The Player’s Agent

Growing up in Upper Saddle River, David Pepe was fascinated with U.S. presidential history, reading scores of biographies and having the dawning recognition that many of the men he admired were lawyers. At the same time, Pepe’s father, Phil, was the longtime Yankees beat writer for the New York Daily News, providing an inside glimpse at professional athletics not afforded to most children. So a question began percolating in the boy’s mind: How would he merge these two passions?

“First I wanted to be general manager of the Yankees, but I quickly realized there’s only 30 of those jobs in the world and I had no scouting background,” recalls Pepe, a partner at Wilentz, Goldman & Spitzer in Woodbridge Township, and a managing agent with its subsidiary Pro Agents, which boasts a client roster of more than 30 professional athletes.

“But I knew I loved sports. I just loved the competition.”

In high school, Pepe played football and wrestled, then wrestled for two years at Rutgers University before moving on to Seton Hall University School of Law. “I thought a law degree would somehow provide me an entry into the sports world,” he says.

He was right. For two summers he worked as a legal intern for the Yankees, where his tasks included reviewing contracts for licensing agreements between the ball club and Hollywood producers.

“I never lost sight of the fact that I got to go to Yankee Stadium every day and then got to stay for the games,” says Pepe, who also began picking the brains of Yankee scouts and learning the fine art of player evaluation.

After law school, Pepe got hired as an associate at Morristown’s Ribis, Graham & Curtin, whose client list included Tommy Hilfiger and Donald Trump. Partner Tom Curtin had an abiding passion for sports.
“Tom Curtin was a wonderful man and a really good lawyer, and he had a genuine belief that people should pursue their happiness and meld their passions with their practice,” says Pepe.

An opportunity came when Pepe met a man who wanted to move a Minor League Baseball team to Sussex County. Pepe took him on as a client and, with the support of Curtin and his firm, got a stadium built for the newly minted New Jersey Cardinals in 1994.

Pepe found himself surrounded by young baseball players who needed help understanding or negotiating their contracts. Shortly thereafter, Pro Agents, Inc. was born.

To build a client list, Pepe attended scores of baseball games alongside professional scouts who taught him how to evaluate talent, which was much harder than he originally thought.

“I remember watching a Minor League pitcher for the Vermont Mariners. He threw seven innings of three-hit ball and shut down the Reading Phillies. I went back to the Yankees’ scouting office and told them I saw this really good pitcher,” recalls Pepe. “Well, the scout pulled out the pitcher’s report, which included a laundry list of reasons why this guy would never play in the majors and why he wasn’t a prospect. A light bulb went off for me. Just because a guy is great one day doesn’t mean he’s always great.”

With time, Pepe refined his skills for not only player evaluation but also contract negotiations, and wound up representing Minnesota Twins pitcher Joe Nathan.

It was 2008 and Nathan’s career was at its peak. Drafted in the sixth round as a shortstop, Nathan eventually became a pitcher. He was a setup man during his fourth year with the Giants before getting traded to the Twins, where he thrived as an exceptional closer. By 2007, his contract was set to expire and the Twins wanted to negotiate an extension.

Nathan and Pepe were willing to talk, but only if the Twins tore up his remaining one-year, $6 million contract and started from scratch. That’s when things got grueling.

“It was a difficult and labor-intensive negotiation over months and months. Because look, they had him. They could have told me to pound sand, but I kept saying, ‘Guys, if we’re not talking about what our client wants, then we’re not talking,’” says Pepe. “Negotiating is all about comparative numbers, understanding the market and the value of similar players so you can say, ‘We want X, and here’s why.’ The more you know, the better.”

Pepe eventually got the Twins to re-sign Nathan to a four-year, $47 million contract through 2011, including a $12.5 million club option for 2012 with a $2 million buyout. At the time it was the largest-ever guaranteed contract for a Major League closer.

“I took a lot of pride in that,” says Pepe, 60, who still takes on the occasional personal injury case in addition to his work as a player agent. “It made me think back to a time in law school when a sports agent came to speak to our sports law class. He said, ‘This business is easy. All you need is a newspaper, a client and a cellphone.’ But something about that struck me as total nonsense. This business is hard work!”
And it’s evolved in some challenging ways. The saturation of agents means that competition for clients—and the occasional poaching of clients—is fierce. Nonetheless, Pepe’s firm has remained intentionally modest in size, allowing him and his two partners to develop closer relationships with the players they represent.

“We’re not a monster agency. We are a closely knit group. Our clients know each other and they’re friendly. They know when they call, I’ll pick up the phone.”