This rule officially takes the Yankees out of the running for any other type A or B free agents. Yes Yankee fans, that means the pipe dreams of signing Manny Ramirez and Ben Sheets are over.
"The most commonly held misconception of this offseason is that the Yankees could have signed pitcher Ben Sheets or could still sign left-fielder Manny Ramirez if only there were a few million dollars remaining in the Steinbrenner bank.
Both assumptions are incorrect. According to the Basic Agreement, and confirmed by a top Major League Baseball official, once the Yankees signed CC Sabathia, A.J. Burnett and Mark Teixeira, they had signed their quota of Type A or Type B free agents under the collectively bargained rules established by management and the Players Association." mlb.com
I guess this rule prevents the Yankees from building a super-duper all star team with their abundance of resources. I severely doubt the Yankees would have seriously pursued either guy, but hey, it's the principle that counts.
Fun side note: maybe this rule is why the Yankees continued to pursue Andy Pettitte even after he rejected their initial offer. Unless the Yankees were willing to settle with Tim Redding or Odalis Perez, then Pettitte was by far their best option. I'm guessing if the Yankees missed out on Pettitte for whatever reason then they simply would have slid Phil Hughes into the 5th spot in the rotation instead of signing a scrub. It all makes sense now.
Update (12:57 PM): Apparently this report is untrue, which is amazing to me considering that MLB labor relations guru Rob Manfred was heavily quoted in the article. Either the reporter did some shotty reporting or Manfred simply does not know the rules.
The great Peter Abraham notes that the Yankees believe that they can sign up to eight type A free agents. The Manny Ramirez to the Yankees rumors will have to live for at least another day.