By Michael McCann
Legal Analyst and Senior Sports Legal Reporter
Major League Baseball announced Friday it launched a formal investigation into the unusual circumstances surrounding a sports betting scandal involving the game’s most celebrated star, Shohei Ohtani of the Los Angeles Dodgers.
The extent to which the probe, overseen by a private organization, uncovers the truth remains to be seen.
The Dodgers Wednesday fired Ohtani’s interpreter, Ippei Mizuhara, who is suspected of wiring payments totaling at least $4.5 million from Ohtani’s bank account to California bookmaker Matthew Bowyer. Mizuhara granted an interview to ESPN Tuesday in which he asserted he has never bet on baseball, though bet on other sports. ESPN says Mizuhara later denied making the wire transfer and claimed Ohtani—whose representative insists he never gambles and is a victim of theft—had no knowledge of Mizuhara’s activities.
Although sports betting is legal in 38 states, it is illegal in California. Bets made across state lines, as well as those to offshore websites, can also trigger legal complications that attract the attention of federal law enforcement agencies. According to ESPN, Bowyer’s betting operation is under federal investigation.
For its part, MLB prohibits players, managers and others in the game from betting on baseball. That type of betting activity is grounds for a one-year suspension, which is elevated to a lifetime ban if the bet is on games in which one is involved.
MLB’s Department of Investigations, which was created in 2008 at the urging of the Mitchell Report into illegal use of steroids, will conduct the Ohtani investigation.
MLB has significant authority over Ohtani and other persons employed by MLB teams. They are contractually bound to cooperate with a league investigation. MLB players, managers and other employees—including interpreters—could be suspended or fined for failing to cooperate or otherwise obstructing an investigation. The MLBPA can advocate that players’ rights are protected in an investigation, though ultimately a player needs to cooperate.
MLB nonetheless faces several hurdles in attempting to compile evidence.
For starters, Mizuhara has been fired, which is both a significant and ambiguous development. It’s unknown how the Dodgers employed Mizuhara or how they fired him. If Mizuhara was employed via a contract or if he was fired as part of a financial agreement with the team, he may have nondisclosure obligations. Those obligations could condition his continued receipt of payments from the Dodgers on keeping quiet. MLB could compel the Dodgers to relieve Mizuhara of nondisclosure restrictions.
MLB also faces several structural limitations in approaching Mizuhara. It can’t suspend or fine him since he is no longer part of MLB. He could simply refuse to talk to MLB and MLB would have no ability to compel him to participate in an investigation. The same is true of Bowyer and anyone else outside of MLB connected to the controversy.
Persons outside of MLB might conclude they have little to gain by cooperating with the league. These individuals could soon become involved in legal disputes with former employers and the federal government.
As Sportico detailed, Mizuhara might consider legal action against the Dodgers over his firing. He could also become a criminal defendant if his alleged transfers from Ohtani’s bank accounts constituted theft or wire fraud. Anything he, or anyone else, tells MLB could be subpoenaed by the feds. A person who is concerned that admissions to MLB could provide evidence later used by prosecutors to seek criminal charges might decide to not cooperate.
To that point, MLB is a private entity. It lacks subpoena powers that could compel sworn testimony or the sharing of emails, texts and other forms of electronic evidence. Individuals who speak with MLB investigators won’t be under oath, a point that becomes particularly important if an interviewee knows telling the truth could necessitate admitting to breaking a law or violating a morals clause in an endorsement deal. When not under oath, a witness might knowingly lie without fearing the risk of a perjury criminal charge. They might also use the interviews to provide incomplete or biased narratives and deflect blame onto others.
MLB has a longstanding track record of aggressively seeking facts and evidence. When it investigated Pete Rose, MLB extracted information from Rose’s bookie, Ron Peters, to build its case. When MLB suspected Biogenesis was supplying players with PEDs, it sued the Florida clinic to obtain client records. It’s possible the league could adopt an aggressive approach in trying to uncover why Ohtani’s accounts were (apparently) used by a now-former MLB team employee to transfer more than $4.5 million to a bookie.
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