Agents' Suit Creates Rep Flap

Two prominent baseball agents have sued their former company, SFX Entertainment Inc., for fraud and asked for $60 million in damages.

The lawsuit throws in question who will represent dozens of major league players, including Pedro Martinez, Mariano Rivera, Larry Walker, Moises Alou, Vladimir Guerrero and Jim Thome.

SFX fired agents Jim Bronner and Bob Gilhooley last week after the suit was filed and put veteran agent Randy Hendricks in charge of their players and staff.

Bronner and Gilhooley sold their company, Speakers of Sport, to SFX on Feb. 2, 2000, for $29.76 million plus another $10 million in possible future payments, according to the suit, filed last Friday in federal court in Chicago.

SFX then was acquired Aug. 1 by Clear Channel Communications Inc. for about $3.3 billion in stock.

Because Tom Hicks, the Texas Rangers' controlling owner, is vice chairman of Clear Channel, and because Clear Channel also owns small shares of the Colorado Rockies and Tampa Bay Devil Rays, Bronner and Gilhooley claimed in the lawsuit that the buyout created a conflict of interest that hampered "their ability to retain their current existing players as clients" and to "attract new players as clients."

SFX began its sports acquisitions in June 1998 by purchasing the business of basketball agent David Falk, who represented Michael Jordan, for $82.24 million in cash and assumed debt plus 1.5 million shares of stock, which if he hasn't sold it is now 900,000 shares of Clear Channel, worth $54.5 million.

In 1999, SFX bought the baseball business of brothers Randy and Alan Hendricks for $15.7 million in cash, $5 million in deferred payments and the chance to earn additional bonuses.

It then acquired the company of Arn Tellem, another baseball agent, and Speakers of Sport, signing both Bronner and Gilhooley, who each owned 26 percent of SOS, to $1 million, five-year contracts.

At that point, SFX represented about 16 percent of players on 40-man rosters, a group that includes Albert Belle, Mike Mussina, Roger Clemens, Andy Pettitte, Al Leiter and Chuck Knoblauch.

Bronner and Gilhooley's suit said SFX deceived them because, at the time they sold their business, SFX failed to tell them the company was negotiating to be acquired by Clear Channel. They said in the suit that damages were likely to exceed $10 million and asked for an additional $50 million in punitive damages.

They cited the decision by Juan Gonzalez, their longtime client, to switch last September to Scott Boras, who then negotiated a $10 million, one-year contract with Cleveland.

They said the failure to complete a tentative $143 million, eight-year deal between Gonzalez and Detroit last year, saying it cost them the chance to meet earning requirements that would result in annual $1.5 million payments.

The contracts Bronner and Gilhooley signed with SFX said they cannot compete with SFX until after Feb. 2, 2006.

Fernando Cuza, who worked with SOS's Latin American players, is staying with SFX along with agents Brian David and Pat Rooney, who also worked for Bronner and Gilhooley.

Randy Hendricks is expected to take over SOS's salary arbitration cases.

SFX spokeswoman Alyson Sadofsky declined comment other than to say her company's position was that the "suit was completely without merit and that SFX would move immediately to dismiss it."

"SFX further indicated that it was confident the company would prevail in this dispute after documentary evidence and testimony are presented in the appropriate forum," she said.

The case was assigned to U.S. District Judge Elaine E. Bucklo.

Gilhooley declined comment Thursday and Bronner could not be contacted. The Hendricks brothers did not respond to telephone messages.

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