By Zachary Zagger

Law360 (June 11, 2020, 8:51 PM EDT) -- The return of Major League Baseball from the COVID-19 pandemic is in jeopardy due to a labor dispute over how much players will be paid for a shortened season with few or no fans in attendance, but experts say the good-faith talks do not appear headed for a courtroom showdown that could further tarnish the sports' popularity.

MLB, along with other major leagues and the NCAA, shut down in March weeks before its 2020 season was set to begin. Last month, MLB seemed poised to be possibly the first North American professional team sports league to resume, with plans to host games in empty or near-empty stadiums starting in early July.

But now the MLB and the players union are stuck on what exactly the players will be paid, an issue that turns on a preliminary agreement for a return that was reached just weeks after the season was halted. The players reportedly argue that they are entitled to a full prorated portion of their salary based on the number of games in the shortened season, while the owners say circumstances have changed now that it appears the games will be played in empty stadiums — meaning the teams lose out on ticket sales, concessions and other stadium-related revenue.

With negotiations continuing this week, experts say it does not appear that there is any bad-faith bargaining or other facts that could give rise to an unfair labor practice charge, such as the case that ended the infamous 1994-95 players strike.

"I think they are playing some brinkmanship right now, which they can do, because it is easy to do, because nothing is being delayed yet," said Scott Witlin, a sports and labor and employment attorney at Barnes Thornburg LLP. "They have a couple more weeks before they really have to iron all of that out. The question is whether cooler and more rational heads will prevail and they make a deal. I think by all accounts they should."

The plan had been for the season to start in early July. There are reported concerns throughout baseball about finishing the World Series by November due to a potential second wave of the virus, meaning teams would have to open their preseason training very soon.

While there are several issues in the negotiations, which come not long before the current full collective bargaining agreement is set to expire after the 2021 season, the holdup centers on the amount players will be paid. The challenge for both sides is balancing the fraction of per game prorated pay and the total number of games played.

The players are pushing for more games and a full prorated salary for those games, according to reports by ESPN and other outlets. The MLB Players Association reportedly made a proposal Tuesday that included an 89-game season with full prorated pay, down from the union's proposal last month for a 114-game season.

With a typical MLB regular season lasting 162 games, the latest proposal calls for the players to make about 54% of the salary they would have received for a full season.

The sides appear to be moving closer, as the owners' last proposal was reportedly 76 games at 75% of prorated pay, which would provide the players about 35% of their full-season salaries.

"Unlike the other major sports leagues, the owners rely upon stadium revenues for a much higher percentage of overall revenue," Witlin said. "If they are playing games before empty stadiums or stadiums with severely restricted capacity, then they are not going to get enough revenue to sustain an economically profitable model."

When the players went on strike and prematurely ended the 1994 season, they filed an unfair labor practice charge with the National Labor Relations Board over the owners' decision to unilaterally eliminate the free agency and salary arbitration system in place at the time. The strike ended after the NLRB took the case to federal court, alleging that the owners, by taking that action, had violated their duty to bargain in good faith.

Then-U.S. District Judge Sonia Sotomayor, who is now on the U.S. Supreme Court, sided with the NLRB in Silverman v. Major League Baseball , ordering the owners to keep the existing system in place, return to the table and negotiate in good faith.

Experts contrasted that saga with the current situation, where the MLB owners appear to be arguing in good faith. When the March agreement was reached, weeks after the sports world shut down out of concern over the COVID-19 pandemic, it was not obvious that when live sports returned it would be in empty stadiums.

The players "are not going to be able to force the owners to stick to the March 2020 deal," said labor and employment attorney Michael Elkins, a partner and founder of MLE Law. "At the end of the day, the working conditions for the game changed ... the conditions in that there is going to be no stadium revenue. That is problematic from a financial perspective."

MLB told the players last month that it expects to lose $640,000 for each game without fans over a then-proposed 82-game season, with some teams losing hundreds of millions in local revenue, according to The Associated Press. The league said 39% percent of revenue comes from the gate and in-ballpark sources, according to the report.

"It is hard to believe that there was a meeting of the minds from the owners that said no matter what happens, even if there is a season played without one single fan, we get no concession money, no attendance money, we're writing checks back to sponsors, even under those circumstances we will essentially pay you 100 percent prorated," said Richard Brand, head of the sports practice group at Arent Fox LLP.

The MLBPA did not respond to requests for comment from Law360. The union's executive board said in a statement last week that the players are ready to play but that they have already agreed to a reduced salary for the season and are unwilling to agree to any further reductions.

After publication of this article, MLBPA said in a statement to Law360 that the applicable duty of good faith regarding playing games "arises from the terms of the March agreement directly."

"In addition, the March agreement is clear that players get paid prorated salaries in the event any games are actually played (whether with or without fans) and even MLB has agreed that there is no obligation on the MLBPA to agree to anything less," the union said.

Experts said there may not even be a duty to continue bargaining after the March agreement and that the commissioner may have the power to force a significantly abbreviated season of around 50 games.

MLB Commissioner Rob Manfred said on ESPN and MLB Network on Wednesday that the league prefers a negotiated resolution but that there will definitely be a season this year. At this point in the year and with the COVID-19 pandemic continuing, the players' proposal for 100 percent pay over 89 games is not workable, he said.

"If there is a duty to bargain they could go to the NLRB and then it would be up to [the agency] to make a determination," Witlin said. "I don't know if there is any evidence of that. They keep going back and forth, and it does not seem like anything unreasonable or unlawful."

Ken Jacobsen, who teaches sports law at Temple University Beasley School of Law, said the sides could well bring in a mediator to hammer out an agreement, assuming they can find someone they both trust. Both the NFL and the National Hockey League used mediators to help resolve lockouts in recent years.

"I don't see a bad faith argument here on either side," said Jacobsen. "From the owners' perspective, they are going to lose money anyways, so they are trying to cut their losses and salvage some revenue. For the players, they have already given up something like 50 percent of their salary."

Regardless, experts said there is urgency on both sides to get a deal done, as the consequences could be dire. Not only do both sides stand to lose even more money if there is no season at all, experts say failing to return to play could turn off fans, pointing out that the 1994 players strike had a detrimental impact for years. Attendance per game dropped 20% from the 1994 shortened season to the 1995 season and did not return to its previous level until 2006, according to statistics compiled by Baseball Reference.

"Them passing on this season when they could have had a season is mutual assured destruction," said Brand. "If they can't play for health reasons, that is a very legitimate thing, but if it is simply because the billionaires don't want to pay the millionaires and the millionaires don't want to play for less than millions" that is not going to go over well with fans.

In the last week, the NBA, the NHL and Major League Soccer have announced plans to return later this summer with buy-in from their respective players. The NFL has also continued toward its normal start to the season in September. That means MLB is now both at risk of being left behind and having to compete with more sports in its typical season window for the attention of sports fans, even if they are starved for live sports.

"There will always be a certain amount of people who will watch whatever sport they love no matter what, but I think a majority of sports fans will at some point vote with their pocketbook if they are treated unfairly," said sports and entertainment attorney Tye Gonser of Weinberg Gonser LLP. "There is a real brand risk that if they don't get a deal done it will turn off a certain amount of their fan base, and given a recession or the state of our country [moving forward], maybe those people don't come back in 2021."

--Editing by Brian Baresch and Michael Watanabe.

UPDATE: This story has been updated to include comment from MLBPA.

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