The Yankees and Steinbrenner are screwed. They can't void the contract..not because they're afraid of losing in arbitration..and I think they might win..but rather because they don't know what's up with Sheffield..
There's several big differences between Sheffield and Giambi. First is that while both admitted to using steroids, Sheffield said it was inadvertent from to using a topical cream, while Giambi admits he knows what he was taking, and was shooting himself up in the stomach and butt. Second is that Giambi even took a female fertility drug, which may have exacerbated his tumor. Third is the performance level -- the year Sheff admitted to taking steroids turned out to be the worst of his career. And Sheffield played 150+ games this year and was second in the MVP voting. Giambi has gone downhill fast, spent most of the year on the DL, and is not the player the Yankees thought they signed. Plus, the fertility drug he took may have exacerbated his tumor.
What I think and hope will happen, if they can't void the contract, is that the Yankees work out a settlement with Giambi, where they pay him something in exchange for the contract being terminated.