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  • Andrew Goldenberg

Contract Dispute Between Staten Island Yankees and the New York Yankees

Plaintiff Nostalgic Partners, LLC ("Nostalgic"), the owner of the Staten Island Yankees ("the SI Yankees"), commenced a lawsuit in the New York Commercial Division against the New York Yankees Partnership ("the Yankees"), various related Trusts ("the Trusts"), and The Office of the Commissioner of Baseball, an Unincorporated Association d/b/a Major League Baseball ("MLB"), asserting breach of contract, promissory estoppel, tortious interference with contract, breach of fiduciary duty, and violations of the New York State Franchise Sales Act. See Nostalgic Partners, LLC v. N.Y. Yankees P'ship.

Nostalgic claimed that the Yankees wrongful conduct caused the demise of the SI Yankees by terminating the minor league team's affiliation with the Yankees and MLB in 2020. Nostalgic alleged the Yankees breached a 2011 Agreement by refusing to negotiate a new Player Development Contract with the SI Yankees. The affiliation was ended as part of a restructuring of the relationship between MLB and minor league baseball. This created a local uproar which sparked this lawsuit by Nostalgic. Defendants moved to dismiss the action for failure to state a claim. The motion was granted in part and denied in part.

Under New York law, when determining a motion to dismiss for failure to state a claim pursuant to CPLR 3211, the Court must accept the facts as alleged in the complaint as true, and give the plaintiff the benefit of every possible favorable inference, and determine only whether the facts as alleged fit within any cognizable legal theory.

Applying this standard, Judge Barry Ostrager dismissed all of Nostalgic's causes of action, except its first cause of action for breach of contract. Nostalgic sought damages for breach of contract claiming the Yankees refused to negotiate a new deal with the SI Yankees. Nostalgic relied on the 2011 agreement which provided that the partnership between the SI Yankees and the Yankees would survive so long as certain conditions were met. Judge Barry Ostrager found Nostalgic's complaint stated a claim against the Yankees for money damages based on an alleged breach of the 2011 agreement.

The Yankees have appealed the decision.

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