the modern organisation’ where we are driven by continuous improvement. We all have to change for the better, improve, create efficiency….and do it pro-actively. Doctors: they improve medicine and the state of health. Office workers: they improve their systems and processes. Road diggers: they train on better machinery and do they job quicker with less disruption. Lawyers: They look at the past and copy it. It’s that simple. They continually say ‘it’s the system’. They are the only profession that does not change their own surrounding when they know its wrong. It’s a perpetual case of ‘if we keep it broken they’ll have to pay us to manage it’. Lawyers are far too comfortable in their world, and they think we’ll all put up with it. Most people learn, improve, give and take. Lawyers sit back and take.”
My 2020 Thoughts on the Case
The Cubs/its attorneys didn’t consider the fans and their view of things, and certainly came off as money-grubbing by demanding a share of the bars’ proceeds. Interestingly, according to MLB’s own figures, game attendance dropped from 72.27 million in 2001 to 67.86 million in 2002. (It dropped again, to 67.57 million, in 2003 before starting to rise again.)
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