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U.S. Supreme Court Reverses Federal Ban On Sports Betting

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The United States Supreme Court on Monday voted 7-2 in favor of reversing the federal ban on sports betting (link via Robert Barnes of the Washington Post). States legislatures will now be free to set their own laws as pertaining to betting on professional and college sporting events. Full details of the ruling are available at the Supreme Court’s web site. From the ruling, as set forth by Justice Samuel A. Alito Jr.:

The legalization of sports gambling is a controversial subject. Supporters argue that legalization will produce revenue for the States and critically weaken illegal sports betting operations, which are often run by organized crime. Opponents contend that legalizing sports gambling will hook the young on gambling, encourage people of modest means to squander their savings and earnings, and corrupt professional and college sports.

The legalization of sports gambling requires an important policy choice, but the choice is not ours to make. Congress can regulate sports gambling directly, but if it elects not to do so, each State is free to act on its own. Our job is to interpret the law Congress has enacted and decide whether it is consistent with the Constitution. [The Professional and Amateur Sports Protection Act] is not. PASPA “regulate[s] state governments’ regulation” of their citizens, New York, 505 U. S., at 166. The Constitution gives Congress no such power.

Major League Baseball has issued the following statement on the matter:

“Today’s decision by the United States Supreme Court will have profound effects on Major League Baseball. As each state considers whether to allow sports betting, we will continue to seek the proper protections for our sport, in partnership with other professional sports. Our most important priority is protecting the integrity of our games. We will continue to support legislation that creates airtight coordination and partnerships between the state, the casino operators and the governing bodies in sports toward that goal.”

MLBPA executive director Tony Clark has also weighed in on the subject:

“The court’s decision is monumental, with far-reaching implications for baseball players and the game we love. From complex intellectual property questions to the most basic issues of player safety, the realities of widespread sports betting must be addressed urgently and thoughtfully to avoid putting our sport’s integrity at risk as states proceed with legalization.”

[Related: Hoops Rumors on impact of Supreme Court ruling on NBA]

Of course, sports betting already exists in prominent fashion throughout the United States. Barnes’ piece above cites an estimated $150 billion annual valuation of the underground sports betting market in the U.S., which doesn’t include already legalized betting at sportsbooks in Nevada casinos. Certainly, though, widespread legalization of the matter creates many potential causes for concern and also for revenue; NBA commissioner Adam Silver, for instance, has openly expressed a desire to be compensated for the compensated for his league’s “additional costs involving integrity,” (via Michael Scotto of The Athletic). ESPN’s Brian Windhorst reported earlier this year that the NBA could seek one percent of every bet legally placed on its outcomes.

The state of New Jersey had the support of 18 other states, per Barnes, in seeking to legalize betting in their state. Justine McDaniel of the Philadelphia Inquirer tweets that the state of Pennsylvania, for instance, legalized sports betting last year in anticipation of federal legalization.

Boras, Halem Continue Quarrel Over Free Agent Activity

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Agent Scott Boras jabbed back at Major League Baseball’s comments to ESPN’s Crasnick this evening, writes FanRag’s Jon Heyman. Specifically, Boras questioned how the league could reconcile the notion of commenting on any offers made to unsigned players — a reference to Manfred telling Crasnick that some players had received “nine figure” offers.

“I find it interesting that free agents have nine-figure offers since the CBA mandates that teams not share that sort of information,” said Boras. “I am also curious how a public statement communicated to all teams about offers on the table and players demanding too much money from a central league office … is any different from the infamous ’information bank’ in the 1980s.”

MLB chief legal officer Dan Halem responded to Boras’ comments (also per Heyman):

“If Mr. Boras spent as much time working on getting his players signed as he does issuing inflammatory and unsubstantiated statements to the press, perhaps the events of this off-season would be different.”

Boras, without missing a beat, replied by pointing out that Halem made no denial that the league’s comments on the nature of offers some players have received contained the type of information that should not be made public and should not be known about by league officials. He also invoked statements from former union chief Donald Fehr made more than three decades ago:

“I’d be embarrassed,” Fehr said of MLB owners back in 1987. “But they aren’t. And the reason they aren’t is that they have decided that winning a battle with the players over salaries is more important than winning on the field. Winning on the field is secondary these days. The owners apparently feel they will come out no matter what.”

To Boras’ credit, it does seem curious that the league’s statement would openly acknowledge the size of offers that some players have received. In addition to running counter to the CBA, the comments hardly paint players in a favorable light at a time in which commissioner Rob Manfred is spearheading efforts to broadly expand the game’s appeal to a younger audience. If anything, today’s statement only furthers the popular “greedy player” narrative — one which often ignores that the alternative is for the even wealthier owners to simply pocket money not spent on player contracts.

While those numbers weren’t exactly a secret after being leaked to the media by various sources, likely from both the agent and team side of the equation in various cases, it was nonetheless surprising to see the league stating those numbers in a factual manner (even if it was merely in reference to media reports; it’s not clear which was the case in this instance).

Of course, it’s also worth noting that Boras is making a reach by likening the current economic state of free agency to one in which owners were proven to have colluded, resulting in mass one-year deals throughout the league and, eventually, an “information bank” in which owners readily shared intel on the types of offers that were being made to free agents.

Boras’ usage of Fehr’s comments, though, was more likely in reference to the spirit of competition (or lack thereof) and the number of “tanking” teams that aren’t endeavoring to put forth a winning club in 2018. Viewed through that lens, there’s some merit to the reference, but teams today certainly have greater incentive to tank than the more financial motives of those late-80s clubs. Furthermore, the five-year deal for Lorenzo Cain as well as reported seven-year offers for Eric Hosmer and five-year offers for J.D. Martinez and Yu Darvish underscore the fact that it’s not an apples-to-apples comparison.

That point seems particularly worth highlighting; while many critics of the labor side of this dispute express difficulty in sympathizing with millionaire players that aren’t finding often outlandish contractual demands met, the larger issue isn’t so much that players like Hosmer, Martinez and Yu Darvish aren’t receiving offers in excess of $150MM. Rather, one of the main gripes — certainly the one voiced by Boras and MLBPA chief Tony Clark today — is simply that not enough teams are making any sort of effort, and their refraining from free agency entirely has eliminated the game’s general spirit of yearly competition (both on the field and on the open market). In addition to limiting the market for the top-tier talents, the absence of 10 or more teams on the free-agent market dramatically erodes the market for mid-range free agents who, in prior winters, would’ve happily taken two- and three-year deals from teams that may not be clear division-championship-level contenders. Obviously, there’s time yet for offers from some such teams to materialize.

Of course, as has been pointed out on many occasions — the players themselves bear no shortage of responsibility in the matter. The current structure of amateur talent acquisition in Major League Baseball disproportionately rewards noncompetitive clubs in both the draft and the amateur international market, thereby encouraging teams to strive for high draft picks rather than taking an against-the-odds shot at a Wild Card berth. Those measures, as well as the luxury tax that many of the game’s heaviest spenders are treating as a soft salary cap, were agreed upon by the union in the most recent wave of collective bargaining a bit more than one year ago.

Tony Clark Accuses MLB Teams Of “Race To The Bottom”

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MLBPA chief Tony Clark has issued a statement, first provided by ESPN.com’s Jerry Crasnick, leveling significant accusations at MLB organizations. With a huge number of free agents still un-signed, Clark says that teams have failed to engage the market in earnest.

Here is the full statement:

“Pitchers and catchers will report to camps in Florida and Arizona next week. A record number of talented free agents remain unemployed in an industry where revenues and franchise values are at record highs.

Spring Training has always been associated with hope for a new season. This year a significant number of teams are engaged in a race to the bottom. This conduct is a fundamental breach of the trust between a team and its fans and threatens the very integrity of our game.”

Notably, Clark does not accuse teams of acting in concert to artificially suppress earnings — quite a different, more serious potential charge for which we’ve seen no evidence. Rather, his view seems to coincide with the broad points already presented by some prominent media members and agents (as well as at least one sitting GM): i.e., that more teams than usual are strategically disinterested in trying to win in the coming season.

Unsurprisingly, Major League Baseball has a different view of the matter that reflect prior comments from commission Rob Manfred. In a statement released to Crasnick, the league rejects Clark’s characterization as an “unfair” attack on MLB teams. Arguing that many top free agents are “sitting unsigned even though they have substantial offers,” the league statement suggests that agents have failed to “value their clients” reasonably “in a constantly changing free agent market based on factors such as positional demand, advanced analytics, and the impact of the new Basic Agreement.”

Clark’s statement seems to represent a notable ramp up in the rhetoric surrounding the notably slow free agent process this winter. At the moment, though, it seems that this is mostly a war of words for public relations positioning. Camps will soon open without several prominent players, barring some quick developments in the market, which will dramatically raise the visibility of this long-simmering dispute.

The union/agent stance seems to be a familiar one, arguing that tanking tactics are reducing competition for top free agents. From the league/team side, as the above statement suggests, the rejoinder is that clubs are within their rights to operate as they see fit within the rules regime agreed upon by collective bargaining. It isn’t too difficult to see how each side hopes to draw upon the natural but competing inclinations of fans both to chide “cheap” owners and to turn a skeptical eye toward “selfish” players.

In truth, this debate isn’t a new one. Tanking has been discussed for years. Manfred’s prior argument was, in essence, that the market adequately allows for such a strategy; it’s just not that successful an approach if too many teams employ it, since inevitably plenty of clubs will “lose” the “race to the bottom” and fail to recoup top draft picks, etc. Dave Cameron has argued, though, that this year may be somewhat unique in that, for many teams, the incentives to pursue draft status and cost savings may be sufficient to outweigh an expensive, low-odds effort to chase down the half-dozen “super teams” currently pacing the game.

As Evan Drellich rightly observes on Twitter, the concept of tanking does not really adequately cover the deeper mechanisms at play. There’s more at play here, somewhere in the intermingling of pervasive and deepening analytics; aging curves in a (mostly) post-PED era; and drastically cabined amateur spending and other collectively bargained rules. The most recent collective bargaining agreement largely continued the preexisting rules regime, with a few tweaks, largely reflecting an assumption that market mechanisms would allow player compensation to keep pace with earnings growth. Even as they swim in revenue, though, MLB organizations increasingly seem to be pursuing strategies that eschew major long-term free agent entanglements — potentially challenging the assumptions undergirding the players’ commitment to the existing CBA framework.

Quick Hits: Padres, Blue Jays, A’s

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The Padres benefited from the qualifying offer system this winter, writes Dennis Lin of the San Diego Union-Tribune. When Justin Upton and Ian Kennedy declined their qualifying offers, it earned the Friars the 25th and 26th picks in the next amateur draft. The experiences of players like Ian Desmond and Dexter Fowler have led many to expect sweeping changes in the next collective bargaining agreement. While visiting the Padres camp today, MLBPA chief Tony Clark cautioned that changes would be “wrapped in together” with revenue sharing, service time, the luxury tax, and other factors. As Clark explains, it’s not useful to look at items individually when the entire agreement should work in concert. Clark is also expected to visit the Indians today, tweets Paul Hoynes of Cleveland.com.

  • The 2015-2016 offseason was the winter of the opt-out. Don’t count on the Blue Jays to join the trend, writes Ben Nicholson-Smith of Sportsnet.ca. Per team president Mark Shapiro said: “In some ways they’re just another form of a player option which I think are ridiculous. You’ll never see us do a player option.” Shapiro does allow that there are circumstances where an opt out can make sense. In other words, he’s not as firmly against them as player options. While an anti-opt out stance eliminates many top free agents, the Blue Jays typically play in the bargain end of the pool.
  • The Athletics have accrued solid prospect depth, but GM Billy Beane doesn’t intend to trade them for short term upgrades, writes Joe Stiglich of CSN Bay Area. Players such as Matt Chapman, Franklin Barreto, and Sean Manaea may soon be cornerstones of the major league roster. While Beane dealt quality prospects for players like Jeff Samardzija, Jon Lester, and Ben Zobrist in recent seasons, the club is more focused on developing long term talent at the moment.

Pirates Notes: Revenue, Cole, McCutchen

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Earlier this evening, we heard from union chief Tony Clark on a variety of topics. Clark is also closely monitoring revenue sharing, writes Rob Biertempfel of the Pittsburgh Tribune. The MLBPA head was vague about any specific clubs they’re monitoring, saying things like “there may be teams that are of interest early that may not be late because of considerations that are being made.” The Pirates were once on the player union’s radar for not spending shared funds, but their recent on-field success probably has them in the clear – for now.

Here’s more from Pittsburgh:

  • Pirates ace Gerrit Cole is upset after the club renewed his salary for $541K, writes Biertempfel. Because Cole has fewer than three seasons of major league service, the Pirates can renew his contract at any rate – typically near the major league minimum. He played for $531K last season and received a $10K bonus for reaching the All Star Game. The team’s initial offer this year was for $538K, and they threatened a pay cut to the $507K league minimum when Cole expressed a desire for a raise. As Cole put it, “When you perform at a level that draws the praise of management, teammates, coaches and fans, you expect appropriate compensation. I understand the business of this game, but it is hard to accept that a year of performance success does not warrant an increase in pay.” The initial $538K offer was due to a team policy that caps raises at $7K for any player with fewer than three seasons of major league service. Cole does not want the situation to become a distraction for the team.
  • The Pirates have much to weigh when considering an extension to franchise icon Andrew McCutchen, writes Travis Sawchik of the Pittsburgh Tribune. The club can ill afford to make a costly mistake with a mega-extension. McCutchen is under contract for $48.5MM over three more seasons including a club option for 2018 ($1MM buyout). A seven-year extension would keep him in Pittsburgh through his age 38 season. The history of similar extensions is off putting. Sawchik finds a list of 16 players who signed nine-figure contracts under similar circumstances. Consider the names of David Wright, Joe Mauer, Ryan Howard, Ken Griffey Jr., Ryan Zimmerman, Ryan Braun, Alex Rodriguez, and Matt Kemp. Others like Miguel Cabrera, Joey Votto, Troy Tulowitzki, and Evan Longoria could look just as bad in the near future. As former Rockies GM Dan O’Dowd explains, any massive extension has to be about more than just performance. If ticket and merchandise sales won’t cover an ugly back end of the deal, then the club may be best served to move on from McCutchen.

MLBPA’s Tony Clark On Gallardo, Fowler, Chapman, Cuba

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Over the last day, Executive Director of the MLBPA Tony Clark has commented on the recent spat of high profile stories around the league. Here’s what he had to say regarding Yovani Gallardo, Dexter Fowler, Aroldis Chapman, and other topics.

  • Clark is concerned with the way medical information is processed in light of Gallardo’s renegotiated contract, writes Peter Schmuck of the Baltimore Sun. Per Clark, “Medical information shouldn’t be public…There’s a reason why individuals’ medical information is protected. The idea that those who shouldn’t have access to it have access to it and feel compelled to offer it is a concern.” Clark appears to be setting up medical information as a bargaining point in the next round of CBA talks. As Schmuck notes, teams do need this information to make informed contract decisions, yet there may be better ways to protect player privacy.
  • Clark was also worried about Fowler’s incorrectly reported agreement with the O’s, writes Rich Dubroff of CSN Mid-Atlantic. “I think it is disappointing that we live in a world where it is more important to be first than it is to be right, and it’s a very dangerous place to exist when information makes its way out that may not be 100 percent accurate.” Clark’s specific concern is that wrongly reported information could negatively affect a player’s bargaining power. He also spoke up in support of Fowler’s agent Casey Close who issued a scathing statement in response to the false report.
  • It’s long been rumored that Chapman will receive a suspension for his alleged role in an offseason domestic dispute. If Chapman appeals the suspension as expected, a hearing may not occur until after the beginning of the season, writes Jayson Stark of ESPN. Clark explained the process for setting up an appeal with Fredric Horowitz, the league’s independent arbitrator. A date must be scheduled based on Horowitz’s availability. Stark noted that it took five months for Horowitz to get to Alex Rodriguez’s appeal of his PED suspension. Clark did mention that the nature of the case could accelerate time frames.
  • Clark also commented on the Rays upcoming exhibition trip to Cuba which still has a few road blocks to overcome. He referred to “logistics” and “sensitivities” that yet need to be solved, although he was optimistic the trip would happen. A visit from President Barack Obama is also expected to be a part of the three day tour.
  • The Stark piece also contains comments from Clark about this previous free agent market and “intricacies” that may lead to various bargaining points.

Tony Clark On Qualifying Offers, Draft, Luxury Tax

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Here’s the latest from MLBPA head Tony Clark, who gave an interview to the Associated Press last week in which he articulated his positions on a number of issues that could affect the next round of CBA negotiations once the current CBA expires in December. Here are the highlights.

  • Clark expressed frustration that top players are still on the free agent market in February. (Presumably, Clark is referring to players like Ian Desmond, Dexter Fowler and Yovani Gallardo, who remain on the market after rejecting qualifying offers months ago. “I think it’s disappointing when there are as many talented players still without a home,” he said. “I don’t think it’s in anyone’s best interest to be in a world where very talented players are at home for whatever reason they are there. It will likely be a part of the conversation in bargaining.”
  • Clark also said he might be in favor of some sort of draft lottery system. As opposed to the current system, which awards draft picks merely on reverse order of record, a lottery system might somewhat disincentivize the kind of so-called “tanking” seen in recent years from teams like the Astros (who got three straight No. 1 overall picks from 2012 through 2014) and Braves. “It will be beneficial to look at that, and not look at it in a vacuum but appreciate whatever it is that we attempt to negotiate there or propose there, that it ties into the other moving pieces and doesn’t create an imbalance,” Clark said.
  • There are “very significant issues” with the idea of an international draft, Clark said, although he expects the idea will come up in CBA negotiations. (This isn’t the first time Clark has expressed doubt about the possibility of an international draft.)
  • Unsurprisingly, Clark believes the luxury tax threshold should rise. The figure remains at $189MM, and its growth has not kept pace with industry revenue. The threshold has arguably constrained player salaries, as it has likely played a role in preventing some traditional big spenders (such as the Angels) from signing key free agents this offseason.

Quick Hits: Gardenhire, Bryant, Valverde

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Former Twins manager Ron Gardenhire, who was in attendance as the team his son coaches at the University of Wisconsin-Stout took on a Twins rookie team Tuesday, would be thrilled to manage again, Phil Miller of the Star Tribune writes. “Oh, no. I’ve got a lot left in me in baseball,” says Gardenhire, shown in a photo wearing a T-shirt and smoking a cigar. “If somebody is looking for a manager and I’m a fit, great. I would love to manage again.” After the Twins fired him following last season following the team’s fourth straight season of 92-plus losses, Gardenhire lived for a month in an RV parked near his daughter’s house in Oklahoma while he waited for his first grandchild to be born. Gardenhire turned down a front-office job with the Twins, but says he’s still willing to help his former organization, perhaps with occasional scouting tasks. Here’s more from around the game.

  • MLBPA head Tony Clark says it’s “unfortunate” that teams delay promotion of top prospects for service-time reasons, ESPN’s Jayson Stark reports. “We don’t think it’s in anyone’s best interest, and we don’t think it’s in the industry’s best interest, to not have the best players on the field all the time,” says Clark. This has become, of course, a point of discussion every year. This season, top Cubs prospect Kris Bryant has been the focus of the issue. The Cubs are likely to send him to the minors to start the season even though he’s leading MLB in Spring Training homers with six.
  • One Padres move that didn’t attract much attention in a high-profile winter was their signing of former Diamondbacks, Astros and Tigers closer Jose Valverde to a minor-league deal. Valverde has performed well in camp, however, and now appears to have a good shot to make the team, Barry M. Bloom of MLB.com writes. “I feel like I’m 21 because I’m throwing 98 [mph],” says Valverde. “I’m surprised because I haven’t walked anybody yet.” Bloom suggests Valverde could even be the Padres’ closer. That would be an upset if it came to pass, since Joaquin Benoit performed well in that role last year after the team traded Huston Street.

Tony Clark On Astros, Nix, Draft, Springer, Singleton

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Major League Baseball Players Association executive director Tony Clark addressed a host of interesting topics in an interview with Evan Drellich of the Houston Chronicle. Drellich published two separate articles, both are worth a full read: one focusing on draft-related issues and the other on various recent contractual matters at the major league level.

Generally, Clark had positive words for Houston, crediting the team with a “tremendous stable of young talent,” which, along with some recent veteran signings, “suggests that there’s a plan in place and a light at the end of this rainbow.” He noted that the team’s relatively new ownership and management group is “continuing to acclimate.”

Here are some more key takeaways:

  • We’ll turn first to the well-publicized matter of the Astros failing to sign recent draftees Jacob Nix and Brady Aiken. Drellich reports that the settlement between the club Nix, which avoided a grievance proceeding, was actually for a value in the six-figure range, not the full $1.5MM he had originally agreed upon for a bonus (as had previously been reported). Aiken, meanwhile, has not taken any formal action — either through the grievance proceeding or otherwise. Clark says that the “entire situation was unfortunate,” but declined to criticize the club for manipulating the draft prrocess (as he had previously charged) and indicated that the focus was on ensuring that the players “land on their feet with an opportunity to get drafted again this year.”
  • Drellich explains that the settlement avoided a potentially tricky jurisdictional issue in the grievance matter. Even as the team (if not also the league) bore risk of an adverse judgment from an arbitrator, Nix himself could have won a hollow victory by having the better of the substantive argument but not receiving any actual monetary relief. This is because the draft is a subject of collective bargaining, but non-40-man players like Nix are not members of the union. Clark did not tip his hand on the union’s view regarding possible changes to the draft, but did say he has “a feeling it’ll be a topic of discussion when we sit down in ’16.”
  • Last year, the Astros (among other teams) came under scrutiny regarding service time considerations, in their case involving two of the team’s best prospects. Outfielder George Springer turned down an extension offer and started the season in the minors. Per the report, “steps that could have eventually led to a grievance hearing were taken on his behalf,” though that process was halted when Springer was ultimately promoted. Because he missed the first couple weeks of the season, Springer will be controlled for an additional season, though he is lined up to qualify for another arbitration year as a Super Two.
  • Meanwhile, first baseman Jon Singleton ultimately accepted a $10MM extension and was simultaneously promoted to the big leagues. That deal — the first of its kind — created quite a stir, though as I explained at the time there were certainly good reasons for the youngster to reach agreement. Clark’s comments were fascinating on this point, given the controversy surround the contract. “We are supportive of every opportunity a player has to sign a contract,” Clark said. “All we ever ask is that the player is as educated as he can be on all the different moving pieces that may enter that conversation. But no, we think it’s great, and we also think it’s a testament to how well the industry is doing that clubs are being willing more and more to make those commitments to guys who are younger and younger.” (If you’re interested in the subject, Singleton’s agent, Matt Sosnick, explained the deal from his perspective in a recent MLBTR Podcast episode, at the 10:33 mark.)

MLBPA Names Tony Clark As Executive Director

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The Major League Baseball Players Association announced that former big league first baseman Tony Clark has been appointed as executive director.  Clark takes over for the late Michael Weiner, who passed away after a 15-month long battle with brain cancer in November.

The move has been expected for some time – Clark was given the newly-created mantle of deputy executive director in July in the event that Weiner would be unable to continue in his role.  At the time of the announcement, Weiner gave Clark a glowing endorsement.

“Tony’s rise within the Union will come as no surprise to those who know him. It was clear from the moment Tony joined the MLBPA that his on-field experience and passion for the fraternity of players would make him a tremendous advocate for all who play the game. I look forward to working closely with Tony as together we represent the interests of the players,” Weiner wrote.

Clark, 41, spent parts of 15 seasons in the Major Leagues after being drafted by the Tigers second overall (behind Chipper Jones) in the 1990 draft.  From 1995-2009, Clark batted .262/.339/.485 in 5120 plate appearances, belting 251 homers along the way. Most of his career was spent with the Tigers, but he also spent five years with the D-Backs and had brief stints with the Mets, Yankees, Padres, and Red Sox.

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