Arbitration Losses

Yesterday, two pitchers lost their arbitration cases: John Patterson of the Nationals and Kevin Gregg of the Marlins. I have a few thoughts.

Patterson was asking for $1.85 million but the Nationals now have to pay him only $850K. In my mind, this case went to arbitration because Patterson’s agent submitted a number that was way too high. There is no way he was going to get that. By my calculations, Patterson’s 2006 was worth about $2.87 million. Arbitration-eligible pitchers typically get 75% less than their previous season’s performance value, putting him at about $720K—that is less than what the Nationals offered. I suspect Patterson’s good 2005 may have made him a bit overconfident. Still, when Patterson’s number came in, I suspect the Nationals didn’t even try negotiating. Why bother? There was no chance that the panel would give him $1.85 million. If he’d asked for say, $1.25 million, he’d have probably ended up settling with a contract close to $1 million.

Kevin Gregg is an interesting case, because I don’t see how he lost. He asked for $700K and the Marlins countered with $570K. Gregg had a really nice career with the Angels, generating $4.43 million in 2006 and $3.16 million in 2005. He should have easily garnered a million dollar contract, but his less glamorous role as a middle reliever/spot starter may have cost him. And I admit that my model for predicting non-free agent contracts is rough. But never underestimate the Marlins when it comes to managing their budget. I guess there is a reason I find them to be the best organization in baseball in my book.

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