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T EI stand corrected on the Peace Accord between leagues.
Here is lengthy excerpt from Rob Neyer's article for espn.com fro July 16...
In 1902, the American and National Leagues were at war with each other. Following the 1899 season, the National League had contracted -- that's Bud Selig's word; I don't know what they called it at the time -- from 12 teams to eight, with Baltimore, Louisville, Washington, and Cleveland losing their franchises.
A number of men saw this as a business opportunity, and in 1901 the American League, under the leadership of Ban Johnson, entered into direct competition with the National League. The new circuit featured teams in three of those four ex-National League cities (with Louisville the exception), plus Milwaukee and Detroit, and also competed directly with the NL by placing new clubs in Boston, Chicago and Philadelphia.
The old Baltimore Orioles had dominated the National League in the mid-1890s, and one of the Orioles' best players was a combative third baseman named John McGraw. With the Orioles contracted out of existence in 1900, McGraw joined the St. Louis club. But he spent just one year there. In 1901, the American League lured McGraw back to Baltimore as third baseman and manager of the new franchise.
So far, so good.
However, Ban Johnson was determined to run a league largely absent of rowdyism and umpire-bullying. And as it happened, John McGraw had been, in his National League days, the acknowledged master of rowdyism and umpire-bullying. So it was probably inevitable that McGraw and Johnson would eventually butt heads.
They did coexist with some degree of peace in 1901, though. After the season, Johnson and McGraw even kept in touch about various league-related subjects, including Johnson's intention to relocate an existing franchise to New York in the not-distant future. The Orioles, who had ranked sixth in attendance in 1901, were an obvious candidate, and if they did move to New York, it was assumed (by McGraw, at least) that McGraw would continue as manager in Gotham.
But McGraw was ejected from the Orioles' first game of the 1902 season, for verbally abusing the umpire. On the first day of May, McGraw was ejected again, and this time Johnson suspended him for five days. McGraw began to entertain thoughts of deserting Johnson's American League (if he hadn't already, which evidence suggests he had), and hooking up with the National League's New York Giants.
There was, in those days, little to stop a player from simply quitting one league and joining the other; the two leagues wouldn't reach a peace agreement until 1903. However, McGraw and Giants owner Andrew Freedman weren't satisfied with something so mundane. As Charles Alexander writes in his biography of McGraw, "Instead they conceived a complicated plot to destroy the Baltimore franchise and cripple the American League."
McGraw, who had suffered a serious spike wound weeks earlier, returned to the Orioles' lineup on June 28. Throughout the game, McGraw and team captain Joe Kelley heaped abuse on umpire Tom Connally, and in the eighth inning Connally finally ordered both of them from the field and forfeited the game to Boston. Johnson immediately suspended McGraw and Kelley for an indefinite period of time (as they undoubtedly knew he would).
On July 8, the Orioles released McGraw and paid him $6,500 for his stock holdings. That evening, McGraw told reporters that he would shortly take up his new position as manager of the New York Giants.
A week later, the situation became serious, as Freedman went for the jugular. On July 16, an agent of Freedman's named Joseph C. France bought a majority of the Orioles stock from a sympathetic shareholder (i.e. co-conspirator), thus making Freedman, in effect, the owner of both the Giants and the Orioles (and you think baseball's screwed up today).
He could take whichever players he wanted for the Giants, dispense others to his friends in the National League, and, as a happy side effect, turn one of the American League's eight franchises into a complete joke. Freedman immediately devastated the Orioles' roster, releasing six players. Four of them signed with his (and McGraw's) Giants, and two of them became Reds (Cincinnati's owner headed the National League). The Orioles had been carrying only 14 players on the roster, so all these machinations left the club with somewhere between five and seven players (accounts differ).
And that's where Freedman erred.
Without enough players to field a team, Baltimore had to forfeit its July 17 game against St. Louis, and that gave Ban Johnson his chance. Operating under the authority of the American League's constitution, Johnson declared the franchise vacant, took control for the League, and quickly stocked the roster with players donated from other League teams. The Orioles went into the tank -- after a decent start, they finished at 50-88 -- but disaster had been averted, and the franchise did move to New York for the 1903 season. That New York franchise would, of course, eventually become the most successful franchise in American sports (though it took them 20 years to surpass McGraw's Giants).
How might things have been different if McGraw and Freedman hadn't staged their temporary coup? Three of Baltimore's lost players became great, at least for a time, and could have made a huge difference in the fortunes of the New York Americans...
Sources for this article include Charles C. Alexander's John McGraw (Viking, 1988), Reach's Official Baseball Guide, 1903 and Fred Lieb's The Baltimore Orioles (G.P. Putnam's Sons, 1955).