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'Personal service' contracts for athletes gain popularity

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A growing contract trend among star athletes helped strip Albert Pujols of the birds on the bat for the next two decades.

The Los Angeles Angels locked down the former Cardinals slugger for 20 years by using a creative but little known instrument known as the "personal services" contract. The contracts are most commonly dangled before star athletes, but are also perks now offered to well-known business figures and education leaders as a form of brand management.

The 10-year, $254 million Pujols contract is said to include a 10-year personal services provision that begins when he retires and precludes him from reconnecting with his former franchise. That will keep his image away from Cardinals red and Busch Stadium, where he played 11 seasons and cemented his name as a baseball great. The deal allows the Angels to preserve its hefty investment by keeping Pujols in the fold as they attempt to define their baseball brand.

"This is a whole change in the industry," said David Carter, executive director of the Sports Business Institute at the University of Southern California. "Creative deal-making is more of the order of the day. These sorts of things sweeten the totality of the offer."

The specific contract language hasn't been made public, but most other service contracts secure a player's presence at organization events and keeps their image within the brand. In addition, Carter said, they sometimes give the player a portion of merchandise sales connected with their name.

"These contracts are now strategic alliances and partnerships," Carter said. "This is a business. Pujols is part of the Angels family after he leaves the playing field."

Pujols and his wife, Deidre, have publicly said the Cardinals weren't as enthusiastic about including a personal services contract. William Dewitt III, the Cardinals president, didn't return calls seeking comment.

In 2006, a 10-year, $2 million personal services contract between Ozzie Smith and the Cardinals expired. Smith's duties basically consisted of showing up for opening day festivities and before playoff and World Series games. Otherwise, he remained largely out of sight after a dispute with former manager Tony La Russa.

Experts say personal service contracts operate in the same way as consulting contracts.

"These are just labels that have no formal meaning," said Royce Barondes, an associate law professor at the University of Missouri. "It's about the language, not the label."

Personal service contracts tend to involve requiring a tangible action, such as appearing at a baseball game. Consulting contracts are more about advice and expertise. In many cases, contracts can require both.

In recent years, the East St. Louis School District paid $25,000 to Olympic gold medalist Jackie Joyner-Kersee to organize a children's wellness program and appear at events.

Such agreements are also creeping into civic institutions. Peter Raven, the acclaimed former director of the Missouri Botanical Garden, was reported to be paid $277,890 for services after he retired in 2010. Raven took on the title of "president emeritus," where he gave advice and assisted in fundraising.

In 2008, August Busch IV was given a lucrative consulting deal after Anheuser-Busch was sold to Belgian brewer InBev. The deal had aspirations to go beyond simple consulting. The new company, Anheuser-Busch InBev, indicated the contract would make Busch its public ambassador. That never happened.

Busch's contract, which ends in 2013, pays him about $120,000 a month. It also gives Busch several perks, including a personal security detail and free access to events sponsored by A-B. He also signed a mutual "non-disparagement" covenant, limiting what he could say about InBev. The deal was similar to the Pujols arrangement. Busch was forbidden from working with other brewers.

Whether Pujols will return to Busch Stadium after his 20-year contract ends is anyone's guess.

In 1993, the Texas Rangers signed Nolan Ryan to a 10-year personal services contract that used him primarily for promotional and ceremonial roles. Ryan played there for only five seasons.

After that contract ended, Ryan took on a similar agreement with the Houston Astros, where he had played for nine seasons. It didn't last for long. Ryan has returned to the Texas Rangers organization, where he is now team president and part owner.

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