Use economic terms covered in class (where appropriate) to answer the following questions, in less than 100 words (total) (we learned externalities and Coase's Theorem in class)
WSJ: I Paid for That Rooftop Seat (4/28/2013)
1. Why are people like John Deppert able to benefit from the Cubs' games?
2. Does the current arrangement between the building owners and the Cubs result in the most efficient outcome?12/4/13
Randy J. Maniloff: I Paid for That Rooftop Seat - WSJ.com
I Paid for That Rooftop Seat
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A potential legal spat over the rooftop views of Wrigley Field would be another of the sport's clashes over property rights.
April 28, 2013 5:38 p.m. ET
Baseball is the national pastime, but litigation is a close second. So it is no surprise that
the recently announced $500 million renovation of Chicago's Wrigley Field has been
accompanied by talk of a possible lawsuit. Wrigley is famous for its "friendly confines," and
that is what the lawsuit would concern: One party wants to change those confines, and the
other considers that an unfriendly move—because it would block a view of the field.
Since the stadium's construction in 1914, spectators have been able to see its field from
the rooftops of buildings behind the outfield bleachers. For the owners of those buildings,
this is big business. Each game, more than 1,500 people pay in the $70$200 range to
watch the Cubs from such an unusual vantage point.
But the impending renovation of Wrigley Field will reportedly include the construction of a
Jumbotron in the outfield—a 6,000squarefoot video screen that would obscure the view
from some rooftops across the street. That is where the potential lawsuit comes in.
This isn't the first time that rooftop owners and the Cubs organization have had to address
their coexistence. In 2002, the Cubs sued the rooftop owners to bring an end to their "free
ride," as Andy MacPhail, then president and CEO of the Cubs, put it. Two years later, the
parties reached a 20year agreement that has the Cubs collecting 17% of the rooftop
owners' revenue from selling views of the friendly confines.
Now the rooftop owners are threatening to use "any and all means necessary"—
translation: a lawsuit—to demonstrate that their contract entitles them to 11 more years of
Is all this yet another sign that baseball is losing its innocence to the insatiable appetite for
money? Not quite. Of course the sport has changed since the days when men wore suits
and hats to the ballpark, but the legal storm around Wrigley isn't such a novel
Consider the story of John Deppert Jr. , who once owned a building next to a ballpark
where a professional baseball team played. The team used fences and screens to prevent
people from watching the action if they hadn't paid to enter.
Deppert had an idea. He built stands on the roof of his building tall enough to enable fans
to look over the park's fences and watch the games. He charged admission to his roof at a
price far cheaper then the team's tickets, and he sold refreshments to his spectators, who
numbered 25 to 100 per game.
But Deppert didn't own a building in Chicago. He owned one in Detroit. And the team that
played on the field across the street was the Detroit Baseball Club, one of eight in the
National Base Ball League. The year was 1885.
The Detroit Baseball Club was not pleased with Deppert and demanded that he stop
selling access to stadium views. He refused. The late 19th century might have been a
gentler time, but soon the baseball club lawyered up, suing for an injunction against
Deppert's operation. The club lost at trial but appealed to the Supreme Court of Michigan.
Each side had some points in its favor. The club had expenses of more than $3,000 per
month, and it relied largely on ticket sales to defray costs. By building a fence around the
stadium, the team was only protecting its rightful use of the property. Deppert, for his part,
was simply using his property without breaking any laws. And the board of building
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