Dodgers withdraw application to hire TV rights broker
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The Dodgers on Wednesday withdrew their application to hire a firm to sell their cable television rights, prompting speculation about how and when Frank McCourt might offer a U.S. Bankruptcy Court his plan to emerge from bankruptcy as the team’s owner.
Lyndsey Estin, a spokeswoman for the Dodgers, said the team had no comment about why the application was withdrawn. McCourt has said the money from selling the team’s cable rights would enable him to repay creditors in full and put the Dodgers on solid financial footing for years to come.
Estin would not say whether the Dodgers would proceed with the plan to sell the team’s cable rights. McCourt and his advisors do not think that a sale of television rights is the only way out of bankruptcy, a person familiar with McCourt’s thinking said recently.
“We are not commenting on questions regarding media rights at this time,” Estin said.
The Dodgers withdrew the application on the day after it was submitted.
“It just seems odd,” said Thomas Salerno, the lead attorney for the NHL’s Phoenix Coyotes during that team’s bankruptcy case.
[UPDATED 6:01 p.m.: The application was most likely withdrawn because of a potential omission regarding a conflict of interest issue, according to a person familiar with the bankruptcy proceedings but not authorized to comment publicly. The Dodgers reserved the right to re-submit the application.]
Bruce Bennett, the Dodgers’ lead bankruptcy lawyer, had said the team would pursue a cable rights sale at a court hearing Aug. 16. The Dodgers did not do so.
Fox, which holds exclusive negotiating rights with the Dodgers through the next 15 months, has opposed any such sale and has threatened to sue for damages. Major League Baseball is expected to oppose such a sale, as is Frank McCourt’s ex-wife, Jamie, who claims half-ownership of the team.
Salerno offered two possible reasons for the withdrawal of the Dodgers’ application, cautioning that each is “total speculation.” It is possible, he said, that the Dodgers could be trying to see whether Fox would negotiate a new contract rather than fight McCourt -- and possibly fight other bidders in an auction.
[UPDATED 6:01 p.m.: There are no active negotiations between Fox and the Dodgers, said a person familiar with the matter but not authorized to discuss it publicly.]
It also is possible, Salerno said, that McCourt might be trying to sell a minority share of the Dodgers. McCourt could structure a deal similar to one proposed by the New York Mets, which would remove Fox as an obstacle. The Mets’ proposed deal calls for an investor to loan the majority owner $200 million now, with an option to buy the team later if the loan is not repaid.
Under MLB rules, the league would have to approve any minority owner. McCourt has argued that MLB has enforced its rules selectively and, in theory, could ask the bankruptcy court to approve the sale of a minority share over any objection from MLB.
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