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Lucrative opportunity Expert says Raiders got best deal from Oakland
Updated: Thursday April 19, 2001 10:07 PM
LOS ANGELES (AP) -- The NFL opened its defense Thursday in a $1 billion lawsuit by the Raiders with an economics expert testifying that a return to Oakland was more valuable to the team than a new stadium at Hollywood Park. The Oakland deal was worth anywhere from $52 million to $87 million more for the team, depending on the projections used, Richard Gilbert, an economics professor at the University of California, Berkeley. "Oakland was the more valuable opportunity" for the Raiders, he said, based on an examination of revenue estimates. The Raiders claim the NFL forced the team to leave the lucrative Los Angeles market by pushing for a second team to play at the proposed Hollywood Park stadium in nearby Inglewood. Last week, Raiders owner Al Davis testified that another team would have crippled the Raiders financially when it came to selling luxury suites and competing for fan loyalty in Los Angeles. The NFL counters that the Raiders never made a commitment to the new stadium and were using the situation to get a better deal from Oakland, where Davis moved the team in 1995. Gilbert's analysis was based on 45 projections done in 1994 and 1995 by Oakland, the Raiders and Hollywood Park, along with updated estimates submitted by the Raiders for the trial. The figures include revenue generated by luxury suites, club seats and stadium naming rights, Gilbert said. Such revenue represents about a third of the total income of most teams and is a key to generating money to compete for star players and coaches. His analysis also factored in Oakland's offer of a $54 million loan to the team. The loan was unsecured, meaning Oakland officials would be unable to seize property if the Raiders defaulted. In effect, Gilbert said, that made the loan a cash advance for the Raiders. Gilbert also challenged an analysis done by an economics expert working for the Raiders that showed Hollywood Park was the better deal, calling the projections inflated and "nonsense." For example, he said, one estimate did not include any projected increase in the cost of game tickets in Oakland between 1995 and 2010, with the average price remaining about $50. But the projected Hollywood Park ticket price grew to more than $100 in that time, according to the Raiders' projection. During cross-examination, Raiders attorney Joe Alioto attacked Gilbert's analysis, getting the expert to say he did not know the source of some of the projections he had used. "You didn't verify them, did you?" Alioto asked. "No," Gilbert replied. Gilbert also said he did not use actual attendance and revenue figures from Oakland in the past five years and that he did not factor in documentation that a team gets higher ticket prices when it moves into a new stadium. Alioto introduced a document showing that Oakland's ranking regarding revenue among all NFL teams fell from sixth place to 28th place between 1989 and 1999. During the afternoon session, Thomas Spock testified that in 1993, when he became the NFL's chief financial officer, "there was a great sentiment that the league needed a lot of news stadiums." Spock, currently the NFL's executive vice president of new media and enterprises, said there were many teams, including the Raiders, playing in old stadiums with limited capacity. After examining documents, he estimated that the league contributed at least $53 million to help teams in Atlanta, Miami and Buffalo build or renovate stadiums by waiving the NFL's share of club seat moneys. Davis insists the right to the Los Angeles football market still belongs to him. If the NFL wants Los Angeles back, he says, it will have to pay him more than $1 billion for the privilege and for the revenue he says he lost. Saying the NFL left him no choice, Davis accepted a deal in Oakland that provided $63 million in upfront payments, loans and other benefits. Since then, however, the Raiders have accused Oakland and others of not living up to their end of the deal.
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