The long-running drama of the McCourt-led Dodgers had a somewhat pivotal moment last week when one of the biggest legal issues in the impeding divorce of the owner and his wife was closer to being resolved. For those of you who don’t closely follow the Dodgers or are just Dodger fans living in a rock in the middle of nowhere, here’s a brief recap of what has got us here:
- Frank McCourt highly leverages himself and his Boston parking lot (his main asset pre-Dodgers) to come up with the loan money to purchase the Dodgers from previous owner Fox Corp. Fox is so eager to dump the franchise that they themselves LEND 200 million dollars to McCourt to help complete the purchase. McCourt is now the debt-ridden, highly-leveraged principal owner of the Los Angeles Dodgers.
- During the ownership, Frank and Jamie McCourt (his wife of 30 years) formulate a post-nuptial agreement to allocate their assets. Jamie is basically freaked out that the debt incurred by the Dodgers acquisition will potentially wipe out their entire life savings and assets not related to the team. They form an agreement which states that Frank McCourt is the sole owner of the Dodgers; not Jamie or anybody else. Jamie gets to become the sole owner of their sizable real estate portfolio, which includes numerous family homes throughout the United States and is presumably worth over 100 million dollars. Jamie gets the security she wants. But she has basically just handed over half of an entire major league franchise in the LA market (worth anywhere from 400-800 million) in order to protect the couple’s numerous mansions from potential foreclosures and have them to herself.
- The McCourts’ union bitterly collapses and both file for divorce. Frank McCourt fires his wife as CEO, and declares (through his legal team) that the Dodgers belong to only him. Jamie McCourt, obviously blindsided by the turn of events, insists that all their assets are communal property which means they share everything together and should split everything evenly (including the Dodgers). She argues that the post-nuptial agreement is not valid because she did not have her lawyer with her when she signed it. Frank McCourt and his legal team claims that Jamie McCourt was the one who initiated the agreement to allay her concerns over their real estate portfolio. Oh and also, he says, she’s a lawyer herself!!
So here we are, with both sides firmly entrenched in their positions. Both sides agree to undergo a forensic examination of the actual post-nuptial agreement. They want to see whether the agreement was tampered with, possibly after its signing. At issue is a separate page listed at the end of document that basically lists which McCourt gets to keep what. It is stapled after the page with all the consenting signatures, leading to questions over its validity.
Well, it turns out that the page was attached to the document via the same staple as the core agreement. Thus, it was not tampered with. Frank McCourt’s lawyer declares this to be a major victory for his client. It may very well be a significant development that eventually places the franchise in the control of only Frank.
The divorce trial is scheduled to take place in August and you can bet it will be explosive. We’ve already discovered so much about the way the McCourts run the franchise thanks to these legal hearings (like how the Dodgers spent over a 100K annually on a faith leader named Vladimir who used to send positive messages to the team via the television while sitting on his couch). I can’t wait to hear more details. When I know, you will know. Make sure to follow the Lair over the next couple of months.