McCourt just prolonging the inevitable
Philadelphia, PA (Sports Network) -
In a last ditch effort to maintain control of his team, Los Angeles Dodgers' owner Frank McCourt has filed for bankruptcy.
Of course the filing comes just three days before his team's payroll was due - a payroll that the club would not have been able to meet, which basically would have allowed the Dodgers to be put up for sale by Major League Baseball.
The Chapter 11 filing, though, permits the Dodgers to use $150 million for daily operations as part of a "debtor-in-possession" loan, and buys time for McCourt to seek a media deal and ensure the team's long-term financial stability, the Dodgers said in a news release.
"There will be no disruption to the Dodgers day-to-day business, the baseball team, or to the Dodger fans," the statement said.
Let's be clear. This move is just the latest Hail Mary pass from Team McCourt.
This move is just the latest Hail Mary pass from Team McCourt.
It was just last week that MLB commissioner Bud Selig rejected a proposed deal with FOX that would have paved the way for McCourt to resolve numerous financial issues, including the divorce from his wife Jamie. It was a reported $3 billion transaction that would have given Frank McCourt $385 million up front, which he would need to help fulfill the team's payroll obligations come Thursday.
I said a few months ago that when Selig allowed MLB to assume all aspects of the business and day-to-day operation of the Dodgers it was just the first step in him forcing a sale of the team.
His moves since have echoed that same sentiment.
"The Dodgers have delivered time and again since I became owner, and that's been good for baseball," Frank McCourt stated Monday. "We turned the team around financially after years of annual losses before I purchased the team. We invested $150 million in the stadium. We've had excellent on-field performance, including playoff appearances four times in seven years. And we brought the commissioner a media rights deal that would have solved the cash flow challenge I presented to him a year ago, when his leadership team called us a 'model franchise.' Yet he's turned his back on the Dodgers, treated us differently, and forced us to the point we find ourselves in today. I simply cannot allow the commissioner to knowingly and intentionally be in a position to expose the Dodgers to financial risk any longer. It is my hope that the Chapter 11 process will create a fair and constructive environment to get done what we couldn't achieve with the commissioner directly."
Of course McCourt is hoping that the FOX decision be overturned. Truth be told, what I know about bankruptcy law could fit into a thimble. But of my limited knowledge I am pretty sure the bankruptcy court will look at all issues in this case, including the FOX TV deal, and consider the best interests of the Dodgers' creditors, and not the Dodgers themselves.
In rejecting the FOX deal last week, Selig cited the transaction as being "structured to facilitate the further diversion of Dodgers assets for the personal needs of Mr. McCourt. Given the magnitude of the transaction, such a diversion of assets would have the effect of mortgaging the future of the franchise to the long-term detriment of the club and its fans."
Forget the fact that MLB will argue that this clearly isn't the best deal, Who's to say that FOX even wants to get back in on the Dodgers' talks? I mean what is in the best long term interests of FOX, being in bed with the Dodgers, or upsetting MLB?
So, basically where we are is here ... the same place we were a few months ago. Chaos in Dodgers land. It doesn't help either that on the field, things aren't much better, as the Dodgers sit nine games under .500 and just a game out of last place in the National League West.
We knew bankruptcy was as inevitable as McCourt having to sell the team. Step one is complete. Now the next step seems to be coming, perhaps delayed, but still coming.
The courts could order a sale of the team. The Texas Rangers filed for Chapter 11 in their mess last year and were auctioned off. The Dodgers could be headed down that same path.
The bottom line is this. Frank McCourt is not going to be running this team much longer. Everyone, except him, however, apparently, knows that.
Anyone have Mark Cuban's phone number?