Power shifts to McCourts in bankruptcy filing, experts say
The judge, not Major League Baseball, will generally have the final say over financial matters affecting the team.
“The bankruptcy court has a vast amount of power,” said Darrell G. Adkerson, a Texas lawyer who represented clients in the bankruptcy of the Rangers.
And bankruptcy law “is designed to protect the debtor.”
The law gives the debtor 120 days to file a plan of reorganization, making it the architect of the first plan put before a federal judge.
The McCourts can include a TV contract with FOX in their proposal, and MLB would have to come up with strong reasons for why the contract should not be accepted, analysts said.
Although MLB retains the right to approve the sale of the team, it would have to show why it would not favor the most lucrative offer on the table, they said. The team could go to auction if the FOX contract is not approved by the judge.
The sports financier said that Frank McCourt does not want to sell, but MLB “wants him out. He has become a public embarrassment with this whole divorce situation.”
“This is going to be ugly,” he said.
Bankruptcies by sports franchises remain rare, and the Dodgers’ is the first baseball team to file without the support of MLB, he said. Other experts said that fans would probably notice little difference as a result of the bankruptcy and that players would continue to be paid.
“We’re confident that all player obligations, both current and deferred,” will be met, said Greg Bouris, a spokesman for the Major League Baseball Players Assn. “We are confident of that. The Dodgers are an important franchise historically and economically, and the Players Association will continue to monitor the situation closely.”
-- Maura Dolan
Photos: (left) Frank McCourt. Credit: Los Angeles Times
(right) Jamie McCourt. Credit: Los Angeles Times