Monday, June 20, 2011

Rejected! Bud Selig says no to Frank McCourt. No Fox TV contract (updated)

Bill Shaikin of the LA Times is reporting that Bud Selig has rejected the proposed television contract between the Dodgers and Fox Sports.

The reasoning was laid out explicitly in the Commissioner's statement:
It is my conclusion that this proposed transaction with FOX would not be in the best interests of the Los Angeles Dodgers franchise, the game of Baseball and the millions of loyal fans of this historic club.
The $385 million up front would have likely rescued McCourt from his current financial hole and secured his role as owner of the Dodgers. The Commissioner's Office would have preferred all of the up front money to be put back into the team, but "last week's divorce settlement earmarked up to $173.5 million for the McCourts and their attorneys."

Selig's decision now invalidates the divorce settlement and opens the door for Frank to sell the team or sue Major League Baseball.

Read full story here.

Update 1: Lawsuit looms
Frank McCourt's lawyer just released a statement in response to MLB's rejection of Dodgers/FOX TV deal. This excerpt is pretty laughable:
Commissioner Selig’s letter of rejection is not only a disappointment, but worse, is potentially destructive to the Los Angeles Dodgers, and Major League Baseball.  Accordingly, we plan to explore vigorously our options and remedies with respect to Commissioner Selig’s rejection of the proposed FOX transaction and our commitment to protect the long-term best interests of the Los Angeles Dodgers.
I like a man that doesn't shy away from hyperbole.

Read full statement here.

Update 2 This is gonna get ugly
One of the few cool people associated with ESPN, Molly Knight was on the air today with Steve Mason and John Ireland. Knight brought up a possible — and horrific — scenario in which Frank McCourt would sell the team alone but continue as landlord of the stadium and parking lot. She also mentioned that a McCourt lawsuit could "force" MLB to open their books, but that Selig is willing to sustain "collateral damage" in order to get carpetbagger McCourt out of baseball.

The Knight segment starts at about the 7:30 mark. Listen here.

Update 3 Open letter to McCourt  
Steve Dilbeck of the LA Times writes a open letter to Frank McCourt: "You say you love the Dodgers? Then do what’s best for the team and the franchise. Sell the club and move on." Read entire letter here.

Update 4: "Take the team. But I'll keep everything else."
The Wall Street Journal reports that people close to Frank McCourt are saying that he has long considered suing MLB in the event that Selig rejected Fox TV deal. The article also mentions that ol' carpetbagger will try to claim that the team is separate from the stadium and parking lot:
A person familiar with Mr. McCourt's thinking said he plans to argue that Major League Baseball can only make a claim on the team itself, and not on his other properties or companies connected to the franchise. However, while Major League Baseball signed off on these deals, including the $367 million loan against ticket sales, another person familiar with the agreements said all of the entities are subject to the governance of Major League Baseball, which can move to take control of each of them.
Read full story here.

Update 5: Don't expect any of that Stockholm Syndrome
From the LA Weekly, more on this underhanded strategy by McCourt to sell the team but hold the parking lot hostage:
McCourt seems to believe that MLB can seize just the Dodgers and Dodger Stadium, but it can't seize the other entities which collect revenue from Dodger tickets or parking fees. Clearly those are functions that are integral to the operation of a baseball team, but Frank believes that by spinning them off into separate entities, he's put them out of MLB's grasp. If that were true, it would be all but impossible to sell the team. 
Read full story here.

Update 6: Save us, Mark Cuban!
Closing the door on Frank McCourt and opening the door to Mark Cuban. The money wizards at Forbes write that Bud Selig would be a fool not to invite Cuban to buy the Dodgers. Here's one of the writer' stronger yet pretty obvious points:
Oh, and if you didn’t already know this, he’s liquid baby.  As in cash liquid, homey.  Financially, he’s as liquid as the ocean while Frank McCourt has been a desert as his resources are all dried up.
Makes complete sense to me, but the crusty old fogies at MLB headquarters don't see it that way. Read full story here.

Update 7: Sorry, Frank. But you agreed not to sue
Via 6-4-2, the MLB Constitution explicitly prohibits team owners from taking the league to court:
The Major League Clubs recognize that it is in the best interests of Baseball that all actions taken by the Commissioner under the authority of this Constitution, including, without limitation, Article II and this Article VI, be accepted and complied with by the Clubs, and that the Clubs not otherwise engage in any form of litigation between or among themselves or with any Major League Baseball entity, but resolve their differences pursuant to the provisions of this Constitution. In furtherance thereof, the Clubs (on their own behalf and including, without limitation, on behalf of their owners, officers, directors and employees) severally agree to be finally and unappealably bound by actions of the Commissioner and all other actions, decisions or interpretations taken or reached pursuant to the provisions of this Constitution and severally waive such right of recourse to the courts as would otherwise have existed in their favor. 
 Source material originally provided by The Biz of Baseball.

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