Some sports lawyers are conservative when it comes to showing their passion for sports. And then there’s Ed Schauder. A partner at Phillips Nizer, Schauder breathes sports, as anyone who has stepped foot in his office, or followed him on Instagram, will tell you. And it’s infectious. We recently sat down with Ed for the insightful interview that follows:
Question: What grade would you give professional teams when it comes to creating revenue opportunities around past players and why?
Answer: Just about every team is leaving money on the table in terms of revenue-generating ideas, both with alumni and current players. I would say, on average, it’s probably B- or C, but there are some teams that are better than others. I’ve been writing for PSL for several years about organizing nostalgia teams and game-use programs, and only recently began to see some innovative ideas being implemented.
Q: What took so long for teams to reach this realization?
A: With all of the analytics, different revenue streams and various ways to try to generate revenue, people are always going to be more focused on their current players than on their alumni.
Q: What teams have been the exception?
A: The Yankees are one of the teams that do a great job with their alumni, they at least have an Old-Timers’ Day! They are very good in keeping and preserving their history; they celebrate it by making it front and center. The New York Rangers are starting to follow suit. They just had an alumni game against the Boston Bruins alumni, which was pretty cool.
Q: What are some of the things that teams can do to lay the foundations for growth in this area?
A: A couple things. One of the simplest things to do is embrace your alumni and say, “Let’s cut a deal.” What do I mean by that? Teams can produce reproductions of a yearbook and reproduce different nostalgic promotions. They could produce photos for autographs. It’s funny, the Mets get a bad rap about a lot of things, but they’ve done a couple things recently that really have impressed me, both as a Met fan and as a sports lawyer. By retiring Jerry Koosman’s number, for example, they’ve now done a tremendous amount to reconnect with their past and generate marketing opportunities for Jerry. They should now cut a deal with Jerry where he gives them the ability to sell (in the ballpark and online) his image in a Met uniform with signs, inscriptions, et cetera. Simple, right? If you’re willing to cut a deal with nostalgic players and do licensing deals with them and sign memorabilia deals with them, it creates new revenue streams for the team. The team is celebrating the historical connection to the team, while also generating money for the player.
Here’s another concrete example: Stadiums and sports facilities have a lot of “open” days on the calendar throughout the year. Why not have alumni come back and offer clinics? Alumni softball games for charities is another way to fill seats when stadiums are otherwise not in use. The Yankees have alumni visit the suites, which more teams explore as possible perks for their season ticket holders, they could play catch on the field with an alum! There’s so many more things that could be done, like taking the teams to their minor league affiliates and cultivating some goodwill. Baseball’s done a great job and Rob Manfred has done a great job with the Little League Classic and having the players show off their personalities with the nicknames. It can go even further, and there’s real money to be made. More important, alumni (especially championship teams) are such great ambassadors to the team.
Just recently the Mets announced that they’re unveiling a Tom Seaver statue and renaming 126th Street in Flushing to Seaver Way, which is a great way to honor a player, but there’s more that can be done. Another concrete example is possibly striking a deal with the Seaver family so they could actually sell, to the public and fans like me, a replica street sign with Seaver’s name on it. Merchandise licensing increases revenues while engaging fans, past and present.
Q: Why is outside counsel’s experience in this area important to teams?
A: Team general counsel are very, very competent lawyers. Most come from litigation or labor backgrounds and licensing or appearances deals require their areas of legal expertise. There are several things to consider, like morals clauses that deserve attention. It’s important to select outside counsel, who has experience in this area.
Q: What are some examples of teams that other teams should model their programs after?
A: The teams with the richest histories have a head start in this area, such as the Yankees, Dodgers and Cardinals. But it doesn’t mean other baseball teams and teams in other sports can’t follow suit. Every team has a unique history they can call upon to create new revenues, while inspiring loyalty among their fans.
People want experiences. For example, New York Knick fans want to be able to take a picture with the great Walt Frazier. Why not enhance the game day experience by offering fans an opportunity to take a picture with an all-time legendary Knick?
Q: Your firm has been active in the estate tax planning area. Tell me about its niche as it relates to executives and players?
A: Phillips Nizer’s amazing estate planning group is one of the reasons I joined the firm. Whether it’s an executive or a player it’s important to structure compensation to avoid taxes and create wealth for their families.
This is actually one of the areas where I venture outside of sports law, focusing on high net worth families, as well as team executives and owners, which has also expanded into players. Having worked with Steiner Sports, I’ve made friends with a lot of agents. While I never recommend investments, I do try to save athletes money by looking at investment papers, to make sure they are protected.
Sometimes players make handshake deals, which is silly. Take advantage of lawyers, who are very well-educated and know the tax code. This is not to replace an agent — this supplements the services that an agent is providing.
Q: What are some of the overlooked areas where legal guidance to teams is important?
A: I’ve been involved in areas that teams might find interesting, such as lessons to be learned in creating sports museums. You’re going to need guidance on when you get a piece in, is it on loan or is it something that’s permanent? I’ve been fortunate to have represented the Naismith Memorial Hall of Fame.
Another area is game-use programs. There was a very publicized incident where a good friend of mine bought a jersey, the Mike Piazza home-run jersey after 9/11. He was an avid collector, one of these guys that was known as somebody that wouldn’t sell the jersey. But when he needed to sell the jersey, he sold it. And it caused the Mets significant embarrassment, to a point where the whole game-use program was shut down and rethought. It came back stronger and better than ever. But that’s an area where a simple agreement that said you’re going to offer it to us first if you ever wanted to sell it, could have avoided a host of issues. Attorneys that are knowledgeable about this area, and they are out there, can help teams avoid embarrassment and other problems.
