Dodgers' owner Frank McCourt submits team for bankruptcy
Discussion
The Los Angeles Dodgers might have a payroll problem to deal with on Thursday, June 30. This is due to Los Angeles Dodgers Holding Company LLC filed for Chapter 11 bankruptcy, according to NBC Sports. Players and staff payroll is beyond owner Frank McCourt's ability to rectify at the moment. Post resource - Los Angeles Dodgers file Chapter 11 bankruptcy by Newsytype.com.
The way the Dodgers keep away from lawsuit
The point of the Chapter 11 filing is clear. It prevents legal action against the LA Dodgers Holding Company LLC. The team is now protected from up to 49 creditors. The paperwork shows that they cannot sue now. The team will not be controlled by McCourt anymore though. Now, Major League Baseball Commissioner Bud Selig will be in control. Legal experts know that Dodgers reorganization will most likely be the end result regardless.
McCourt planning on an offer
A 17-year broadcasting rights deal was what Frank McCourt was relying on. This offer between the Los Angeles Dodgers and Fox Sports is around $3 billion in worth, according to Bloomberg. Several sources suggest that payday loans were taken out on the offer by McCourt. This was so all crew expenditures could possibly be met. A few of the sources say that McCourt's divorce and other personal things were also involved.
Frank McCourt probably didn't have a back-up plan for finances according to this and the Chapter 11. The Wall Street Journal speculates McCourt will ask the bankruptcy court to compel Fox Sports to follow through with the remainder of the Television offer money, but whether or not his request will be granted is up in the air. With regards to Frank McCourt, Fox has been very hands off. That has been the suit for the last few months. Legal experts also point out the bankruptcy court's essential interest is the Los Angeles Dodgers' creditors, not the Dodgers or Frank McCourt.
McCourt blamed by Major League Baseball
According to NBC Sports, Selig and Major League Baseball are taking the position that Frank McCourt accepted less money from Fox Sports than he could have acquired for a broadcasting offer of that length. A pushed auction sale might result in being what happens if the court decides the LA Dodgers were short-changed by McCourt for quick cash. In the meantime, MLB will no doubt be responsible for the Dodgers paycheck until the matter is settled in court.
McCourt stressed the Dodgers will move forward:
"The Chapter 11 process provides the path on which to position the Los Angeles Dodgers for long-term success," he said. "The process will allow us to focus on maximizing value in a manner that is transparent and driven by the best interests of the Los Angeles Dodgers and our fans."
The Dodgers are a beneficial franchise
In the bankruptcy filing, Los Angeles Dodgers Holding Company LLC lists between $500 million and $1 billion in assets, with under $50,000 in liabilities. Bruce Bennett is a bankruptcy consultant at law firm Dewey & LeBoeuf which is located in New York. He said that all Dodger financial obligations will be met:
"The deal with Fox demonstrates that the Dodgers have enormous value which substantially exceeds the team's current and future liabilities," said Bennett. "The media rights will, one way or another, generate enough value to facilitate reorganization."
The payday loans taken by Frank McCourt
http://www.youtube.com/watch?v=fgSueo5nSPw
Articles cited
Bloomberg
bloom.bg/jqcqsA
NBC Sports
hardballtalk.nbcsports.com/2011/06/27/the-dodgers-file-for-bankruptcy/
PRNewswire
prn.to/lvw7Ab
Wall Street Journal
online.wsj.com/public/resources/documents/dodgers.pdf
The way the Dodgers keep away from lawsuit
The point of the Chapter 11 filing is clear. It prevents legal action against the LA Dodgers Holding Company LLC. The team is now protected from up to 49 creditors. The paperwork shows that they cannot sue now. The team will not be controlled by McCourt anymore though. Now, Major League Baseball Commissioner Bud Selig will be in control. Legal experts know that Dodgers reorganization will most likely be the end result regardless.
McCourt planning on an offer
A 17-year broadcasting rights deal was what Frank McCourt was relying on. This offer between the Los Angeles Dodgers and Fox Sports is around $3 billion in worth, according to Bloomberg. Several sources suggest that payday loans were taken out on the offer by McCourt. This was so all crew expenditures could possibly be met. A few of the sources say that McCourt's divorce and other personal things were also involved.
Frank McCourt probably didn't have a back-up plan for finances according to this and the Chapter 11. The Wall Street Journal speculates McCourt will ask the bankruptcy court to compel Fox Sports to follow through with the remainder of the Television offer money, but whether or not his request will be granted is up in the air. With regards to Frank McCourt, Fox has been very hands off. That has been the suit for the last few months. Legal experts also point out the bankruptcy court's essential interest is the Los Angeles Dodgers' creditors, not the Dodgers or Frank McCourt.
McCourt blamed by Major League Baseball
According to NBC Sports, Selig and Major League Baseball are taking the position that Frank McCourt accepted less money from Fox Sports than he could have acquired for a broadcasting offer of that length. A pushed auction sale might result in being what happens if the court decides the LA Dodgers were short-changed by McCourt for quick cash. In the meantime, MLB will no doubt be responsible for the Dodgers paycheck until the matter is settled in court.
McCourt stressed the Dodgers will move forward:
"The Chapter 11 process provides the path on which to position the Los Angeles Dodgers for long-term success," he said. "The process will allow us to focus on maximizing value in a manner that is transparent and driven by the best interests of the Los Angeles Dodgers and our fans."
The Dodgers are a beneficial franchise
In the bankruptcy filing, Los Angeles Dodgers Holding Company LLC lists between $500 million and $1 billion in assets, with under $50,000 in liabilities. Bruce Bennett is a bankruptcy consultant at law firm Dewey & LeBoeuf which is located in New York. He said that all Dodger financial obligations will be met:
"The deal with Fox demonstrates that the Dodgers have enormous value which substantially exceeds the team's current and future liabilities," said Bennett. "The media rights will, one way or another, generate enough value to facilitate reorganization."
The payday loans taken by Frank McCourt
http://www.youtube.com/watch?v=fgSueo5nSPw
Articles cited
Bloomberg
bloom.bg/jqcqsA
NBC Sports
hardballtalk.nbcsports.com/2011/06/27/the-dodgers-file-for-bankruptcy/
PRNewswire
prn.to/lvw7Ab
Wall Street Journal
online.wsj.com/public/resources/documents/dodgers.pdf
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