Major League Baseball filed a petition today with the federal judge in Delware handling the Dodgers’ bankruptcy demanding that the team be sold before it is deemed no longer a part of the league.
In response, owner Frank McCourt called the motion “meritless,” “offensive” and “a last resort” through his financial communications firm.
A hearing in the case is set for Oct. 12.
The MLB attorneys argue that McCourt “cannot hide the Dodgers in bankruptcy court forever” as he continues to use the team to resolve his personal financial issues. In addition, the MLB contends that McCourt’s plan to auction the team’s television rights without league approval, a motion filed on Sept. 16, is a breach of the Dodgers’ existing contract with Fox Sports’ Prime Ticket and could lead to the team’s ouster from the league.
McCourt has been holding out that MLB commissioner Bud Selig will approve a multi-billion media deal with Fox Sports that provides him financial stability for years to come. Selig’s refusal to do so, based on the belief that McCourt will use advances from that rights deal to pay legal fees in his recently high-profile divorce from Jamie McCourt, will severely damage the team’s innerstructure. McCourt also contends Selig’s actions led him to the bankruptcy filing on June 27.
“The sale proposed in the media rights motion – the centerpiece of the team’s sole reorganization strategy – is dead on arrival,” the MLB petition read. “No one will pay (the Dodgers) to broadcast . . . games if the club is not part of Major League Baseball. Consequently, the (Dodgers’) path in this case is a dead end or worse.”
The league also argues that McCourt is trying to circumvent its authority, which could leave the judge in the position of determining whether the federal bankruptcy code trumps the MLB’s constitution.
“Bankruptcy is not a vehicle for rewriting the rules of sports leagues like Major League Baseball,” league attorneys said.
In a statement issued through Kekst and Company in New York, McCourt said the MLB action “is another step in the commissioner’s continuing effort to cause the sale of the Dodgers notwithstanding that the Dodgers can and will be successfully reorganized as outlined in the recently filed media rights marketing motion.
“In United States bankruptcy reorganization cases, liquidation is the last resort, not the first option.”
McCourt said that his media rights agreement with Fox is “designed to maximize the value of the Dodgers so it has the opportunity to emerge successfully from Chapter 11. The alternative offered today by Major League Baesball really amounts to an unnecessary and value destroying distressed sale of the Los Angeles Dodgers.
“The inaccuracies in the ‘facts’ recited in the motion and the false characterization of other matters are offensive and too numerous to mention.MLB’s motion also ignores the fact that the commissioner has treated the Dodgers differently from other Major League Baseball clubs and that the commissioner’s actions starved the Dodgers of cash and caused the bankruptcy filing.”
The statement says that the Dodgers will file a response to the MLB’s petition “early next week.”
Meanwhile, the Dodgers are poised to announce a new radio rights deal with Clear Channel that would move broadcasts from current partner KABC-AM (790) to KLAC-AM (570) starting in 2012. Sources indicate the deal will be for as long as five years, but because of the way it is structured, there is no indication as to how much money it would provide McCourt with upfront to continue to help him make team payroll.
The Dodgers, third in the National League West with a record hovering around the .500 mark, end the regular season on Wednesday after a three-game series in Arizona.
The Associated Press contributed to this story.