The Dodgers' $102M bet on Bauer cost them $37.5M — then they released him

On 11 February 2021 the Los Angeles Dodgers signed free-agent pitcher Trevor Bauer to a three-year, $102m contract, with a $10m signing bonus and opt-outs after each of the first two seasons.

On 2 July 2021, five months into the deal, MLB placed Bauer on paid administrative leave while its investigation ran alongside a police investigation in Pasadena. On 8 February 2022 the Los Angeles County District Attorney's office announced he would face no criminal charges, saying a five-month review found it could not 'prove the relevant charges beyond a reasonable doubt'.

On 29 April 2022 MLB suspended him for 324 games — two full seasons — and he appealed, the first player to contest a punishment under that policy. He could not play while the appeal ran. On 22 December 2022 a neutral arbitrator reduced the suspension to 194 games — 144 credited as served and 50 to serve in 2023 — with total lost salary of about $37.5m. Six days later the Dodgers designated him for assignment, and on 12 January 2023, with no trade found, they released him, with $22.5m of his 2023 salary still owed.

The Dodgers released him with $22.5M owed after an arbitrator cut the ban to 194 games, but no club claimed him, so the market priced the risk higher than the club did.

The structure of the bet protected the player, not the club: the reputation risk landed five months in, and the salary stayed on the books through two seasons of suspension.

Suspension without release was the costliest middle ground: the club paid for the 2022 season he did not play, watched an arbitrator halve the ban, and still owed $22.5m when the release came.

The arbitrator's cut did not restore his market value: no club claimed him in the trade window, so the Dodgers ate the remainder — the market priced the risk higher than the club did.

A record contract prices talent, not reputation: five months in, the club was paying a suspended pitcher, and no structure — opt-outs, arbitration, a trade window — got the $102m back.

Bauer did not throw another pitch for the Dodgers. The release left $22.5m on the books for a 2023 season he never played in Los Angeles. The club's statement said two reviews had concluded the suspension was warranted.