- In Ohtani's deal, the majority of the contract will be paid out after ten years
- Baseball fans were upset with the structure and that this was allowed to happen
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The fallout from the Shohei Ohtani deal could lead to drastic changes for the league after the Los Angeles Dodgers agreed to a contract with the superstar that features an interesting payout structure.
The Dodgers officially announced late Monday night that they had signed Ohtani as a free agent — but key details of his 10-year, $700 million contract were revealed before it was officially announced.
According to multiple reports, Ohtani will defer $680 million of his contract to receive the payout when it expires – meaning he will receive an average annual salary of just $2 million per year.
After that, he will receive $68 million every year between 2034 and 2043.
This accomplishes a few things. For one thing, the Dodgers don't have to pay the luxury tax on Ohtani's contract while he plays for them.
Shohei Ohtani's signing with the Los Angeles Dodgers is causing a lot of excitement among baseball fans
Ohtani will defer $680 million of the $700 million he is owed – meaning he will receive about $2 million per year
Another reason the Dodgers agreed to this is so they can continue to build around Ohtani while deferring his otherwise massive payments.
Ohtani also won't have to pay California taxes on his income if he moves elsewhere after his contract expires.
Needless to say, this is a very strategic move by the Dodgers — and a very bold deal by Ohtani — that angers fans of the sport.
Some are calling it a deal that will destroy baseball as we know it. Others praised the Dodgers for their cunning.
“Allowing this Ohtani contract will be very, very bad for baseball,” one Twitter user wrote. “There were already problems in small and medium-sized markets and this is only going to make it worse.” “Baseball keeps killing itself and it makes me sad.”
Another user said: “Embarrassingly bad for the MLB.” Unbelievable for Ohtani and his agent. It's downright ridiculous that the MLB let this go. This is a league-killer deal. The inequality between franchises will only increase. So bad for baseball.'
“Ohtani killing the sport he was praised for saving is poetry,” another post said.
Another post said in part that these deals “set precedents,” adding, “Agents and MLBPA should be 100%.” [percent] Be concerned that this will become standard contract terms. “It destroys the value that players get and not every player is as lucky with Ohtani not on the field.”
Fans on social media were outraged by the structure of the deal's payment deferrals
One post praised the Dodgers: “Everyone has gone crazy over the Shohei Ohtani deal, but the reality is that LA just implemented a cheat code for every other MLB team that wants to keep their star player.” Shameful for every team for not exploiting this loophole.”
MLB officials and the MLBPA will not be able to challenge the deal Ohtani agreed to, thanks in part to the collective bargaining agreement.
As highlighted by ESPN Jeff PassanArticle XVI of the CBA states: “There are no limitations on the amount of deferred compensation or the percentage of total compensation attributable to deferred compensation.”
Baseball fans condemn Shohei Ohtani's “league-killer deal” after it was revealed he will defer $680 million of his eye-popping $700 million contract… while rival fans decry the “just “Ridiculous” decision by MLB to give in to the green light