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MLB: Frank McCourt would personally benefit from his proposed financing

Jul 15, 2011, 9:17 AM EDT

Combination of file photos of MLB commissioner Bud Selig and Los Angeles Dodgers owner Frank McCourt

At the moment, the big issue in front of the court handling the Dodgers bankruptcy is how the Dodgers’ operations will be financed for the next several months while the legal process is played out.  Frank McCourt has obtained a private loan and wants to use it to run the team.  Major League Baseball counters, offering its own financing to run the team.  He who controls the spice controls the universe, so whoever wins this financing battle is going to have a way bigger hand in the future of the Dodgers than whoever doesn’t. It’s a big deal.

To that end, Major League Baseball filed a brief yesterday explaining why Frank McCourt’s proposed financing is not in the best interest of the Dodgers. Their biggest beef: Frank McCourt stands to personally benefit from the loan he obtained:

“Clearly, Mr. McCourt has not allowed these bankruptcy cases to change the practice of using the [Dodgers] as his personal piggy bank”

The brief is redacted for some reason, so the exact amount McCourt is allegedly skimming off the top of his loan is not explicitly stated. The brief makes further allusions to just how much McCourt has looted the Dodgers over the years. These numbers are redacted too, but the L.A. Times spoke with a source who says that the number is closer to $200 million than the $100 million which has been widely reported over the past couple of years.

As we’ve noted before, on its basic terms, the loan McCourt wants to use is pretty poor. High interest and a big up-front fee that Major League Baseball’s proposed financing doesn’t call for.  Frank’s only apparent objection to baseball’s financing is that, well, it’s not good for Frank. Pity, that.

There will be a hearing on all of this next Wednesday and, if form holds, a pretty quick ruling.

  1. okobojicat - Jul 15, 2011 at 9:43 AM

    So, I read your Tweet earlier about using a Dune reference. But didn’t click through. Then I read this article and about 3/4 of the way through, I was like – wait, was there Dune reference? And I was right.

    However, I think its more important to note that phrases from Dune have entered our lexicon and have become almost common place that we don’t necessarily know where they come from.

    Or maybe, I’m just as big of a nerd as you, and all my friends are as well…

    • jimbo1949 - Jul 15, 2011 at 10:42 AM

      I read that as a reference to the British East India Company vs the Dutch East India Company. Guess I’m just a history nerd.

  2. sdelmonte - Jul 15, 2011 at 9:51 AM

    Between this and Roger Clemens, it seems like you are spending more time talking the law now than when you were a practicing lawyer, Craig. Maybe you should be billing NBC for legal fees.

  3. Charles Gates - Jul 15, 2011 at 10:10 AM

    Statement: Frank McCourt would personally benefit from his proposed financing.
    Response: Duh.

  4. Old Gator - Jul 15, 2011 at 10:11 AM

    Let’s get cracking on that new downtown Dodger stadium. Wrest the Bums from the Harkkonens, move them into a temporary shared arrangement with the Halos to pull Frank Harkkonen’s heart plug and choke off the last of his income. The spice will flow, and MLB’s Bene Gesserit contingent can worry about finally cauterizing Frank and Jamie Harkkonen, and Dodger fans can taste the water of life again.

    • ltzep75 - Jul 15, 2011 at 3:35 PM

      So does that make Arte Moreno Stilgar? And who would be Feyd? I’m confused…

  5. craigbhill - Jul 15, 2011 at 11:03 AM

    CRAIG: My understanding is that MLB has stated, and made clear to the judge, that their covering the Dodgers’ bills can not include McCourt in that loop, or they won’t make the loan. That has been established. IF the choice the judge has decided he wil make is between THAT and the continuing ownership of McCourt, this ruling on 7/20 could be much more momentous than has been expected by journalists. If the judge decides what should be the most obvious choice for the improvement of the health of the bankrupted, the Dodgers, it would mean automatically the judge recognizes McCourt is finished, that he must henceforth drain some other ATM dry, and accordingly the judge would have to put the team up for auction. Fact: Last year’s auction of the Rangers, and their immediate improvement—after all, with the new owner at the helm tweaking the team in September, they won the AL pennant—took mere weeks. That is undeniable. Not that this current mess of a team would win a wiffleball league, but gross improvement this winter could be in the offing, via a deep-pockets owner MLB could not stop.

    • CJ - Jul 15, 2011 at 11:30 AM

      “Not that this current mess of a team would win a wiffleball league, but gross improvement this winter could be in the offing, via a deep-pockets owner MLB could not stop

      It’d have been faster just to type Mark Cuban’s name.

      • okobojicat - Jul 15, 2011 at 12:01 PM

        Cuban is not going anywhere near the Dodgers unless he has really good (i.e. better) info on their debt obligations and can guarantee the rest of the revenue stream (stadium/parking lots). Until that happens, and MLB is going to have to do some masterful maneuvering to make that happen, the team lost in wunderland.

      • SmackSaw - Jul 15, 2011 at 12:26 PM

        By correcting the mistake Bud made by choosing McCourt over billionaire Eli Broad, he could unleash Cuban on MLB?

      • craigbhill - Jul 15, 2011 at 2:10 PM

        I don’t choose to pull Mark Cuban out of a hat, like a magic rabbit, because i don’t believe in him specifically any more than i believe in any prospective billionaire, including Eli Broad. I’m sick of Cuban being invoked as The Answer. He has many problems, more than the eventual winner does. For one very important factor, he does not live in LA and, no differently than McCourt, has NO institutional memory of the Dodgers like a long-term fan does who lives in LA and goes to the games, many games for many years. Has Cuban been to Dodger Stadium three times? 10? None? It can’t be enough, he doesn’t live there. Like McCourt i have never read him saying “The Dodgers were always my favority team.” The lack of that love is a ringing danger signal that he too might see the team as an investment, or an ATM. We can’t afford a Mark Cuban, an out of towner, like David Glass, who unfortunately owns the KC Royals, lives in Arkansas, never goes to the games, and sucks up all the overspending money from the Yankees and Red Sox.

        We do not need another like those two, and Cuban as non-resident resembles them too much.

      • SmackSaw - Jul 15, 2011 at 3:46 PM

        Dennis Gilbert

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