PWCC Statement on Recent Card Trimming Concerns

[darkhorse9]

I think one issue here (legally) is that there is no legal definition of a baseball card grade. It's an opinion.

If I trim a card and say it's now mint, then it's mint. No law has been broken by being a real crappy person and doing that. Now if the buyer asks if it's been trimmed I have to disclose that.

A TPG exists only on reputation. They can't be legally held liable for their grading standards or procedures.

[CuriousGeorge]

CLCT stock down over 5% today. Short it while you can!

[vintagetoppsguy]

Originally Posted by darkhorse9

I think one issue here (legally) is that there is no legal definition of a baseball card grade. It's an opinion.

If I trim a card and say it's now mint, then it's mint. No law has been broken by being a real crappy person and doing that. Now if the buyer asks if it's been trimmed I have to disclose that.

A TPG exists only on reputation. They can't be legally held liable for their grading standards or procedures.

Grading is a 2 step process - authentication then grading. Grading is subjective. Authentication is not. It's either altered or it isn't. There is no gray area there. And if a TPG assigns a numeric grade to a card (instead of an AUTHENTIC), they're basically stating that the card has not been altered.

[judsonhamlin]

Selling "adulterated" or "mislabeled" commodities is a criminal offense under MPC section 224.7, with those terms defined by established commercial usage. While the penalties may not be significant (in NJS 2C:21-7, a DP offense), it would expose those sellers to further criminal liability as to the corporate officials (in NJ, NJS 2C:21-9c) and Commercial Breach of Duty (MPC 224.8) criminalizing their accepting a benefit for themselves if they are in the business of making a disinterested selection/appraisal/criticism of a commodity.

[vintagetoppsguy]

Originally Posted by judsonhamlin

Selling "adulterated" or "mislabeled" commodities is a criminal offense under MPC section 224.7, with those terms defined by established commercial usage. While the penalties may not be significant (in NJS 2C:21-7, a DP offense), it would expose those sellers to further criminal liability as to the corporate officials (in NJ, NJS 2C:21-9c) and Commercial Breach of Duty (MPC 224.8) criminalizing their accepting a benefit for themselves if they are in the business of making a disinterested selection/appraisal/criticism of a commodity.

So who do you go after criminally? The one selling it (Brent) or the one that labeled it (PSA)? Or both?

[70ToppsFanatic]

The one(s) who had provable INTENT to sell something that they knew to be altered as unaltered.

At least that’s what you do criminally.

[Aquarian Sports Cards]

Well as far as I know, and Peter correct me if I'm wrong, criminal fraud requires intent to defraud. You can't commit criminal fraud by accident. I don't even think you can commit it through incompetence. Civil liability is still on the table but unless there's a smoking gun that says PSA was complicit with the doctors there's nothing criminal there. Also you can't file criminal charges against a company (nice work if you can get it, they have all the rights of a person but...) you hav to have a person committing the criminal act.

Any corrections Peter?

[Peter_Spaeth]

Originally Posted by Aquarian Sports Cards

Well as far as I know, and Peter correct me if I'm wrong, criminal fraud requires intent to defraud. You can't commit criminal fraud by accident. I don't even think you can commit it through incompetence. Civil liability is still on the table but unless there's a smoking gun that says PSA was complicit with the doctors there's nothing criminal there. Also you can't file criminal charges against a company (nice work if you can get it, they have all the rights of a person but...) you hav to have a person committing the criminal act.

Any corrections Peter?

Crimes require intent. Intent does not require a smoking gun it can be inferred from circumstantial evidence although the strength of that evidence may influence a prosecutor's decision whether to proceed. A corporation can be criminally liable if its employee/agent committed a crime within the scope of his employment/agency and the act benefits the corporation.

[marcdelpercio]

I will preface to say I am not a lawyer, though I do hang around some pretty good ones quite often.

The best analogy I can come up with is rolling back the odometer on a car, which is a felony. Obviously, the car is still authentic and in many ways materially the same. However, it has been altered in a way to make it appear to be in a much more pristine condition and have less wear than is actually the case. When buying a vehicle, the purchaser must receive a written declaration of the accurate mileage.

Imagine a scenario where a person purchases a vehicle with 100k miles, rolls back the odometer to 10k, and details the rest of the car to make it appear in significantly better condition. Then this person takes said vehicle to a "professional" mechanic or vehicle inspector who certifies that it does, in fact, only have 10k miles on it and is otherwise unaltered. Then this vehicle is sold for multiples of what it otherwise would be, based on the representation of mileage and condition.

Is this not fundamentally what is happening here? And, if not, please explain your reasoning.

[Peter_Spaeth]

Same concept IMO and well reasoned. Only difference is that here it's done over and over and over and over again and involves use of the mail and wires.

[Orioles1954]

Originally Posted by marcdelpercio

I will preface to say I am not a lawyer, though I do hang around some pretty good ones quite often.

The best analogy I can come up with is rolling back the odometer on a car, which is a felony. Obviously, the car is still authentic and in many ways materially the same. However, it has been altered in a way to make it appear to be in a much more pristine condition and have less wear than is actually the case. When buying a vehicle, the purchaser must receive a written declaration of the accurate mileage.

Imagine a scenario where a person purchases a vehicle with 100k miles, rolls back the odometer to 10k, and details the rest of the car to make it appear in significantly better condition. Then this person takes said vehicle to a "professional" mechanic or vehicle inspector who certifies that it does, in fact, only have 10k miles on it and is otherwise unaltered. Then this vehicle is sold for multiples of what it otherwise would be, based on the representation of mileage and condition.

Is this not fundamentally what is happening here? And, if not, please explain your reasoning.

I actually know a lot about odometer tampering. When I was a 22 year-old college student in 1997 I was the youngest juror on a federal case where 11 defendants were on trial. Think sports cards can be sleazy?! Through this ring it was estimated that 60-70% of all used cars in Baltimore had been altered. The amount of effort it took to cover their tracks was mind-boggling and several office workers had been paid off to facilitate the scheme. It took 3 months and was one heck of an interesting summer job that I hadn't expected. The comparison to our industry is a very, very good one.

[topcat61]

Originally Posted by darkhorse9

I think one issue here (legally) is that there is no legal definition of a baseball card grade. It's an opinion.

If I trim a card and say it's now mint, then it's mint. No law has been broken by being a real crappy person and doing that. Now if the buyer asks if it's been trimmed I have to disclose that.

A TPG exists only on reputation. They can't be legally held liable for their grading standards or procedures.

It was only a few years ago that Doug Allen and Bill Mastro went to prison for doing "allegedly" what collectors and dealers here are saying PWCC is doing. Short term memories being what they are I suppose, here's what Ryan Cracknell reported in Beckett Magazine -

"So what does a history of fraud in high-profile sports memorabilia auctions get you? For Bill Mastro, it’s 20 months in federal prison.

That was the sentence handed down by U.S. District Judge Ronald Guzman on Thursday. It could have been as much as five years but Guzman and prosecutors agreed on the lighter sentence based on Mastro helping authorities following his 2012 indictment.

In a plea agreement, Mastro admitted to driving up prices through shill bidding between 2002 and 2009. He and his associates would bid up auctions to drive prices higher.

“The long-running and systematic nature of the scheme undermines confidence in the auction house and sports-memorabilia industries, and calls into question the true value of merchandise,” said Assistant U.S. Attorney Steven J. Dollear. “The defendant’s ultimate goal was to beat the competition and garner more business for his auction house, and, in the end, more money for himself.”

After decades of whispers and suspicions, Mastro finally admitted to trimming the famed T206 Honus Wagner that would go on to be graded PSA 8 and sold to Wayne Gretzky and Bruce McNall. When Mastro sold the card in 1987, he didn’t disclose the fact that it had been altered. He was also involved in subsequent sales of the card in 1991 (to Gretzky and McNall) and 2000. Again, he didn’t given any hint about what he’d done to the card".