To make room on the 40-man roster, the Indians designated outfielder Jerry Sands for assignment.
Otero was claimed off waivers by the Phillies on Nov. 3. He went 2-4 with a 6.75 ERA in 41 appearances for Oakland last season.
Joey Nowak is a reporter for MLB.com. Follow him on Twitter at @joeynowak. This story was not subject to the approval of Major League Baseball or its clubs.
