MLB, Players’ Union Win Contempt Ruling Against Ex-Pitcher

Feb. 4, 2021, 10:30 PM

A former minor league baseball pitcher was held in contempt Thursday for failing to pay an award of fees that Major League Baseball and the players’ association spent defending his claims that they improperly banned his company’s elk antler health supplements.

The U.S. District Court for the Northern District of California also ruled that Neiman Nix’s counsel, Lance Reich, is jointly liable for the fees.

Judge William Alsup in October held that Nix and his company, DNS Sports Performance Lab Inc., engaged in a campaign of harassment by pursuing the league in a series of suits over nine years filed in federal and state courts.

As a result, Alsup ordered Nix to pay the players’ association $104,000 and the league $33,000 in attorneys’ fees to be paid by Nov. 20, which he failed to do.

Though Nix claimed he lacks the money to pay the fees, the court said, his poverty “is unquestionably self-induced,” Alsup said.

Nix used his counsel, “including attorney Reich, as a depository for settlement funds when they anticipated an adverse award of fees here,” the judge said.

And Nix testified that he has paid attorney Reich “between one hundred to three hundred fifty thousand dollars so far,” Alsup said.

“Put plainly, attorney Reich took potentially hundreds of thousands in legal fees from a man living in his truck and on charity to prosecute a case which counsel should have known would result in a significant adverse fees award,” the court said.

It is therefore appropriate to extend joint liability for the fee award to Reich, he said.

The ruling stems from a March 2018 suit alleging the defendants engaged in unfair business practices. Nix voluntarily dismissed the claims in August 2020.

But the “tale begins” in October 2012, when Nix sent a “shakedown letter” to the league accusing it of defamation and demanding $6 million, the court said in its October ruling.

In the following years, Nix filed suits in Florida, New York, and California, the court said.

Nix would repeatedly dismiss the suits, and then file a slightly new cause of action challenging the ban in a different venue, the court said.

But the court in October declined to award sanctions against Reich, noting that it was his first appearance before the court.

Kobre & Kim LLP represents the league. Altshuler Berzon LLP represents the players’ association. Reich is with Holley Driggs. Nix was also represented by Bullivant Houser Bailey PC.

The case is DNA Sports Performance Lab Inc. v. Major League Baseball, N.D. Cal., No. 20-cv-00546, 2/4/21.

To contact the reporter on this story: Peter Hayes in Washington at PHayes@bloomberglaw.com

To contact the editor responsible for this story: Rob Tricchinelli at rtricchinelli@bloomberglaw.com

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