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Frank McCourt turned a $1.278 billion profit on the sale of the Dodgers

Apr 23, 2013, 8:23 AM EST

Frank McCourt sunglasses

That’s free and clear, after paying taxes and taking an offset for the debt assumed by the Dodgers’ new owners, reports Bill Shaikin of the L.A. Times.

We know this because he’s in court right now, trying to fight off a challenge from Jamie McCourt. Jamie is now trying to get a better deal than the one she walked away with when they settled their divorce. Her deal: $131 million, tax free.  She now claims that Frank committed fraud when they settled, misleading her as to the value of the team. Of course, at the time, most folks thought she was getting a pretty good deal, being able to walk away from what then appeared to be a doomed business. Which she helped doom.

As for Frank, I’m struggling to think of anyone who has done better financially while making so many dumb and questionable decisions while running a baseball team. It’s either a testament to how hard it is to go broke as a team owner or a testament to how naive I am about how capitalism works at its highest levels.

  1. illcomm - Apr 23, 2013 at 8:26 AM

    you must be naive

    • heyblueyoustink - Apr 23, 2013 at 8:43 AM

      Please, feel free to expand on your expertise in economics, both macro and micro.

      If you feel up to making statements more than four words, including proper sentence structure.

    • andrewproughcfe - Apr 23, 2013 at 9:49 AM

      Naive, Craig.

      Anyone could have seen the value of the parking and retail property alone was going to fetch him an enormous sum of money. He played it brilliantly, appearing to run the team into the ground, all the while watching the value of the property increase rapidly.

      And that’s before considering the potential value of the TV deal, which was not tied to the team’s performance on the field.

      Remember – for smart, rich real estate guys like Donald Trump and McCourt, “bankruptcy” often equals “bonanza”.

      • heyblueyoustink - Apr 23, 2013 at 9:58 AM

        Exacta! Now, i’m not saying it’s morally right in these two particular cases, but it’s one of the ways *anyone* with any kind of money, be it a little or a lot, can skirt the system by using it as it’s currently structured.

        And until they make sensible tax code changes, it will remain the same.

        Part of the reason why the internet sales tax proposal is potentially damaging. The people that are gonna get crushed by this thing are small to mid sized business owners, and, by extension, the people they employ.

        Not because of the tax, but because of the cumbersome nature of complying to 52 different sales tax codes at minimum. For that, you need to pay for at least one person, if not an entire department to figure out.

      • natslady - Apr 23, 2013 at 11:53 AM

        @heyblueyoustink, yeah, because there’s not a $50 piece of software out there that can calculate sales tax for the internet sellers…

      • heyblueyoustink - Apr 23, 2013 at 1:02 PM

        @Natslady Having some day to day knowledge, it’s an area that’s part of my employment, it’s not that easy, just the short list to consider:

        1) The volume of orders you do
        2) Sales tax juridiction in some places changes county to county, 52 is a light number
        3) Sure, you can buy a $50 program that will give you the tax percentages, care to take a stab at how much it costs to integrate a tax program into the computer system you already run so that it jives automatically from invoice to invoice (see volume, again) and properly bills?

        Or there’s always the option of converting to a new OS that does that for you, care to drill down into the cost of that venture? All on margins that are already low because of the competitiveness of the online market ( Amazon’s, Ebays. overstocks ).

        C’mon now, you’re a smart lady, I know you are. I deal with small business every day, this thing is an albatross.

      • historiophiliac - Apr 23, 2013 at 1:23 PM

        blue, how is that any harder than for brick&mortar small businesses?

      • historiophiliac - Apr 23, 2013 at 1:27 PM

        Oh, wait, I guess they just charge the local tax on shipping orders and the state you live in gets screwed. Nevermind.

      • heyblueyoustink - Apr 23, 2013 at 2:32 PM

        Well, there’s a hundred ways the brick and mortar folks can get around taxes, they can, for instance. depending on the state, apply for a state resale tax exempt certificate, because they are reselling the product. They only have to apply once per period ( year, three years, whatever the lead time is on the certificate)

        That’s just one multi billion dollar instance.

        A small/medium sized business would have to get one for every state it ships into. The process of finding out how to request that state to state alone is cumbersome.

      • zerohandicapper - Apr 23, 2013 at 10:01 PM

        @natslady
        First off let me start by saying you are a complete moron. There is no “$50 software” out there to calculate tax. There are almost 9K tax jurisdictions in the United States. In Washing state for example one side of the street could pay less tax than the other side of the street. California charges any business at least $800 a year just for the privilege of just being able to do business in their state. I own a company and last year we found out we have “nexus” in every state we do business in since our equipment resides in that state for a certain period of time. Be it 1 day or 1 year. It doesn’t matter, we have to collect sales tax on the order. Well after doing business for 5 years, we never did this until we started getting “nexus questionnaires” from different states. My accountant had no clue, the people we would call and talk to with that state had no clue. So in a nutshell, we dished out a few hundred thousand dollars to pay back taxes that we had no idea we should have been collecting for. The tax laws in this country are screwed and you could ask the same question to 10 different people and you will get 10 different answers. Its obvious you have no clue on how business or taxes work, so please stick to what you know, which is nothing, obviously. That being said, it costs us about 15-20K a year for a company to file the taxes for us. Some states require monthly, some yearly, some quarterly, etc… Within the state tax, there may be local tax. Within that local tax there may be a stadium tax for cities that have new stadiums built. Trust me when I say its a complete mess and after about 2 months of worrying when this first started hitting, I dropped about 30 pounds from the stress. I kept hearing “audit” blah blah blah. When I thought of an audit I thought of guys in suits coming in a taking any information I had. It was not the case. Every state was different, but they were all very nice and told us to just send them the numbers and pay the tax. They waived all penalties, since this is still all very new. So to sum up your moronic statement….no there is no $50 software.

      • badintent - Apr 24, 2013 at 3:47 AM

        so I’m thinking for 100K John could have that hoe put in a hole in the desert. Just thinking out loud here , of course.Bruno, Vito, Carmine put the cards down , we got work to do.Bring some shovels.
        Is Gloria Allred repping Jamie ?
        $ 128 million tax free ?? That’s what ARodless makes on his Yankee contract AFTER taxes.Maybe they could hook up and share ideas on making ends meet.

  2. heyblueyoustink - Apr 23, 2013 at 8:33 AM

    It’s like having a split personality, just because you’re a bad sport’s team owner doesn’t mean you don’t know how to turn a buck out of everything. Those with tremendous wealth, whether earned or inherited and educated on it while the money remains in a structured system, like a trust, tend to figure out how to retain and build on that wealth despite whatever the expedetures of their “hobbies” may be. It’s why folks who are handed a winning lottery ticket ( whether literally through the lottery or athletes handed large money with no backround of knowledge to handle it properly ) have a large percentage of financia; failure after their windfalls.

    Meanwhile, in Miami……

    • apmn - Apr 23, 2013 at 8:47 AM

      It is because the system is rigged so that those with tremendous wealth keep making money. The wealthy write our laws, remember? Your lottery comparison is based on a couple of high-profile examples, not the broader experience.

      Having that much wealth is shameful and wrong.

      • jm91rs - Apr 23, 2013 at 8:54 AM

        The wealthy should be ashamed?

      • heyblueyoustink - Apr 23, 2013 at 9:12 AM

        I’m not going to adress your general philosophy on wealth. I just don’t have the time while i’m at work to explain how “Having that much wealth is shameful and wrong” makes me want to personally drop you off in Havana and let you enjoy.

        Meanwhile, exhibit A, a little outdated, I believe the number is higher currently:

        http://sports.espn.go.com/espnmag/story?id=3469271

        Just “a couple” of high profile examples, as you naively said.

        Go search on your own, lottery winners declaring bankruptcy 5-10 years after winning. I betcha it’s over 50%, all day long and twice on Sundays

      • historiophiliac - Apr 23, 2013 at 9:53 AM

        Capitalist pig!

        /shakes fist

      • heyblueyoustink - Apr 23, 2013 at 10:30 AM

        Security, get this Pinko Commie out of here! ( points at lady, then sneers while wagging finger )

      • yahmule - Apr 23, 2013 at 11:08 AM

        It would be an incredibly exhaustive (and invasive) undertaking to determine the bankruptcy rates of lottery winners, but there’s little reason to believe the rates are anywhere near 50%.

        http://blog.lottery-syndicate-world.com/how-many-lottery-winners-go-broke/

      • apmn - Apr 23, 2013 at 11:19 AM

        Why does anyone personally need that much money?

        I have no problem with capitalism, but it has to be coupled with some sense of social equity.

      • apmn - Apr 23, 2013 at 11:28 AM

        And BTW, I have been to Havana. It sucks. Communism sucks. But so does a system that allows for billionaires to co-exist with extreme poverty.

        I would personally like to drop you off in Appalachia or the Rio Grande Valley and let you enjoy.

      • heyblueyoustink - Apr 23, 2013 at 11:36 AM

        I’ve been to Appalachia, and do not live all that far away from there, and I would adapt and excel in whatever way I could instead of pointing fingers and blaming people.

        And if there was no opporunity there, me personally, I would move on.

        And i’m glad you’ve been to Havana, where *everyone* is poor. That’s the result of social equity left in the hands of human beings. Some day, yes, but as of today, there’s very little hope in finding folks who wouldn’t take advantage of the idea at every turn.

      • historiophiliac - Apr 23, 2013 at 11:38 AM

        Once again, Americans are all about the moderation. Dichotomies be damned!

      • heyblueyoustink - Apr 23, 2013 at 1:19 PM

        The more you preach moderation to folks on either side of the aisle, the further left or right they go. It’s what they’re being told to do on TV and the web.

        Sadly, there’s not enough critical reading done these days.

  3. temporarilyexiled - Apr 23, 2013 at 8:34 AM

    My how inflation has had its way with the price of one’s soul…

  4. steve7921 - Apr 23, 2013 at 8:41 AM

    wow… turns a parking lot in Boston into a Billion dollars!

    • bigleagues - Apr 23, 2013 at 11:33 AM

      Ya know what?

      I can’t stand either of them, but I hope Jaime proves her case and McCourt gets taken to the cleaners because as bizarro as the Expos/Marlins/Red Sox deal went down (and I’m a Red Sox fan who is appreciative of the Henry ownership group) – McCourt NETTING $1.2 Billion takes the friggun cake … and he gets to eat it to!

      That article also makes the point that the Dodgers sold for more than $2Billion, and that even after McCourt paid his $460 MILLION TAX BILL – his NET P*R*O*F*I*T is MORE than 25% MORE than the previous record SALE PRICE for a team!

      And the guy still owns half the parking around Dodgers Stadium.

      Somewhere Bernie Madoff is marveling in admiration at what Frank McCourt has pulled off here.

      • bigharold - Apr 23, 2013 at 2:55 PM

        “Somewhere Bernie Madoff is marveling in admiration at what Frank McCourt has pulled off here.”

        I’m with you!! This clown appeared to be hell bent on running the Dodgers into the ground and yet somehow he walks away with 1.2 billion bucks??? And, his wife, that took a measly 131 mil is bitching she got screwed?? I get it not!

        I guess all this hard work and nose to the grindstone nonsense is for chumps. But, the next time there is a thread about overplayed and or greedy players I’ve got a succinct response; Frank McCourt cleared 1.2 billion selling the Dodgers, .. STFU.

      • psousa1 - Apr 23, 2013 at 5:00 PM

        Listen here bigleagues: as a fellow sox fan let’s just be thankful he sold it to a group who thought acquiring Josh Beckett, Carl Crawford and Adrian Gonzalez was a good idea…………………….

        Mind you Gonzo always was a good player for them and Crawford has bounced back but it was addition by subtraction. Look where the sox sit today. They would not be there if those 3 were on the team.

        Can’t believe the Dodgers traded the sox Allen Webster. Kid pitched well the other night. Just hung two pitches but otherwise looked like he has been there for the last 5 years.

      • bigleagues - Apr 23, 2013 at 6:00 PM

        bigharold LOL! I think I might use that one too.

      • bigleagues - Apr 23, 2013 at 6:11 PM

        psousa,

        No doubt. I’m pretty certain that John Henry sends Selig a really really nice fruit basket at the holidays each year. Because twice now, Selig has helped set the conditions for mega-deals that have squarely put the Sox on a road paved in gold.

        Far more the ownership swap than the trade itself, but still, I could have seen a different scenario where a real independent Commissioner (not someone who is doing double duty as CEO of the sport) would have said no way to that deal as constructed.

        Believe me though, like most reasonable Sawx fans, I am grateful for an ownership group who is professional in its approach and willing to take risks to put a winner on the field. Some of it has worked swimmingly, and some of it has been a disaster. But far more success than disaster and thats far more than could ever be said for Thomas A. Yawkey (IMO, the most over-rated owner in the history of the sport) and his immediate successors).

  5. sdelmonte - Apr 23, 2013 at 8:49 AM

    It’s like all those times on The Simpsons when Mr. Burns somehow came out of a tailspin with more money than when he started. Only it’s not as funny in real life.

    • bigharold - Apr 23, 2013 at 2:57 PM

      “Only it’s not as funny in real life.”

      Unless you’re Frank McCourt.

  6. jm91rs - Apr 23, 2013 at 8:59 AM

    The guy just got lucky, that’s all. He was never qualified to own the Dodgers, but somehow that slipped through the cracks and MLB approved him. Then when it was clear he had borrowed and stolen from everything he “owned”, MLB forced him to sell and the bids went higher than any in history. A series of lucky events earned him a billion dollars. It’s not a sign of how capitalism at the highest level works, and it’s not a sign of how hard it is to go broke (he would have gone broke on his own if MLB didn’t force him to sell), it’s pure dumb luck.

    I have a feeling that if we follow the life of Frank McCourt we’ll find out that some day he’s in financial trouble again. I find it entertaining. Maybe with his $1.2 billion he can buy another team?

    • yahmule - Apr 23, 2013 at 11:10 AM

      It’s almost like he was buddies with the unscrupulous cretin in the commissioner’s chair.

    • manchestermiracle - Apr 23, 2013 at 1:21 PM

      The lube that helped him “slip through the cracks” is likely the same stuff Loria is using down Miami way to keep collecting revenue-sharing funds: Money. I’m not saying that Selig and MLB take illegal kick-backs or anything like….Never mind, yes I am.

      And if MLB “forced him to sell” (bankruptcy and his just-as-greedy-as-he-is wife did that) why is Loria still running OG’s team into the Everglades?

  7. turdfurgerson68 - Apr 23, 2013 at 9:31 AM

    Unbelievable…

  8. historiophiliac - Apr 23, 2013 at 9:51 AM

    Frank McCourt was fraudulent? What? I don’t understand. He lied and was misleading about his money? That makes no sense.

  9. dparker713 - Apr 23, 2013 at 9:58 AM

    Frank paid taxes?!? That’ll be the first time in years.

  10. Old Gator - Apr 23, 2013 at 10:22 AM

    This divorce ain’t Haystacks Calhoun versus Cowboy Billy Watts, but it’s at least as much fun to watch.

    • historiophiliac - Apr 23, 2013 at 10:27 AM

      But, are you Team Jamie or Team Frank?

      • Old Gator - Apr 23, 2013 at 10:51 AM

        Neither – just a big fan of maiming and eye-gouging in general.

      • historiophiliac - Apr 23, 2013 at 10:54 AM

        Ah, the return of the fine old Antebellum tradition. We shall know their dishonor by their scars.

      • hep3 - Apr 23, 2013 at 12:28 PM

        I have bad feelings about Frank, but I hope he crushes Jamie. Jamie is a licensed family law attorney and stated she did not read the post nuptial agreement that gave the business interests to Frank and she would keep the personal property. The two of them had done this dance for 30 years and now when the lawyer’s subterfuge would help her, I believe she lied.

        Her lawyers and his lawyers all had all the data prior to the Dodgers sale and Jamie took what she saw as the guaranteed bird in the hand. Nobody expected a $2.1 BILLION sale of the Dodgers. Everyone was saying that Frank would break even if the Dodgers sold for one billion.

        For $131 million and the deeds to the McCourt houses, it is hard to feel sorry for “poor” Jamie.

        Heck, maybe she can get that political candidacy study she had commissioned dusted off and make up the short fall by getting into public office and taking advantage of graft and corruption.

    • manchestermiracle - Apr 23, 2013 at 1:23 PM

      It is indeed highly hilarious, but the buzz-kill is realizing most of that squandered dough is going to overpaid, under-worked attorneys.

      • bigharold - Apr 23, 2013 at 3:04 PM

        I would suggest that the real buzz kill is realizing all that dubious capital gains and after tax profit of the McCourt’s and fees to their respective lawyers is in fact underwritten by baseball fans in general and Dodger fans specifically.

        This must be a GREAT game for fans to put up with this bullshit.

  11. biffnasty - Apr 23, 2013 at 10:41 AM

    the capitalism system is structured to keep the rich wealthy while preventing the poor/working class from moving up in socioeconomic status. this is accomplished in numerous ways. most shockingly is that the top 20% has seen there income increase while the other 80% has seen theirs decline. this is not an invitation to demonize the rich, it is just an observation of how capitalism is geared to reward the rich and punish the poor

    • Old Gator - Apr 23, 2013 at 10:52 AM

      Well yes, but how else are we going to keep the poor in their place?

      • Uncle Charlie - Apr 23, 2013 at 12:41 PM

        Boil and can them, then sell them as designer dog food?

      • manchestermiracle - Apr 23, 2013 at 1:26 PM

        Soylent Green! Opening a Kickstarter account soon….

  12. onbucky96 - Apr 23, 2013 at 11:15 AM

    Frank’s got 99 problems, and the ex wife is #1.

  13. koufaxmitzvah - Apr 23, 2013 at 11:42 AM

    Do I need anymore proof that money does not make the man? Or, rather, can be used to dress up a pig?

    If there is a God, the judge will throw out the divorce settlement, and force them to live together.

  14. rcali - Apr 23, 2013 at 12:50 PM

    Glad to here he won’t have to steal from any charities….although I still wouldn’t put it past him.

  15. manchestermiracle - Apr 23, 2013 at 1:32 PM

    Bud Selig and his minions really deserve much more blame for letting scheming douchebags like McCourt and Loria into MLB. At some point the standards for team ownership have to go beyond just ponying up a couple pallets of money for the commissioner’s slush fund.

  16. henryd3rd - Apr 23, 2013 at 2:39 PM

    This is a great country. We have here a parking lot attendant; who purchased a baseball team without put up any of his own money, runs it into the ground, alienates his fan base and then sell said team and realizes over a billion dollar profit. And his ex-wife is pissed off because all she walks away with over $100,000,000.00 for their ugly divorce.

    Hey Jeffrey Loria are you reading this? In two years we should be reading about you and your step son David Sampson realizing a similar financial windfall.

    God Bless America!

  17. jkaflagg - Apr 23, 2013 at 4:39 PM

    The whole McCourt saga will make a great book and movie someday…..Frank certainly proved himself smarter than Bud Selig and the other MLB goofs who tried to run him off with nothing, and while people denigrate his business ethics and acumen, I guarantee you that he’s no better or worse than most American business “titans” who run the country……the most interesting thing to remember is that without the divorce, McCourt would still be firmly in control of the Dodgers, no matter what anyone thought about him……

    • ilovegspot - Apr 23, 2013 at 5:09 PM

      SHe banged her driver. Classy people.

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