Got An Athlete of Color For Sale?

Wasserman Media Group has reached an agreement in principle to acquire the baseball practice of Tom Reich and Adam Katz, creating one of the largest MLB practices. Among the 35 major leaguers being added to Wasserman’s roster are Carlos Lee, Miquel Cabrera, Rafeal Furcal, Aramis Ramirez, Francisco Rodriquez and Omar Visquel, all ballplayers of color. Financial terms of the deal were not released.

In January, 2006, Wasserman acquired the practice of Arn Tellem, considered by some to be the most powerful agent in the NBA, which is dominated by players of color, as is the clientele of Tellem. In 2000, Tellem sold his practice to SFX for $66 million. In 2002, Tellem repurchased his practice and sold it again in 2006 to Creative Artist Agency, the Hollywood talent agency. Financial details of that sale were not disclosed.

CAA became a major player in representing professional athletes adding more than 300 NFL, NHL and MLB clients through four major acquisitions, including the practices of former IMG football agent Tom Condon and former SXF football agent Ben Dogra. Dogra and his partner, Jim Steiner, brought 57 NFL clients to CAA, including last year’s league MVP, Shaun Alexander; top rookie, Carnell “Cadillac” Williams; and this year’s No. 1 pick, Mario Williams, all players of color. Condon, and his partner, Ken Kremer, brought about 80 players to CAA, including LaDainian Tomlinson.

According to sources, Rob Pelinka is in talks with CAA to purchase his NBA practice. Pelinka, whose top client is Kobe Bryant, also represents Carlos Boozer, Corey Maggette, Channing Fry, and Andre Iguodala, all players of color.

Earlier this year, SXF baseball agent Pat Rooney bought back their baseball player representation firm from Live Nation, including such stars as Vladimir Guerrero, Mariano Rivera, Pedro Martinez, Alfonso Soriano and Miquel Tejada, all players of color. With the sale to Rooney, SFX has divested itself of its sports properties. SFX made headlines in 1988 when it entered the athlete representation business by buying FAME (Agent David Falk, players Michael Jordan, James Worthy, Sam Perkins, Patrick Ewing, etc) for $150 million, Tellem’s practice, and the practice of the Hendrick Brothers in 1998 for approximately $25 million. SFX was ultimately purchased by Clear Channel Communications for about $4.4 billion.

Assante Corp, which like SFX is no longer in the business, made headlines in 1999 when it purchased the Leigh Steinberg’s practice, which included Warren Moon, KiJana Carter, Dan Wilkerson for $120 million, and the firm of basketball agent Dan Fegan, whose clients include Gilbert Arenas, Kwame Brown, Jason Richardson, Erick Dampier, all players of color.

Under the terms of most of the purchase agreements, the selling agents sign long-term employment agreements with the buying agency. As a result, the selling agents not only make a handsome profit on the sale of their clientele, but they make more money under their employment contracts to continue in their role as agent to the players. What about the players of color? Do they participate at all in all of the money changing hands is this deals, all of which are based on their talent and accomplishments? No. Instead of participating in the profit on the sale of their accounts, players of color are convinced to agree to move their business based on the promise that the purchasing agency has “more resources to provide their players with marketing and new media content.” If that is true, then what do these guys tell the players of color when they buy back their businesses, again without sharing any of the profits with their athletes of color?

If you have questions or require additional information, please contact Everett L. Glenn, Esq. at eglenn@espsportslawpro.com or call 562.619.8460.