The Mexican League Doesn’t Respect Contracts

Jean Machi almost never made it to the Giants (via Michael Marconi).

Jean Machi almost never made it to the Giants (via Michael Marconi).

Editor’s Note: To read this article in Spanish, please click here.

When asked about the season he played for Mexico’s Diablos Rojos in 2011, Jean Machi remembers the thoughts he once had about playing in the Mexican League. “I used to say that I would never play in the Mexican Baseball League.” Yusmeiro Petit, who was sitting next to Machi adds, “Someone should do something. It’s frustrating that the Mexican League does not respect contracts.”

Draft Process

An amateur draft, like those held in the United States, is something that is nonexistent in Mexico. Actually, scouts never seek talent in high schools or colleges due to the lack of baseball teams in schools. In Mexico, baseball is played through “weekend leagues” in which kids and adults alike play for the fun of the sport. It is in the “weekend leagues” where Liga Mexicana de Beisbol (LMB) scouts look to find talent.

The interest process starts with approaching the young kid, followed by getting close to the family. Parents normally are very trusting of scouts and allow their sons to travel to El Carmen, Nuevo Leon for tryouts at the Academia without question.

The Academia complex is designed to develop Mexican talent with the hope that within a year the player is playing rookie ball in one of the two minor leagues, Liga del Norte de Mexico and Liga del Norte Sonora, both affiliated with LMB.  This system is comparable to the relationship between the minor and major leagues in the United States, with LMB obviously being the goal.

A unique aspect of the Mexican league–and one that typically creates controversy–is that if a player is released by an LMB team, the player must return home, but his rights are still owned by the team. If a team within the LMB, or one of the Major League Baseball franchises, is interested in the services of the player, that team must negotiate with the team that holds the player’s rights, normally the team that first signed him.

Selling Process

The problems with the way Mexican league teams go about business comes to light when an MLB team is interested in a player whose rights are owned by a team in the LMB, because the Mexican teams will most likely ask for a fortune for that player’s services. Normally, LMB asks for an amount of money MLB teams could use to sign multiple players from other countries like Venezuela and the Dominican Republic. For example, some Mexican players  have been sold for up to $2 million.

In an interview with Jaime Blancarte, general manager of Toros de Tijuana, he shared that some players are so worried about the situation,  they have started to add a clause that states that, if an outside team is interested in him, the signing team cannot stop him from pursuing the opportunity. However, the Mexican team then starts adding legal clauses that include the right to charge penalties in such situations.

Blancarte also shared with us another aspect of these contracts. If the player is considered “valuable” to the team, the team is within its rights to prolong the selling process so the player is able to finish the LMB season (which runs through the end of August). There currently are no guidelines or regulations set by MLB regarding this process, so neither the player nor MLB teams are protected in these situations.

This is the situation that Jean Machi faced when in 2011 when he was “on loan” to the LMB after not having made his Triple-A team. He became the official closer for the Diablos Rojos de Mexico, finishing with a 3-1 record and an era of 2.31 with 15 saves.

The San Francisco Giants immediately were interested in Machi, but the Diablos Rojos did not want to lose him mid-season. Therefore, Machi was not allowed to leave for the U.S. until the Mexican League was finished. The situation became extremely frustrating for Machi. “I used to say that I would never play for the Mexican League because I knew things like this happened.”

Oscar Daniel Verdugo provides another example of the situations that Mexican talent must endure on their road to the majors.  Currently an active player in the LMB, at age 16 Verdugo was signed by Aguilas de Veracruz to attend la Academia. He started the process to play in LMB successfully, going through the Academia, posting numbers that sent him to rookie ball very quickly.

During that process, two MLB teams showed interest in Verdugo, but negotiations lasted two years due to the absurd sum of money the Veracruz team was asking for, a sum that neither of the MLB teams was willing to pay. Finally, after two years the Mexican team lowered the asking price, and the Pittsburgh Pirates bought him, but not included were his rights. Verdugo was sent to the Venezuelan Summer League, where he had been effective with a 4-0 record and an ERA under 3.00.

In 2010, Verdugo was part of the Gulf Coast League, and though he only played in one game, that was enough for him to sustain an injury. El Aguila de Veracruz took that opportunity to claim their rights over him, and Verdugo was forced to return to Mexico. Currently, he is one of the most promising pitchers in the LMB with a 4-0 record and 4.46 ERA.

A Hardball Times Update
Goodbye for now.

Verdugo ended the interview by saying that he always thinks about what could have been, especially if an agreement had been made two years prior. Though Verdugo is unaware of the sum of money his Mexican team had initially asked for, he wonders, what if his team would have asked for a little less money?  Maybe right now he would be closer to the majors…maybe.

LMB Franchises

The Liga Mexicana de Beisbol is made up of 16 teams in two divisions, North and South. It also includes two rookie leagues, Liga del Norte de Mexico and Liga del Norte Sonora. The rookies leagues are run in smaller cities, where the average attendance is 200 people each game.

In order for a league to be recognized as part of “organized baseball,” the league must be affiliated in some way with MLB.

The Mexican baseball system operates under unwritten rules. There are a lot of creative ways the league dictates how a player can be sold.  None of these rules is regulated in any way by MLB, and that is where many argue the problem lies. The consequence of this structure is that each Mexican league team and its leadership decides what to do with their players, often leaving the player without a voice.

Returning to the interview with Blancarte, he explained the various ways a player can be sold. He explained how those players that stipulated special clauses in their contract to address the issue beforehand normally get to keep 75 percent of the money for their first year of play, while the team gets to keep the remaining 25 percent of that contract. However, the Mexican team selling him maintains the player rights in case the player wants to return.

When percentages are not included in a contract beforehand, it is a given that the sale will take much longer, if it happens at all, and the Mexican team will look for ways to cash in. There are cases when the team has pocketed up to $1.5 million of the offered contract while the player walks away with a mere $500,000 from the MLB deal. Either way, the Mexican team continues to have the player rights within the Mexican league.

Partial Sale

Another selling term is called a partial sale. This is when a player is completely sold to an MLB team only when and if the player reaches the majors in a predetermined amount of time. The player continues to be property of the Mexican league team during the player’s time through the minor league system. If the player does not reach the majors during the predetermined time, the player must report back to his Mexican team.

These types of issues do not exist in other Latin American countries.  Players sign for much less money and without a team in the middle to sabotage their journey. In countries like Venezuela and the Dominican, the winter leagues are the most important, due to the attendance of major league players who use the league to hone their skills or stay in shape leading up to spring training.

Red Numbers

On a good day, ballparks in Mexico reach an attendance total of 6,000-8,000 fans. Most fans, however, do not pay to attend the game; they use comp tickets. Paying fans normally pay a very minimal amount.  Therefore, ticket sales are not a big revenue source for Mexican teams.

Revenue comes in the ways of sponsorships and advertisement sales inside the ballpark. For these teams, every space is available, including player uniforms. Another source of income is television rights. The Mexican league has contracts with TVC Sports, and some games are transmitted by ESPN Latinoamerica.

According to Forbes Mexico, each of the Mexican league teams needs an average of $4 million dollars per year to operate; however, projected revenue makes up only 70 percent of that figure. That is a deficit of $19 million dollars among the 16 teams. This is why teams look to their local government for economic support, and when an MLB team shows interest in one of its players, they seize every single opportunity to make money. However, they often inflate the numbers so high that the U.S. team loses interest in the player.

Mexico has a salary cap in place which limits a player’s salary to $8,000 per month. There was a time when the player was able to earn a bonus as a form of compensation for performance, anything from connecting for X number of home runs, to earn a certain number of wins, to pinch running. There also were allowances and perks that would go toward food, airfare for the player and his family, and other special requests.

All those things have gone away. The player now must ensure that all his contract amount is sufficient to cover his lifestyle without expecting more from the team.

Mexican Students in the United States

Parents worried about the situation with the Mexican league and who are consciously aware of their son’s talent potential to play in the majors some day make an economic sacrifice to send their kids to high school or college in the U.S. with the hopes that their sons are selected in the amateur draft. This would avoid the difficult process of attempting to play in the majors while with a Mexican team. Examples of this situation are Alan Garcia, Alfredo Amezaga, Ali Solis, Xorge Carrillo and Fernando Perez, among others.

Perez is a young man who grew up in Ensenada, Baja California, and showed baseball abilities at a very young age. His parents, aware of the situation with the Mexican baseball league and wanting the best for their son, saved money so that they could send Perez to high school in San Diego and college in Arizona.

Perez was selected in the third round of the 2012 draft by the San Diego Padres. In 2013, his batting average never fell below .400, and he quickly was sent to Class A. He currently is part of the Fort Wayne Tin Caps and continues to demonstrate great fielding and outstanding hitting, which will be what takes him to the majors in a few seasons.

Baseball is a business and though generating revenue is part of that, no business should be able to ignore contracts already in place. The Mexican League is recognized by MLB, and that takes away its independent league status. Therefore, MLB should intervene so that player contracts are fair and regulated. It is apparent that the Mexican League does not go by any type of rules but their own.

Special thanks to Marisol Villagomez for translating this story.

Nathaly Morga-Oregel writes for Puro Beisbol Magazine and The Sports Post, with a focus on the San Francisco Giants. Follow her on Twitter @nathalymorga.
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8 years ago

I was confused by the mention of the Pirates buying Verdugo, but not his rights. What does that mean? It kind of sounds like they wanted him to play for them, but the Mexican team could call him back at any time, but that can’t be right, can it? What team would do that?

8 years ago
Reply to  Catoblepas

Finished the article, and I’m guessing it was the partial sale that was explained a bit later. Would’ve been a bit nicer if that could’ve been mentioned before the Pirates example, but overall a good read.

8 years ago

I don’t feel sorry for Jean Machi at all. So he signed a contract to play a season with a team in Mexico in 2011, and because he did well wants to leave and then complains that the team requires him to finish the season he signed the contract for? Seems to me in that case it was the player who doesn’t want to “respect the contract”.

Paul G.
8 years ago

I tend to agree that finishing out the season before the team allows you to leave is not an unreasonable demand. I believe this was normal operating procedure with American minor league teams before they were completely subdued. The major league team would buy a player from a minor league operation with said player to report once the minor league season was completed.

That said, it does appear that the Mexican League is dysfunctional in several ways. Considering that the Mexican teams run on budgets that are tiny compared to MLB, if the MLB is interested in reforming the system that probably could be resolved by throwing money at the problem. Give the Mexican League a subsidy of say $10 million a year – cheap! – in exchange for a better posting system that lets players get a chance at the MLB and the teams a reasonable return on their investment. Whether this is worthwhile to the MLB given cheaper alternatives elsewhere I don’t know. It might be a bad precedent.

John C
8 years ago
Reply to  Paul G.

This is true. The Mexican League is classified as a AAA league by organized baseball, but it operates in the manner of high minor leagues before the major leagues took full control of the U.S. minors–like in the era where Jack Dunn’s Baltimore Orioles were better than some MLB teams thanks to being able to keep stars like Lefty Grove around. Mexican League teams aren’t farm teams; they’re actually trying to win the LMB championship, not develop talent for someone else.

With that said, organized baseball should insist that they abide by the same contract rules and regulations that everyone else does. If you sell a player, his full rights go to the new team. If you release a player, he’s a free agent. If they won’t do that, then they need to become a fully independent league, outside of organized baseball, the same as Nippon Professional Baseball, the Atlantic League, or the American Association, and negotiate contract terms with organized baseball on that basis.

8 years ago

I’m curious why Mexico City (or Monterrey or Guadalajara for that matter) is never mentioned as a possible expansion city. MLB is already in Canada, what’s to stop them from moving South? Mexico City is the largest metropolitan area in the Americas, not that far of a flight, and already has enough baseball fans to support a 26,000 seat stadium, and that’s just in the Mexican League. Surely a major league team would draw enough for a much larger facility. Shouldn’t MLB be aggressively trying to expand the sport in an era when the game is flush with cash and more popular than ever? Why isn’t this happening?

John C
8 years ago
Reply to  Sam

The MLB Players Union wouldn’t stand for it. There was talk about transferring the Montreal Expos to Monterrey when the Expos needed a new home, but it didn’t get far because the union didn’t want to play in Mexico, for several reasons. If a Mexican city ever did join MLB, it would be Monterrey, because of its relative proximity to the USA, its strong fan support for the Sultanes, the fact it’s one of Mexico’s wealthiest cities, and the fact that it has a fairly low crime rate relative to the rest of the country (although still very high by U.S. standards). Mexico City is too far away and has other issues.

Anonymous Coward
8 years ago
Reply to  John C

Mexico City’s 3785km by air from Seattle, which is the farthest MLB city. Miami’s 3800km by air from Seattle. I don’t think the distance is scaring anyone off.

7 years ago
Reply to  Sam

Mexico city doesn’t play much baseball they are mostly interested in soccer the states that are big in baseball are the northern states in Mex Sonora, Sinaloa, Monterrey, also Guadalajara. I agree with you the MLB should expand south of the border but to me these Mexican teams want lots of pesos…

Alfonso Garcia
8 years ago

Esto es completamente cierto, los equipos venden al jugador y no solo eso después de vender al jugador se quedan con el 75 al 85 por ciento de su salario como jugador, lo que se podría decir que pueden llegar a ganar menos que un pizzero

8 years ago

You should have the line with the link to the Spanish article in Spanish, and vice versa for the link to this article from the Spanish one.

Alfonso Garcia
8 years ago

All about this article it’s a 100% truth, this is the dark side of the Mexican League.
I hear this about some players:
“When i sign with my team of the USA i was expecting to win some money but my mexican team stays with the 75% of my salary”

Liam Murphy
8 years ago

There was a really informative article on on this issue about a year ago. Its just terrible what some of these Mexican League teams are doing, and how little MLB is doing to stop it.!37zmg

Eduardo S
7 years ago

Baseball in Mexico has been downhill for 40 years. It was the most popular sports on most places, but now almost all the country is Soccer land. One important issue was the Players strike of 1980. It was a big strike, players did not had retirement fund, or most workers rights. Even medical services were not covered on offseason. The last straw was a fight on field in a Veracruz – Puebla game. After the game concluded, the local police of Veracruz arrested Puebla players, and the team owner did not help his players.
The players formed the ANABE, an Association to protect them (creating a syndicate was very difficult). The owners took a hard line, threatening to ban any player joining the ANABE. So, the players formed their own league (Liga Nacional). Mexican league downsized from 20 to 6 teams. ANABE league was regarded as the better, but Mexican league owners had relationships with the media, and National league was not covered on newspapers, radio and TV (with a couple of exceptions).
Eventually, the players league had a lot of problems, and many players asked for amnesty to return to the Mexican league. The split lasted 4 years, but after the 2nd year it was clear that Liga Nacional would not survive. But the damage was done, a large part of fans abandoned baseball.

Currently baseball in popular mostly in Northeast Mexico (Sonora, Sinaloa, Baja California), where the winter league is played.

Steely Glint
7 years ago

Dysfunctional country, dysfunctional baseball league.

Adriana OP
7 years ago

Muy interesante! Espero que tenga una reflexión para los implicados y esto pueda mejorar por el bien del béisbol, pero sobre todo de los jóvenes talentosos que sueñan en grande . Felicidades por tu artículo Nathaly !!

David P Stokes
7 years ago

OK, I’m a bit confused. I don’t see anything in the article that says that Mexican League teams don’t respect contracts. I see plenty that says that they require players who sign with them to agree to unfair contract terms, but that’s different than not respecting contracts.

6 years ago

Although this article was published a year ago it has a strong bias and I don’t think the author is seeing the whole picture. Let me star for asking a simple question: If a Dodger’s AAA minor league player is call to the Majors by the Red Sox, the Dodgers are going to let him go in order to play in the Majors? The answer is very simple: OF COURSE NOT!!! They Dodgers would negotiate players, money, draft picks, etc. in order to complete the transaction. If a MLB team need a player FROM THEIR OWN minor league system they will take him to the major as simple as that. If a MLB team need a player FROM OTHER team’s minor league system they will negotiate. The same principle apply in the Mexican Baseball League (LMB)! The LMB even though is the only Latin American Independent Professional Baseball League affiliate to the MLB, the LMB in any way is farm system owned by the MLB teams. The teams in the LMB are built to win championships, as any other professional sport league. The teams are not build to let it go ball player to the major whenever a player or MLB team wants it in the middle of the season. Let me go a little further, in fact if a deal is make between a MLB team and a LMB team to send a ballplayer to the U.S. most of the time is in a trail basis on spring training camp. If the Mexican player makes the cut the then the contract is execute. And here comes the “PARTIAL SALE”, let me explain it: If a player with contract with a LMB team goes to the US, the right of the player in Mexico are still owned by the team, because as simple as the ball player had a contract! And about the kids that are let it go to the Carmen Baseball Academy, of course thee parents will let them go, as simple as there they will attend a private school inside the Academy way much better (physical and academic speaking) than the public school the kid could go if (and it’s a very big if) there’s a public school at all! If for any reason the kid doesn’t make it to a professional league, he has already a great education that will allow him enter top university in Mexico, that’s a no-brainier decision process!

About Machi: When he signed with Diablos Rojos ( Red Devils in english) he sign a contract for the remaining of the season and not to be released if a Major League call for him. And he wasn’t either send to the Diablos as a minor league assignment by or the SF Giants or by any other MLB team.