City, Angels Make Pitch

It was standing-room only in the lobby of Anaheim City Hall, with civic leaders and baseball executives gathering for a celebratory news conference. The Walt Disney Co. had agreed to buy the Angels, keep them in town for decades and pay for most of an ambitious and costly stadium renovation.

And, as city officials happily noted on that sunny afternoon in 1996, their team no longer would be known as the California Angels. The city would contribute to the renovation, and in return the team would be called the Anaheim Angels.

“After being known as California for the last 30 years, this team is now going to be called Anaheim,” Mayor Tom Daly said then. “That’s huge.”

Not so huge, however, for the city to insist upon contractual language that would force the team to call itself the Anaheim Angels or market itself using that name. The stadium lease agreement demands only that the team name “include the name Anaheim therein,” providing Angel owner Arte Moreno with a potential loophole to exploit should he decide to call his team the Los Angeles Angels of Anaheim.

“There’s no question the city could have written a lease provision that would have given the team no wiggle room. This provision does give the team some wiggle room,” said Robert Jarvis, professor of law at Nova Southeastern University in Ft. Lauderdale, Fla., and co-author of a sports law textbook.

The City Council has voted to sue if Moreno implements a name change, arguing he would breach the lease. City officials have spurned a change to the Los Angeles Angels and dismissed as ludicrous a compromise proposal: the Los Angeles Angels of Anaheim.

No matter how geographically nonsensical that compromise might appear, Moreno could argue it satisfies the requirement that the team name “include the name Anaheim therein.” According to several contract law professors interviewed by The Times, the city would have a reasonable -- but not airtight -- legal case and should thus consider a negotiated solution to a dispute that city officials vow will not be negotiated.

“Imagine the city fathers and mothers trying to explain how they wrote a contract that allowed the team to be called the Los Angeles Angels of Anaheim,” Jarvis said. “And, from the team’s point of view, you wouldn’t want the P.R. nightmare of saying we want to be called X but we have to be called Y. It would be a terrible fiasco for the Angels.

“This is not something for which there is a black-and-white answer. As a result, I have no doubt the parties would reach a compromise. Neither one will want to go to court and lose.”

Yet the city might sue even if Moreno does not change the team name. By selling his team simply as the Angels -- and removing the city name from uniforms, tickets, merchandise and publicity outlets -- city officials contend Moreno has violated the lease. The City Council could authorize such a suit at its Jan. 11 meeting.

In the absence of specific lease language about how the Angels should use the Anaheim name in marketing, and with clauses and precedents that could favor the team, the professors suggested the city might stand on shaky legal ground in its position that a promise to call the team the Anaheim Angels implies a promise to promote the team using that name.

“That doesn’t seem to hold water,” said Eli Bortman of Babson College in Wellesley, Mass.

*

If Moreno were to change the name to the Los Angeles Angels of Anaheim, and if the city were to sue as promised, the court case would revolve around one sentence in an 80-page lease. The sentence, formally identified as Section 11(f), reads: “Tenant will change the name of the team to include the name ‘Anaheim’ therein, such change to be effective no later than the commencement of the 1997 season.”

If the name “Anaheim Angels” was so critical to the city, Moreno’s lawyers could argue, then the city should have written that specific name into the lease, said Michael Dessent of California Western Law School in San Diego.

“If the city drafted it and didn’t put in exactly what they wanted, it’s the old slap against the forehead -- oops!” Dessent said. “Courts usually don’t give the benefit of the doubt to whoever drafted it in an ambiguous way.”

In the 1996 negotiations, Disney agreed to call the team the Anaheim Angels but refused to approve a provision forbidding modification of that name, City Atty. Jack White said. Disney called its hockey team the Mighty Ducks of Anaheim and suggested it might someday want to call its baseball team the Angels of Anaheim or something similar, he said.

“The city originally did ask that the lease contain the restriction that the team be named the Anaheim Angels,” White said. “Disney was unwilling to make it that specific. They wanted to keep that flexibility.

“It was never either party’s intention that another geographical name would appear along with Anaheim. They didn’t call it the California Angels of Anaheim.”

They did, however, call the stadium Edison International Field of Anaheim, popularly shortened to Edison Field -- followed by Angel Stadium of Anaheim, popularly shortened to Angel Stadium. The language in Section 11(d) is similar to that in Section 11(f): “ ... the name of the baseball stadium will at all times include the name ‘Anaheim.’ ”

So Moreno could argue that Los Angeles Angels of Anaheim, even if commonly shortened to Los Angeles Angels, follows precedent approved by the city, Bortman said.

“For the last seven years, the city has not complained about the name of the city being swallowed up and almost forgotten as far as the name of the stadium is concerned,” Bortman said.

City officials say they would clarify the ambiguity about the intent behind Section 11(f) by calling as witnesses the men who negotiated the contract -- former City Manager Jim Ruth and former Angel president Tony Tavares -- and would expect each to testify that Anaheim was the only geographic element contemplated for the team name.

However, if a judge decides the lease ought to stand on its own merits, he need not allow such testimony -- or, if he does, need not admit that testimony into evidence, said Gary Monserud of the New England School of Law in Boston.

“Courts don’t listen to people who say this is what we meant,” Bortman said.

Still, California courts typically are receptive to hearing such explanations, Monserud said.

“If that evidence were admitted, that would strengthen the city’s case,” he said.

*

If a court interprets the lease strictly as written, Moreno might well win the right to change the team name from Anaheim Angels, according to Dessent.

“For a court to say, we’ll lock you into this name even though the clause is ambiguous ... that would be a pretty bold move for a court,” he said.

But the city’s lawyers would rely on what Dessent calls “the implied obligation to deal in good faith.” In committing $20 million to the stadium renovation -- and accepting limitations on development in the parking lot surrounding the stadium -- city officials intended to reap the publicity benefits of attaching the Anaheim name to the team.

“The lease clearly could have been written much better,” Jarvis said. “But, at the end of the day, would a judge and jury let you call yourself the Los Angeles Angels of Anaheim if the whole point of the lease for the city was to get bragging rights and publicity?

“By co-featuring the name Los Angeles, you diminish the value of the contract to the city. The city would presumably not have given the concessions it did if they thought they would be sharing top billing.”

In this argument, the history of popularly dropping the “of Anaheim” part of the stadium name would work in the city’s favor, not Moreno’s.

“The words in the contract are subject to interpretation in light of the purposes of the contract,” said Carl Bjerre of the University of Oregon. “It seems to me they were trying to give some flexibility to the team but preserve the publicity for the city name. If the new name is going to be naturally shortened, that publicity purpose would be defeated.”

After all, Bjerre said, Moreno could follow the letter rather than the spirit of the lease by proposing a name change to “The Los Angeles Angels, a team of really great players who happen to play their games in a city we grudgingly acknowledge is called Anaheim.”

Disney had a vested interest in selling Anaheim, with Disneyland, Disney’s California Adventure and the Mighty Ducks in town. Moreno, an Arizona resident who has no other business interests in Anaheim, believes he can generate additional revenue by using the Los Angeles name to help tap into a regional and national base of baseball fans, advertisers and broadcasters.

Ultimately, then, a court case could turn on whether the city should reasonably have anticipated that the Angels might be sold during the term of a 33-year lease and should have better protected its interests by insisting upon clear and unequivocal language in the agreement.

“In hindsight, you always want that specificity,” Bjerre said. “Nobody can foresee every contingency. The inability to foresee should not be turned into a trap.”

*

That inability to foresee also would be at issue should the city sue Moreno for violating the lease on grounds he fails to use the Anaheim name in marketing the Angels. White, the city attorney, acknowledged the lease contains no requirements about using the city name in marketing but said no such language should have been necessary.

“I don’t know of any other team in Major League Baseball that totally strips the name off its uniforms and all of its merchandise, publications, media guides and its official website,” he said. “I don’t think you have to use the word Anaheim every time you use the word Angels, but you have to do what’s customary in the industry as far as using the geographical name along with the nickname.

“There’s been a systematic stripping of the name Anaheim. We didn’t get the benefit of what we paid for.”

The city’s position could have merit, Bjerre said. If a court agrees that teams generally use geographical names in marketing, the city could be excused for not negotiating a clause that compelled the Angels to do so.

“If the practice was taken for granted, the expectations by the city and Disney would have been that you’ll use the city name,” Bjerre said. “You don’t expect that, if you and I make a contract, it will require us to keep breathing.

“The fact that it doesn’t show up in the words of the contract is not a reason not to enforce the expectation.”

But what does show up in the contract could trip up the city, Monserud said. In at least two sections, the lease includes language that could help Moreno’s case more than the city’s.

In Section 11(a), the parties agree that ballpark signs “for the purpose of designating the baseball stadium shall give prominence to the name Anaheim at least equal to 75% of the size of the sponsor name.” Indeed, the letters that spell out “Angel Stadium” above the ballpark entrance are larger than the ones that spell out “of Anaheim.”

The size of the letters is not critical to this case. Rather, Monserud said, the direction in how the city name should be used on stadium signs could trump the city’s argument that it did not negotiate any marketing provisions in the lease.

“If you say specifically some way you want the name mentioned and specifically put on signage, the expectation would be something specific but not enumerated is not to be covered,” he said.

“Since they don’t specifically cover tickets, marketing and such, then the city’s case is awfully weak.”

Yet the marketing of tickets is covered, in language that could further damage the city’s argument. In Section 12, the Angels are granted “sole control over the pricing, marketing, inventory control and sales of tickets for admission to events at the baseball stadium.” Moreno also could argue that the city has not objected to previous marketing strategies and did not object to this one until faced with the prospect of the team changing its name.

The city did not quarrel, for instance, when Disney removed Anaheim from the front of road jerseys from 1997 to 2001, restricting the city name to a small patch on one sleeve.

And, in a Sept. 11, 2003, letter to Moreno, City Manager Dave Morgan expressed concern that Moreno might change the team name and the city’s belief that such an action would violate the lease. However, Morgan did not address the use of the city name in marketing and wrote that “we endorse your efforts to broaden support for the team ... marketing and branding on a regional basis has merit.”

White noted Moreno operates the team under the corporate name Angels Baseball LP, with the city name not included. However, the lease does not demand the team be operated under a corporate name that includes Anaheim. White acknowledged the city did not object when Disney ran the Angels -- and signed the 1996 lease agreement with the city -- under the corporate name Disney Baseball Enterprises, Inc.

“It’s just one part of the whole picture,” White said. “What we’re looking at is how the Angels have completely and systematically stripped the name Anaheim from everything.”

Jarvis said the city would be on far weaker legal ground pursuing this case than the one it could file if Moreno actually changed the team name.

“They have a shot,” Jarvis said. “It’s a tougher argument to make.”

If Moreno changes the team name, the City Council has authorized immediate filing for an injunction, in which the city would ask a judge to block the change pending a trial.

The city would be required to demonstrate both irreparable harm if the change is not reversed at once and a substantial likelihood of winning at trial, with no guarantee a judge would agree.

“I don’t think a temporary restraining order would get issued if the team were to suddenly change its name to the Los Angeles Angels,” Bortman said.

The city -- and Moreno -- might be better served to negotiate rather than litigate, the experts said, given the risk of losing at trial.

“There is so much unpredictability in court -- and their lawyers will tell them that -- that they’ll never get to a judge and jury,” Jarvis said.

Said Bortman: “I’m afraid I would not be able to predict who’d win this one. My guess is that he and somebody from the city should think of some other creative name that would make the city happy. It seems to me this situation cries out for some creative thinking, and a compromise that would suit both sides.”