Jul 7, 2010, 10:07 AM EST
Many people thought it problematic when it was revealed several months ago that Tom Hicks was both (a) selling the Rangers; and (b) part of the ownership buying the Rangers. Different capacities, sure, in that Tom Hicks the individual was buying from an entity — Hicks Sports Group — that Hicks just so happened to own and run, but it is the kind of thing that raises eyebrows among those who are not used to the often convoluted and incestuous world of closely-held corporations.
But public perception may not be the only problem. The trustee overseeing the Rangers’ bankruptcy has a problem with at least one aspect of the overall arrangement, and that involves the law firms. Take it away Barry Shlachter:
Trustee William Neary asserted that all of the work – and millions
in fees – Weil Gotshal & Manges received from team owner Tom Hicks
jeopardized the fairness and transparency expected by the
public, including Rangers fans. Attorneys for the baseball
franchise are charged with acting in its best interests, not that
of the outgoing ownership.
Gotshal & Manges’ role evolved and shifted as events
transpired before the bankruptcy case, but it was WGM’s responsibility
to focus on the conflicts issue,” Neary said in the filing with a
U.S. bankruptcy court in Fort Worth.
Weil Gotshal denies any suggestion that it was conflicted, of course.
My view: I’m just a dumb litigator who nobody ever let near the table when a complicated deal was being negotiated, but it’s not like having the same law firm all over a transaction like this has never happened before. There are a lot of ways to guard against conflicts when you have hundreds and hundreds of lawyers you can throw at a deal, many of whom don’t even know one another. Best practice in the world? Nah, but it’s not, in and of itself, fatal.
In light of that my guess is that there was something specifically troublesome that either Hicks or the law firm was doing during the course of this deal that raised the ire of the trustee. These things tend to get ironed out pretty quickly, however, and my guess is that the law firm problem doesn’t cause any big hiccup in a deal that has enough other hiccups.
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- No, the Red Sox signing Pablo and Hanley is not proof that baseball needs a salary cap 154
- Red Sox announce four-year, $88 million deal with Hanley Ramirez, DFA Juan Francisco 33
- The Cubs have offered Jon Lester “north of $135 million” 68
- Pablo Sandoval’s deal: five years, $98 million plus an option 43
- Kyle Seager, Mariners close to $100 million extension 25
- The 2015 Hall of Fame ballot is out — Randy Johnson, Pedro Martinez are new on the ballot 286
- So what would the Red Sox look like with Hanley Ramirez and Pablo Sandoval? 49
- The 2015 Hall of Fame ballot is out — Randy Johnson, Pedro Martinez are new on the ballot (286)
- No, the Red Sox signing Pablo and Hanley is not proof that baseball needs a salary cap (156)
- More Hall of Fame ballots like Adam Rubin’s please (138)
- UPDATE: The Pablo Sandoval-Red Sox deal is done, pending a physical (133)
- Report: Pablo Sandoval chose the Red Sox over the Giants because he felt disrespected (132)